EQRx redesigns ‘radical’ drug pricing plans for first two drugs
- EQRx plans to “adopt market-based pricing” in the United States for two of its investigational drugs, signaling a step back from its goal of bringing brand-name drugs to market at “drastically lower” prices. If approved, both treatments would compete with from AstraZeneca Tagrisso and Pfizer Ibrance.
- The high profile startup also said it will not seek Food and Drug Administration approval for its lead cancer drug, sugemalimab, as agency officials want the company to complete a second phase 3 trial. before considering an examination, the the company said on Thursday. The drug was discovered and tested primarily in China, which has become a burning issue for the FDA.
- The announcements represent major strategic setbacks for EQRx, which had sought to take a “rapid follow-up” approach to compete with blockbuster drugs. Shares fell 30% in early trading.
Overview of the dive:
As the United States grapples with rising prescription drug costs, a number of companies have offered solutions based on the market rather than government regulation. Civica Rx, backed by hospital system Intermountain Healthcare and other partners, aims to alleviate critical generic drug shortages, while the state of California hopes to manufacture its own insulin at a lower cost, to name just two examples.
EQRx was part of this trend, but aimed to bring price competition to brand name drugs rather than focusing on older drugs. Unveiled with marquee leaders and $200 million in funding nearly three years ago, EQRx was able to get a quote on the public market through a special purpose acquisition company under an August 2021 deal.
Two of its lead candidates, sugemalimab and aumolertinib, have been licensed by China-based companies, CStone Pharmaceuticals and Hansoh, respectively. Sugemalimab works similarly to checkpoint inhibitors like Keytruda from Merck & Co., while aumolertinib is similar to Tagrisso from AstraZeneca.
This strategy has run into difficulties, however, as the FDA has taken a more critical view of drugs primarily developed and tested in China. Trials conducted in several countries can capture genetic differences as well as medical care practices that might affect how long patients survive or stay in remission after treatment. Earlier this year, the FDA rejected a drug sponsored by Eli Lilly on this problem.
In a statement, EQRx said it sees “no commercially viable route” for sugemalimab in lung cancer in the United States, but is still in discussions with the FDA for a type of lymphoma.
For aumolertinib, the company said a trial in combination with chemotherapy could meet FDA standards. This trial compares the combination to Tagrisso alone and aumolertinib alone, and may have sufficient data to support approval by 2027. In the meantime, the drug has generated data that UK drug regulators have accepted review, and EQRx may pursue further filings overseas.
A third EQRx drug, called lerociclib and discovered by a US-based company, is being tested internationally in metastatic breast cancer. The company intends to start a US-led Phase 3 endometrial trial in 2023. The drug would compete with Pfizer’s Ibrance and Eli Lilly’s Verzenio.
Aumolertinib and lerociclib are the two drugs for which the company plans to adopt market-based pricing. “We are adapting and believe that using a market-based pricing approach for our lead cancer programs, aumolertinib and lerociclib, will ensure that we can still deliver these important medicines to patients,” said EQRx CEO Melanie Nallichéri.