Tekmira stock soars on acquisition of OnCore to strengthen hep B pipeline

RNAi specialist Tekmira Pharmaceuticals expanded its reach with the announcement of the purchase of OnCore Biopharma, developer of an all-oral candidate for hepatitis B, saying that a combination therapy approach is the optimal way to treat that disease.

Investors approved of the deal. Tekmira's stock soared from $15.70 to $24.13 in after-hours trading between Jan. 9 and Jan. 12. As a result, the company's share price has doubled over the last year.

OnCore's hep B candidate (OCB-030) is designed to inhibit cyclophilins, or a class of proteins that viruses use to take control of the innate immune system following infection. Meanwhile Tekmira's RNAi-based hep B candidate (TKM-HBV) uses the company's Lipid Nanoparticle delivery platform, in which small interfering RNA molecules are encapsulated in lipid particles.

TKM-HBV is scheduled to enter clinical trials in the first quarter of the year, and OCB-030's are scheduled for the second half of the year; OnCore CEO Patrick Higgins said in a statement that the merger "accelerates our timeline for combination clinical trials."

Tekmira says TKM-HBV is designed to stimulate the immune expression by eliminating HBV surface antigen expression (HBsAg), while OnCore's OCB-030 is supposed to suppress HBV replication. In addition, the to-be-acquired company is also investigating methods of eliminating covalently closed circular DNA. Tekmira says this three-pronged approach is needed to develop a curative treatment regime for hep B.

The transaction is expected to close in the first half of 2015, and the combined company will have an implied market value of about $750 million, according the release.

According to the Hepatitis B Foundation, there are seven FDA-approved drugs for the disease, including two injectables and 5 pills. The list of candidates is lengthy and includes RNAi contenders from Arrowhead ($ARWR) (Phase IIa), Alnylam ($ALNY) (preclinical stage) and Benitec/Biomics (preclinical stage).

- read the release

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