Recursion and Exscientia Merge, Create New Drug Discovery Company
US-headquartered biotech firm Recursion has announced that it will acquire UK-based pharmatech Exscientia in an all-stock deal. The transaction, which is expected to close in early 2025, would provide the combined entity with approximately $850 million in cash to fund its operations for the next three years. Reuters reported that Recursion will pay $688 million for the acquisition of Exscientia.
Once integrated, the companies said that they believe the “extended and evolved Recursion” will enable the discovery and translation of higher quality medicines more efficiently and at a higher scale with a full-stack technology-enabled small molecule discovery platform. In addition, the combined company expects to read out approximately ten clinical trials in the next 18 months.
“We believe the proposed combination is deeply complementary and aligned with our missions to industrialize drug discovery to deliver high quality medicines and lower prices for consumers,” said Chris Gibson, co-founder and CEO of Recursion as well as the planned CEO of the combined entity. “Exscientia’s precision chemistry tools and capabilities, including its newly commissioned automated small molecule synthesis platform, will augment our tech-enabled biology and chemistry exploration, hit discovery and translational capabilities.”
“Adding Exscientia’s best-in-class focused precision oncology internal pipeline to Recursion’s first-in-class focused pipeline spanning rare disease, precision oncology and infectious disease is highly complementary as we look to bring treatments to patients faster,” said David Hallett, Exscientia’s interim CEO and planned chief scientific officer of Recursion post-closing of the transaction.
According to Recursion and Exscientia, the planned business combination will also advance existing collaborations with biopharmaceutical companies such as Roche-Genentech, Sanofi, Bayer and Merck. These partnerships could generate approximately $200 million in milestone payments over the next two years and more than $20 billion in royalties from net sales of the partnership programs over the course of the partnership, the companies said.
