Protiva Biotherapeutics this week filed two separate lawsuits against one-time parent company Inex Pharmaceuticals and erstwhile collaborator Sirna Therapeutics, alleging that each company engaged in improper activities that undermined Protiva's key drug-delivery technology.
The legal maneuverings shed new light on a saga involving the RNAi drugs sector's two biggest players and allegations of fraud, theft of trade secrets, and breach of duty and contract.
In the first suit, Protiva alleges that Inex and certain of its directors, hoping to enrich themselves after a setback with the US Food and Drug Administration, inappropriately made statements indicating that Protiva did not own the SNALP technology in the field of RNAi.
"In our view, Inex is trying to expand its business into an area they knew nothing about until Protiva validated it," Mark Murray, president and CEO of Protiva, said in a statement issued this week. "They are trying to usurp Protiva's discoveries, created by our scientists and funded by our investors, with no help from Inex, other than the prior encouragement we got from the Inex representatives who used to sit on our board."
In the second suit, which responds to a case Sirna brought against Protiva last month, Protiva charges that Sirna Therapeutics maintained a "hidden agenda" throughout the companies' strategic alliance to develop its own siRNA delivery technology using Protiva's proprietary technologies.
"In our view, Inex is trying to expand its business into an area they knew nothing about until Protiva validated it."
"We are persuaded that Sirna took Protiva's confidential information • which we provided in good faith to enable a partner to make further advances in the siRNA field • and that they then violated that confidence," Murray said in his statement.
Protiva filed the suit against Inex in the Supreme Court of British Columbia and the suit against Sirna in the Superior Court of the State of California, County of San Francisco.
In January 2001, Protiva was spun out of Inex in order to develop a gene-delivery technology for cancer and inflammatory diseases. According to a press release issued by Inex at the time, the company had transferred to Protiva "all assets relating to its proprietary gene-delivery technology."
Protiva developed that technology into what it now calls SNALPs, which are essentially nucleic acids encapsulated by cationic and fusogenic lipids, which are surrounded by a polyethylene glycol coating to prevent clearance of the positively charged cationic lipid from the bloodstream.
Around mid- to late-2003, Protiva began actively shopping the SNALP technology to potential licensees for RNAi therapeutic applications (see RNAi News, 11/7/2003), and in February 2005 Sirna announced that it had licensed the technology. In a matter of months, Sirna was seeing promising results from its experiments with SNALPs, and published data in Nature Biotechnology showing that it could use the delivery technology to achieve a significant knockdown of hepatitis B virus in mice (see RNAi News, 7/29/2005).
However, early in 2006 Sirna President and CEO Howard Robin said that his company would be using its own nanoparticle-based delivery technology, not SNALPs, with its hepatitis C clinical candidate, Sirna-AV34 (see RNAi News, 1/19/2006).
Although it was feasible that Sirna decided to go with an in-house technology because it worked better than SNALPs, a lawsuit the company filed against Protiva in late February told a different story.
As reported by RNAi News, Sirna alleged in the suit that Protiva did not control the intellectual property necessary to have signed the licensing agreement (see RNAi News, 3/2/2006). According to Sirna, that IP remains with Inex.
"Sirna never intended to use Protiva's technology for its final [hepatitis C] product (at least not openly); instead … it had its own hidden agenda from the beginning of the collaboration."
Sirna's claims were seemingly backed up this week by rival Alnylam Pharmaceuticals, which reported the publication of data demonstrating that systemically administered siRNAs, formulated with SNALPs, could be used to knock down apolipoprotein B, a protein associated with cholesterol metabolism, in non-human primates. Despite having conducted the primate studies in collaboration with Protiva, Alnylam said this week that it signed a licensing deal for a liposomal-based drug-delivery technology, similar to the SNALP technology, with Inex (see related story, this issue).
Although Alnylam and Inex officials were not available for comment, it appeared that the same issues that led to the breakdown of Protiva's deal with Sirna were responsible for scuttling a possible licensing arrangement with Alnylam.
However, Protiva's recent suits against Inex and Sirna suggest that the situation may not be so clear-cut.
Protiva's against Inex states that when Protiva was spun out of the company, it acquired Inex's "stable plasmid lipid particle technology and related assets including the assignment, license, and sublicense of patents related to the … technology."
The suit adds that Protiva's agreement for the delivery technology also included details regarding each companies' "rights and obligations to new inventions and any improvements to the licensed patents," but that the deal does not include and was not intended to "cover or refer to delivery technologies relating to siRNAs," but rather protect Inex from competition in the field of immunostimulatory DNA vaccines.
Essentially, Protiva maintains that RNAi was "not within either companies' defined field of operation," CEO Murray explained to RNAi News.
Late last year, months after signing its licensing deal with Sirna, Protiva began talking with Alnylam about possible business transactions, according to the lawsuit. However, the suit adds, around the end of 2005, Inex CEO Timothy Ruane informed both Alnylam and Sirna that his company "had exclusive rights to substantially all of Protiva's SNALP technology in siRNA," which caused Alnylam to pull out of its negotiations with Protiva and triggered Sirna's lawsuit.
