Alnylam Pharmaceuticals, a Cambridge, MA-based developer of RNA-interference drugs, said today that it sees a new business opportunity in using its gene-silencing technology to increase the output of biomanufacturing processes. The company, which has already successfully licensed its RNAi technology for drugs, is looking to make additional money from its science by licensing it for manufacturing many types of biotech drugs.

The company (NASDAQ:ALNY) is presenting data today at its R&D day in New York that support the use of RNAi to silence certain genes in Chinese hamster ovary cells, which are used in biomanufacturing. Alnylam’s data show that the RNAi technology improved the viability of the cells by 40 to 60 percent, compared with untreated cells. The firm used RNAi to switch off certain genes that control metabolism in the cells, as well as genes involved in a cellular self-destruct mechanism.

An internal group at the company called Alnylam Biotherapeutics is advancing the application of RNAi technology in biomanufacturing. The firm, which plans to retain ownership of this use of the technology, says it could improve the production of existing biotech drugs, new biologics, and copies of biological treatments, known as “biosimilars” or “biogenerics.”

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Alnylam Pharmaceuticals (NASDAQ:ALNY) had more than $470 million in the bank as of the last official count at the end of June, so it struck me as odd that the Cambridge, MA-based developer of gene-silencing drugs was a presenter along with dozens of cash-starved biotech startups at the MassBio Investors Forum in Boston yesterday. Alnylam and its poorer biotech counterparts made some interesting buzz.

While Alnylam is richer than the vast majority of biotech firms, the company still appears to have a thirst for new alliances. The firm, which is a leading developer of RNA-interference (RNAi) drugs, already counts Roche, Novartis, Takeda, and Medtronic among its bevy of collaborators. And Barry Greene, president and chief operating officer of Alnylam, told the folks at MassBio to expect more major alliances to surface in the coming months—the company told investors in January that it aimed to close at least two more major new alliances in 2009.

Alnylam dropped some hints yesterday about its plans to spin off another startup akin to Carlsbad, CA-based Regulus Therapeutics, which was founded by Alnylam and Carlsbad, CA-based Isis Pharmaceuticals (NASDAQ:ISIS) as a joint venture for developing microRNA drugs in 2007. Alnylam CEO John Maraganore told Xconomy back in February about a number of other technologies inside Alnylam with spinoff potential, like methods for enhancing stem cells for regenerative medicines, or immune-system compounds called adjuvants, that can boost the potency of vaccines.

Greene said there could be another “Regulus-like” deal in the works at Alnylam. When I pressed him for details after his presentation, he demurred yet did reiterate that his company, which is already pursuing the development of biological drugs that mute disease genes, has an interest in doing more in the vaccine and stem cell fields. While this mysterious “Regulus-like” deal now exists as speculation, it could be interesting to see how Alnylam finds new ways to reap value from its existing portfolio of drug candidates or RNAi patents. Such joint ventures enable companies to explore new areas without taking on all the financial risks associated with drug development on their own. For sure, Greene’s comments will likely stir up gossip about potential deals in the works at Alnylam.

Besides Alnylam, other Boston-area life sciences firms that made pitches at MassBio appeared to be making progress. Here are several tidbits that I gathered about EyeGate Pharma, Cequent Pharmaceuticals, and other firms during my travels at the annual investor conference:

—Stephen From, CEO of Waltham, MA-based EyeGate Pharma, said his existing venture investors have committed …Next Page »

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(Updated: 1:20 pm ET with new commentary from Alnylam’s CEO.)

Alnylam Pharmaceuticals and Tekmira Pharmaceuticals announced today that they have teamed up to develop new particles to deliver RNA-interference drugs. Their joint effort aims to identify new ways to overcome the hurdles that the gene-modulating drugs must clear to reach diseased cells deep in the body.

The two-year collaboration deal gives Cambridge, MA-based Alnylam (NASDAQ:ALNY), which is funding the effort, exclusive rights to new discoveries stemming from the research. Alnylam can also sublicense the discoveries to its partners, according the firms. As part of the agreement, Vancouver-based Tekmira (TSX:TKM) can use the discoveries for some of its own RNAi treatment programs. The research—which will take place at the University of British Columbia and at a new firm called AlCana Technologies—will focus on the discovery of new positively charged fatty molecules called cationic lipids for delivering RNAi therapeutics. No financial details of the research deal were revealed.

