Transaction Overview - Recursion and Exscientia are combining to bring better medicines to patients more rapidly and cost efficiently[11] - Exscientia shareholders will receive 0.7729 shares of Recursion Class A common stock for each Exscientia ordinary share[27] - Recursion shareholders will own approximately 74% of the combined company, while Exscientia shareholders will own approximately 26%[27] - The transaction is expected to close by early 2025, subject to shareholder approvals and closing conditions[27] Financial Synergies and Cash Position - The combined company will have approximately $850 million in cash as of the end of Q2 2024[11, 27] - Estimated annual synergies of $100 million or more are expected[11, 27] - The pro forma combined financial plans are expected to extend the cash runway into 2027[27] Pipeline and Partnerships - The combined company anticipates approximately 10 clinical readouts over the next 18 months[11, 12, 14] - Current partnerships have the potential for over $200 million in milestone payments over the next 2 years[11, 18] - The combined company has the potential for over $20 billion in total revenue before royalties from partners[18] - CDK4/6 inhibitors generated $11 billion in sales in 2023[31]

Core Insights - The business combination of Recursion and Exscientia has been completed, creating a vertically-integrated and technology-enabled drug discovery platform [1][2] - The combined entity will focus on first and best-in-class drug discovery and development, leveraging AI to reduce time and costs [1][2] Pipeline - The combined pipeline includes more than 10 clinical and preclinical programs, along with approximately 10 advanced discovery programs [3][4] - Key upcoming milestones include initial Phase 1 data for REC-617 expected on December 9, 2024, and various updates for other candidates throughout 2025 and 2026 [4][5] Partnerships - The company has over 10 partnered programs in oncology and immunology, with approximately $450 million received in upfront and milestone payments to date [6][7] - Potential future milestone payments from partnerships could exceed $20 billion [6][7] Platform - The integration of Exscientia's chemical design methods and Recursion's extensive proprietary data (over 60 petabytes) will enhance the Recursion Operating System (OS) for drug discovery [8][9] - The platform aims to create virtual cells for executing clinical trials at scale, driving iterative learning from research to development [9] Company Structure and Leadership - The combined company will have around 800 employees, with headquarters in Salt Lake City and additional offices in various locations [10] - Leadership changes include appointments of former Exscientia executives to key positions within Recursion [10]

Core Viewpoint - Recursion and Exscientia have received overwhelming shareholder approval for their proposed business combination, which is expected to close on November 20, 2024 [1][2][3] Group 1: Transaction Details - The transaction is anticipated to close on November 20, 2024, pending customary closing conditions [2] - Recursion will host an update call on the closing date, broadcasting via multiple platforms [2] Group 2: Company Profiles - Recursion is a clinical stage TechBio company focused on industrializing drug discovery through its Recursion Operating System, which utilizes extensive datasets and machine-learning algorithms [4] - Exscientia is a technology-driven drug design company that integrates AI and automation to create effective medicines more efficiently, with a focus on oncology and other therapeutic areas [6] Group 3: Leadership and Future Outlook - Chris Gibson, Co-Founder and CEO of Recursion, will continue as CEO of the combined entity, emphasizing the integration of both companies' capabilities to enhance drug discovery [3] - The combination aims to leverage Recursion's biological and chemical exploration with Exscientia's molecular design to accelerate drug development [3]

Company Updates - Recursion (NASDAQ: RXRX) will provide business updates and report its Q3 2024 financial results on November 6, 2024, after market close [1] - The company will not hold its usual earnings call for Q3 but plans to host an update call after the proposed business combination with Exscientia, expected on November 20, 2024 [1] Business Model and Technology - Recursion is a clinical stage TechBio company focused on decoding biology to industrialize drug discovery [1] - The company utilizes the Recursion OS, a platform that integrates diverse technologies to expand a large proprietary biological and chemical dataset [1] - Recursion employs advanced machine-learning algorithms to identify trillions of searchable relationships in biology and chemistry, minimizing human bias [1] - The company conducts millions of wet lab experiments weekly and operates one of the world's most powerful supercomputers to enhance drug discovery [1] Corporate Presence - Recursion is headquartered in Salt Lake City and is a founding member of BioHive, a collective for Utah's life sciences industry [1] - The company has additional offices in Toronto, Montréal, London, and the San Francisco Bay Area [1]

