There’s been so much stem cell news recently, I haven’t written a lot about the other major breakthrough area in medicine. That is, of course, RNA interference (RNAi). So I’d like to rectify that oversight.

For those of you who are not familiar with RNA interference, here’s what it is and how it works: DNA is, in a sense, the operating system software for our cells. As such, DNA does not directly interact with genes. It’s too important to risk corruption through unnecessary exposure. Instead, DNA operates by sending out chemical instructions. These instructions are in the form of complex RNA molecules. They are similar to double-stranded DNA, but are usually single stranded.

Basically, these extraordinarily complex RNA molecules control gene activity or expression. This is important because nearly all diseases are either caused or cured by the proteins produced by genes. You can, therefore, think of the ability to increase or decrease the production of these proteins as an on/off switch for diseases.

The remarkably young science of RNA interference is based on the accidental discovery that it is possible to flip these switches. The remote control, so to speak, for these switches consists of portions of RNA molecules. Because these portions are recognized as invaders by the body, they provoke the rejection of larger disease-causing RNA molecules. The other side of the coin is “RNA activation.” This is the process that increases gene expression.

The birthday of the science, according to many, was in 1998. That was the year when scientists Craig Mello and Andrew Fire published their paper on RNA interference in nematode worms. The paper earned them the Nobel Prize in physiology or medicine in 2006.

RNAi companies, unlike stem cell firms, have grown very rapidly. Many have already been gobbled up by Big Pharma companies, positioning for a foothold in this promising new field.

Unlike regenerative medicine (think: stem cells), RNAi scientists and companies sidestepped the legal and ethical scrutiny that has hobbled some stem cell companies. Now the legal situation has been clarified and embryonic stem cells have been replaced for therapeutic uses by iPS and parthenogenetic cells. As a result, we can expect important stem cell companies to make similar deals with Big Pharma companies.

Regardless, many RNAi companies already have significant capitalization and Big Pharma partnerships. Even at that stage of their development, however, they still have profound transformational potential. For example, I would have added RNAi pioneer Sirna Therapeutics to our portfolio. Sirna, however, was acquired in 2006 by Merck & Co. Inc. in a deal worth $1.1 billion.

That deal, the largest in the RNAi space so far, was followed by others:

Anglo-Swedish pharm firm, AstraZeneca Intl., made a $400 million deal with a European RNAi firm, Silence Therapeutics. Alnylam formed a $1 billion partnership with Swiss giant, Roche. The high-water mark for RNAi stockholders, however, is still the Sirna Therapeutics acquisition by Merck in October 2006.

As I’ve said repeatedly, RNA interfering molecules work. There is no question that they flip the switches they’re supposed to flip. The challenge, however, is getting them to their target genes before they are recognized and destroyed by the body’s immune system. Various companies are homing in on specific delivery solutions now. There are, however, many different solutions to the delivery problem. Each gene switch has its own special considerations and there is no “one size fits all” solution.

Most of the new RNAi companies have been founded specifically to develop RNAi therapies. Opportunity abounds in this sector. But beware; the failures will be as spectacular as the successes.

Source: RNAi’s Buyout Deals: Who Will Benefit?