Moderna joins the RNA parade with chunky Alexion deal

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Moderna Therapeutics sealed what will probably be one of the top licensing deals of 2014 before the first fortnight has ended: a pact worth $100m up front to deliver rare disease candidates to the maker of Soliris, Alexion Pharmaceuticals.

Following a 2013 cash bonanza that saw Moderna sign a nine-figure deal with AstraZeneca and raise a similar amount from a series B round, the Massachusetts-based group should be sufficiently financed to advance both its partnered and proprietary pipeline of mRNA therapies into the clinic. As activity around RNA therapeutics picks up, venture-backed Moderna could be well positioned to strike more deals, although much remains to be proven about its approach (Alnylam lives the biotech dream as big pharma returns to RNAi, January 13, 2014).

Everybody wants it

The deal gives Alexion the option to license up to 10 products from Moderna’s development platform, which aims to use mRNA to build therapeutic proteins in response to inherited disorders or conditions in which missing or defective proteins are the cause, such as haemophilia. Moderna claims to have developed a technology that allows mRNA to evade immune response and allow in vivo production of active, stable intracellular and secreted proteins.

So far, not a single proprietary or partnered candidate has entered the clinic. The group claims eight fully owned projects in preclinical work in inherited conditions, oncology supportive care, haemophilia and blood factors, and through a $25m contract with the US government’s Defense Advanced Research Projects Agency (DARPA) to develop countermeasures to biological agents.

In a short time the technology has been attractive enough to draw $150m in venture backing and $365m in partnership cash to support R&D. As part of the Alexion deal, the Connecticut-based partner also took a $25m stake in Moderna, which will only strengthen the company’s cash position.

As partnerships go, the Alexion deal is a big one, but is still overshadowed by the AstraZeneca pact signed last year, which drew $240m to develop up to 40 candidates in cardiometabolic disease and oncology – analysts praised the novelty of the approach even as they acknowledged the long clinical pathway ahead (Astra’s near-record research deal gets lost in the noise, March 21, 2013). That deal put Moderna on the map as this was one the first moves by Astra chief executive, Pascal Soriot, to fill an emptying pipeline.

Strategy options

Unlike Astra, Alexion has no immediate need to fill a pipeline as Soliris has patent protection at least through 2021. Soliris is the world’s most expensive drug: it is a $400,000 antibody used to treat paroxysmal nocturnal haemoglobinuria (PNH), a condition that affects perhaps 6,000 Americans. Thus Alexion is in about as secure a competitive position as a biotech could hope for.

The $3.6bn in sales Soliris is forecast to generate in 2018 has produced the opposite problem, however – EvaluatePharma forecasts the group taking home $1.8bn in profit that year. Putting cash to good use is likely a priority for Alexion, and beefing up its pipeline of six clinical projects is a sensible place to put its money if growth past 2021 is a goal.

Alexion investors did not give the deal a ringing endorsement – shares fell 3% to $130.61 yesterday.

Compared with Alexion’s likely strategy, Moderna’s endgame is a little harder to determine. With the deal flow it has experienced and funds it has attracted its venture backers might increasingly hope for an exit in the near future. If a clean trade sale is the goal, its management should be cautious about encumbering the group with many more deals on the scale of Alexion or Astra.

To contact the writer of this story email Jonathan Gardner in London at jonathang@epvantage.com or follow @JonEPVantage on Twitter

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