Core Viewpoint - The merger between Exscientia and Recursion Pharmaceuticals aims to create a leading AI-driven drug discovery company, despite challenges in clinical evidence supporting AI's effectiveness in drug development [1][2]. Company Overview - Recursion Pharmaceuticals is set to become the largest AI-fueled drug discovery business following its merger with Exscientia, which has raised concerns about its current clinical progress and financial health [3][4]. - The combined entity will leverage different methodologies: Recursion focuses on large-scale experiments and data mining, while Exscientia utilizes published data and patient samples for drug candidate discovery [4][5]. Clinical Development - Following the merger, Recursion anticipates reporting results from 10 clinical trials over the next 18 months, with the potential for some candidates to become approved drugs if AI-driven discovery proves effective [6]. - The company has established partnerships with major pharmaceutical firms such as Sanofi, Bayer, Merck KGaA, and Roche, with potential milestone payments exceeding $20 billion, excluding royalties [7]. Financial Position - Recursion Pharmaceuticals has a market capitalization of approximately $1.6 billion, which is considered high for a clinical-stage drugmaker that has not yet entered phase 3 trials [8]. - As of June 30, 2024, Recursion has accumulated a deficit of $1.2 billion, raising concerns about its financial sustainability given its lack of advanced drug candidates [11]. Industry Challenges - The value proposition of Recursion's technology is questioned by big pharma, as improvements are primarily focused on the early stages of drug development, which may not justify the high costs associated with later stages [9]. - Despite its promise to expedite drug development, Recursion has not yet initiated any phase 3 trials, indicating a slower-than-expected progress in bringing new drug candidates to market [10].

Core Viewpoint - Exscientia plc and Recursion Pharmaceuticals Inc. have agreed to merge, creating a combined entity where Recursion shareholders will own approximately 74% and Exscientia shareholders will own about 26% [1] Group 1: Merger Details - Exscientia shareholders will receive 0.7729 Recursion shares for each Exscientia share, with fractional shares paid in cash [1] - The combined company will be named Recursion and will continue to be headquartered in Salt Lake City, Utah, while maintaining a significant presence in the U.K. [2] Group 2: Leadership Structure - Chris Gibson, Co-Founder & CEO of Recursion, will serve as CEO of the combined company, while David Hallett, Interim CEO & Chief Scientific Officer of Exscientia, will join as Chief Scientific Officer [3] Group 3: Technological Integration - Exscientia will contribute its precision chemistry design and small-molecule automated synthesis technology to enhance Recursion's capabilities [4] Group 4: Financial Outlook - The combined company expects to read out approximately ten clinical trials in the next 18 months, with potential annual peak sales opportunities exceeding $1 billion for successful programs [5] - The entity will have $850 million in cash and about $200 million in expected milestones over the next 24 months, along with a potential $20 billion in royalties if drugs from the pipeline are approved [5] - Estimated annual synergies of approximately $100 million are expected, with a runway extending into 2027 [6] Group 5: Market Reaction - Following the announcement, EXAI stock closed 17.1% higher at $5.27 [6]

Core Viewpoint - The merger between Recursion and Exscientia aims to create a leading technology-first, end-to-end drug discovery platform that leverages advancements in life sciences and technology to deliver novel treatments more efficiently and cost-effectively [1][2][3] Company Overview - Recursion is a clinical stage technology-enabled biotech company focused on industrializing drug discovery, while Exscientia is a technology-driven drug design and development company committed to creating effective medicines faster [12][14] - The combined entity will maintain the name Recursion and will be headquartered in Salt Lake City, Utah, while also having a significant presence in the U.K. [10] Strategic Rationale - The merger is expected to create a diverse portfolio of clinical and near-clinical programs, with approximately 10 clinical readouts anticipated over the next 18 months, potentially leading to annual peak sales opportunities exceeding $1 billion for successful programs [5][6] - The combination will enhance operational synergies, with expected annual savings exceeding $100 million [1][8] Pipeline and Clinical Programs - The combined pipeline will include a variety of programs across oncology, rare diseases, and infectious diseases, with no competitive overlap between the two companies [5][6] - Key clinical programs include REC-994 for Cerebral Cavernous Malformation, REC-2282 for Neurofibromatosis Type 2, and several oncology-focused programs from Exscientia [4][5] Partnerships - The merger will advance collaborations with major biopharma companies such as Roche-Genentech, Sanofi, Bayer, and Merck KGaA, with potential milestone payments of approximately $200 million over the next two years and over $20 billion in revenue before royalties [3][6] Financial Position - The combined companies will have approximately $850 million in cash and cash equivalents as of the end of Q2 2024, providing a strong financial foundation for future growth [1][8] Transaction Details - Under the terms of the agreement, Exscientia shareholders will receive 0.7729 shares of Recursion Class A common stock for each Exscientia share, resulting in Recursion shareholders owning approximately 74% of the combined company [8][9] - The transaction is expected to close by early 2025, subject to customary closing conditions and regulatory approvals [9][10]