The problem with RNAi therapeutics, which have shown great promise in turning off disease-related genes in research studies, is that they can be chewed up by enzymes or encounter other hazards in the body before they reach the cells involved in diseases. While Alnylam has a substantial stockpile of RNAi molecules that have shown promise in treating the root causes of diseases, the company has had to turn to others such as Tekmira for the molecular vessels that can carry such therapies into cells in the body. (Luke explained the hurdles of RNAi drug delivery when he profiled Tekmira in May.) The particles that Alnylam and Tekmira hope to develop in the new research effort will allow them to deliver RNAi drugs to more parts of the body than currently available particles can reach, as well as providing other benefits.

“We are excited to participate with Tekmira to support research efforts that will focus on the discovery of novel lipids for nanoparticle-based formulations of RNAi therapeutics that we believe will have the potential to push the frontiers of systemic delivery to further improve potency and broaden biodistribution,” said Barry Greene, president and chief operating officer of Alnylam, in a statement.

Alnylam is already using Tekmira’s lipid nanoparticle technology to deliver one RNAi therapeutic, which is now undergoing an early clinical trial for blocking two key genes linked to liver cancer. And Tekmira is using the technology for delivering an RNAi drug—which is also in an initial clinical trial—that targets a protein known as ApoB that carries LDL, or “bad,” cholesterol through the bloodstream.

Alnylam also has other drug-delivery agreements underway that have not been announced yet, said Alnylam CEO John Maraganore, in an interview. He noted that his company has the capabilities to deliver short interfering RNA (siRNA) molecules to organs such as the heart and the pancreas, yet it has struck research deals with firms such as Tekmira and AlCana—which he said is a startup recently launched by former Tekmira scientists—to improve the potency and distribution of the firm’s drugs in the body. (This paragraph was added to the original story to provide further details obtained in the interview with Maraganore late this morning.)

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Famed scientist Phil Sharp’s retirement from the board of directors at Biogen Idec (NASDAQ:BIIB) leaves the board without what was perhaps its leading scientific voice, but his departure doesn’t leave activist investor Carl Icahn with much of an opening to seize greater control over the company.

When I reported last week that Sharp had stepped down from the board of Biogen, which he co-founded in 1978, it was still unclear whether or how Sharp’s retirement would impact the balance of power at the Cambridge, MA-based biotech company, which Icahn is on a quest to take over. It turns out that Biogen’s board of directors will decide whether or not to find someone to take Sharp’s seat on what is now a 12-member board of directors—but the board wouldn’t have had this power had a vote that took place at Biogen’s annual shareholders meeting on June 3 turned out differently.

At the meeting, Biogen shareholders rejected an amendment that Icahn proposed to the company’s bylaws, which would have set the number of seats on the board of directors at 13. During the proxy battle leading up to the meeting, Biogen, which also has significant operations in San Diego, advised shareholders to reject that amendment because it would remove the board’s power to determine how many directors there should be.

As of this writing, there were no indications one way or another from Biogen about whether its board would seek a replacement for Sharp.

“There is no obligation to fill his seat, as you may recall from following our proxy contest,” Biogen spokeswoman Jennifer Neiman told me, “so the board will make that decision based on …Next Page »

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Cambridge, MA-based Alnylam Pharmaceuticals (NASDAQ:ALNY) says that Swiss drug giant Novartis has opted to extend the companies’ research collaboration related to RNA interference treatments for a fifth year. The extension means that Novartis will continue to fund certain research and development efforts at Alnylam through October 2010. “We view this development as very positive for Alnylam because… it provides the company with additional non-dilutive R&D funding, and… it signals Novartis’ continued interest and investment in the RNA therapeutics space in general, and in Alnylam specifically,” wrote Simos Simeonidis, a biotech analyst for investment firm Rodman & Renshaw in New York, in a note to investors.

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Biotech stalwarts in two of Xconomy’s home regions, Isis Pharmaceuticals (NASDAQ: ISIS) of Carlsbad, CA, and Alnylam Pharmaceuticals (NASDAQ: ALNY) of Cambridge, MA, said today that they’ve agreed to share techniques devised by Isis for using single-stranded RNA interference (ssRNAi) to silence genes in the body that cause disease.

Under the agreement, Alnylam will owe up to $31 million to Isis in the form of upfront payments, milestone-based payments, and royalties on any drugs that may be developed using the technology. That’s relative pocket change for Alnylam, which has a comfortable $500 million in the bank.

