How EQRx Aims to Reengineer the Health-Care System to Produce More Effective, Less Costly Cancer Drugs

A Conversation With Melanie Nallicheri

Get Permission

The numbers are dizzying. The costs of cancer care in the United States are rising so fast that by 2030, it is projected the national cancer-attributable costs will total more than $246 billion, up from $183 billion in 2015—a 34% increase.1 And although the total global economic burden of cancer is currently unknown, in 2010, the World Health Organization (WHO) estimated that the financial costs of cancer on economies worldwide totaled $1.16 trillion.2

Editor’s Note: Although the interviewee is discussing EQRx’s approach to drug development, there are many perspectives on the topic, including the one provided by Dr. Lee Newcomer on page 47. Recent provisions in the Inflation Reduction Act aim to reduce drug prices on a limited number of drugs, and multiple pharmaceutical companies are collaborating on lowering costs for low- and middle-income countries. It should be noted that drugs in development at EQRx have not yet been approved by the U.S. Food and Drug Administration.

Studies show the increasing costs of treating cancer, especially in this era of novel targeted drugs, which can cost more than $100,000 per year, and cellular therapies, such as chimeric antigen receptor (CAR) T-cell therapy, which can exceed $1 million per patient,3 are putting patients in financial jeopardy—and worse. Financial stress can be so debilitating; not only are patients nearly three times more likely to file for bankruptcy after a cancer diagnosis compared with individuals who have not been diagnosed with the disease, they are also at a higher risk of death from any cause.4 Rising cancer costs are also resulting in about one-quarter of patients choosing not to fill a prescription, to fill only part of a prescription, or to take less than the prescribed dose.5

Ironically, the amount of money the United States spends on cancer care is not resulting in appreciable better survival outcomes compared with other high-income countries. A cross-sectional study of national cancer care expenditures and cancer mortality rates across 22 countries by Chow et al found that although the United States has the highest per capita spending on cancer care, after adjusting for smoking, the cancer mortality rate was comparable to that of median high-income countries.6

Achieving Clinical Benefit in Difficult-to-Treat Cancers

Reducing the high costs of cancer care while maintaining the fast-paced advances in treatment witnessed in recent decades is the goal of EQRx, a new pharmaceutical company. Study data from China on two new therapies developed by EQRx, sugemalimab, a PD-L1 inhibitor, and aumolertinib, a third-generation epidermal growth factor receptor (EGFR) tyrosine kinase inhibitor, were presented during the 2022 ASCO Annual Meeting.

The clinical trials included the Chinese phase III GEMSTONE-302 study of sugemalimab plus platinum-based chemotherapy vs placebo plus platinum-based chemotherapy in newly diagnosed patients with stage IV non–small cell lung cancer (NSCLC). The findings showed that sugemalimab plus platinum-based chemotherapy reduced the risk of death by 35% compared with platinum-based chemotherapy plus placebo. Median overall survival was 25.4 months with sugemalimab plus chemotherapy compared with 16.9 months with placebo plus chemotherapy. The 2-year overall survival rate was 51.7% with sugemalimab plus chemotherapy vs 35.6% with placebo plus chemotherapy.7

Melanie Nallicheri

Melanie Nallicheri

Data presented on the Chinese phase II GEMSTONE-201 study investigating sugemalimab in patients with relapsed or refractory extranodal natural killer/T-cell lymphoma showed durable response rates. The analysis showed an objective response rate of 46.2% in patients treated with sugemalimab, with 37.2% of patients achieving a complete response. The 1-year duration of response rate was 86%, and the median duration of response was not reached as of the cutoff date.8

Data from the third study presented at the ASCO meeting, a Chinese phase III trial investigating aumolertinib in patients with central nervous system (CNS) metastases and EGFR-mutated NSCLC, the AENEAS study, found that aumolertinib demonstrated significantly prolonged CNS median progression-free survival compared with gefitinib, 29.0 months vs 8.3 months, respectively.9

The ASCO Post talked with Melanie Nallicheri, Chief Executive Officer of EQRx, to learn more about how the company plans to reach its goal of reducing cancer costs for patients while ensuring they receive the most effective and safe therapies.

Making Drugs More Affordable

EQRx was founded on the premise of equity, equality, and equal access to medicines for every patient, and with the goal of reducing drug costs for patients. How do you plan to make cancer drugs more affordable? What needs to happen in the pharmaceutical industry and within the health-care system to enable changes in the way medicines are discovered, developed, approved by the U.S. Food and Drug Administration, and ultimately priced?

At EQRx, we think of ourselves as “new pharma,” because we are fundamentally reengineering how we are creating, developing, and delivering the innovative medicines for some of our most life-threatening and chronic diseases, foremost among them, of course, is cancer.

You asked a big question. Our ability to discover and create innovative medicine for many diseases has never been better. You can argue that we are in the Golden Age of biology. Even if you look at how far cancer therapies have advanced over the past 5 years, much of which came from our understanding of biology and genomics and new technologies like CRISPR [clustered regularly interspaced short palindromic repeats] gene editing, it is amazing.

