Royalty Pharma announces $2B funding arrangement with Revolution Medicines

Royalty Pharma (RPRX) announced a $2B funding arrangement with Revolution Medicines (RVMD), consisting of a synthetic royalty of up to $1.25B on daraxonrasib and a senior secured loan of up to $750M. 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 canceri and non-small cell lung cancer. 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 Pharma will provide up to $1.25B in exchange for a synthetic royalty on annual worldwide net sales of daraxonrasib. Royalty Pharma will provide a senior secured term loan of up to $750M at SOFR plus 5.75% which matures six years after the first tranche of $250M is drawn. The first tranche must be drawn following U.S. Food and Drug Administration approval of daraxonrasib for metastatic pancreatic cancer. The two additional $250M tranches are available at Revolution Medicines’ option based on the achievement of certain annual net sales milestones for daraxonrasib. Royalty Pharma retains the flexibility to syndicate all or a portion of this loan with other investors.