Pharmaceutical company Novartis plans to invest up to $2.2 billion in the development of Arrowhead's siRNA therapy.

In an exciting development for the pharmaceutical industry, Novartis and Arrowhead Pharmaceuticals have announced a collaboration aimed at developing treatments based on Arrowhead's Targeted RNAi Molecule (TRiM) platform. This partnership will focus on two key areas: neurodegenerative diseases and obesity.

For neurodegenerative diseases, Novartis will be licensing and developing Arrowhead's preclinical stage small interfering RNA (siRNA) therapy, ARO-SNCA, for Parkinson's disease and other synucleinopathies. This move comes after Novartis' second attempt to develop a Parkinson's treatment, minzasolmin, failed in the Phase IIa ORCHESTRA trial.

Fiona Marshall, PhD, Novartis' president of biomedical research, expressed optimism about the potential of Arrowhead's TRiM technology for effective delivery in key brain structures for RNA medicines in neurodegeneration.

Arrowhead's president and CEO, Christopher Anzalone, Ph.D., shared similar sentiments, stating that the potential translation of preclinical results in upcoming clinical trials would represent an important leap forward for neurodegenerative diseases. Investors responded positively to this collaboration, sending Arrowhead shares up nearly 17%.

In the realm of obesity, Arrowhead has been making strides with its RNAi candidate, ARO-ALK7. The company presented positive preclinical data for this obesity candidate in February, and a single subcutaneous dose of ARO-ALK7 led to dose-dependent and durable reductions in ALK7 mRNA in abdominal fat. Arrowhead has launched a Phase I/IIa trial for ARO-ALK7 in New Zealand.

Under the terms of the agreement, Novartis will pay Arrowhead $200 million upfront, up to $2 billion in milestone payments, and royalties on commercial sales. Arrowhead will be responsible for preclinical research activities for all licensed programs, enabling a CTA filing. Once the research phase is complete, Novartis will take control of development, manufacturing, medical affairs, and commercialization activities.

The transaction is expected to close in the second half of the year, subject to regulatory approval and other conditions. Novartis' shares on the SIX Swiss Exchange dipped 0.3% following the announcement, possibly due to the upfront payment and potential milestone costs associated with the collaboration.

This partnership marks a significant step forward for both companies, with the potential to bring innovative RNAi therapies to market for the treatment of neurodegenerative diseases and obesity. Anzalone expressed enthusiasm for collaborating with Novartis to bring ARO-SNCA for synucleinopathies into clinical trials and to work on additional programs.