Better Than Stem Cells? Short Interfering RNA Hold Promise For Dramatic New Treatments    by John Leavitt, Ph.D.

I rarely give stock advice. The last time I did was in the summer of 1964 when I read in the newspaper that a new company called ComSat was having an IPO in September. I considered this, perhaps naively, a sure thing. Yet being in my first job I had no money to invest. So, I decided to watch this stock with the fantasy of having invested $1,000 ($6,548 in today's dollars). My plan was to buy at the IPO price of $10 a share and then sell just before the launch of the first commercial communications satellite, just in case the launch failed. The stock rose meteorically from $10 per share to $80 (the launch did not fail), then the stock split and rose again to more than $80 per share. I made about $240,000 from my $1,000 fantasy investment, equivalent to $1.5 million today.

The reason I bring this up is that recently, I was fortunate to attend a small meeting in Boston that focused on developments in the seemingly esoteric field of siRNA or "short interfering RNA" used to silence genes. The promise of this technology has rightfully created a significant buzz in the scientific and investment communities over for the last two to three years. And as I left this meeting, it occurred to me that in the next 10 to 20 years, siRNA, also called "RNAi", will probably dominate drug development, with many successful drugs currently targeting specific proteins, like Genentech's Herceptin and Imclone's Erbitux, being replaced by RNAi-based drugs. Furthermore, many disease-causing proteins thought to be "undrugable", like the metastatic biomarker L-plastin for colon, breast, melanoma, prostate, and bladder cancer, could now be targeted by RNAi drugs.

Businesses Are Being Built Around siRNA

Andrew Fire, of Stanford, and Craig Mello, at the University of Massachusetts, discovered "gene silencing by double-stranded RNA" in 1998, earning them the 2006 Nobel Prize in Medicine. In 2001 companies started forming around RNAi. One of them, Alnylam Pharmaceuticals filed its S-1 registration with the SEC in February 2004, claiming $23,000 in cash assets and creating 3.2 million shares worth 28 cents each. Two years later, Alnylam went public with stock selling at $7.50 per share after an unprecedented short start-up time. Alnylam's shares were selling on NASDAQ at around $16 per share in early July after hitting a 52-week high of $24.46 last December. By December or perhaps early winter, Alnylam will announce the outcome of its Phase II clinical trial on their lead product for treating the infant respiratory disease caused by Respiratory Syncytial Virus (RSV infections). Alnylam has multiple collaborations funded by Merck, and about 20 pipeline products. At the same time Merck bought Sirna Therapeutics, another RNAi company with strong IP for this technology. During the last year, in order to acquire additional RNAi-relevant IP, Hoffmann-La Roche bought 454, Sigma Chemicals bought Proligo, Alnylam bought Ribopharma, Acuity Pharmaceuticals merged with two other companies to form Opko, Dharmacon became part of Thermo-Fisher Scientific, and RXi Pharmaceuticals was spawned by CytRx. Also Pfizer, GlaxoSmithKline, Novartis, Bristol-Myers Squibb, and Abbott Labs have started R&D programs around RNAi.

Santaris Pharma, a Danish company formed in 2003, has a novel method for making and stabilizing RNAi and drug products in Phase II clinical development. Santaris is strategically partnered through licensing agreements with Enzon, a leading clinical research organization that is conducting clinical trials in the U.S. for many Santaris' drug candidates. Santaris has completed Phase I/II clinical trials in Denmark, France, the U.K. and the U.S. for an RNAi drug for treating chronic lymphocytic leukemia (CLL) and Phase I trials for a second product treating renal and colon carcinoma and multiple myeloma. The CLL product should compete favorably with Genta's BCL-2 antisense (RNA) product in development for over a decade, through phase III clinical development, and in pre-registration for CLL and malignant melanoma.

As an aside, it's worth noting that several of these companies are Nerac clients.

