AI-driven drug discovery saw significant advancements in 2024, highlighting a growing role in psychiatry, oncology, and telehealth. AbbVie partnered with Gilgamesh to develop neuroplastogen therapies for psychiatric disorders, offering $65 million upfront and up to $2 billion in milestones and royalties. Isomorphic Labs granted Eli Lilly access to its AI platform for small molecule therapies, with a $45 million upfront payment and up to $1.7 billion in milestones. Caris Life Sciences partnered with Merck to develop cancer-targeting ADCs using its AI-driven platform, securing up to $1.4 billion in potential milestones.
In ventures, Xaira launched with $1 billion in series A funding to accelerate drug discovery using AI and advanced data integration. At the same time, Formation Bio raised $372 million in series D to streamline clinical trials and co-develop drug IP. Doc.com secured $300 million to expand its telehealth platform, raising its valuation to $1.3 billion.
In IPOs, Ceribell raised $207 million for neurological diagnostics, Alto Neuroscience raised $148 million for mental health therapeutics, and XtalPi debuted on the HKEX, raising $127 million to advance AI-based pharmaceutical R&D.
AI/ML Drug Discovery – Platform Licenses and Services
AI/ML drug discovery in 2024 surpasses 2023 in deal volume but slightly trails in value. By Q3 2024, 57 deals worth $10.1 billion were completed, with $245 million in upfront cash and equity on par with 2023. In contrast, 2023 saw 53 deals totaling $10.8 billion. Over two years, 110 deals have been closed, generating $20.9 billion in value and $490 million in upfront payments.
Top 3 R&D Partnerships AI/ML Drug Discovery
AbbVie research partnership with Gilgamesh – May 2024
AbbVie partnered with Gilgamesh to develop AI-driven neuroplastogen therapies for psychiatric disorders with an exclusive licensing option. Gilgamesh received $65 million upfront and could earn up to $2 billion in option fees, milestones, and tiered royalties (mid-single to low-double digits).
Isomorphic Labs development and commercialization deal with Eli Lilly – January 2024
Isomorphic Labs granted Eli Lilly exclusive rights to its AlphaFold and AI platform for developing small molecule therapies targeting multiple undisclosed areas. Isomorphic will leverage virtual screening and ab initio design methods. The deal includes $45 million upfront, up to $1.7 billion in performance-based milestones, and royalties reaching low double digits.
Caris Life Sciences development and commercialization deal with Merck – April 2024
Caris Life Sciences granted Merck exclusive global rights to develop and commercialize antibody-drug conjugates (ADCs) for cancer using Caris’ AI-driven multi-omics platform. The agreement includes an undisclosed upfront payment, R&D funding, up to $1.4 billion in milestones, and tiered royalties.
AI/ML Venture Funding
AI/ML venture funding grew in 2024, outpacing 2023 in funding rounds and raising capital. By Q3 2024, 175 rounds secured $5.7 billion, compared to 164 rounds raising $4.4 billion in 2023. Over two years, 339 rounds have raised $10.1 billion.
Top 3 Venture AI/ML Drug Discovery
Xaira – Series A – $1B – April 2024
Xaira leverages AI to revolutionize drug discovery and aims to accelerate effective therapies by integrating advanced product development, biological and clinical data generation, and AI research applied across all stages of drug development. Co-founded by Dr. David Baker and incubated by ARCH Venture Partners and Foresite Labs, Xaira launches with over $1 billion in funding.
Formation Bio – Series D – $372M – June 2024
Formation Bio, an AI-native pharmaceutical company, has raised $372 million in series D funding led by a16z. Sanofi and other investors have provided significant backing, including Sequoia, Thrive, and Emerson Collective. New participants include SV Angel Growth and FPV Ventures. Formation focuses on licensing and co-developing drug IP with biotech and pharma companies, advancing therapies beyond clinical proof-of-concept, lengthy timelines, and low success rates in drug development by streamlining clinical trials.
Doc.com – Series Unspecified – $300M – January 2024
Silver Rock Group, known for backing ventures like Docusign, announced a $300 million equity investment in Doc.com, a decentralized telehealth platform offering free basic healthcare and health education globally. The funding raises Doc.com’s valuation to $1.3 billion, marking Silver Rock’s first foray into healthcare. The investment will support Doc.com’s expansion into the U.S., aiming to deliver free basic healthcare to millions of uninsured individuals across all 50 states.
Manufacturing, Services, and Healthcare AI/ML IPO Activity
AI/ML IPO activity in manufacturing, services, and healthcare surged in 2024. By Q3, 5 IPOs raised $1.5 billion, a sharp increase from one IPO raising $500 million in 2023. Over two years, 6 IPOs collectively raised $2.1 billion.
Top 3 IPO AI/ML Drug Discovery
Ceribell – IPO – $207.3M – August 2024
CeriBell, Inc. (Nasdaq: CBLL), a medical technology company specializing in neurological diagnostics, closed its upsized IPO, issuing 12,196,969 shares at $17.00 per share, including 1,590,909 shares from underwriters’ exercised options. The offering raised approximately $207 million in gross proceeds. CeriBell’s stock began trading on the Nasdaq Global Select Market on October 11, 2024, under the “CBLL.”
Alto Neuroscience – IPO – $147.9M – January 2024
Alto Neuroscience, Inc. (NYSE: ANRO) completed its upsized IPO, issuing 9,246,000 shares at $16.00 per share, including 1,206,000 additional shares from underwriters’ exercised options. The offering generated gross proceeds of approximately $148 million. Alto’s stock is now listed on the NYSE under the “ANRO.”
Xtalpi – IPO – $126.7M – December 2024
QuantumPharm (HKEX: 2228), known as XtalPi, debuted on the Hong Kong Stock Exchange. Shares were priced at HK$5.28, opening at HK$5.39 and reaching an intraday high of HK$6.58. The IPO raised total proceeds of HK$989 million (approximately $127 million). XtalPi, founded in 2015 by MIT quantum physicists, leverages AI, quantum physics, cloud computing, and robotics to accelerate R&D in pharmaceuticals, biotechnology, and materials science.
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