We now know that cancer is many diseases, is molecularly driven, and is not -defined by a body part alone. In addition to our greater understanding of how cancer develops, we have become better at understanding how to leverage technology more broadly. When you put all that knowledge together, you would think we would be able to discover and deliver cancer drugs more efficiently, quickly, and cost-effectively. But exactly the opposite happens. Technology got better, but costs keep going up. We said we can do this differently.

To us, a market-based solution would address some of the largest categories that are driving pressure on budgets, creating administrative burden on physicians from a prescribing point of view, and placing a burden on patients. If we produce therapies at radically lower prices, then we have the ability to make everybody better off.

When we say that our mission is to improve health for all with great innovative, affordable medicines, what we mean is we must be willing to charge radically lower prices for these drugs. We have the ability to do this and to have a real impact on the lives of patients; then, anyone with a serious condition can have access to the medicines they need, and physicians can treat patients without financial barriers to prescribing the most effective, affordable medicines. That is how you change the system from within.

Bringing Lower-Drug Competition to the Marketplace

Why does the price for cancer therapies keep going up even though innovation makes it less costly to develop more effective drugs? Isn’t the price of drugs based on what the market will bear? And how will you convince pharmaceutical manufacturers not to raise the prices on their drugs?

We cannot convince others on what their pricing strategy should be. However, we believe that by bringing competition to the market, we will have a positive impact on the industry. We can only control our own destiny, but we can have an outsized impact on our industry if we are able to produce and deliver innovative, high-quality therapies at reduced prices.

Part of our goal when we were selecting our initial drug portfolio was to see where we had the greatest opportunity to bring innovation to help patients with cancer, and, of course, we thought of the checkpoint inhibitor class. It is wonderful what we can do with checkpoint inhibitors, but the prices for these drugs keep going up.

In our current drug portfolio, we have lerociclib, a cyclin-dependent kinase 4/6 inhibitor, which targets hormone receptor–positive breast cancer and is another one of the largest classes of drugs in oncology treatment. We also have a third-generation EGFR tyrosine kinase inhibitor, aumolertinib, for the treatment of certain types of NSCLC, and sugemalimab, a PD-L1 antibody, for the treatment of relapsed or refractory extranodal natural killer/T-cell lymphoma. Aumolertinib and sugemalimab demonstrated benefit in clinical trials from which data were presented during the 2022 ASCO Annual Meeting.7-9

These three drug classes alone represent close to $75 billion of global drug spending. By choosing these drug classes as the first areas for us to work in, we can bring a benefit to physicians, patients, and health systems. We will continue adding to and developing our portfolio, including in classes where drugs have not yet been developed.

Charting the Exorbitant Cost of Drugs

Is your focus on the development of lower-cost oncology drugs, or are you developing lower-cost medicines for all disease types?

We are starting with treatments for patients with cancer and autoimmune diseases because therapies in these two diseases alone are anticipated to reach more than $500 billion in global branded drug spends by the middle of this decade, $300 billion for oncology medicines, and $225 billion for immune-inflammatory diseases. This is half of the total global drug spending, which we expect will reach the $1 trillion mark by 2025. Again, this is just in branded medicines. It does not include the cost of generic or biosimilar drugs. The portfolio of more than 10 medicines in development we are now pursuing addresses $100 billion of anticipated global drug spending, 10% of the total or 20% of the spend on oncology and autoimmune diseases.

Over time, we plan to branch out and build more classes of drugs in other diseases.

Reducing the Cost Burden for Patients

A recent report by the American Cancer Society found that patients with cancer in the United States spent more than $21 billion on their cancer care in 2019,10 and the costs keep increasing. The typical cost of a new chemotherapy drug exceeds $100,000, and the cellular therapies, including CAR T-cell therapies, can cost as much as $1 million,3 and only a small percentage of patients benefit from these treatments. How do you propose to make cancer therapies more effective for individual patients while reducing their cost?

We are looking to reduce the cost burden on patients and on the health system. Data from the study abstracts presented during the 2022 ASCO Annual Meeting on both our third-generation EGFR tyrosine kinase inhibitor aumolertinib and our PD-L1 inhibitor sugemalimab were exciting. In addition to showing clinical benefit for patients, both treatments also had good safety profiles and were reported to be well tolerated.

No one would want to have just a lower price if the drug was not equally effective or even better than current options for a particular indication.

Can you provide an example of how these drugs may differ in cost from the current standard-of-care therapies?

Our goal is to reduce prices by between 50% and 70%, depending on where the current prices are for a specific drug. For example, if there is an oncology drug with a U.S. list price of $200,000 per patient per year, we want to price our drug at below $100,000 and perhaps as low as $50,000.

Ensuring Equitable Pricing and Equal Access to Cancer Care

Although advances in cancer therapy have led to approximately 18 million cancer survivors in the United States—and that number is expected to increase to more than 22 million by 2030—many of these survivors will not be cured of their cancer and must remain on long-term treatment, extending their financial burden for many years following a diagnosis. How can the costs for these survivors be reduced?

