Pages

Friday, July 22, 2011

On the Importance of Semple-Wheeler

The Semple-Wheeler (S-W) patents can be considered essential intellectual property (IP) for those liposomal siRNA formulations currently in development that have shown clinical promise. Because Alnylam obtained significant control over Semple-Wheeler (S-W) through a license from Tekmira, this patent estate has been important to Alnylam in controlling access to Tekmira’s SNALP delivery technology and, equally important, keeping Tekmira close to its chest.

Today, I will provide a brief re-cap of S-W and explain why its strategic importance is rapidly waning as patent expiration dates draw close.

What Semple-Wheeler Covers

Most critically, S-W cover LNPs comprising

a) ionizable lipids (e.g. DLinDMA, MC3), a modified lipid that prevents particle aggregation (e.g. PEG-lipid) in addition to the nucleic acid cargo (e.g. siRNA; Semple US6858225); and/or

b) a cationic lipid, a non-cationic lipid, a PEG-lipid conjugate in addition to the nucleic acid (i.e. the chemistry of a SNALP liposome; Wheeler US6815432).

While, until S-W has been tested in court, there will always been some uncertainty as to the real scope of the claims, e.g. in light of such newfangled terms like ‘lipidoids’ or other classes of lipids that may not have been covered by the examples in the specification, such strategies would seem to stand on weak scientific grounds.


Ownership and Control over Semple-Wheeler

Originally, Old Tekmira had an exclusive license to S-W from the University of British Columbia (UBC). Realizing the importance of liposomal delivery for the first wave of value creation in systemic RNAi Therapeutics, Alnylam obtained exclusive rights to Tekmira’s exclusive rights to S-W in January 2007. By this, Old Tekmira’s ability to further monetize this patent estate became greatly limited, and, in the absence of other significant RNAi assets at that time (i.e. lack of Protiva IP, know-how, and trade secrets), was widely regarded as a de facto satellite company of Alnylam.

Fair enough- not only did Alnylam pay $8M in upfront for these rights and is on the hook for milestones and royalties, Old Tekmira was in turn granted RNAi trigger IP and the use of S-W for the selected targets. Interestingly, the latter has been brought into question by Alnylam by stating in their recent Response to Tekmira’s Amended Complaint that Tekmira actually does not have rights to S-W and that Alnylam had given Tekmira such notice:

23. Consistent with this pattern, Tekmira has failed to adequately disclose the limitations of its licenses to investors. Despite the clear terms of the license agreements and notice from Alnylam that it lacked licenses to the Semple & Wheeler patent series and Isis patents, Tekmira made representation to the contrary in its public filings with the SEC and in other documents provided to investors.’

It is unclear on what grounds Alnylam makes these claims. Does it claim that Tekmira apparently was never granted such rights, or does it simply mean that Alnylam considers the lawsuit brought by Tekmira as grounds for terminating these rights? In any case, the irony is not lost as it is Tekmira through which Alnylam gained access to S-W and it is for Tekmira to terminate Alnylam's rights if at all.


Strategic Importance of Semple-Wheeler in Light of Upcoming Patent Expirations

In biotechnology, patent infringement typically only becomes ground for lawsuits either when drugs/devices allegedly covered by such claims are about to be commercialized or as generics want to muscle their way onto the markets before the expiration of patents covering an innovator drug. Because of the so called Research Exemption, it is very difficult to enforce patent rights before any commercialization of related drugs, i.e. during the period that patented technologies are being used for drug development pre-commercialization.

Certain licensing and collaboration agreements may be considered to fall between the Research Exemption and the commercialization of drugs, as they may involve technologies covered by 3rd party patents, even if these patents can be assumed to have expired by the time drugs are ready to be commercialized. In other words, the LCAs may be interpreted as a way of commercializing patents. Although such actions are less common, emotions are running high, so Alnylam may use S-W as pre-text for throwing a wrench into any significant LCA that Tekmira may strike. Old Tekmira e.g. once sued Protiva for allegedly licensing S-W to Merck, and one can only speculate to what extent Alnylam instructed Old Tekmira to do so.

The reason though why such actions are unusual is that chances of enforcing such patent rights are slim if the parties involved in an LCA word their agreement appropriately (e.g. by simply excluding the appearance, implicitly or explicitly, that the partner gains rights to S-W; performing work in countries where S-W is not in force etc etc). As such, Tekmira has substantial freedom to strike deals as long as SNALP-based drugs are not being commercialized before the expiration of the fundamental S-W patents…which should be around 2015-7:

Semple US6858225 (ionizable LNPs):

Date of patent: Feb 22, 20005

Filing date: June 29, 2001

Priority date: May 14, 1997 (claims priority to No. 08/856474)

Approximate term of patent: Feb 22, 2005- May 14, 2017

Wheeler US6815432 (SNALP chemistry):

Date of patent: Nov 9, 2004

Filing date: Feb 24, 2003

Priority date: June 7, 1995 (claims priority to No. 08/5981501; note that although this is just before the famous June 1995 cut-off date, because the patent application of ‘432 was filed after that date, patent terms are according to the new regime)

Approximate term of patent: Nov 9, 2004- June 7, 2015


Tekmira business development prospects

Two factors largely controlled by Alnylam have long held back Tekmira’s full business development potential. In addition to granting Alnylam exclusive rights to S-W, it was particularly Alnylam’s RNAi trigger gate-keeper claim that tied SNALP technology to Alnylam.

