Monday, February 4, 2008

RNAi study may be a harbinger

By Ryan McBride

One of the most advanced studies in the white-hot field of RNA-interference (RNAi) is to be unveiled later this month, providing one of the first glimpses of how well the gene-silencing drugs work in humans.

The study, by Cambridge biotech Alnylam Pharmaceuticals Inc., is being watched by industry executives in Massachusetts and beyond to see whether the results will have implications on the commercial acceptance of RNAi-based drugs.

Billions of dollars have been invested in RNAi technology, yet there has been little evidence of its effect on human disease.

Last week Alnylam revealed general, basic data on its midstage study of an RNAi drug for a respiratory virus. Like other drugs of its kind, the treatment is designed to turn off a gene at the root of the illness. Though RNAi drugs have advanced as eye-disease treatments, none have shown as much progress in the human body, industry watchers say.

"Alnylam is a great company and they've been one of the leading lights with (RNAi) technology," said Douglas Fambrough, a general partner at Boston venture firm Oxford Bioscience Partners, who has invested in firms that compete in the RNAi arena. "I'm definitely rooting for them."

Fambrough led Oxford's lucrative investment in San Francisco-based RNAi firm Sirna Therapeutics Inc., which New Jersey drug giant Merck & Co. Inc. acquired in 2006 for a whopping $1.1 billion. And late last year, he launched an RNAi startup called Dicerna Pharmaceuticals Inc. in Cambridge with a $13 million Series A round of venture capital.

Investor confidence

While not a make-or-break proposition, the Alnylam trial is important and could have an impact on investor confidence in RNAi treatments, Fambrough said. Earlier classes of drugs that prompted similar excitement, such as gene therapies, suffered setbacks in initial human trials, which slowed investment in those fields. But Fambrough said he believes the first wave of RNAi-based drugs will succeed in trials.

Executives at RNAi startup Cequent Pharmaceuticals Inc. in Cambridge say they are awaiting the results of Alnylam's trial and its impact, whether positive or negative, on their own venture.

"To tell you the truth, I think the whole field is still a little jittery about what could happen," said Johannes Fruehauf, a director of drug development at Cequent.

Cequent is an example of the commercial excitement around RNAi treatments. The company has raised $13.5 million in venture financing -- including $2.5 million received last month -- since its operations began in late 2006 with technology licensed from Harvard Medical School. And it has drawn investments from the venture arm of Swiss drug giant Novartis AG as well as several independent firms, including Wellesley's Ampersand Ventures, where Cequent CEO Peter Parker had been a general partner before leaving to focus on the startup after its launch.

Another Bay State biotech in the RNAi field is RXi Pharmaceuticals Inc. of Worcester, a subsidiary of Los Angeles biotech CytRx Corp., which was co-founded in January 2007 by Craig Mello, the University of Massachusetts Medical School researcher whose team won a Nobel Prize in 2006 for the discovery of RNAi's potential in treating disease.

Alnylam executives are keenly aware of the company's featured trial.

"This clearly has the possibility to be the first RNAi therapy to reach significant Phase 2 and Phase 3 studies -- or even the market," said Barry Greene, president and COO of Alnylam.

Greene said he would be unable to make further declarations about the firm's lead RNAi drug until after full results of its study are released during a Feb. 28 conference in Singapore. The Phase 2 trial involved patients who were given the firm's inhaled RNAi treatment before and after being intentionally infected with respiratory syncytial virus. Specifically, the drug's RNA molecules are intended to mute a gene in the virus needed to produce proteins for viral replication.

Based on the results of the study, Alnylam says it plans to begin a new Phase 2 study in the first half of 2008 that would test its drug in patients who are naturally infected with the respiratory virus. One industry analyst believes the second study would provide even greater insights into how well RNAi fights infectious diseases.

"(The latest study) is not as exciting as it would be to get a naturally infected population," said Alan Carr, an analyst for Needham & Co. LLC, a New York investment banking, equity research and asset management firm. "(But) it's certainly a good step in that direction."