A CNS collaboration

TARRYTOWN, N.Y. & CAMBRIDGE, Mass.—RNA interference (RNAi), as described by Alnylam Pharmaceuticals Inc., is “a natural pathway involved in regulation of gene expression in all mammalian cells, and is mediated by small interfering RNA (siRNA) molecules.” And while some drug targets have previously been termed “undruggable,” Alnylam points out that “it is possible to design siRNAs for the mRNA transcript of any gene,” making RNAi therapeutics an attractive approach.

Regeneron Pharmaceuticals Inc. and Alnylam hope to take advantage of the strengths of RNAi therapeutics in a newly announced collaboration. The companies will work together on the discovery, development and commercialization of RNAi therapeutics against disease targets expressed in the eye and central nervous system, as well as some targets that are expressed in the liver.

Per the terms of the agreement, Regeneron will lead development and commercialization for all programs that target eye diseases, and Alnylam will be eligible for potential milestone and royalty payments. The partners will jointly advance and alternate leadership for the CNS programs, with the lead party holding global development and commercial responsibility. In addition, regarding the CNS programs, Regeneron and Alnylam will have the option at the time of candidate selection to participate equally in potential future profits of the programs led by the other company.

In conjunction with the agreement, Regeneron will pay Alnylam $400 million up front, and will purchase $400 million of Alnylam equity at a price per share of $90 (4.44 million common shares). Alnylam also stands to receive up to an additional $200 million in milestone payments if certain goals are met during early clinical development of the eye and CNS programs. The partners intend to advance programs directed at 30 targets and move several into the clinic during the collaboration's initial five-year discovery period. Regeneron will provide $2.5 million in funding to Alnylam at the initiation of each program, and an additional $2.5 million at lead candidate identification, for a potential of roughly $30 million in annual discovery funding for the alliance.

"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. We are thrilled to collaborate with Regeneron, a like-minded science-based organization, to significantly accelerate our efforts to bring RNAi therapeutics to patients," said Dr. John Maraganore, CEO of Alnylam. "Importantly, the alliance structure enables Alnylam to continue to build its industry-leading pipeline of RNAi therapeutics while retaining significant product rights. In addition, 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."

Regeneron and Alnylam will also be looking at several RNAi therapeutic programs targeting genes expressed in the liver. Among the intended programs is a joint effort to evaluate anti-C5 antibody-siRNA combinations for C5 complement-mediated diseases, which includes investigating the combination of Regeneron's pozelimab (REGN3918) and Alnylam's cemdisiran, which are in Phase 1 and Phase 2 development, respectively. Alnylam will retain control of cemdisiran's development as a monotherapy, while Regeneron will lead development of the combination approach. Both companies will equally share investment and potential future profits on the monotherapy program, and Alnylam stands to receive royalties on sales of any future combination product. For the other liver programs, Regeneron and Alnylam will alternate leadership and share equally in profits. They will also continue their ongoing collaboration, which seeks to identify RNAi therapeutics for treating nonalcoholic steatohepatitis. Alnylam will retain broad global rights to its other unpartnered liver-directed clinical and preclinical pipeline programs.

"At Regeneron, we believe the best use of our resources is to invest in potentially game-changing science that will yield innovative medicines for patients with serious diseases. This collaboration couples proven and emerging RNAi technology, which holds important promise in many diseases, with Regeneron's world-leading genetics research and target discovery engine," Dr. George D. Yancopoulos, president and chief scientific officer of Regeneron, remarked in a press release. "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. 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."

Zacks Equity Research spoke positively about the agreement, noting that “the technology promises potential.”

“The collaboration with Alnylam will give Regeneron an option to have a pipeline based on RNAi technology … [and] will provide Alnylam with funds and a strong partner like Regeneron,” Zacks noted. As Alnylam pointed out in a presentation regarding the collaboration, Regeneron offers strengths such as "world-leading capabilities in human genetics and industry-leading commercial presence in ophthalmology and other large markets."

Alnylam's Onpattro gained the nod from the FDA in August 2018 as the first-ever approved RNAi therapeutic, Zacks added. Onpattro is indicated for polyneuropathy of hereditary ATTR amyloidosis in adults in the United States, and in such adults with Stage 1 or 2 polyneuropathy in the European Union.