According to a recent American Cancer Society Cancer Action Network survivor survey, half of patients with cancer and survivors report that they are incurring medical debt, and another half of those are delaying or avoiding medical care.11 That is not innovation in cancer care. If we have advances in cancer treatment, and those advances do not actually help patients because they cannot afford their treatment, it is the same as not having innovation at all.

A recent study by the Hutchinson Institute for Cancer Outcomes Research found a correlation between out-of-pocket expenditures for tyrosine kinase inhibitors for patients with EGFR- and ALK-positive advanced NSCLC and overall survival.12 Patients with higher out-of-pocket costs were more likely to have inferior overall survival, decreased adherence to tyrosine kinase inhibitors, and higher tyrosine kinase inhibitor discontinuation rates, which is shocking.

This is not okay. We named the company EQRx because we stand for equal access and equitable pricing. Being able to have access to cancer therapies should not be based on socioeconomic status or where patients live. It shouldn’t matter what job patients have or how much their insurance covers.

An innovative cancer therapy should be available to any patient, anywhere, anytime. To institute positive change, we must work within the health-care system. For example, we are working directly with payers. We are requesting that in exchange for radically lowering the price of drugs and reducing the burden on them, payers show that same courtesy to patients by lowering their out-of-pocket cost burden. We are also working with payers to reduce the administrative hassles faced by physicians.

We are trying to work within the system to form a true partnership with all stakeholders, not just by extending better pricing, but by working with them to lower the cost burden on patients. By bringing all stakeholders together, we believe we can change the system from within, but we need physicians to help us. Based on the efficacy and safety data we are generating, we will need physicians to say, “Yes, this drug is equally good or better.”

We believe that for an industry that has historically thrived on exclusivity, providing health equity for every patient is the right way to go. This is how we can have the greatest impact on those we serve: patients. 

DISCLOSURE: Ms. Nallicheri is Chief Executive Officer of EQRx.

Editor’s Note: For information about all members of EQRx’s Board of Directors and Mission Advisory Board, visit


1. Mariotto AB, Enewold L, Zhao J, et al: Medical care costs associated with cancer survivorship in the United States. Cancer Epidemiol Biomarkers Prev 29:1304-1312, 2020.

2. World Health Organization: Cancer. Available at Accessed June 29, 2022.

3. ASH Clinical News: CAR T-cell therapies predicted to cost more than $1 million per patient. Available at Accessed June 29, 2022.

4. Ramsey SD, Bansal A, Fedorenko CR, et al: Financial toxicity as a risk factor for early mortality among patients with cancer. J Clin Oncol 34:980-986, 2016.

5. Zafar SY, Peppercorn JM, Schrag D, et al: The financial toxicity of cancer treatment: A pilot study assessing out-of-pocket expenses and the insured cancer patient’s experience. Oncologist 18:381-390, 2013.

6. Chow RD, Bradley EH, Gross CP: Comparison of cancer-related spending and mortality rates in the US vs 21 high-income countries. JAMA Health Forum 3:e221229, 2022.

7. Zhou C, Wang Z, Sun M, et al: A protocol pre-specified interim overall survival analysis of GEMSTONE-302: A phase 3 study of sugemalimab versus placebo plus platinum-based chemotherapy as first-line treatment for patients with metastatic non-small cell lung cancer. 2022 ASCO Annual Meeting. Abstract 9027. Presented June 6, 2022.

8. Huang H, Tao R, Yang Yu, et al: GEMSTONE-201: Preplanned primary analysis of a multicenter, single-arm, phase 2 study of sugemalimab in patients with relapsed or refractory extranodal natural killer/T cell lymphoma. 2022 ASCO Annual Meeting. Abstract 7501. Presented June 3, 2022.

9. Lu S, Dong X, Jian H, et al: Aumolertinib activity in patients with CNS metastases and EGFR-mutated NSCLC treated in the randomized double-blind phase III trial (AENEAS). 2022 ASCO Annual Meeting. Abstract 9096. Presented June 6, 2022.

10. American Cancer Society: Annual report to the nation part 2: Patient economic burden of cancer care more than $21 billion in the United States in 2019. Available at Accessed June 29, 2022.

11. American Cancer Society Cancer Action Network: Survivor views: Cancer & medical debt. Available at,their%20credit%20score%20negatively%20impacted. Accessed June 29, 2022.

12. Goulart BHL, Unger JM, Chennupati S, et al: Out-of-pocket costs for tyrosine kinase inhibitors and patient outcomes in EGFR- and ALK-positive advanced non-small-cell lung cancer. JCO Oncol Pract 17:e130-e139, 2021.

Related Articles

EQRx Pricing Strategy: Not a Win for Everyone but a Key First Step to Expand Access to Cancer Care

Lee N. Newcomer, MD, MHA

Lee N. Newcomer, MD, MHA

EQRx is an economics professor’s dream company. It is the perfect example of the principle of substitution. EQRx provides quality, lower-cost drugs in high-cost categories that may substitute for the higher-priced options. Although the profit margin for each drug unit ...