Revolution Medicines Joins Amgen and Mirati in Quest for New Type of Cancer Drugs

Company's shares up 70% just days after public offering

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Barry Cohen
Feb 19, 2020
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The share price of a clinical-stage oncology company that went public just last week has climbed more than 70% on hopes that it can develop drugs to transform the way cancer is treated.

Redwood City, California-based Revolution Medicines Inc. (

RVMD, Financial) sold 14 million shares at $17 each on Feb. 13, 2020, raising a total of $238 million (more than twice its original goal). At close on Feb. 18, shares were trading at just over $29.

The six-year-old company will use the funds to push along drug candidates that block certain proteins that cause cancer to grow and thrive. The pharmaceutical industry has long known that a family of genes turns regular cells cancerous after mutating.The hard part was finding medications that quashed the effects of those genes. New research indicates that several pharma companies are on the brink of finding effective treatments.

Last year, Amgen Inc. (

AMGN, Financial) heightened hopes in the medical community when it released test results that showed one of its experimental drugs seemed to stabilize a small number of lung cancer patients with a mutated form of a gene called KRAS.

Revolution has a number of drugs in the early stages of testing aimed at treating KRAS mutations. The one that is furthest along just began human studies last summer. It is being developed in conjunction with Sanofi (

SNY, Financial).

In order for a drug to block a protein, it needs to bind to a site somewhere on the molecule. RAS proteins pose the challenge of lacking druggable binding pockets for a drug, Revolution said in its filing. The companys technology addresses that problem by using a second protein, which it calls a chaperone, to form a pocket. That druggable pocket is where Revolutions small molecule drugs are intended to bind to a RAS protein.

Oncogenic mutations in RAS genes are found in about 30% of human cancers, with the highest incidence in pancreatic (about 98%), colorectal (52%) and lung (32%) cancers.

Revolution has plenty of competition in its quest to find effective protein blockers. Last October, San Diego-based Mirati Therapeutics Inc. (

MRTX, Financial) showed data that indicated its drug candidate appeared to duplicate Amgen's discovery. Since that announcement, Mirati traded up to more than $132, but has since eased to just under $97.

Also targeting KRAS are Johnson & Johnson (

JNJ, Financial), Boehringer Ingelheim, Moderna Inc. (MRNA, Financial), BridgeBio Pharma Inc. (BBIO, Financial) and the National Cancer Institute.

Revolution is led by President and CEO Mark A. Goldsmith. He holds an A.B. from Princeton University and an M.D. and Ph.D. in microbiology and immunology from UCSF. While working in academia, he served as a consultant and collaborator to a variety of small and large biotechnology and pharmaceutical companies. Later, he served in senior management roles in private and public biotechnology companies, including Genencor International and Constellation Pharmaceuticals Inc. (

CNST, Financial).

Disclosure: The author has a position in Amgen and Johnson & Johnson.

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Author's Avatar
Barry Cohen has nearly 40 years experience in communications and marketing, the majority in senior positions at large international health care companies, including Abbott Laboratories and Bayer Inc. He has contributed to a number of financial websites, writing primarily about the stocks of health care companies.