Roche snaps up more biotech firms

Thursday 24 July 2008
John Davis - Managing Editor

Roche has announced two more biotech acquisitions, of Mirus Bio and Arius Research, although both are valued at substantially less than the $44 billion that it has just bid for the remainder of Genentech (Scrip Online, July 21st, 2008).

The moves may deflect some of the adverse criticism of the Genentech bid, indicating that it is keen to pursue a broad range of biotech initiatives. The criticisms have included the low price of the bid, and the about-turn that it represents in overall strategy – keeping biotech researchers at arm's length from large corporations was supposed to improve their productivity and preserve their entrepreneurial spirit.

Achieving greater depth in RNA interference (RNAi) technology is behind the $125 million acquisition of Mirus Bio, a private US firm based in Madison, Wisconsin. The company focuses on the development of innovative nucleic acid based technologies, including its proprietary Dynamic PolyConjugates RNAi delivery platform, and its Pathway IV hydrodynamic gene therapy delivery platform.

Dynamic PolyConjugates consist of small interfering RNA (siRNA) sequences attached to a new type of polymer that protects them from degradation in the bloodstream, and enables them to be released from cellular endosomes, which would otherwise break them down. They also have a masking agent attached that prevents the body from recognising them as foreign. Mirus Bio researchers have shown that the platform can turn off genes involved in the production of LDL cholesterol from liver cells.

Roche entered a major alliance last year with the RNAi pioneer Alnylam Pharmaceuticals and acquired that company's European research site in Kulmbach, Germany. Roche will maintain an RNAi research site in Madison but will transfer Mirus's transfection reagents business into a company called Mirus Bio LLC. Completion of the acquisition is expected in the second half of this year.

Mirus's lead gene therapy programme, MyoDys, is in the field of muscular dystrophy, in collaboration with the French firm Transgene.

antibody screening

The Canadian firm Arius Research has developed a method of screening antibodies called FunctionFIRST to assess their ability to affect disease before they move into clinical development. It says its technology targets the precise epitopes that can induce cell death.

Arius has an early pipeline of more than 400 antibody drug candidates, which Lee Babiss, head of global research at Roche, says are an excellent fit for its own candidates in cancer and immunology. Three of Arius's lead programmes, antibodies directed to CD44 (a cancer stem cell target), Trop-2 (a signal transduction molecule) and CD59 (an immune modulator) are in late-stage preclinical development. It has also identified antibodies directed against the major human cancers, of the breast, prostate, lung and colon.

It already had partnerships with Genentech, Takeda, PDL BioPharma, Medarex and Oxford BioMedica.

Roche will pay Cdn$2.44 for each of Arius's shares, valuing the company at Cdn$191 million and representing a 15% premium to the closing price on July 22nd. Roche will also acquire all the issued and outstanding warrants of Arius. The acquisition is expected to close in the third quarter of this year. Investors in Arius include Orbimed Advisors, Cmark Opportunity Funds and Efficacy Capital.

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