Associate

Fueling its approach "that is different from a lot of companies in the field," Nucleonics Inc. acquired from Wyeth rights to patent applications centered on RNA interference for a small equity stake.

The patents, which have yet to be issued but have early priority dates, give Malvern, Pa.-based Nucleonics "a proven delivery system," said its CEO, Robert Towarnicki. "Proven in the sense that the plasmid delivery system we have access to has been in over 500 patients in DNA vaccine trials. Similar plasmid delivery systems have been used in over 3,000 patients now."

The patent applications cover the delivery of DNA constructs that encode double-stranded RNA into cells with the intent of expressing long or short interfering RNAs. The applied-for patents are based on work done by Nucleonics' founders, C. Satishchandran and Catherine Pachuk, while they were still employed at Apollon Inc., a company Madison, N.J.-based Wyeth eventually snapped up. Satishchandran and Pachuk, now vice president of research and development and senior director of biological sciences, respectively, are on sabbatical from Thomas Jefferson University, but as the company further matures, the hope is they will "cut ties with the university" completely to focus solely on Nucleonics, Towarnicki told BioWorld Today.

In exchange for the co-exclusive rights (Wyeth has the right to work under the patents, too), Nucleonics has given Wyeth 5 percent of the company. While not able to go into more details, Towarnicki said the percentage now held by Wyeth is low on the list of shareholders for the young company with one round - a $3.4 million Series A - under its belt.

RNA interference technology focuses on double-stranded RNA segments designed to block gene expression. While most companies attempt to do that by "delivering short RNA directly," Towarnicki said, privately held Nucleonics is "approaching it from an expression standpoint."

The company's strategy is to deliver DNA to the cells, where the cell's transcription process produces a long, double-stranded RNA. That long RNA segment is then cut into short interfering RNA.

Why long DNA?

"Because we can then encode for multiple genetic sequences - a single delivery can deliver multiple sequitopes of short RNA, all aimed at the same virus," Towarnicki said. Since viruses are mutable, by hitting them with varying forms of RNA they "cannot remain viable and escape our approach."

The acquired patents are for a delivery method, but Nucleonics will be delivering its own product. The company's technology has given rise to the filing of more than 14 patents, and the company has seen "sustained knockout of our target for over 30 days in animals," Towarnicki said. Focused on hepatitis B and hepatitis C for now, the company said its technology also might have applications in herpes and HIV. Nucleonics is in animal studies with its HBV product and should have filed an investigational new drug application and potentially be in the clinic 18 months from now.

At about 12 employees now, Nucleonics is expecting to close a financing in the fourth quarter of at least $20 million. That kind of money would push the company about six months past two IND filings, it said. It then plans to seek another $30 million in a Series C round, which would give it financial resources to last another six months beyond Phase II work.

"And that's not including any revenue from any collaborations," Towarnicki said. "Obviously, we aren't going to be sitting around and not talking to others about development programs and licensing."

As the RNA interference area heats up and more and more companies are evaluating the technology, it's hard to discern which might have an intellectual property lead or which is making strides quickest. However, Nucleonics feels it is focused on its own area.

"In the RNA space, the IP is very confusing right now - there are a lot of different patents," Towarnicki said. "We have focused on a freedom to operate in expressed interfering RNA, and we feel comfortable we have a freedom to operate there."

And, as time passes and advances are made, perhaps Nucleonics could become what most business want to be to the competition: "A hindrance to others in the area," he said.