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Alnylam Swallows Poison Pill, Unveils New Systemic Delivery Data, Inks Licensing Deals

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Alnylam Pharmaceuticals has adopted a shareholder rights plan designed to stave off a potential hostile takeover, presented new data on its systemic RNAi efforts, and signed two intellectual property out-licensing deals.

The disclosures cap a busy couple of weeks for the Cambridge, Mass.-based RNAi drugs shop despite an otherwise characteristically slow summer month. The following is a wrap-up of Alnylam's developments.

Poison Pill

Alnylam said last week that its board of directors has approved a rights agreement, or poison pill, allowing the company's shareholders to receive preferred stock purchase rights. According to Alnylam, the plan is "similar to plans adopted by many other public companies, is designed to protect the long-term value of the stockholders' investment, and was not adopted in response to any current third-party attempt to acquire the company."

"The board believes the rights agreement is a prudent measure to safeguard the interests of our stockholders so that they receive fair and equal treatment in the event of any proposed takeover of Alnylam and to guard against partial tender offers, squeeze-outs and other abusive tactics to gain control of Alnylam that could impair the board's ability to represent stockholders' interests fully," Alnylam President and CEO John Maraganore said in a statement.

Under the plan, one preferred stock purchase right will be granted to stockholders as a non-taxable dividend on each outstanding share of Alnylam common stock as of July 26. The rights will trade automatically with the underlying common stock, and only be exercisable after a person or group acquires, obtains the rights to acquire, or initiates an offer to acquire beneficial ownership of 20 percent or more of the company's common stock through a transaction not approved by the board of directors.

Each right initially entitles the holder to purchase 1/1,000 of a share of Series A junior preferred stock at $80 per share. According to an Alnylam filing with the US Securities and Exchange Commission, at such time when the rights become exercisable, each holder of a right will be permitted to receive a number of shares of Alnylam common stock equal to the exercise price of the right divided by 50 percent of the current market price of the common stock.

"For example, at an exercise price of $80 per Right, each right not owned by [the person or party acquiring 20 percent or more of the company … would entitle its holder to purchase for $80 such number of shares of common stock … as equals $80 divided by one-half of the current market price … of the common stock," Alnylam said in the SEC filing. "Assuming that the common stock had a market price of $20 per share at such time, the holder of each valid right would be entitled to purchase eight shares of common stock, having a market value of 8 [shares times] $20, or $160, for $80."

Should Alnylam become merged into another company in a deal its board did not approve, each right holder will be entitled to the number of shares of common stock of the acquiring company equal to the exercise price of the right divided by 50 percent of the current market price of such common stock at the date of the takeover, the SEC filing indicates.

The SEC filing notes that the rights will expire on July 13, 2015, if not exercised unless they are redeemed or exchanged at an earlier time.

Systemic Delivery

Separately, Alnylam reported this week that it has developed an improved dosing regimen for its preclinical program in hypercholesterolemia, marking an advance for systemically delivered RNAi drugs.

The company has been working to systemically deliver an RNAi-based drug targeting a gene encoding apolipoprotein B, a protein essential for the formation of low-density lipoproteins and associated with cholesterol metabolism (see RNAi News, 11/12/2004).

Last November, Alnylam published a paper in Nature describing how its researchers targeted apoB in rats using intravenously delivered, synthetic siRNAs with partial phosphorothioate backbone and 2'-O-methyl sugar modifications on the sense and antisense strands. The siRNAs were further modified through the conjugation of cholesterol to the 3' ends of their sense strands using a pyrrolidine linker, according to the paper. The result, according to the paper, was the silencing of apoB messenger RNA in the liver and jejunum, decreased plasma levels of apoB protein, and reduced total cholesterol.

However, in an accompanying Nature article, Beckman Research Institute's John Rossi noted that if the dosage required to achieve the knockdown effect in mice — 50 mg/kg — were translated to humans, "gram quantities of siRNA-cholesterol conjugates would be required in regular infusions, which would be enormously expensive."

But according to Alnylam, in its latest mouse experiments it was able to systemically deliver a daily dose regimen of 5 mg/kg to achieve 60-percent silencing of apoB in the target organ, while "overall doses of siRNA in this regimen were 6-fold lower than those published … in Nature."

Licensing Deals

Also this week, Alnylam inked licensing deals for its RNAi IP with reagent and kit seller Sigma-Aldrich, and drug-delivery company Nastech Pharmaceuticals.

Sigma-Aldrich first threw its hat into the RNAi ring earlier this year when it acquired Proligo from specialty chemical giant Degussa in a bid to expand its presence in the gene-silencing market (see RNAi News, 2/18/2005).

Now it has taken a non-exclusive license to provide RNAi research products and services using technology covered by Alnylam's Kreutzer-Limmer patent estate, which includes a European patent covering the use of "at least one double-stranded oligonucleotide designed to inhibit the expression of a target gene." Alnylam picked up the IP portfolio when it acquired German RNAi firm Ribopharma in July 2003.

Specific terms of the deal with Sigma-Aldrich were not disclosed.

Nastech, which specializes in intranasal drug delivery, first indicated its interest in RNAi drugs in early in 2004 when it said it had licensed the fundamental Fire-Mello patent from the Carnegie Institute (see RNAi News, 2/6/2004). The company later announced that it was working on an RNAi-based treatment for rheumatoid arthritis (see RNAi News, 4/8/2005).

According to Nastech, it has recently taken an exclusive license to use Alnylam IP to discover, develop, and commercialize RNAi therapeutics targeting tumor necrosis factor-alpha, a protein over expressed in RA, Crohn's disease, and other autoimmune disorders. The license was taken under Alnylam's InterfeRx program, which the company launched in December 2003 in order to make its IP accessible in therapeutic areas outside of Alnylam's core focus (see RNAi News, 12/19/2003).

The terms of the arrangement call for Nastech to pay Alnylam upfront and annual fees, as well as milestones and royalties under the terms of their arrangement. Additional terms were not disclosed.

Aside from Nastech, Japanese biotech firm GeneCare Research Institute and Australia's Benitec have taken InterfeRx licenses from Alnylam (see RNAi News, 1/7/2005 and 4/15/2005).

— Doug Macron ([email protected])

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