Isis concentrates on developing drugs that make use of “antisense” molecules that lock onto messenger RNA and destroy it before it can be translated into proteins. Alnylam, meanwhile, is a leader in research on therapeutic applications of RNA interference (RNAi), in which small pieces of RNA interrupt other parts of the protein manufacturing process. The two companies have a long relationship—in 2007, for example, they pooled their intellectual property in an area called microRNAs to form Carlsbad, CA-based Regulus Therapeutics.

Most RNAi research to date has focused on using double-stranded molecules to turn off specific genes, and Alnylam has amassed a strong patent portfolio in this area. But some researchers believe that single-stranded RNAi molecules may be easier to administer as drugs than double-stranded molecules. Isis discovered ways to design chemically modified, single-stranded, RNA-like molecules as part of its antisense research—but Alnylam, with its expertise in RNAi therapeutics, is in a better position to develop and test RNAi drugs based on the insights.

In today’s announcement of the deal, Stanley Crooke, chairman and CEO of Isis, called Alnylam “the perfect partner” to help broaden applications of ssRNAi technology. “We are confident that working together in RNAi gives ssRNAi technology the best chance for success,” Crooke said.

John Maraganore, CEO of Alnylam, said in the announcement that his company would continue to focus primarily on double-stranded RNAs, but that the collaboration with Isis on single-stranded RNA-based drugs will “strengthen [Alnylam's] overall efforts.”

“We’ve recognized since Alnylam’s beginning that Isis is the leader in all aspects of antisense technology,” Maraganore said. “We’ve had a mutually beneficial collaboration based on their innovation and patents in the field of double-stranded RNAi drugs, and we’ve been impressed with their continued expansion of this innovation to single-strand RNAi approaches.”

The agreement would seem to be a sweet deal for Isis. All of the funding for the joint ssRNAi research—up to $3 million per year, according to the companies—will come out of Alnylam’s pocket. Alnylam will also pay Isis $11 million upon the signing of the deal and an additional $10 million within 18 months—or even sooner, if Alnylam can demonstrate that the molecules interrupt the production of proteins in rodents.

Another $5 million payment will be triggered if Alnylam can achieve efficacy in primates, along with a final $5 million if an ssRNAi drug makes it to human clinical trials. And if Alnylam licenses drugs based on the technology to other companies, Isis will get 50 percent of the license payments.

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“Biotechnology” and “water purification” aren’t usually themes that you hear mentioned in the same sentence. There are plenty of biotech startups aiming to use cutting-edge molecular approaches like RNA interference (RNAi) to develop profitable new drugs—but fewer people, if any, talk about how these technologies might help people in developing countries where safe drinking water is in short supply. Indeed, at first blush, the idea that molecules as fragile as snippets of RNA could be used on an industrial scale to kill pathogens in water seems farfetched.

But that’s exactly what a Somerville, MA-based startup called 349Q hopes to do. In stealth mode until last week, the company has now begun talking to reporters about its plans, which call for identifying genes common to the main species of dangerous microbes found in water, then engineering viruses that could manufacture RNA strands capable of shutting down the microbes’ basic metabolic processes. The company’s technology, for which it has obtained provisional patents, grows out of work in the laboratory of Claudia Gunsch, a microbial engineering expert in the Civil and Environmental Engineering department at Duke University in Durham, NC. Mark Modzelewski, a cleantech and venture capital veteran based in Somerville (and an Xconomy guest essayist), is handling the company’s fundraising and business development.

With supplies of fresh, clean water chronically limited around the world, water purification is obviously an area crying out for new technological solutions. In a Technology Review interview published last week, prominent Silicon Valley venture capitalist Steve Jurvetson called water purification “a trillion-dollar opportunity” and said the water industry exhibits “probably the biggest mismatch between a screaming, enormous market and a lack of technology innovation I’ve ever seen.”

There’s no shortage of technologies for purifying contaminated water—they include distillation, carbon filtration, membrane filtration, ultraviolet irradiation, reverse osmosis, and ion exchange. But all have their shortcomings, ranging from high cost and high energy consumption to low flow rates.

Modzelewski says he has spent years on the lookout for a new water purification technology that merits a venture capital investment. Over breakfast last week, he laid out his criteria for such a technology: “It needed to cost the same as anything we have now; it needed to be very easy to attach to current water-treatment systems, without requiring any expensive retrofitting; and it had to be completely different.”

