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AI Drug Discovery

Artificial intelligence is identifying and testing new therapies faster than ever.

Overview

Artificial intelligence promises accurate and faster drug discovery

Artificial intelligence (AI) drug discovery is the process of applying advanced algorithms and machine learning to large biological and chemical datasets in order to find potential drug candidates. AI’s ability to rapidly and precisely analyze highly complex scientific data potentially results in faster discovery of drug candidates, reducing the time taken by a factor of 15 and offering a greater chance of success. Many large pharmaceutical companies are collaborating with AI companies to offer drug discovery services to speed up the delivery of medicines to the market.

Although there is no fully AI-developed drug yet on the market, a few drug candidates have already advanced into clinical trials. A drug discovered by the AI startup Exscientia’s drug discovery platform reached clinical trial stage within 12 months instead of the five years expected for similar development in the traditional drug development process. AI models are also accelerating the delivery of repurposed Covid-19 drugs (meaning reusing existing drugs for new treatments) with a few currently being tested at the clinical trial stage.

What's driving this industry?
Market Sizing

Global market size for AI drug discovery startups could reach USD 4.2-12.7 billion by 2025

Conservative case

USD 4.2 Bn

Base case

USD 8.5 Bn

Expansion case

USD 12.7 Bn

USD million02,0004,0006,0008,00010,00012,00014,000202020212022202320242025
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COVID-19 IMPACT

  • BenevolentAI ’s repurposed drug for Covid-19 has been granted the FDA’s Emergency Use Authorization. 

  • Exscientia has been screening more than 15,000 drugs (comprising some approved and others clinically ready) to assess their effectiveness against Covid-19.

  • Insilico Medicine launched COVIDomic, a system for Covid-19 basic and clinical research.

  • AbCellera has discovered antibody treatment for Covid-19, Bamlanivimab, using its AI-powered discovery platform, which received the FDA’s Emergency Use Authorization. 

  • Google’s DeepMind used its AlphaFold AI platform to publish predictions of protein structures associated with the virus.

Market Mapping

The AI drug discovery industry consists of:

AI SaaS companies: A large number of startups in the AI drug discovery space operate as AI SaaS (Software-as-a-Service) companies providing their ML platform to other pharma companies. These pure play startups often specialize in a specific stage of the drug discovery process, and have not expanded into latter stages of drug development.

AI drug discovery and development companies: Majority of the well funded startups in the AI drug discovery space operate as drug discovery and development companies. These are biotechnology companies that have integrated AI as a core component of their in-house drug development process. They typically have a few in-house drug development programs and also collaborate with pharma companies to develop certain drugs.

Pharma incumbents: Large pharma companies operate in this space through collaborations with AI startups or tech companies or by developing in-house AI capabilities.

Tech incumbents: Tech companies which are known for their strong AI capabilities have also entered the industry and offer machine learning tools to support drug discovery. Tech incumbents simply offer ML tools and are not specialized in any particular segment. Hence, they are not included in the market map.

Over 90% of the startups are at the seed/early stages. Most AI SaaS platform operators are yet to achieve stable revenue despite collaborations with pharma companies. AI biotechnology startups have not commercialized their drug with only a few reaching the clinical trial stage.