Core Viewpoint - The merger between Recursion and Exscientia aims to create a leading technology-first, end-to-end drug discovery platform that leverages advances in life sciences and technology to deliver novel treatments more efficiently and cost-effectively [1][2][3]. Company Overview - Recursion is a clinical stage technology-enabled biotech company focused on industrializing drug discovery through advanced biological decoding [12]. - Exscientia is a technology-driven drug design and development company that utilizes precision design and integrated experimentation to create effective medicines [14]. Strategic Rationale - The combination is expected to yield a diverse portfolio of clinical and near-clinical programs, with approximately 10 clinical readouts anticipated in the next 18 months, potentially leading to annual peak sales opportunities exceeding $1 billion for successful programs [5][6]. - The merger will enhance operational synergies, with an estimated annual synergy of over $100 million [8]. Pipeline and Clinical Programs - The combined pipeline includes a variety of programs across oncology, rare diseases, and infectious diseases, with no competitive overlap between the two companies [5][6]. - Key clinical programs include REC-994 for Cerebral Cavernous Malformation, REC-2282 for Neurofibromatosis Type 2, and several oncology-focused programs from Exscientia [4]. Partnerships and Financials - The merger will strengthen existing partnerships with major biopharma companies such as Roche-Genentech, Sanofi, Bayer, and Merck KGaA, with potential milestone payments of approximately $200 million over the next two years and over $20 billion in revenue before royalties [3][6]. - The combined companies have a well-capitalized balance sheet with approximately $850 million in cash and cash equivalents as of Q2 2024 [1][8]. Transaction Details - Under the terms of the agreement, Exscientia shareholders will receive 0.7729 shares of Recursion Class A common stock for each Exscientia share, resulting in Recursion shareholders owning approximately 74% of the combined entity [8][9]. - The transaction is expected to close by early 2025, subject to customary closing conditions and regulatory approvals [9][10]. Management and Governance - The combined company will retain the name Recursion, headquartered in Salt Lake City, Utah, with Chris Gibson serving as CEO and David Hallett as Chief Scientific Officer [10].

Core Viewpoint - The Gross Law Firm has issued a notice to shareholders of Exscientia plc regarding a class action lawsuit due to alleged misconduct by former executives [1][4]. Group 1: Class Action Details - The class period for the lawsuit is from March 23, 2022, to February 12, 2024 [2]. - Shareholders who purchased shares during this period are encouraged to register for monitoring and updates on the case [2][3]. - The deadline for shareholders to seek lead plaintiff status is June 25, 2024 [2][3]. Group 2: Allegations Against Executives - The complaint alleges that Andrew Hopkins, the former CEO, engaged in improper relationships with employees, violating company standards [4]. - David Nicholson, the former Chairman, is accused of having prior knowledge of these relationships and failing to address them properly [4]. - The company's enforcement of its Code of Business Conduct and Ethics is claimed to be inadequate, leading to risks of leadership disruptions and reputational harm [4].

Group 1 - A class action lawsuit has been filed against Exscientia plc for violations of the Securities Exchange Act of 1934 and related rules [1] - The class period for the lawsuit is from September 13, 2022, to October 9, 2023, during which investors are encouraged to contact the law firm if they suffered losses [2] - The lawsuit alleges that Exscientia made false and misleading statements, with former CEO Andrew Hopkins engaging in improper relationships and former Chairman David Nicholson having knowledge of these issues [6] Group 2 - The company is accused of failing to maintain its Code of Business Conduct and Ethics, which left it vulnerable to improper conduct [6] - The public statements made by Exscientia were deemed false and materially misleading throughout the class period, leading to investor damages when the truth was revealed [6] - The Schall Law Firm specializes in securities class action lawsuits and represents investors globally [7]