[E-Daily Reporter KIM SUNG-JIN ] “This is a new type of contract that is rare in the industry.”

This is what an industry insider said regarding the recent contract signed between the RNA interference (RNAi) technology company Olix Pharmaceuticals, Inc.(226950)and China’s Hanso Pharmaceutical (hereinafter “Hanso”). Olix Pharmaceuticals, Inc. has signed an agreement allowing Hanso to utilize “two types of RNA (siRNA) sequences” for product development and commercialization. Unlike typical contracts covering comprehensive technology for specific targets, this agreement is segmented on a sequence-by-sequence basis.

Analysts note that this agreement between Olix Pharmaceuticals, Inc. and Hanso breaks down the commercialization unit into individual siRNA sequences rather than the entire gene target, thereby opening up the possibility of continuously expanding the business base using the same technology in the future.

Hanso Secures ‘Two Types of siRNA’… Contract Structure

On the 21st, Olix Pharmaceuticals, Inc. announced that it had granted Hanso the worldwide rights to develop and commercialize products based on one short interfering RNA (siRNA) sequence each, selected for two different gene targets. Simply put, siRNA is a small RNA that shuts down the activity of specific genes; its mechanism of action involves treating diseases by removing the mRNA of specific genes to reduce protein production.

Under this agreement, Olix Pharmaceuticals, Inc. received an upfront payment and is also set to receive additional milestone payments based on the progress of candidate development, regulatory approval, and commercialization. If the product is commercialized, Olix Pharmaceuticals, Inc. will also be eligible to receive running royalties tied to sales performance. However, the specific terms of the agreement were not disclosed.

If DNA is conceptualized as containing the original blueprint for which proteins to produce, mRNA plays the role of copying the necessary information from DNA to synthesize proteins. Broadly speaking, this process occurs within the “DNA → mRNA → protein” framework, and siRNA is a system that identifies and eliminates mRNA responsible for the excessive production of specific proteins. While existing therapies attack cells containing proteins that have already been produced, the RNAi method—which manipulates RNA—interferes with the production of problematic proteins from the outset.

In this announcement, Olix Pharmaceuticals, Inc. did not specify which diseases the siRNA commercialization agreement targets. However, Olix Pharmaceuticals, Inc. had previously signed an agreement in 2021 worth up to $451 million related to joint research and technology transfer. The agreement involves the discovery of two candidate compounds for cardiovascular and metabolic diseases. In April of last year, the company received its first milestone payment of $3 million (approximately 4.3 billion won) for “OLX706C,” a treatment for cardiovascular disease, out of three siRNA drug candidates.

RNAi Technology Export: Evolving from Platform to Candidate Compounds

Industry observers note that it is rare for a contract to be based on specific sequences rather than the siRNA technology as a whole. An Olix Pharmaceuticals, Inc. official explained, “We understand that the practice of designating a specific siRNA sequence targeting a particular target as an independent commercialization unit and granting rights to it is not a common contractual structure.”

However, analysis suggests that recent contracts in the RNAi industry are showing a trend toward narrowing in scope. In the early days of RNAi technology, the predominant approach was to transfer the entire platform technology as a package. A prime example is Alnylam’s 2007 licensing agreement with Roche covering the entire platform in the field of RNAi therapeutics. At the time, Roche received the right to freely develop RNAi drugs for any target within four therapeutic areas: oncology, respiratory diseases, metabolic disorders, and certain liver diseases.

As the technology advanced, the terms of agreements between companies gradually became more detailed. In 2018, Arrowhead entered into an agreement with Janssen to grant a worldwide exclusive license for JNJ-3989 (ARO-HBV), an siRNA therapeutic targeting the hepatitis B virus (HBV). Unlike previous agreements covering the entire platform technology, this agreement was notable for being limited solely to the HBV target.

Additionally, Alnylam’s 2019 agreement with Regeneron to develop cemdisiran—an siRNA therapy targeting the C5 complement pathway—is cited as a contract that clearly illustrates this trend. Alnylam entered into an agreement with Regeneron specifically for the candidate compound cemdisiran. The two companies had initially signed two separate agreements simultaneously: one to jointly develop cemdisiran as a monotherapy, and another granting Regeneron exclusive rights to combination therapy. Regeneron withdrew from the joint development agreement for monotherapy in November 2022 but later re-signed a licensing agreement in 2024 granting it exclusive rights to both the monotherapy and combination therapy of cemdisiran.

Different Efficacy Depending on the Sequence… Patents Determine Commercialization Success

Industry observers predict that Olix Pharmaceuticals, Inc.’s recent agreement targeting specific siRNA sequences will lead to further segmentation of the RNAi business. Ultimately, the characteristics and roles of compounds with specific structures—such as antibodies and RNA—must be clearly defined; only then can treatment methods and their efficacy be clearly established.

RNA is composed of four nucleotides—adenine (A), uracil (U), guanine (G), and cytosine (C)—and the arrangement of these four nucleotides allows for a wide variety of sequence configurations. Each sequence created in this way is utilized as a specific candidate compound.

This is precisely why the various sequences within a single siRNA can be commercialized individually. Even when targeting the same mRNA, which specific sequence on the mRNA is targeted depends on the siRNA’s sequence. However, it is widely recognized that designing siRNA—while considering factors such as how well it can access the target mRNA, whether it unintentionally affects other mRNAs, and whether it triggers an inflammatory response—is technically challenging.

Another industry insider stated, “Since the sequence varies and the effects differ depending on which part of the target mRNA is disrupted, separate commercialization is possible.”

There is also a view that it is advantageous for companies purchasing the technology to specify the siRNA sequence. This is because purchasing the entire platform or the entire siRNA technology and then conducting research and development (R&D), only to fail, could result in greater financial and time-related losses.

Experts also agree that, ultimately, data specific to a particular substance is more important. Kim Soon-woong, a patent attorney and CEO of Jeongjin Patent Law Firm, said, “The same applies to antibodies: if the sequence changes by just one or two bases, the resulting effect can vary significantly. In other words, you can only trust the efficacy when there is data confirmed specifically for that substance.”

He added, “Although platforms are expensive, since they target only specific demand for specific sequences, they are advantageous from a risk management perspective as well.”