Contributing Writer

A year after first announcing plans to spin out its RNAi programs, CytRx Corp. completed the job with the formation of majority-owned subsidiary RXi Pharmaceuticals Corp. The fledgling biotech is "the only pure play in RNAi aside from Alnylam," noted CytRx President and CEO Steven Kriegsman. (See BioWorld Today, Jan. 31, 2006).

Alnylam Pharmaceuticals Inc. emerged as the undisputed leader in the RNAi space following the recent $1.1 billion acquisition of rival Sirna Therapeutics Inc. by Merck & Co. Inc. Although several other companies have programs in RNAi, Ram Selvaraju, associate biotech analyst with New York-based Rodman & Renshaw LLC, said that Sirna, Alnylam and CytRx hold the most significant patent estates in the space. (See BioWorld Today, Nov. 1, 2006.)

CytRx's intellectual property includes licenses to RNAi technologies from the University of Massachusetts Medical School and the Carnegie Institution of Washington. That includes pending patents on RNAi target sequences, chemical modifications and delivery to cells. In exchange for transferring its IP and RNAi pipeline to RXi, CytRx took an 85 percent stake in the company. The remaining 15 percent is held by RXi's scientific advisors.

RXi's lead program targets the mutant SOD1 gene, which is responsible for familial amyotrophic lateral sclerosis (ALS). The drug is designed to be injected directly into the spinal cord and is slated to begin clinical trials this year. Given the severity of the indication and lack of existing treatments, Kriegsman said he expects a potentially truncated clinical development path that could result in "the first approved RNAi therapeutic - ahead of Sirna and Alnylam."

Also in the pipeline is a program targeting the RIP140 gene, which regulates fat and carbohydrate metabolism and may prove relevant to treating obesity and diabetes. RXi is developing drugs for direct injection into areas with excess fat, and preclinical studies have demonstrated acceleration of fat burning activity. Programs in oncology and CMV retinitis also are in preclinical development.

To shepherd the pipeline forward, Kriegsman recruited what he called a "first-class" management team and advisory board. "At the end of the day, what separates one company from another is brainpower, and I believe no one has more brainpower in RNAi than we do," he said.

That brainpower includes scientific advisors Craig Mello, 2006 winner of the Nobel Prize in medicine for his role in the discovery of RNAi; Gregory Hannon, a former advisor to Alnylam whose lab discovered the mechanism of RNAi in human cells and short hairpin RNAi; Tariq Rana, a former advisor to Sirna who discovered key technology for the chemical stabilization of RNAi; and Michael Czech, who has used RNAi to discover several genes involved in diabetes and obesity.

On the management side, Kriegsman recruited Tod Woolf as CEO and James Warren as chief financial officer. Woolf served time at Sirna during the Ribozyme days, where he contributed to the development of RNA therapeutics and developed the Genbloc RNA technology, which was spun out to create Atugen. He also founded and served as CEO of Sequitur, an RNAi company acquired by Invitrogen. More management announcements are expected in the near future as RXi gets settled in its Worcester, Mass., facilities.

Selvaraju added that the company's small size has limited investor interest, but he expects other big pharma suitors to "fall into place behind Merck" once the RNAi field churns out clinical efficacy.

With its RNAi programs managed by RXi, CytRx now will turn its attention to its small-molecule programs, including lead product arimoclomol for ALS. The pivotal Phase IIb trial with nearly 400 patients is slated to begin in the third quarter of 2007, and positive results could provide sufficient fodder for a regulatory filing. CytRx also is evaluating Phase II clinical trial options with iroxanadine for cardiovascular indications and diabetic ulcers and with DP6-001 for HIV.