US-based EQRx Inc. (NASDAQ: EQRX) has revealed that a definitive agreement has been signed for the company to be fully acquired by US-based Revolution Medicines (NASDAQ: RVMD). The transaction will be executed as an all-stock deal, with Revolution issuing shares to EQRx shareholders, anticipating the acquisition of over USD 1 billion in net cash as a result.
EQRx’s Decision to Wind Up Activities and Invest Cash Holdings
According to the statement, EQRx determined that the optimal path for the company was to conclude its operations and invest its cash holdings in another entity. An independent committee of EQRx’s board of directors evaluated strategic alternatives to maximize value for EQRx stockholders and decided to support Revolution Medicines. The transaction is anticipated to close in November 2023, at which point EQRx shares will no longer trade on the Nasdaq. Revolution will not proceed with EQRx’s R&D portfolio, leading to the winding down of these programs and the return of all intellectual property to related partners.
Revolution Medicines’ Focus on Precision Medicine Oncology
Revolution Medicines is a clinical-stage precision medicine oncology company focused on RAS and associated pathways, including the mTOR pathway. The company’s lead candidate, RMC-6236, is currently undergoing Phase I trials.
EQRx’s Strategy and Changes in Partnerships
Established in 2019, EQRx aimed to disrupt the US market by offering modern, innovative medicines at lower prices, primarily through partnerships with China-developed molecules and leveraging China-based data for regulatory filings. However, as the US FDA indicated that this approach would not be feasible, EQRx began to wind down earlier partnerships. In May of this year, the company canceled previous deals with CStone Pharmaceuticals (HKG: 2616) and Lynk Pharmaceuticals. EQRx retained rights to Jiangsu Hansoh Pharmaceutical’s aumolertinib and a CDK 4/6 inhibitor in-licensed from US firm G1 Therapeutics, as stated in EQRx’s May announcement.-Fineline Info & Tech
