In a story summarizing biopharma executives’ forecasts for 2020 last weekend, one said that while it may take a political solution to address the issue of high out-of-pocket costs for patients, it would be up to drugmakers themselves to bring down list prices. A new startup, founded by a well-known health policy expert and a biotech industry exeutive, plans to do that.
Cambridge, Massachusetts-based EQRx announced its launch Monday with a $200 million Series A financing whose participants include GV, ARCH Venture Partners, a16z, Casdin Capital, Section 32, Nextech and Arboretum Ventures, in addition to other investors.
The company aims to provide what it calls a market-based solution for the rising cost of drugs by changing the process of creating medicines from discovery all the way through to patient delivery in order to make the process cheaper. It will then offer its drugs at costs lower than those of drugs on the market. Per a spokesperson, its initial focus will be on small molecule drugs in cancers, immuno-inflammatory and rare genetic diseases, with the goal of eventually producing biologics as well.
“The process of developing and bringing new drugs to market should and can be organized toward the goal of their being affordable, both for patients and society,” said Dr. Peter Bach, director of the Center for Health Policy and Outcomes at Memorial Sloan Kettering Cancer Center in New York and a co-founder of EQRx, in a statement. Bach will act as an adviser to the company. “Today, even people with insurance are delaying filling prescriptions or going without due to the high cost sharing that’s part and parcel of high drug prices.”
Fellow co-founder Sandra Horning – former executive vice president, chief medical officer and global head of product development at Genentech/Roche – will also serve as an adviser to EQRx.
List prices from drug manufacturers, which in recent years have soared to eye-popping levels in the hundreds of thousands or even millions of dollars, are distinct from the out-of-pocket costs that patients typically pay, but they contribute to those costs nonetheless. That has led to a number of proposals from both major political parties that include everything from requiring more transparency in negotiations between manufacturers and pharmacy benefit managers to allowing Medicare to negotiate drug prices, which it currently is prohibited by statute from doing.
However, Tim Mayleben, CEO of drugmaker Esperion Therapeutics, previously said that while the solution to out-of-pocket costs would probably have to be political, given that it stems more from cost-sharing policies imposed by payers and PBMs, it would likely be up to drugmakers to lower list prices.
“Over the last several decades, society has benefited from unprecedented technological advances and a deeper understanding of disease biology, revolutionizing the way many diseases are treated today,” EQRx CEO Alexis Borisy said in a statement. “That said, the pricing of new therapeutic approaches is pushing beyond the limits of common sense, preventing people and society from equally benefiting from innovation. The time is now for a market-based solution to rising drug costs.”
Photo: gerenme, Getty Images