The idea that RNA interference might provide a solution is new, radical, and largely untested. A lot of the drama in pharmaceutical research on RNA interference is around how to shepherd RNA molecules past all the blood-borne enzymes that would normally chew them up and deliver them safely into cells, where they can then disrupt the activity of targeted genes. Delivering the molecules inside the body has been such a preoccupation for researchers, according to Duke’s Gunsch, that there wasn’t any data on whether they could be disseminated to microbes through water.

That’s the experiment Gunsch and Sara Morey, a PhD candidate in her lab, first tried last year. They filled a sample of water with a strain of fungus that had been engineered to produce a particular yellow protein. They then added RNA snippets that had been custom-sequenced to silence the gene responsible for the protein’s production. The water’s color changed instantly—indicating that …Next Page »

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Alnylam Pharmaceuticals (NASDAQ:ALNY), a Cambridge, MA-based developer of RNA-interference (RNAi) drugs, says that the European Patent Office will grant the firm a patent related to its “Tuschi I” patent series covering the use of double-stranded RNA molecules for RNA-interference. The patent, which the company expects to be issued in four months, covers claims such as the use of RNAi to reduce expression of a gene with double-stranded RNA molecules of 21 to 23 nucleotides in length.

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San Diego-based Traversa Therapeutics today announced it has raised $5 million in a Series B financing round; Morningside Venture Investments led the deal, which was joined by Mesa Verde Venture Partners and existing investors. The company says the money will help it move its RNAi-based treatments for cancer into clinical trials. Founded in mid-2006, Traversa previously raised $2 million in a round led by San Diego Tech Coast Angels.

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It was a quiet week for deals in the Northwest, with a few partnerships formed in software, biotech, and intellectual property.

—Bothell, WA-based MDRNA (NASDAQ: MRNA), a developer of RNA interference technology for drug development, agreed to license its technology non-exclusively to Novartis in exchange for $7.25 million in upfront fees, as Luke reported. MDRNA also signed a separate deal that gives Novartis an exclusive period in which to form a larger R&D collaboration with MDRNA. Terms of that deal were not disclosed.

—Intellectual Ventures, the Bellevue, WA-based invention firm, inked an agreement with the Indian Institute of Technology-Bombay to license some of the university’s technologies, and to work with its researchers on commercialization strategies. Financial terms were not announced. Intellectual Ventures has similar deals in place with other institutes in Asia, but IIT-Bombay is a particularly prestigious university specializing in electronics, software, and materials, and the partnership epitomizes the firm’s broader strategy to support the invention process around the world—and profit from it.

—Seattle startup Ontela, a maker of photo-sending software for camera phones, has teamed up with T-Mobile to offer its service via the photo-sharing website Photobucket. T-Mobile subscribers can sign up to have their pictures sent automatically from their BlackBerry smartphone or other handheld device to the photo site. Ontela’s software is now available to about half of all U.S. mobile-phone subscribers, and comes pre-installed on four of the top five handset manufacturers.

—Seattle-based Evri, a startup that makes novel Web browsing software, formed a partnership with The Times of London to provide a widget that recommends related articles when a reader clicks on a story of interest. Financial terms were not given. This deal follows a similar one announced last month with the Washington Post, and is part of Evri’s effort to build an audience for its service, which tries to understand connections between people, products, and other entities on the Web and present the info in a useful way. (This news was dampened later in the week when it was reported Evri laid off one-fourth of its staff.)

—Luke reported that Geospiza, a Seattle developer of software that helps researchers sort through mounds of genomic data, received a two-year, $1.1 million grant from the National Institutes of Health, as part of a collaboration with The HDF Group. The effort will support biological software applications that use Hierarchical Data Format, an advanced data capability made to handle demanding and complex tasks like studying genomes and monitoring climate change.

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[[Correction: see editor's note below]] It’s a difficult time for a brand new biotech firm to be drumming up interest in a novel approach to delivering drugs, with investors snubbing so many firms with drugs already in clinical trials. But the market conditions haven’t stopped Elisabet de los Pinos, a former fellow at the MIT Sloan School of Management, from raising more than $3 million in an initial financing in recent months for her new company Aura Biosciences.

Aura, which has an office at an incubator in Cambridge, MA, plans to commercialize drugs based on discoveries at European research institutions. The firm’s particles, made of nano-sized protein shells, could improve delivery of approved cancer drugs by limiting their affects on healthy cells. The startup also sees the ultra-tiny particles as potential carriers of RNA-interference treatments, which firms have had difficulty delivering to tissues deep in the body. The firm wants to license its technology for RNAi drug delivery and develop it internally for treating cancer.

