EQRx, a biotech company founded with the ambitious mission of developing affordable medicines, recently found itself embroiled in a complex series of events leading to its sale to Revolution Medicines. EQRx’s journey, from its launch in January 2020 to its acquisition, has now been unveiled through regulatory filings.
EQRx initially set out to create new, cost-effective medications and went public through a special purpose acquisition company (SPAC) deal valued at approximately $4.2 billion at the end of 2021. Armed with funding, the company advanced five clinical-stage programs in oncology and immune-inflammatory diseases, including the EGFR inhibitor aumolertinib and the PD-L1 antibody sugemalimab. EQRx also formed a “Global Buyers Club” comprising payers, providers, and health systems interested in accessing the affordable drugs once approved.
In late 2022, difficulties arose when discussions with the FDA indicated that EQRx would need to conduct a second phase 3 trial for sugemalimab in non-small cell lung cancer (NSCLC) with a diverse US population to demonstrate overall survival, rather than relying on interim data from a similar Chinese trial. This increased the costs and pushed back the potential filing for aumolertinib to 2027.
Facing these challenges, EQRx’s senior management and board decided to seek strategic alternatives in October 2022, exploring options like a sale, merger, partnership, licensing transaction, or take-private deal. The company reached out to 24 potential partners, including large pharmaceutical companies and biopharmas.
Despite initial interest from some parties, the interest waned over time, with various reasons cited, such as concerns over clinical differentiation, strategic focus, regulatory hurdles, pricing uncertainties, and financial limitations. EQRx even considered out-licensing its ex-US rights for some programs but couldn’t secure a deal.
By May 2023, Revolution Medicines entered the picture with an offer to acquire EQRx’s cash resources, which were attractive to Revolution’s mission of developing treatments for RAS-addicted cancers. After a series of discussions and proposals, the deal was finally sealed in July 2023, with Revolution acquiring EQRx.
This intricate journey showcases the challenges and complexities faced by biotech companies in their pursuit of innovation and market success, as well as the strategic decisions and considerations that ultimately shape their destinies.