RNAi specialist Dicerna Pharmaceuticals Inc.'s chief operating officer, James Weissman, told BioWorld that scientists inside and outside of the company have come to believe in what's called "the X hypothesis" in hepatitis B virus (HBV). "My view, though, as a person who has been in the pharmaceutical industry for decades, is who cares, anyway?" he said as long as the drug works. He pointed out that, with the cholesterol therapy Lipitor (atorvastatin calcium) from New York-based Pfizer Inc., where he served in business development and marketing, "everybody had a different theory for why it lowered the incidence of heart disease. Nobody knew with certainty."
The Dicerna drug in question is DCR-HBVS, and it's still undergoing a phase I study. Roche Holding AG was persuaded by available data to pledge $200 million up front in a research collaboration and licensing agreement deploying Dicerna's GalXC platform, with another $1.47 billion possible in development, regulatory and commercial milestone payouts. Focused on DCR-HBVS, the pact includes discovery and development of therapies targeting more human and viral genes associated with HBV using research approaches from both firms. Dicerna could also collect royalties and retains an option to co-fund pivotal development of DCR-HBVS worldwide. If exercised, that would put the company in line for enhanced royalties and the right to co-promote products, including DCR-HBVS, in the U.S. with Basel, Switzerland-based Roche, a setup that Dicerna was able to negotiate because the available data are "so compelling."
Cambridge, Mass.-based Dicerna's HBV effort deliberately avoids targeting the X gene, whereas other firms trying RNAi or other oligonucleotide programs do. Wall Street has been especially attentive to the deal between Arrowhead Pharmaceuticals Inc., of Pasadena, Calif., and New Brunswick, N.J.-based Johnson & Johnson's Janssen Pharmaceuticals Inc. unit. About a year ago, the pair signed a potential $3.7 billion deal for ARO-HBV, an RNAi drug designed to silence the entire HBV transcriptome, intervening upstream of the reverse transcription process that standard-of-care nucleotide and nucleoside analogues affect. That is, the compound takes aim at all four viral proteins, with the X gene in the mix. The arrangement brought Arrowhead $175 million up front plus a $75 million equity investment. (See BioWorld, Oct. 5, 2018.)
Dicerna theorizes that the X gene is a negative regulator of expression, based on consistent results across various experiments, including some with sequences where the expression is independent of the model used. Wainwright analyst Ed Arce noted in an Aug. 26 report that, "unfortunately, because seroclearance of the HBV S antigen via RNAi is such a nascent approach (especially given recent advancements in delivery platforms), there are no labs (independent or otherwise) to our knowledge that have published any peer-reviewed assessments on this question." He inspected Arrowhead's data for clues as to the relative merit of the S-only strategy taken by Dicerna. The results "seem to corroborate" Dicerna's idea that suppressing the X gene shortens duration of effect and lessens the reduction of S antigen, he said. "As always, however, the final arbiter of meaningful differentiation (if any), will be the final data from each program's ongoing proof-of-concept studies," with Dicerna's due this quarter.
Roche didn't wait for those. What did the company see "that got them so interested?" asked Evercore ISI analyst Umer Raffat in his report. "Answer: while interim data from the phase I [aren't] available yet, there is an indirect readout of efficacy already available to the companies, so Roche knows that the Dicerna drug is likely at least in the competitive ballpark of other RNAi HBV programs." Though no one has seen detailed efficacy numbers, cohort A's results (in healthy volunteers for safety) are available but it "seems like a stretch" for Roche to plunk $200 million up front on just safety data, in his view. "Turns out, there's a stealth tidbit on efficacy available earlier than the formal interim," he said. Interim data are due one month after the last dose given in the cohort (i.e., four months after the last patient gets the first dose). But each cohort starts with a sentinel pair one patient on placebo, one on drug that starts dosing two weeks before the rest of the cohort opens; they're ahead of the others.
At four months of follow-up for each patient in the trial, the physician decides whether to continue follow-up or end the patient's enrollment in the trial. The bar for the choice is a >1-log reduction in S antigen at the four-month mark. Raffat said Dicerna's management "does know that one patient from that sentinel pair is still in follow-up (and it's presumably not the placebo patient). This suggests that at the lowest monotherapy dose Dicerna is testing, they get to >1-log reduction in HBV S antigen after four doses. That's not a lot of info, but that does get them into the ballpark of efficacy that, for instance, Arrowhead has shown," he wrote.
Arc of innovation
SVB Leerink analyst Mani Foroohar, in a Sept. 30 report, observed that "interpretations of this preclinical data are controversial among HBV experts, with supporters of [the X hypothesis] pointing out that Dicerna has demonstrated a robust ~4 log reduction in HBV S antigen upon treatment in mouse models." He predicted that Dicerna will show drops in those levels "in line with Arrowhead," though "the ultimate question of the role of [the X gene] will likely remain open for years to come." In any case, he liked the Roche contract, pointing in a Thursday report to "an attractive royalty structure and opportunity for better economics with opt-in. We see minimal downside to this deal, as it involves no dilution for equity ownership for Dicerna shareholders."
Dicerna's Weissman noted that "small focused biotech companies like Dicerna can go deep into development and commercialization in monogenic rare diseases. In fact, we can build confidence in the company and relations with the various communities in certain rare diseases that can rival that of a large pharma." For the bigger indications such as HBV, though, firepower like that of Roche is a must. "In the two-year span from October 2017 until today, we've done four deals with four really great companies," he said, adding that "lost in the noise" around the collaboration with Indianapolis-based Eli Lilly and Co. was the fact that it includes a broad zone of disease indications. Lilly agreed to pay Dicerna $100 million up front while investing $100 million more in the company as part of the licensing and research collaboration agreement for the discovery, development and commercialization of medicines aimed at "more than 10 targets" in cardiometabolic disease, neurodegeneration and pain indications. The terms include for Dicerna to receive up to $350 million per target in milestone rewards and tiered royalties ranging from the mid-single to low-double digits on any resulting product sales. (See BioWorld, Oct. 30, 2018.)
RNAi has followed the arc of innovation traced by other drug classes such as monoclonal antibodies, Weissman said. "Everybody rushes in when there's a great idea. Life is harder than people imagine quite often, and a few companies survive and thrive." Other players in the space include Cambridge, Mass.-based Alnylam Pharmaceuticals Inc., which has an HBV deal with Vir Biotechnology Inc., of San Francisco, signed in October 2017, the pair agreeing to advance Alnylam's HBV program and start research on as many as four more RNAi programs. Arbutus Biopharma Corp., of Warminster, Pa., has AB-729, a subcutaneously administered GalNAc conjugate RNAi therapeutic that targets HBV replication and antigen production and has demonstrated potent and durable reductions in HBV S antigen in in vitro and in vivo preclinical models. The company started clinical development with AB-729 in a phase Ia/Ib effort in July. Preliminary safety and efficacy data from healthy subjects and several single-dose cohorts of subjects with chronic HBV infection are expected in the first quarter of next year. Shares of Arbutus (NASDAQ:ABUS) closed Thursday at $1.42, up 53 cents, or 59.6%. Dicerna's stock (NASDAQ:DRNA) ended at $16.49, up 75 cents.