Struggling RNAi drug developer Genesis Research and Development this week announced that it will likely establish a new subsidiary to develop a single-stranded RNAi technology it hopes will attract much-needed interest from potential partners and investors.
Genesis is betting that such a subsidiary would embolden investors to back the technology independent of the company's other RNAi programs.
"We are very pleased with the level of … interest [that] has been shown in our new technology by international pharmaceutical and venture capital groups," Genesis CEO Stephen Hall said in a statement. "It is likely the technology will be transferred into a new subsidiary company, which would receive new investment funding from the interested groups to complete critical experiments including in vivo proof-of-concept studies."
Additional details about the subsidiary, including when it may be established or how it would be funded, were not disclosed. Hall said in his statement that Genesis expects to retain majority ownership in the new firm.
Company officials were not available for further comment.
Details about the so-called ssRNAi technology first came to light earlier this year when the New Zealand company announced that it was seeking additional capital from its existing investors after failing to secure the more than NZ$2 million ($1.3 million) it is owed for selling its majority stake in a biofuels company (see RNAi News, 2/12/2009).
According to Genesis, the technology involves chemically modified, nucleobase-masked single-stranded oligos capable of forming "an active double-stranded molecule only when the masking groups are removed inside cells." In part because of their smaller size, ssRNAi agents are expected to be more easily deliverable than their double-stranded or hairpin counterparts.
In February, Hall said in a letter to shareholders that potential collaborators "have all expressed strong interest in the technology," leading the company to speculate that partnering discussions were imminent.
About two months later, Genesis disclosed in its annual report that it was unable to secure the necessary funding from its investor base and that efforts to obtain government support had been unsuccessful, raising significant doubts about the company's ability to continue its operations (see RNAi News, 4/2/2009).
In that report, Genesis Chairman Joachim von Roy Genesis said that despite "significant international interest" in the ssRNAi technology, industry deals were "unlikely to be consummated quickly."
He added that Genesis was "evaluating all options to ensure that the value within [the company] is realized, even if we have insufficient funds to continue the current level of operations," but did not elaborate.
It appears now that the most promising option for Genesis is to establish a separate unit to oversee development of ssRNAi, a move that could allow would-be partners and financers to invest in the technology independent of the company's other RNAi programs in oncology, which have been put on the backburner.
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The new company would also be free from Genesis' bad-news baggage, including the failures of non-RNAi programs in immunological disease (see RNAi News, 8/5/2005) and the shelving of earlier RNAi programs in allergic disease amid disappointing preclinical data (see RNAi News, 3/22/2007).
Single Strand, Multiple Players
Genesis isn't alone in its ambitions to develop a single-stranded RNAi approach.
In late April, long-time collaborators Alnylam Pharmaceuticals and Isis Pharmaceuticals said that they had struck a deal to work together to develop ssRNAi technology owned by Isis (see RNAi News, 4/30/2009).
Under the terms of that arrangement, Isis co-exclusively licensed to Alnylam the rights to the technology in exchange for upfront payments, research and development milestones, and royalties. Isis also retained the right to develop drugs based on the technology itself.
And in 2002, Max Planck Institute researchers reported that single-stranded antisense siRNAs could effectively silence genes in HeLa cells. The next year, a team from the University of Oslo published data demonstrating that antisense siRNAs and double-stranded siRNAs act through the same RNAi pathway, and that the single-stranded oligos suppress target mRNA expression more quickly than conventional siRNAs.
RXi Pharmaceuticals, meanwhile, is developing a technology it calls solo rxRNAs. According to the company, these RNA molecules use a single sequence but have shown the same level of gene-silencing efficacy as conventional RNAi agents in preclinical animal models.
But it is Alnylam and Isis' formal entry into the ssRNAi space that Genesis is banking on to drive interest in its own technology.
The day after those companies announced their arrangement, Genesis issued a statement confirming that it, too, is focusing on the RNAi approach.
“It is extremely interesting to see the collaboration between Isis and Alnylam … which is intended to achieve effective gene silencing using single-stranded oligonucleotides that act through the RNAi mechanism," Hall said at the time.
“Genesis has filed patent applications protecting the technology," he added, "and is in discussion with a number of international companies that have shown interest in co-developing the technology with Genesis and have made many favorable comments on the potential of the Genesis ssRNAi technology."