The biotech firm, which still needs to complete animal studies before it can advance into human clinical trials, wants to put the targeting capabilities of its technology to the test in treating pancreatic cancer, says de los Pinos, the startup’s president and CEO. [[Editor's note: this paragraph and the headline have been corrected to say that Aura is developing drugs to treat pancreatic cancer, not prostate cancer, as was initially reported.]]

Aura’s nano-sized protein shell—which can be engineered to mimic how certain viruses can elude the immune system and attach to specific cells—may be able to carry cancer-killing drugs directly to pancreas tumor cells while avoiding healthy cells. The firm’s technology may also be applied to other types of cancer. Earlier this month the firm revealed that it licensed peptide technology from British biotech firm Cancer Research Technology, and de los Pinos says the peptides would be used on the surface of Aura’s particles to target specific cancer cells.

Aura chairman Edmundo Muniz, a former executive of drug giant Eli Lilly and the CEO of cancer drug developer Tigris Pharmaceuticals, compares Aura’s drug particles to long-range missiles.

“Aura’s technology mimics an intercontinental ballistic …Next Page »

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Regulus Therapeutics, the fledgling biotech firm developing microRNA-based drugs, wasn’t kidding when it told Xconomy earlier this year that it planned to gain a more independent corporate charter and raise a significant round of financing. The Carlsbad, CA-based startup says this morning that it has raised $20 million in a Series A round of financing; Alnylam Pharmaceuticals and Isis Pharmaceuticals each contributed $10 million in the deal.

Regulus—which was formed in September 2007 as a joint venture of Cambridge, MA-based Alnylam (NASDAQ:ALNY) and Carlsbad-based Isis (NASDAQ:ISIS)—has also changed its corporate status from an LLC to C-corporation to enable the firm to raise money from other investors down the road. Luke wrote about Regulus’s designs to become independent of Alnylam and Isis back in January, after he caught wind of the plan at the JP Morgan Healthcare Conference in San Francisco.

“This equity financing, when combined with last year’s significant [$20 million] upfront payment made by GlaxoSmithKline as part of our partnership, gives Regulus cash that we expect will last at least through 2011,” Kleanthis Xanthopoulos, CEO of Regulus, said in a statement.

The firm’s partnership with London-based drug giant Glaxo provided additional validation of the startup’s work toward developing a host of treatments for heart disease, diabetes, and other illnesses by targeting microRNAs. MicroRNAs are short chains of nucleotides that can impact whole networks of genes simultaneously.

Regulus operates with intellectual property from Alnylam, a leading developer of RNA-interference drugs, and Isis, which is commercializing antisense RNA drugs. Luke talked recently to Alnylam CEO John Maraganore about the success of the Regulus spinoff and Alnylam’s desire to repeat the process of launching new companies to commercialize technologies that are related to, but different from, RNAi, a technique for turning off specific genes one at a time.

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RXi Pharmaceuticals (NASDAQ:RXII), a Worcester, MA-based developer of RNA-interference drugs, says that is has agreed to sell up to $25 million of its common stock to YA Global Investments. The deal gives RXi—which was co-founded by Nobel Laureate Craig Mello and featured in a story that Luke wrote last year—the option to sell newly issued stock in increments of up to $500,000 to YA over the next two years at the lowest weighted average price of its shares over five straight trading days, less a 5-percent discount, according to the company.

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Cambridge, MA-based Alnylam Pharmaceuticals and Lexington, MA-based Cubist Pharmaceuticals announced a major deal today in which Cubist will pay Alnylam $20 million immediately, and up to $82.5 million in milestone-based payments down the road, in return for the right to market RNAi-based drugs that Alnylam is developing to treat the deadly respiratory syncytial virus, or RSV.

As we reported back in February 2008, Alnylam (NASDAQ: ALNY) obtained encouraging results from a Phase II clinical study of its drug ALN-RSV01, which uses a tactic called RNA interference (RNAi) to shut down a gene that’s hijacked in infected lung cells to let RSV replicate. When the drug was administered intranasally to otherwise healthy patients, researchers detected a 40 percent reduction in RSV infection rates. The company is now studying the drug’s efficacy in adult lung-transplant patients.

