An emerging technology known as RNA interference – which makes use of short strands of RNA to switch off the activity of specific genes – hit the commercial big time yesterday after Merck & Co agreed to pay $1.1 billion for one of the top companies in the field.

Merck will pay $13 per share for Sirna Therapeutics, whose name derives from the acronym for small interfering RNA (siRNA). The biotechnology company’s lead product is Sirna-027, a molecule targeted at the treatment of age-related macular degeneration, a common form of blindness.

The acquisition is the latest in a string of deals that Merck’s chief executive Richard Clark has announced since taking over the helm of the company in May 2005.

RNA interference is a naturally occurring mechanism within cells and potentially forms the basis for a new class of therapeutic products that can selectively silence genes within the cell. Since many diseases are caused by the inappropriate activity of specific genes, the ability to regulate such genes selectively through RNAi could provide a means to treat a wide range of human diseases.

This promise helped the two discoverers of the technology, Andrew Fire and Craig Mello, win the Nobel Prize for Medicine earlier this month.

But, as with antisense before it - which while operating by a similar mechanism has failed to emerge as a major treatment option - the main obstacle to using siRNAs as therapeutics lies in delivery inside the cell. For this reason RNA interference drugs are not expected to reach the market before 2009, according to industry observers, and initial applications of the technology will likely be in easy-to-access tissues such as the eye.

Sirna also has a $700 million alliance in place with GlaxoSmithKline in the area of respiratory diseases, and is also developing RNA interference therapeutics in infectious diseases, oncology, metabolic disorders and dermatology.

Meanwhile, Merck also has an agreement in place with another leading RNAi specialist, Alnylam Pharmaceuticals, that was signed in June 2004. Originally formed to develop AMD treatments, this suffered a setback last year when the most advanced compound in this programme hit the buffers.

The alliance has since been expanded to include RNAi therapeutics targeting other diseases, and along with the deal with Sirna makes Merck the leading Big Pharma exponent of the new technology.

The Sirna acquisition is expected to close in the first quarter of 2007, said Merck.