Royalty Pharma and Revolution Medicines Enter into Funding Agreements for Up to $2 Billion

Published: 2025-06-24 12:58:52 ET RPRX

Published on 06/24/2025 at 12:58

Royalty Pharma plc announced a $2 billion funding arrangement with Revolution Medicines, consisting of a synthetic royalty of up to $1.25 billion on daraxonrasib and a senior secured loan of up to $750 million. These funds will support Revolution Medicines? plans for global development and commercialization of daraxonrasib and its pipeline programs for patients with RAS-addicted cancers.

Daraxonrasib, a RAS(ON) multi-selective inhibitor, is a potential practice-changing medicine in Phase 3 development for RAS mutant pancreatic cancer and non-small cell lung cancer (NSCLC). RAS is one of the most commonly mutated genes in human cancer. There are currently no approved targeted therapies that broadly target RAS for these cancers.

In the United States, approximately 56,000 patients are diagnosed with RAS-driven pancreatic cancer annually, while approximately 60,000 patients are diagnosed with RAS-driven NSCLC annually. Revolution Medicines expects Phase 3 results for daraxonrasib in pancreatic cancer in 2026 and the Phase 3 NSCLC study is currently enrolling patients. Royalty Terms: The royalty terms are structured across five tranches with the following details: Tranche 1 involves an amount of 250 million, with timing set for immediate draw and required.

Tranche 2 also has an amount of 250 million, with timing contingent upon positive data from RASolute 302, and it is required. Tranche 3 allows for an amount of up to 250 million, with timing dependent on FDA approval in second-line pancreatic cancer, and it is an option for Revolution Medicines. Tranche 4 similarly allows for an amount of up to 250 million, with timing based on sales milestone achievement, and it is also an option for Revolution Medicines.

Tranche 5 permits an amount of up to 250 million, with timing linked to positive Phase 3 data in first-line pancreatic cancer, and it remains an option for Revolution Medicines. The total amount across all tranches sums up to 1.25 billion. The annual sales royalty tiers are as follows: for sales of 0-2 billion, the royalty tier is 2.55%, for 2-4 billion it is 2.00%, and for 4-8 billion it is 1.50%.

The subsequent tiers are 1.00% for 8 billion, 0.75% for 10 billion, and 0.50% for 12 billion. The cumulative royalty rates across all tiers total 7.80% for the first tier, 4.55% for the second tier, and 2.40% for the third tier.