Benitec licenses RNAi to Merck

Brisbane-based Benitec (ASX: BLT) has granted a non-exclusive research licence to Merck & Co, giving permission for Merck to use its DNA-directed RNAi (ddRNAi) technology in research activities.

Benitec CEO John McKinley said the agreement gave Merck complete freedom to use ddRNAi in its research activities, but the company would not have access to commercial uses of the technology under the current agreement. Financial details of the agreement remain confidential.

It's the first in what the company hopes will be a series of research agreements to be announced over the next 12 months.

"In due course, we hope a whole range of companies will want research licences and eventually therapeutic licences," he said.

McKinley said he expected that in the near future, companies will become increasingly interested in entering into collaborative ventures and obtaining licences for use of RNAi technologies in specific therapeutic areas.

"The stock market is likely to be surprised at the number of deals that will be done over the next 12 months," he said.

In the meantime, Benitec is pushing forward with the development of its in-house therapeutic programs, focusing initially on Hepatitis C. Clinical trials are slated to begin in 2005, McKinley said. In addition, the company has a number of collaborations in discussion.

"We're looking forward to the next six months and growing our business in the US," he said.

And following its recent acquisition of US-based biotech Avocel, which has been reborn as Benitec Inc, the company is also eying the US stock market. It would prefer a back door listing through an already listed shell.

"We hope to list on Nasdaq in the next nine months," McKinley said. "We're on the look out and are being looked at by a number of companies."

Benitec's main competitors, Sirna Therapeutics and Alnylam Pharmaceuticals, are already listed on Nasdaq and have far greater market capitalisations than the Australian company. But McKinley believes that Benitec has a superior patent portfolio than either of those two companies.

Benitec's share price had risen 9.2 per cent at the time of writing to AUD$0.95.