Until the expiration of S-W, only those companies with access to S-W (Tekmira, Alnylam, Roche, Takeda, and supposedly Novartis) could commercialize SNALP-based drugs until 2017. Because Tekmira has 8 target picks for which it can use S-W, Tekmira is able to offer an acquirer or product-specific co-development partner more than enough access to S-W until then. 6 years is not a long time in drug development, about the time it would take from initiation of phase I to approval if all goes smoothly. The ~2017 expiration of S-W therefore means that its strategic importance for the development of SNALP-based RNAi Therapeutics is waning rapidly. 2007-8 was a different story.

In this light, a gate-keeping position of Alnylam in RNAi triggers, based on the Tuschl and Kreutzer-Limmer patents would be the real rate-limiting factor, as the terms for these patents may last into 2021-2. However, the RNAi trigger landscape has changed significantly over the last 2-3 years as the importance of Kreutzer-Limmer is rapidly diminishing in Europe and is nowhere to be seen in the US, Tuschl I turns out to be of no relevance for therapeutic applications, and even the validity of Tuschl II is now being questioned. Even if T-II can survive the Utah challenge, as it covers only certain RNAi triggers with certain 3’ overhangs, it is not the type of gate-keeping IP that KL or T-I may have become with a bit of luck.

Consequently, with the strategic importance of S-W waning and access to RNAi triggers ceasing to be a limiting factor, Tekmira’s business development is almost entirely out of Alnylam’s control. If, as a result of the litigation, Alnylam lost all rights to Tekmira’s technology (certainly a plausible outcome if it comes to a trial*), the attraction of partnering with or acquiring Tekmira would increase even more.


* As I am writing this, Alnylam has just filed a $150M shelf registration with the SEC. This typically happens in anticipation of selling stock to the public. The timing of this shelf registration is unusual though, because Alnylam has over $300M in cash/cash equivalents, meaning that with the current and anticipated burn, it should not have a need for raising funds any time soon- under normal circumstances. Given my assessment of the strength of Tekmira’s case and the existential risk to Alnylam’s business, it would not surprise me if Alnylam’s lawyers are advising the company to settle the case. A $150M capital raise may be in the right range to allow for Alnylam to survive and remain an independent company.

A hostile takeover attempt as an alternative explanation? On paper, this would probably make most sense for Alnylam, but I don’t think so.

11 comments:

Anonymous said...

Thanks for translating so succinctly this history for now I understand much better what has led to this unfortunate situation.

Anonymous said...

Many thanks for this post, really helps understanding the significance of the arguments over this IP.

Anonymous said...

Hey Dirk

What countries was it filled in exactly?

Dirk Haussecker said...

I can't answer that question easily. If I wanted to find out, I'd probably have to go back to the priority documents and then see which patent applications in other countries claim priority to them. Alternatively, I'd have to go to the websites of the European patent office etc and see which patents have been issued to Semple and Wheeler. There is probably software out there that can speed up this process.

Anonymous said...

Dirk, I have you considered that Alnylam may be raising capital to make an offer for Benitec? This would fix the the other problem that they have with the Australian CSIRO.

Dirk Haussecker said...

Which problem does Alnylam have with CSIRO?

Anonymous said...

As I understand it, CSIRO are challenging the validity of Fire and Mello based on prior art submitted through the Benitec appeal process. If they are successful, Alnylam will have the rug pulled out from underneath it.

Dirk Haussecker said...

Alnylam already claims (not in the patent sense) that Fire-Mello is of no relevance for siRNA Therapeutics, and based on my reading of the issued claims in Fire-Mello, I have to agree with them. However, as you say, CSIRO could be a different story depending on their issued claims. If you know of some relevant claims, please post them here or send them to me by email.

Anonymous said...

Dirk, I do not believe that the CSIRO have actually lodged any request for a review of Fire in any jurisdiction. I believe they are still preparing a case and so the details are not yet in the public domain.

Anonymous said...

What is CSIRO claims? Can the claims so dominant to challenge Fire-Mello and Alnylam IP estate?

Anonymous said...

As I understand it, the claim is based on work done by Prof Peter Waterhouse, now of the University of Sydney. In the Benitec appeal about the Graham patent, Benitec successfully cited art work by Water house that pre-dates Fire. The CSIRO now believe they have a case to challenge Fire.

As Benitec has the exclusive right to the human RNAi patents from CSIRO, a takeover of Benitec by Alnylam would negate any threat.

By Dirk Haussecker. All rights reserved.

Disclaimer: This blog is not intended for distribution to or use by any person or entity who is a citizen or resident of, or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation or which would subject the author or any of his collaborators and contributors to any registration or licensing requirement within such jurisdiction. This blog expresses only my opinions, they may be flawed and are for entertainment purposes only. Opinions expressed are a direct result of information which may or may not be accurate, and I do not assume any responsibility for material errors or to provide updates should circumstances change. Opinions expressed in this blog may have been disseminated before to others. This blog should not be taken as investment, legal or tax advice. The investments referred to herein may not be suitable for you. Investments particularly in the field of RNAi Therapeutics and biotechnology carry a high risk of total loss. You, the reader must make your own investment decisions in consultation with your professional advisors in light of your specific circumstances. I reserve the right to buy, sell, or short any security including those that may or may not be discussed on my blog.