How RNAi works

RNAi therapy is not like stem cell therapy, which will take decades to develop. Approval of the first RNAi drugs is expected in three to five years. This is because stem cell therapy is complex and the science is still in its infancy. By contrast RNAi is well developed because of the advanced understanding of genetics and gene expression. In fact RNAi will be used to make stem cell therapy work.

The 1993 discovery of microRNA, a natural mechanism of gene regulation in all cells, accelerated understanding of how RNAi works. SiRNA is an exogenous synthetic version of the natural endogenous microRNA that takes advantage of the cellular machinery that normally processes and mediates the function of microRNA. Micro- or siRNA (RNAi) is targeted to inhibit a specific counterpart transcript (messenger RNA) that serves as a template for synthesis of an individual protein, the natural process of gene expression. RNAi is processed by a ribonuclease enzyme that binds to a larger precursor siRNA. The enzyme processes siRNA into a 21-nucleotide base-pair double stranded molecule. The specificity of RNAi is governed both by its 'complimentarity' to a particular messenger RNA nucleic acid sequence and also by a complex of proteins whose function is to mediate the binding of the RNAi to a target sequence on the messenger RNA, usually in the 3'-noncoding region of the messenger RNA. This binding event leads to a shut-down in synthesis of the protein encoded by the messenger RNA (called "knock-down").

There is currently little mystery about how to design siRNA molecules and synthesize them, as this method is aided by readily available algorithms. In fact, Todd Woolf, CEO & President of RXi Pharmaceuticals, says, "Weeks instead of years to lead compounds." This finely tunable technique of RNAi knock-down is also currently used in many academic research labs.

Finally, many studies have been completed including Phase I clinical trials that indicate the siRNA is essentially non-toxic. Conventional drugs have always required the balancing of efficacious doses with consideration of the drug's negative side-effects.

RNAi's Dramatic Performance in Preclinical Studies

Several companies and labs have shown siRNA conjugated with cholesterol or other lipid carriers will attach to cholesterol carrier proteins in the blood and transport to the liver rather than being excreted. If an siRNA is used that knocks down an enzyme involved in cholesterol production by the liver, then serum cholesterol levels can be diminished in mice by 30 to 40 percent without diminishing the good cholesterol (HDL) levels. The blockbuster statin drugs like Lipitor, which are well known to produce toxic side-effects in the liver, also reduce cholesterol levels in the blood by about 30 to 40 percent. In the mouse model, the cholesterol-reducing effects of one treatment with siRNA lasts three to four weeks.

In a mouse model for intestinal adenomatous polyposis, the mice develop a high density of benign polyps that ultimately block the intestines, subsequently leading to death. In humans, such polyps are precursors to malignant colon cancer. Johannes Fruehauf of Cequent Pharmaceuticals and Harvard Medical School described a novel method for delivering siRNA to the intestinal tract which targeted beta-catenin synthesized by polyp cells. Increased expression of beta-catenin is associated with proliferation of polyp cells but not by itself in the conversion of benign polyps to malignancy. Cequent has demonstrated that bacteria, such as E. coli, carrying about 100 copies of recombinant siRNA in a plasmid vector, can simply be fed to polyposis mice whose intestines are clogged with polyps. Administration of these bacteria containing the siRNA copies killed the polyps and cleared up the problem completely; the histopathology pictures established clearly that the intestines were cleansed of the polyps. The explanation for this efficacy is that thousands of these bacteria were engulfed by the polyp cells by the natural process of endocytosis. The bacteria were dissolved in the endosomes, the plasmids carrying the siRNA insert were fragmented, and the liberated siRNA inhibited beta-catenin synthesis in the polyps. This last step causes the polyps to self-destruct by the natural mechanism of apoptosis, or programmed cell death.

The prospect for siRNA as a therapy seems unlimited in that any and every gene can become a target for this therapy. Before siRNA, many potential disease targets were considered "undrugable," meaning that virtually every disease can be considered for siRNA therapy, including all forms of cancer, metabolic diseases like diabetes, and cardiovascular disease. One speaker at the meeting predicted th