Alexis Borisy’s EQRx has secured the ex-China rights to Hansoh Pharmaceutical’s almonertinib. The deal sets EQRx up to work the EGFR inhibitor into its plan to market me-too drugs at radical discounts to incumbent products.
EQRx made a splash in January when it disclosed a $200 million series A backed by GV, ARCH Venture Partners and Andreessen Horowitz. The round set EQRx up to execute a novel strategy. Rather than go after a novel target or advance a new modality, as is typical for such well-backed biotechs, EQRx set out to develop me-too versions of existing products and compete on price.
Now, details of some of the drugs EQRx will use to execute that strategy have emerged. In return for up to $100 million in upfront and milestones, EQRx has secured the ex-China rights to almonertinib, which is approved in China in EGFR T790M mutation-positive non-small cell lung cancer (NSCLC).
A series of EGFR inhibitors have come to market since drugs such as AstraZeneca’s Iressa and Roche’s Tarceva put the target on the map more than 15 years ago. The newer drugs have improved on their predecessors, helping AstraZeneca generate annual sales of $3.2 billion for its latest therapy Tagrisso, but have also come with price tags that have caused some payers to balk.
In almonertinib, EQRx has gained a drug that has already come to market in one country that it may be able to sell at a price that is more to the liking of payers.
Hansoh disclosed the almonertinib deal shortly after G1 Therapeutics revealed it had granted EQRx rights to CDK4/6 inhibitor lerociclib in markets including the U.S, Europe and Japan. EQRx is paying $20 million upfront and committing to up to $290 million in milestones.
In return, EQRx is gaining a potential rival to Eli Lilly’s Verzenio, Novartis’ Kisqali and Pfizer’s Ibrance. Pfizer made $5 billion from Ibrance last year and increased its price by 5% at the start of 2020.
The deals position EQRx to target two large areas of the oncology market where prices have stayed high — Ibrance costs around $620 a pill — despite the presence of multiple competitors. EQRx has also quietly picked up other assets without disclosing the details, potentially because the agreements involve private companies. Hansoh and G1 are both publicly traded.