BioWorld International Correspondent

MUNICH, Germany - A trans-Atlantic merger marks a bid for a dominant position in the emerging field of therapeutic RNA interference.

Alnylam Pharmaceuticals Inc., of Cambridge, Mass., and Ribopharma AG, of Kulmbach, Germany, joined forces to create what its senior managers describe as a company with control of fundamental patents as well as the technology and experience to bring RNAi products to market. Simultaneously, the new company has secured an additional €21.5 million in private equity financing.

The merged company will be known as Alnylam Holding Co., and it will retain both of the existing firms as functional operating units. John Maraganore, current president and CEO at Alnylam, will retain both roles in the new company. Roland Kreutzer, Ribopharma's CEO, will be chief operating officer of the post-merger Ribopharma unit.

"In discussions this winter, it became clear that the two companies had virtually superimposable missions and visions" for future development of RNAi technology, Maraganore told BioWorld International. "We asked ourselves if it would make sense to form a single company in the space."

"We've merged for four reasons," Kreutzer told BioWorld International. "First, together we can create the leading company in RNAi drug development. Second, we can combine the companies' patent estate. Ribopharma is close to getting patents in the United States, and Alnylam has some important intellectual property, but combined it is clear that the most important patent portfolios are covered. Third, we are now one of the best capitalized companies in the RNAi field. Fourth, we have a very similar vision of how the field of RNAi will unfold."

Stefan Limmer, chief scientific officer of Ribopharma, added, "We were in contact with the founders of Alnylam from a very early date. They were renowned in their field, and so the contacts [that eventually led to the merger] arose from our personal knowledge of the field." Limmer, a co-founder of Ribopharma with Kreutzer, will be chief technology officer in the merged company.

Officers of both companies emphasized the broad possibilities of RNAi technology. RNAi is a natural process that some organisms use to destroy viruses, by degrading the genetic message of the cell in its cytoplasm. Consequently, the gene's function is silenced, or "knocked down," without interfering with the gene itself. At present, the platform's broadest use in mammalian studies is target validation. Both Alnylam and Ribopharma have commercialized some applications of RNAi in that realm, and both see broad potential uses in treating disease.

Alnylam has begun to pursue a research program examining therapeutic uses in metabolic, central nervous system and autoimmune diseases. Ribopharma is investigating possible indications in oncology and viral diseases. "We're targeting selected messenger RNA, so we are not restricted to one therapeutic area," Maraganore said. RNAi also is a possible means to address "privileged targets," targets where there is strong clinical evidence for the effectiveness of intervention, but which have been deemed undruggable by small molecules or monoclonal antibodies.

"It's been demonstrated that RNAi is a very robust means for silencing genes in cells," Limmer said. "It's a widespread approach" that could have applications in a broad swathe of indications.

"The technology is very versatile and can be used to treat many different unrelated diseases," Kreutzer said. The company will look at programs going forward in part based on market considerations, such as the availability of world-class partners.

The post-merger Alnylam will be a drug development company with about 60 employees that aims to develop a pipeline in partnership with pharmaceutical or biotechnology companies.

"We expect that together we will be able to bring in significant pharmaceutical alliances, based on the development of therapeutic products, either against specific targets or in specific therapeutic areas," Maraganore said. "Our goals are to bring in a significant number of alliances, and we expect the first deals in the next three to six months. The merger strengthens key elements in these discussions: the strength of our intellectual property portfolio and the number of programs that are partnerable.

"We have three goals for the merger," Maraganore said. "First, to build the leading company in RNAi therapeutics. Second, to bring the project portfolio toward clinical trials. Third, to succeed in landing major alliances together." Maraganore said that the first trials could begin in two to three years.

The company's war chest will help to see it through that phase. The €21.5 million in new investment includes funds from Polaris Venture Partners, Abingworth Management, Cardinal Partners, Atlas Venture and ARCH Venture Partners.

Company leaders also are open about the challenges facing a trans-Atlantic company. "We had a lot of discussions about this issue prior to the merger," Limmer said. "One important element is the commitment of the U.S. side and the investors to keep both sides going at a comparable level."

Maraganore said, "Each site has to have specific and well-defined areas that it works on. It has to have its own integrity. We plan to ensure that there are activities and programs in each place. We're both in a growth stage," he added. "That is very different from mergers among more established companies. Together we are building our companies, so we have the advantage of doing this at an early stage."

Kreutzer said, "We are very optimistic because of the shared vision" of the companies' mission. With fresh capital, a patent estate both firms are confident about and a combined research team, Alnylam and Ribopharma have placed a marker for firms in the emerging RNAi field.