Arrowhead and GSK tie up to develop RNAi drug in a deal worth over US$1 billion

USA – Arrowhead Pharmaceuticals, a company aiming to develop drugs using RNA interference technology, has announced that it has licensed an experimental medicine for a common liver disease to GlaxoSmithKline in a deal worth more than a billion dollars.

According to the terms of the agreement, GSK will pay US$120 million up front and an additional US$130 million if Arrowhead’s drug generates positive data in a mid-stage study and then advances to a late-stage trial.

If the drug is approved, Arrowhead could receive up to US$780 million in additional milestone payments.

The drug at the heart of their agreement, ARO-HSD, is intended to lower levels of an enzyme known as HSD17B13, whose mutation seems to contribute to the pathology of NASH and other liver diseases.

The medication, known as ARO-HSD, is intended to prevent the body from producing an enzyme

ARO-HSD is currently being tested in a small clinical study of patients with non-alcoholic steatohepatitis (NASH) a liver disease caused by fat build-up. The drug is based on RNA interference technology, where genes that contribute to disease are silenced.

NASH is thought to affect millions of people in the United States alone, causes a buildup of fat in the liver, which can eventually lead to scarring and, in some cases, severe liver damage, liver failure, and even death.

In recent years, pharmaceutical companies have poured into the NASH space, drawn by the promise of large rewards for the first drugs to treat a disease that affects millions of people worldwide and is becoming more common.

Novo Nordisk paid US$3.3 billion for Dicerna earlier this month in order to obtain the company’s RNAi technology for diseases such as NASH.

Arrowhead specializes in the same type of drugmaking technology as Dicerna, using nucleic acid strands to silence gene expression.

This Nobel Prize-winning science, known as RNA interference, enables drugmakers to halt the production of disease-causing proteins. Several Alnylam Pharmaceuticals’ RNA interference (RNAi) drugs are already approved in rare diseases.

Arrowhead and its new partner GSK envision RNAi being used to treat more common diseases such as NASH, owing to the liver being one of the most accessible targets for drugs using the technology.

Glaxo will receive the exclusive right to develop ARO-HSD globally, with the exception of China, in exchange for its investment.

This is Glaxo’s first venture into NASH, and it represents a high-risk bet for the company given the industry’s track record of failure.

And, while ARO-HD may be a low-value investment, with activist investors circling, any further failures in Glaxo’s lackluster pipeline will only add to management’s pressure.

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