Arrowhead Research is acquiring Novartis’ full RNAi research and development portfolio and associated assets for $10 million in cash and $25 million in stock. In connection with the agreement, Novartis is eligible to receive milestones and single digit royalties on sales of future products.

As part of the acquisition, Arrowhead is obtaining multiple patent families covering RNAi-trigger design rules and modifications. The company said these fall outside of key patents controlled by competitors, which it believes provides freedom to operate for any target and indication. Additionally Arrowhead is acquiring intracellular targeting ligands that can enhance the activity of RNAi-triggers by targeting the RNA-induced silencing complex.

The company is also being granted access to Alnylam Pharmaceuticals' intellectual property for 30 gene targets chosen by Novartis, which is related to a 2005 license deal between the two companies, and a pipeline of three candidates for which Novartis has generated preclinical data. 

“This is an important deal for us. Novartis has been working in the RNAi field for over a decade and their developments in proprietary oligonucleotide formatting and modifications are some of the best we've seen. We anticipate this acquisition will provide us with substantially expanded freedom to operate, proprietary technology that appears to enhance the activity of RNAi triggers, access to non-delivery Alnylam RNAi IP for 30 targets, and three programs that went through the rigorous Novartis vetting process,” said Christopher Anzalone, Ph.D., president and CEO of Arrowhead. “We now have additional flexibility to optimize each new candidate using the most effective RNAi-trigger design and modifications. We look forward to incorporating these novel technologies into future drug candidates.”

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