EQRx Cuts More Than Half of Headcount in Strategic Reset
Alexis Borisy and Melanie Nallicheri pose for a portrait inside EQRx office in Cambridge, Mass. (Jessica Rinaldi/The Boston Globe via Getty Images)
Massachusetts-based EQRx is launching a sweeping business reset, laying off approximately half of its staff and shifting its focus to advancing clinically differentiated medicines, the company announced Monday during its first-quarter earnings report.
The strategic pivot also leaves EQRx with one late-stage candidate, lerociclib, a CDK4/6 inhibitor which is currently in a Phase III trial to test its combination with Novartis’s Femara (letrozole) as a first-line treatment option for patients with advanced metastatic or recurrent low-grade endometrioid endometrial cancer.
Because of its “compelling early clinical data and potential for strong financial returns,” lerociclib is a great addition to the pipeline, EQRx CEO Melanie Nallicheri said during an investor call Monday afternoon.
During the first quarter, the company reported $1.3 billion in cash, cash equivalents and short-term investments, which Nallicheri said will be used to fund its operation through the remainder of the year.
EQRx will also use this money to pay approximately $45 to $55 million in wind-down, termination and exit costs as it lets go of approximately 170 employees. By the end of 2023, the company estimates it will have $1.1 billion on hand.
Powered by $200 million in Series A funding, EQRx launched in January 2020 to advance a “market-based solution to rising drug costs,” former CEO Alexis Borisy said at the time.
To achieve its mission, the start-up sought to re-engineer the entire drug discovery pipeline and employ the latest scientific and technological developments to produce medicines that it could market at “dramatically lower prices,” according to the press announcement regarding the launch of the company.
This goal and approach landed EQRx in second place on BioSpace’s Top Life Science Startups to Watch in 2021 list.
In the months since its launch, EQRx collected promising partnerships that could help it fulfill its mission. This included Chinese company CStone Pharmaceuticals and U.K.-based Exscientia, which lent the Cambridge start-up its artificial intelligence capabilities in June 2021 for the development of novel small-molecule candidates.
Two months later, in August 2021, EQRx debuted on Nasdaq through a merger agreement with Special Purpose Acquisition Company CM Life Sciences III. The deal pumped EQRx with $1.8 billion in cash, making it one of the most notable IPOs that year.
In November 2022, however, the company announced that it saw “no commercially viable path” for its investigational antibody sugemalimab, which it had been developing as a treatment option for advanced non-small cell lung cancer.
As a result, the company was forced to fall back on its two other candidates, aumolertinib and lerociclib, for which it was planning to adopt market-based pricing. EQRx dropped aumolertinib in Monday’s announced reset and is instead seeking commercialization partners for this molecule.
Following this first pivot, EQRx laid off approximately 18% of its staff in February 2023 to improve its “operational efficiencies and streamline expenses,” according to an SEC filing.
Tristan Manalac is an independent science writer based in metro Manila, Philippines. He can be reached at email@example.com or firstname.lastname@example.org.