Alnylam has already inked a similar deal with Kyowa Hakko Kirin Co. of Japan to market ALN-RSV01 in Asia, assuming that it proceeds to the level of regulatory approval. The deal announced today gives Cubist (NASDAQ: CBST) the right to distribute Alnylam’s RSV drugs everywhere else, with Cubist and Alnylam splitting the development costs and profits 50/50 in North America and arranging a milestone- and royalty-based license for the rest of the world.

Cubist specializes in the development of drugs for infectious diseases, especially drugs delivered in hospital settings. Its lead product is daptomycin (Cubicin), an injectable drug used to treat skin infections caused by bacteria such as Staphylococcus aureus, including the methicillin-resistant strain known as MRSA.

Alnylam CEO John Maraganore said in a statement that Cubist is “a like-minded organization” that can bring “additional critical mass” to the development of ALN-RSV01 and/or second-generation RNAi therapies for RSV. Maraganore also said that the Cubist payments will give Alnylam “additional financial flexibility” to invest in RNAi-based therapies for conditions other than RSV.

“This is a good day for Alnylam,” said Simos Simeonidis, a senior biotechnology analyst at research firm Rodman & Renshaw, in a press statement on the deal today. “They get solid market rate and a specialist partner for a compound they had guided they will partner. In addition, they show they are continuing to attract interest from pharma and biotechs and are able to execute deals with favorable terms.”

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I was initially skeptical when I first heard about biotech startup AiRNA Pharmaceuticals and its new approach to RNA-interference (RNAi already gets lots of attention for its ability to silence genes for cancer and many other diseases). The Norwood, MA, firm claimed in a press release that its next-generation RNA-interference (RNAi) technology is “superior” to other RNA-blocking methods. That would include the gold-standard approach, small interfering RNA, used by a heavyweight in the field, Alnylam Pharmaceuticals (NASDAQ:ALNY), among others.

So my internal hype alarm rang when I saw AiRNA’s claim to superiority. But then I talked to the inventor, Chiang Li, chief executive of Norwood-based biotech firm Boston Biomedical. He convinced me that AiRNA, which is a spin-off of Boston Biomedical, could be on to something big.

AiRNA is developing so-called asymmetrical interfering RNA (aiRNA)—made public in the December issue of Nature Biotechnology—which uses a molecule of 15 base pairs in length. This structure is different than small interfering RNA (siRNA) molecules, which are 19-21 base pairs long. Cambridge, MA-based Alnylam, for one, has built a company with a market cap approaching $1 billion around siRNA technology.

“[Asymmetrical interfering RNA] is essentially the next generation of the technology that can silence genes but with improved gene-silencing properties,” Li says. “It’s the same as siRNA, in that it can theoretically target almost any disease gene.”

How does AiRNA’s approach stack up against Alnylam’s well-known technology? The inventors of aiRNA say that their asymmetrical molecules, which were tested in mammalian cells in the study published by Nature Biotech, have fewer unintended effects on non-targeted genes, better silencing efficiency and duration, and will cost less money to make than the longer siRNA molecules.

AiRNA isn’t the first startup to come along with an alternative to siRNA. Dicerna Pharmaceuticals, based in Watertown, MA, believes that its longer molecules of 25-35 base pairs work earlier in the gene-silencing process and for longer durations than other RNAi methods. (Luke wrote about Dicerna’s technology and latest financing earlier this year.)

Still, it’s early days for AiRNA and its aiRNA technology. Li says that the startup operates with a small science team, which he supervises, in a separate lab at the same building as Boston Biomedical’s office. And the company has just begun to raise funds.

Li is no newcomer to the gene-silencing field—or the biotech industry, for that matter. He’s a co-founder and director of Cequent Pharmaceuticals, a Cambridge-based biotech startup developing so-called transkingdom RNAi for gastrointestinal disorders. Cequent’s RNAi technology—discovered by Li and others in his lab at Beth Israel Deaconess Medical Center, Harvard Medical School in Boston—uses modified bacteria to deliver and produce RNAi molecules in cells.

Li is also the scientific founder of ArQule, (NASDAQ:ARQL), a Woburn, MA-based developer of cancer treatments, where he served as chief scientific officer. He led the spin-off of Boston Biomedical from ArQule in January 2007. Boston Biomedical is focused on small molecule drugs to target cancer stem cells.