In Protiva's eyes, Inex and its CEO made their statements to Alnylam and Sirna "knowing the representations to be false or with reckless disregard as to whether they were … true or false," the suit against Inex states. Further, the suit claims that the statements were made "with the intention of injuring Protiva … and for no other reason except to usurp Protiva's SNALP technology in siRNA for [Inex's] own use."
The suit also alleges that three Inex directors who also sat on Protiva's board were aware of Protiva's activities in RNAi, including its discussions with Sirna • which had expressed interest in acquiring Protiva • and with Alnylam. The directors "did not, at any time during their service on Protiva's board, state, disclose, or suggest that Protiva would be precluded from having access to its SNALP technology" for siRNA applications, the suit claims. Rather, these directors "encouraged Protiva to expend funds, time, and energy on the research and development of … SNALP technology … in siRNA."
Murray told RNAi News this week that while Inex was expected to benefit from Protiva's RNAi activities as a shareholder in the company, "things changed" after US regulators decided not to approve Inex's anticancer drug Marqibo in January 2005. Inex "then saw access to Protiva's inventions as a way to save themselves," he said.
Protiva is asking the Supreme Court of British Columbia to rule that the company owns the SNALP technology in areas not expressly defined in its deal with Inex such as RNAi, and to award damages.
In a statement issued this week, Inex said that it believes it has "certain rights to obtain a fully paid-up, exclusive license from Protiva for certain oligonucleotide technology. Inex has been seeking to clarify its rights under these agreements, but Protiva has denied that Inex has any rights to the disputed technology."
Inex CEO Ruane said in a statement that his company believes Protiva's claims "have no merit, and we are confident of our rights under the 2001 agreements. We will continue to focus on advancing Inex's products through our recent partnering announcements and the proposed spin-out of our oligonucleotide technologies into a new company, Tekmira Pharmaceuticals."
In its lawsuit, Protiva said it opposes the spinout of Tekmira, which would include the transfer of all Protiva/Inex agreements to the new company, which could further cloud the issues surrounding its case.
Protiva's suit against Sirna, meantime, alleges that the delivery system for Sirna-AV34 "appears to be in essence the system Sirna learned in confidence from Protiva's scientists," the suit alleges. "Sirna never intended to use Protiva's technology for its final [hepatitis C] product … at least not openly; instead … it had its own hidden agenda from the beginning of the collaboration."
In its suit against Sirna, Protiva echoed statements it made in its Inex action, claiming that RNAi was not covered under the companies' 2001 asset agreement, but adding that Inex "assured Protiva that, to the extent required, [an expansion of the agreement to include siRNAs] would be available to Protiva from Inex.
Murray conceded that Inex does own "some patents [covering technology] that could conceivably be useful in protecting an siRNA product … and those we did not have a license to at the inception of Protiva. We discussed obtaining a license to those [patents] from Inex over a period of time … should those patents at some point be deemed to cover siRNA," he told RNAi News, adding that "Protiva has made a number of our own inventions in the area of siRNA."
"To date, no agreement has been reached with Inex," Protiva said in its suit, although the company said it remains "ready and willing to reach such an agreement on commercially reasonable terms." However, during negotiations that led up to their February 2005 agreement, Protiva alleges that Sirna was aware of this fact and "expressed a willingness to enter into the strategic alliance whether or not Inex ever agreed to … a field expansion" covering siRNAs.
Protiva claims in its suit that it worked in good faith with Sirna under their agreement, even providing Sirna with information beyond what was called for in the companies' deal.
"Sirna led Protiva to believe that [it] would test Protiva's delivery platform and that Sirna would ultimately and openly use Protiva's platform in one or more drug products," the suit charges. "However, in late 2005, Sirna abruptly switched course and claimed to have invented its own lipid nanoparticle delivery platform that it would be using for a hepatitis C drug. This allegedly-proprietary delivery platform being used by Sirna for this and other development-stage products is highly similar to Protiva's delivery platform and was developed using Protiva's assistance, disclosures, and trade secrets."
According to Protiva, examples of the disclosures and secrets misappropriated by Sirna include the identity of particular types of cationic lipids and PEG-lipids, "as well as the importance of using pH titratable lipids."
Following this alleged about-face, Protiva's suit claims, Sirna then sent a copy of its lawsuit to Protiva and stated in an e-mail that the companies' partnership was being terminated in light of Protiva's failure to meet its obligations and its misrepresentation of its ownership of the SNALP technology.
Protiva states in its suit that it remained "ready and able to perform under the strategic alliance" with Sirna, and that Sirna's allegations of misrepresentation are unfounded.
Protiva is asking the Superior Court of the State of California, County of San Francisco, to declare that Sirna has no rights to Protiva's technology, and that Protiva still has the rights granted by Sirna under the companies' agreement, as well as damages.
Further, Protiva is seeking an injunction against the development, manufacture, use, and sale of Sirna-AV34, and a declaration that the drug candidate incorporates Protiva technology.
Multiple requests for comment from Sirna were not returned.
• Doug Macron ([email protected])