Alnylam Pharmaceuticals will partner with Regeneron Pharmaceuticals to discover, develop, and commercialize RNA interference (RNAi) therapeutics for diseases of the eye and CNS—as well as advance preclinical programs for liver disorders, including C5 complement-mediated diseases—through an up-to-$1 billion collaboration the companies announced this week.

Alnylam will work exclusively with Regeneron to discover RNAi therapeutics for eye and CNS diseases, the companies said. Regeneron agreed to lead development and commercialization for all programs targeting eye diseases, in return for paying Alnylam potential milestone payments and royalties.

The companies also agreed to jointly advance and alternate leadership on CNS programs, with the lead party of each program retaining global development and commercial responsibility. Both companies will have the option at selection of CNS candidates to participate equally in potential future profits of programs led by the other.

Alnylam specializes in developing RNAi treatments. In August 2018, the company won the first-ever FDA approval of an RNAi therapeutic, Onpattro™ (patisiran), which is also the first therapy approved in its indication of polyneuropathy caused by hereditary transthyretin-mediated amyloidosis (hATTR) in adults.

In partnering with Regeneron, Alnylam aims to build on preclinical data the company presented on March 29 at the sixth annual Cold Spring Harbor Conference on RNA and Oligonucleotide Therapeutics, held in Cold Spring Harbor, NY.

The preclinical data showed success in target gene silencing in the eye and CNS, through potent and highly durable delivery of RNAi therapeutics. Alnylam disclosed that a single intrathecal injection of a silent interfering RNA (siRNA) conjugate targeting the SOD1 gene showed superior silencing in all regions of the brain and spinal cord as compared to a single intrathecal injection of an antisense oligonucleotide targeting SOD1, at the same dose.

A single intravitreal injection of an siRNA conjugate targeting TTR in rats and nonhuman primates led to potent and durable silencing in the eye, Alnylam added at the time.

The companies will also apply Regeneron’s VelociSuite® technologies and capabilities from the Regeneron Genetics Center (RGC).

Complementing antibody expertise

“This collaboration enables us to reach targets inside the cell complementing our expertise in antibodies, which are ideal for extracellular targets and those on the cell surface,” George D. Yancopoulos, MD, PhD, president and CSO of Regeneron, said in a statement. “Through the RGC and our other research groups, we are already identifying additional targets that may be well-suited for RNAi-based drug development, particularly in the eye and CNS.”

Alnylam and Regeneron also said they will work to advance RNAi therapeutic programs designed to target genes expressed in the liver. The programs include a planned joint effort evaluating anti-C5 antibody-siRNA combinations for C5 complement-mediated diseases including evaluating the combination of Regeneron’s Phase I candidate pozelimab (REGN3918) with Alnylam’s Phase II cemdisiran.

Alnylam will retain control of cemdisiran monotherapy development, while Regeneron will oversee combination development. The companies agreed to equally share investment and potential future profits on the monotherapy program, with Alnylam to receive royalties on any potential combination product sales.

For all other alliance liver programs, Alnylam and Regeneron added, they will alternate leadership and participate equally in potential profits.

The companies will continue a collaboration launched in March 2018 to identify RNAi therapeutics for the chronic liver disease nonalcoholic steatohepatitis (NASH) based on novel RGC findings. Alnylam retains broad global rights to all of its other unpartnered liver-directed clinical and preclinical pipeline programs.

That alliance was the second by the companies inked last year. In January 2018, Alnylam was one of five biopharmas that joined Regeneron in a $50 million-plus consortium aimed at speeding up exome sequencing of all 500,000 people within the UK Biobank by three years, to this year.

Taking a 5% stake

In their latest partnership, Regeneron agreed to pay Alnylam $440 million upfront, as well as take a 5% stake in Alnylam by buying $400 million of the company’s stock—4.44 million common shares—at $90 a share, based on the volume-weighted average price over the last fifteen-trading-day period. Regeneron also agreed to pay Alnylam up to an additional $200 million tied to achieving milestones during early clinical development for the eye and CNS programs.

The companies plan to advance programs directed to 30 targets and introduce many into clinical development during the initial five-year discovery period, which includes an option to extend. For each program, Regeneron will provide Alnylam with $2.5 million in funding at program initiation and an additional $2.5 million at lead candidate identification, translating to the potential for approximately $30 million in annual discovery funding to Alnylam as the alliance reaches steady state.

“The near-term payments under this new agreement will strengthen Alnylam’s balance sheet with over $2 billion in pro forma cash upon closing of the transaction, supporting our global efforts to develop and commercialize multiple products as potentially breakthrough medicines and advance our profile toward sustainable profitability,” stated Alnylam CEO John Maraganore, PhD.

The alliance and equity-related agreements are subject to customary closing conditions and clearances, including clearance under the Hart-Scott Rodino Antitrust Improvements Act.

“This new industry-leading alliance is aimed at realizing what we believe to be a significant opportunity for RNAi therapeutics as potentially transformative medicines for ocular and CNS diseases,” Maraganore added.

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