I’ll admit, I’m an RNAi hater, but more on that later. Alnylam (NASDAQ:ALNY) and Takeda announced Tuesday that they have formed an alliance in RNAi therapeutics covering the fields of oncology and metabolic disease. Here are the deal details:
Takeda becomes Alnylam’s strategic partner for RNAi therapeutics over a five-year period $150M in upfront and near term tech transfer payments Potentially valued at >$1B dependent on R&D milestones / clinical development Alnylam obtains opt-in options to co-develop and co-commercialize Takeda RNAi therapeutic programs in the U.S. market on a 50-50 basis. The scope of the partnership can be expanded to include additional fields with a $50 million per field expansion payment. Alnylam obtains opt-in options to co-develop and co-commercialize Takeda RNAi therapeutic programs in the U.S. market on a 50-50 basis.
Interesting deal at an interesting time for Takeda. They have been on a shopping spree recently (see: Millennium) tying to offset the coming generic competition of Prevacid and Actos and have not been shy about waving cash around. I’m not familiar with the patent space of RNAi therapeutics in terms of methods or even composition of matter but I’m guessing this might justify price tag. Also, based on the number of alliances (including ones with: (NYSE:GSK), Novartis (NYSE:NVS), Roche, Biogen (NASDAQ:BIIB) and Medtronic (NYSE:MDT)), it seems that others think Alnylam has something special.
To me, RNAi seems to be one of those technologies that is always, “just around the corner” and, over the last 5 years has always been the next hot technology. Like anti-sense DNA oligos, RNAi has been around for a while and so far has proved to be a really nifty research technique with not a whole lot of therapeutic benefit. This is why the deal doesn’t make a lot of sense in the vein of filling pipeline needs; Takeda needs late stage compounds now, not a decade from now. Though relatively, $150M upfront isn’t a terribly large amount to pay when you’re sitting on $20B in cash for the sole purpose of M&A / alliances.
Ultimately, even though I’m an RNAi hater, this is a decent deal for both sides. Takeda gets to share a slice of “next great technology” pie while Alnylam investors can further justify their investment in a drug company with ~$1B market cap, in spite it having only one product in clinical development.