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Alnylam, Merck End RNAi Collaboration Turning One-Time Partners into Rivals

Alnylam Pharmaceuticals this week announced that its collaboration with Merck has been terminated, ending a once-promising relationship that may have run aground after the big pharma acquired Alnylam’s main rival in the RNAi drugs field, Sirna Therapeutics.
"It is fundamentally in our best interests to terminate our Merck collaboration," John Maraganore, Alnylam’s president and CEO, said in a statement this week.
A spokeswoman for Merck said in an e-mail to RNAi News that Merck “wanted the strategic freedom to explore all avenues of research in RNAi-based therapeutic development, and the best way to do that was to focus efforts on Sirna” Therapeutics.
“Merck is strategically focusing its scientific expertise and resources on fully realizing the potential of Sirna's RNAi technology and programs,” she added. “This technology is likely to be used across all of Merck's therapeutic areas [and] we do not believe this could have been achieved within the confines of our agreement with Alnylam.”
With the end of the collaboration, which was mutually agreed upon by the companies, Alnylam has taken back all grants of the intellectual property it had provided Merck related to current and future Merck drug programs, including the ones the companies had been working on together.
Merck first partnered with Alnylam in 2003 to develop RNAi drugs against various Merck-defined targets, marking the first time an RNAi drug company had scored big pharma support. As reported by RNAi News, consummation of that deal was in part due to personal relationships between officials from each company (see RNAi News, 9/12/2003). 
The next year, the companies signed another deal to work together on ocular diseases, including a wet age-related macular degeneration drug Alnylam had in its pipeline (see RNAi News, 7/2/2004).
Though the alliance between the companies appeared to be proceeding apace, a large-scale partnership between Alnylam and Novartis offered the first hints that all might not be well.
In late 2005, Novartis signed a broad drug discovery and development deal with Alnylam that included an almost 20 percent equity purchase in the RNAi drugs shop (see RNAi News, 9/9/2005).
Shortly thereafter, Alnylam said it was shelving its AMD candidate amid increased competition in the AMD field. Among the biggest players in the AMD field is Novartis, which markets Lucentis for the eye disease.  
Then, last summer, Merck and Alnylam revamped their alliances into a single partnership, dropping ocular diseases altogether and giving Merck the option to participate in the earlier stages of research (see RNAi News, 7/6/2006).
About four months later, Merck acquired Sirna in a bid to secure control of what was considered one of the RNAi drugs field’s most important IP estates along with Alnylam’s.
In doing so, Merck became both Alnylam’s partner and competitor, using the RNAi firm’s proprietary IP and know-how in the 10 therapeutic programs covered under the companies’ alliance but not providing access to the rival patent estate acquired from Sirna — all of which led to rising tensions between the partners.  
A week after the Sirna acquisition, Alnylam’s President and CEO John Maraganore stressed to investors during a third-quarter conference call that Merck’s access to Alnylam’s IP was limited to the 10 therapeutic programs covered under the companies’ arrangement and that “anybody commercializing any RNAi therapeutic needs access or will need access to Alnylam IP,” including Merck (see RNAi News, 11/9/2006).

Merck “wanted the strategic freedom to explore all avenues of research in RNAi-based therapeutic development, and the best way to do that was to focus efforts on Sirna.”

That same week, Maraganore was a bit more candid when speaking during a breakout session at the Rodman & Renshaw 8th Annual Healthcare Conference, where he said that Merck was aiming to “increase their footprint in the [RNAi] space” by buying Sirna, but that as far as Alnylam is concerned, “their footprint is still in our sandbox.”
Maraganore also said during that breakout session that Peter Kim, president of Merck Research Laboratories and one of the key architects of the Sirna acquisition, had told him that Merck expected it would need broader access to Alnylam’s IP in the future.
Shortly after the Sirna acquisition, Alnylam continued to fire shots at its rival’s IP estate, even though it now belonged to a partner.
Early this year, Maraganore said during a conference call to discuss Alnylam’s 2006 financial performance that the re-examination and ultimate rejection of a Sirna patent by the US Patent and Trademark Office demonstrated the weakness of Sirna’s patent position (see RNAi News, 2/8/2007).
Not helping matters was the fact that the re-examination of the patent — No. 7,022,828, which covers the use of nucleic acids such as siRNAs to modulate the expression of IKK-gamma genes — was conducted at the request of a law firm that has provided corporate finance services to Alnylam institutional investor Polaris Venture Partners.
Despite the rejection of the ‘828 patent and whatever comments Kim may have made in the past, given the termination of its deal with Alnylam, it appears that Merck plans to rely on its own IP as it forges ahead in the RNAi space.
The Merck spokeswoman declined to elaborate on the situation. Officials from Alnylam did not return a request for comment.

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