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Two RNAi Rx Shops See Strong Gains in Share Value Since the Start of Year

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By Doug Macron

Amid preliminary signs that the US economy is in recovery, shares of MDRNA and Tekmira Pharmaceuticals have experienced strong gains since the beginning of the year, significantly outperforming the nearly 11 percent rise in the bellwether Nasdaq Biotechnology Index.

Not all of the public, pure-play RNAi shops have fared so well, however; both Alnylam Pharmaceuticals and RXi Pharmaceuticals have seen their stocks drop since the start of 2009.

MDRNA

Showing the sharpest increases in share value is MDRNA, a relative newcomer to the field that has been working to shake off the final vestiges of its predecessor, the failed intranasal drug-delivery firm Nastech Pharmaceutical (see RNAi News, 8/7/2008).

At the beginning of the year, shares of MDRNA closed on the Nasdaq at $0.35 apiece. After hitting a 52-week high of $2.70 in June, the stock finished trading on Tuesday at $1.27 a share, an almost 262 percent jump.

Helping buoy MDRNA's stock has been the company's ability to contain costs while building up a pipeline of RNAi-based therapeutics based on proprietary technologies.

When it was first created, MDRNA took aim at a variety of indications, including hypercholesterolemia, bladder and lung cancer, rheumatoid arthritis, and inflammatory bowel disease. But by early this year, the company had narrowed that focus down to a single indication, liver cancer, in order to preserve cash in a difficult financial landscape (see RNAi News, 3/26/2009).

A few months later, MDRNA reported that its work on the disease had yielded promising results, and that it had been able to show efficient delivery and knockdown in a rodent model using its so-called UsiRNA molecules (see RNAi News, 8/6/2009).

The company also said it was making progress with its in-house DiLA2 liposomal delivery platform, and that it would select a lead drug candidate for the liver cancer program before year end, with the goal of filing an investigational new drug application by late 2010.

Additionally, MDRNA said at the time that it was expanding its formal pipeline to include bladder cancer based on encouraging preclinical data with its UsiRNAs. An IND for this program could be filed by late 2011 or early 2012, a company official had told RNAi News.

Tekmira

Also seeing its stock value improve is Canada's Tekmira, which has been extremely successful in finding partners for its stable nucleic acid lipid particle-delivery technology, deals that have in turn given the company the financial wherewithal to launch its own siRNA drug programs.

On Jan. 2, shares of Tekmira traded on the Toronto Stock Exchange for C$0.45. At the end of the day on Tuesday, the stock was selling for C$1.17 a share, a 160 percent improvement.

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After settling protracted technology-ownership litigation by merging with Protiva Biotherapeutics (see RNAi News, 6/5/2008), Tekmira has been free to pursue alliances for its SNALP technology. Its highest-profile deal, thus far, has been with Alnylam Pharmaceuticals, which recently forged a new partnership with Tekmira (see RNAi News, 8/6/2009) and is using SNALPs with both its phase I liver cancer drug ALN-VSP and preclinical TTR amyloidosis therapeutic ALN-TTR (see RNAi News, 8/13/2009).

However, Tekmira also recently inked a product-development deal potentially worth more than $50 million with Roche (see RNAi News, 5/11/2009), which has confirmed that its first RNAi drug candidate will use the SNALP technology (see RNAi News, 10/1/2009).

These and other deals have enabled Tekmira to get its in-house RNAi pipeline flowing, and this summer the company began dosing patients in a phase I study of ApoB SNALP, an siRNA treatment for hypercholesterolemia (see RNAi News, 7/9/2009). Tekmira has also said that a second drug candidate, the cancer therapy PLK1 SNALP, is expected to enter the clinic in 2010.

Out of Stock

Although it remains the largest and best-funded of the RNAi drug developers, shares of Alnylam have slid from $25.15 on Jan. 2 to $21.70 at the close of the Nasdaq on Tuesday, a nearly 14 percent drop.

Alnylam's broad intellectual property portfolio, which not only includes patents and patent applications related to RNAi, but ones covering single-stranded RNAi (see RNAi News, 4/30/2009) and microRNAs, has long been one of its key value drivers.

But Alnylam is currently embroiled in a lawsuit involving the crown jewels of its IP collection — the Tuschl-I and Tuschl-II patent families (see RNAi News, 9/17/2009). An unfavorable outcome in the suit could deal a significant blow to the firm's patent estate, something investors may be wary of.

Still, Alnylam continues to rack up licensing deals for its RNAi technology, most recently extending an ongoing partnership with Novartis for its fifth and final year (see RNAi News, 7/23/2009), while advancing its in-house drug programs, which include a phase II effort in respiratory syncytial virus and preclinical work in Huntington's disease and hypercholesterolemia.

Advancing programs into the clinic and securing partnerships, however, has not been something that nearby RXi has managed to do, which may be two of the causes the company's shares have been battered since the start of the year.

Shares of RXi have been in a freefall, dropping from $6 at the beginning of January to $2.42 at the close of the Nasdaq on Tuesday, a nearly 60 percent decline.

Despite being one of only three companies to hold access to the Tuschl-I patent family and a growing stable of novel RNAi technologies, RXi has seemingly made little progress in moving a drug forward into human testing.

Since it was spun out of CytRx in early 2007 (see RNAi News, 1/11/2007), RXi has shuffled and re-shuffled its pipeline at least three times. Most recently, in March, the company said it had moved an undisclosed program in inflammatory disease to the head of the queue, dropping neurological disease as a near-term focus (see RNAi News, 3/26/2009).

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Meantime, the company has placed increasing emphasis on novel delivery technologies, including a oral delivery approach licensed from the University of Massachusetts Medical School (see RNAi News, 4/30/2009) and a self-delivering RNAi technology acquired from Advirna (see RNAi News, 7/30/2009).

In June, RXi President and CEO Tod Woolf told RNAi News that one of those two technologies would likely be used with the company's first clinical candidate, set to be named later this year (see RNAi News, 6/25/2009). Yet both are early-stage; Woolf noted at the time that mechanisms by which the self-delivering molecules work remains unknown.

And earlier this month, UMMS researcher Michael Czech, an RXi co-founder and developer of the oral-delivery technology, told RNAi News that the approach still required much optimization before it would be ready for testing in humans (see RNAi News, 10/1/2009).

As for partnerships, RXi's former CFO last year said during an investor meeting that the company expected to close a corporate partnership before the end of the year, with a second deal expected in 2009. Thus far, no such arrangement has been announced.

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