“I believe that [aiRNA] is actually a big breakthrough in the field,” says Johannes Fruehauf, vice president of research at Cequent. Fruehauf was among the researchers who discovered transkingdom RNAi in Li’s lab a Beth Israel. Fruehauf says that AiRNA’s and Cequent’s technologies are distinct from each other, and there are no plans to combine them.

AiRNA’s initial focus will be to develop RNAi drugs for cancer, inflammation, and infectious diseases, Li says.

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It’s a big day for the Massachusetts Life Sciences Center, the quasi-public agency that manages the state’s plan to invest $1 billion in its life sciences industry over the next 10 years. New Jersey-based medical products giant Johnson & Johnson (NYSE:JNJ) has become the first company to join the agency’s new Corporate Consortium intended to match state dollars with private-sector funds to support life sciences startups and researchers in the Bay State, the agency says.

Separately, the agency announced $3.7 million in grants to fund collaborative research between scientists and companies in the commonwealth. (Read on for details.)

Johnson & Johnson’s Corporate Office of Science and Technology is chipping in $500,000 to match agency funding awards over the next two years—not a huge sum of money for the multibillion-dollar company, but the contribution attaches a major brand in the life sciences industry to the new consortium. Also, the Life Sciences Center hopes that more industry players will follow J&J’s example.

“We are just incredibly excited,” Susan Windham-Bannister, CEO of the center, told me today. “We’re really hoping that [J&J] will be a charter member of a larger fund.”

Windham-Bannister says that her agency will use the J&J money to enhance the agency’s new Life Sciences Accelerator fund and other funding programs. The Accelerator fund aims to provide seed money to life sciences startups in form of equity investments, grants, or loans. She says those funds could help startups clear hurdles to getting seed-stage funding, while reducing the risk for traditional investors such as venture firms in backing the young companies.

For its contribution, J&J gets to sit in on meetings of the Life Sciences Center’s investment sub-committee that reviews funding requests from startups and researchers. But the company won’t have voting rights on the sub-committee and won’t gain first rights of refusal or equity stakes, Windham-Bannister says.

The J&J funds give a small boost to the Life Science Center’s current budget. The state Legislature cut $10 million from the center’s $25 million annual budget this fall as part of a broader effort to reduce state spending. Windham-Bannister says that $12 million of the center’s remaining $15 million is slated to support grant programs for workforce development and life sciences research, as well as the new fund to seed startups, among other efforts.

Authorized in a bill passed in June, the 10-year plan to invest $1 billion in the state’s life sciences sector provides $500 million to fund infrastructure to support the industry, $250 million in science grants and small business assistance, and another $250 million in tax credits.

Here is a list of the three-year collaborative research grants …Next Page »

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Alnylam Pharmeceuticals (NASDAQ:ALNY), a Cambridge, MA-based developer of RNA-interference (RNAi) drugs, says it has formed a collaboration with the University of California, San Francisco, to explore the use of RNAi therapeutics to treat eye tumors. In previous research, scientists have found that RNAi treatments silenced a gene linked to the survival of eye tumor cells.

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Cambridge, MA-based Alnylam Pharmaceuticals (NASDAQ: ALNY) said today it has acquired a load of intellectual property that includes more than 100 active patent applications and 16 issued patents worldwide from Langhorne, PA-based Nucleonics. The intellectual property is meant to strengthen Alnylam’s grip on its right to develop drugs using RNA Interference technology, or gene silencing. Terms of the purchase weren’t disclosed, although Alnylam said it still expects to finish the year with more than $500 million in cash and investments, as it previously forecast.

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If Aileron Therapeutics is on the right track, it will turn “stapled peptides” into a biotech industry buzzword along the lines of RNA interference. The Cambridge, MA-based company says its technology, like RNAi, is starting to show in animal tests that it can work against diseases where conventional drugs don’t.

This company, whose name is inspired by the hinged wing flaps that stabilize an aircraft, got its start in 2005. It began with technology from the late Stanley Korsmeyer and Loren Walensky, a pair of biologists from Harvard Medical School and the Dana-Farber Cancer Institute, combined with chemistry contributions from Gregory Verdine of Harvard University. Aileron has raised $20 million since inception from the venture investing arm of Novartis and Apple Tree Ventures. Aileron’s aim is to develop what it calls “stapled peptides” as a new class of drugs that block all sorts of interactions between proteins in the body that can’t be affected by conventional small-molecule chemicals or genetically engineered protein drugs.

“If you look at the pharmaceutical industry today, there are about 10,000 diseases, and 500 to 600 targets that are druggable with conventional small molecules,” says Aileron CEO Joe Yanchik. “We believe we can open up opportunities for thousands of new targets.”

Conventional small-molecule chemical drugs, like Pfizer’s atorvastatin (Lipitor) usually need “a nice deep pocket” on the targeted protein for the compound to settle into, Yanchik says. The problem is that only about one-tenth of proteins have this kind of pocket, while many more have long, flatter pockets inside that are “like a hot dog bun, for lack of a better term,” Yanchik says.

Engineering peptides, which are small protein fragments, to have better properties than other drugs is not a new idea—they are critical players inside cells, and have been studied for decades. A few peptide drugs are already on the market, such as Amylin Pharmaceuticals’ and Eli Lilly’s exenatide (Byetta) for diabetes. But most peptides have no chance as drugs, because once they get absorbed, they get chewed up by enzymes in the body that render them useless within minutes, Yanchik says.

Aileron’s insight is that the body’s enzymes can only do this when peptides—which are folded-up chain-like molecules—become unraveled. So it is designing ways to chemically “staple” the peptides into the proper folded shape. The end product, Yanchik says, will resist being chewed up by enzymes, will be efficient at penetrating cells, and will bind tightly and long enough to its target to have the intended effect.

The work is still in very early stages. Aileron hopes to bring forward its first drug candidate—likely a leukemia or lymphoma treatment—into clinical trials within one year, Yanchik says.(Indeed, Aileron recently got a paper published in Nature which showed it could identify a new target on cells to trigger apoptosis, or programmed cell death—a mechanism that firms like Genentech (NYSE: DNA) and Amgen (NASDAQ: AMGN), have been working on for years as a means of treating cancer.)

Unlike the compounds that many other companies are developing, Aileron’s drugs have the ability to hit a wide variety of targets on cells, which might make them potentially more effective than compounds that only hit one specific target Yanchik says. The trade-off, though, is that in theory Aileron’s drugs could have unforeseen side effects by affecting healthy cells. Company scientists haven’t seen those effects in animal studies, he says.

So far, Yanchik says he’s seen enough evidence that the drugs are potent and stable in animals to move ahead with an expansion plan. The company has been on a pace of hiring a new person once every three weeks this year, and now has a staff of 21. Yanchik is looking to raise more capital to expand the company, and is talking with pharmaceutical companies that might be interested in becoming partners. Drug companies are aware of the Aileron work, and likely trying to mimic some of it in their own labs, Yanchik says. “We believe we’re on the edge of something important here,” he says.

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Alnylam Pharmaceuticals has been getting by for years without a full-time chief scientific officer, but no more. The Cambridge, MA-based developer of drugs based on RNA interference (RNAi) technology said today it has hired Jack Schmidt, a former vice president at French drugmaker Sanofi-Aventis and a member of the global discovery leadership team there, to fill the role.

Schmidt, 58, will take over the role of chief scientist from Alnylam CEO John Maraganore, who has been pulling this double-duty for years. Schmidt received his postdoctoral training in immunology at the National Institutes of Health, before joining Merck Research Laboratories and then moving to Aventis. While at Aventis, he built up lots of experience with drugs at their earliest stages of development, helping introduce 15 new drugs into animal testing. Some of that was with conventional small-molecule pharmaceuticals, and some with protein-based drugs. Now he’s itching to help load up Alnylam’s pipeline with a third class of drug, RNA-based therapeutics that block the activity of problematic genes.

“This was an opportunity to get in on the ground floor on a major event in therapeutics,” Schmidt says.

Schmidt has been following the scientific literature on RNAi, or gene silencing, techniques for the past couple years, he says. He tried, but wasn’t able to get his bosses at Sanofi-Aventis to make a big push in the field as have other major pharma companies, like Merck and Roche. “Perhaps out of frustration, I continued to pursue this,” he says.

That led him to Alnylam (NASDAQ: ALNY). His job will be to help Alnylam move drug candidates ahead into clinical trials. He wouldn’t say how many candidates he expects to advance, although he predicted that an RNAi product will reach the market in five to seven years. Right now, Alnylam has just one such candidate in clinical trials, for respiratory syncytial virus. Delivery of the RNAi drugs has been a real bugaboo, but Schmidt says he has confidence in Alnylam’s strategy of forming partnerships around a variety of delivery techniques to hedge its bets.

“I wouldn’t take the job if I didn’t think this could be solved,” Schmidt says.

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