Incumbents
Growth
Early
Seed
Pre-Seed
AI Drug Discovery & Development
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AI SaaS | Data Aggregation and Research
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AI SaaS | Biomarker Development
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AI SaaS | Preclinical Experiments
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AI SaaS | Drug Discovery
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Pharmaceuticals
Pharmaceuticals
Pharmaceuticals
Pharmaceuticals
Pharmaceuticals
Pfizer
AstraZeneca
GlaxoSmithKline
Roche
Merck
Bristol-Myers Squibb
Novartis
Google
Moderna Therapeutics
Microsoft
Intel
Schrödinger
Gritstone Oncology
Relay Therapeutics
Exscientia
Recursion Pharmaceuticals
Generate Biomedicines
Insilico Medicine
Nimbus Therapeutics
Deep Genomics
Arbor Biotechnologies
Pharnext
BlackThorn Therapeutics
Verge Genomics
BIOAGE LABS
Neuron23
eTherapeutics
Lantern Pharma
Healx
Celsius Therapeutics
Genesis Therapeutics
LabGenius
Envisagenics
Evaxion Biotech
Lodo Therapeutics
Aria Pharmaceuticals
Berg
AI Therapeutics
Valo Health
Erasca
HotSpot Therapeutics
Cellarity
Frontier Medicines
METiS Therapeutics
Standigm
Drug Farm
Engine Biosciences
Endogena Therapeutics
Quris
Fountain Therapeutics
Reverie Labs
ReviR Therapeutics
PharmCADD
X-37
Phenomic AI
SEngine Precision Medicine
Turbine
Protai
Unnatural Products
Kuano
Mydecine Innovations Group
Shepherd Therapeutics
PatSnap
Verana Health
DNAnexus
Genuity Science
Owkin
nference
Zilliz
Flywheel
Kyndi
Molecular Health
Cambridge Cancer Genomics
Nautilus Biotechnology
Axtria
PostEra
OccamzRazor
Intelligencia
Ozette
Rhino Health
Molecule.one
InveniAI
WorldQuant Predictive
PathAI
Biodesix
PAIGE
Iterative Scopes
Glympse Bio
Ibex Medical Analytics
Visiopharm
Nautilus Biotechnology
Berkeley Lights
BenchSci
Emerald Cloud Lab
Synthace
VeriSIM Life
Arctoris
Amazon
XtalPi
Insitro
AbCellera Biologics
BenevolentAI
AbSci
Atomwise
Dyno Therapeutics
Nuritas
Empirico
Cyclica
Arzeda
NuMedii
Entos
BigHat Biosciences
Spring Discovery
Tara Biosystems
Pepticom
OneThree Biotech
Peptone
Antiverse
Optibrium
BioSimulytics
Iktos

The Disruptors

Disruptors’ value proposition comes from their specialization and unique technology

Both artificial intelligence (AI) Software-as-a-Service (SaaS) companies and AI-driven biotechnology startups often collaborate with big pharma companies to leverage from the benefits of synergy or due to the lack of funding/expertise to develop drugs in-house. Given that most big pharma companies have also integrated AI into their drug development process in some form, disruptors’ value proposition comes from their specialization and unique technologies.

AI Drug Discovery & Development

?

Disruptors

?
Funding in USD Millions
Recursion Pharmaceuticals
Public - Market cap USD 2.7 bn
Relay Therapeutics
Public - Market cap USD 2.4 bn
Schrödinger
Public - Market cap USD 2.3 bn
Exscientia
Public - Market cap USD 2.2 bn
Erasca
Public - Market cap USD 1.3 bn
Gritstone Oncology
Public - Market cap USD 424.9 mn
eTherapeutics
Public - Market cap USD 291.3 mn
Evaxion Biotech
Public - Market cap USD 105.6 mn
Lantern Pharma
Public - Market cap USD 78.7 mn
Mydecine Innovations Group
Public - Market cap USD 51.5 mn
Valo Health
460
Generate Biomedicines
420
Insilico Medicine
306
Nimbus Therapeutics
302
Deep Genomics
237
HotSpot Therapeutics
210
Cellarity
173
Pharnext
158
Frontier Medicines
156
BlackThorn Therapeutics
138
Verge Genomics
134
BIOAGE LABS
124
Neuron23
114
METiS Therapeutics
86
Standigm
71
Healx
68
Celsius Therapeutics
65
Genesis Therapeutics
56
Drug Farm
56
Engine Biosciences
53
LabGenius
29
Quris
28
Reverie Labs
25
ReviR Therapeutics
20
PharmCADD
16
Protai
8
AI Therapeutics
Unknown
Watchlist
?
Arbor Biotechnologies
Endogena Therapeutics
Fountain Therapeutics
Envisagenics
Lodo Therapeutics
X-37
Aria Pharmaceuticals
Phenomic AI
SEngine Precision Medicine
Turbine
Unnatural Products
Kuano
Berg
Shepherd Therapeutics

AI SaaS | Data Aggregation and Research

?

Disruptors

?
Funding in USD Millions
Nautilus Biotechnology
Public - Market cap Unknown
Genuity Science
455
PatSnap
352
Verana Health
289
DNAnexus
273
Owkin
254
Axtria
206
nference
145
Zilliz
53
Flywheel
51
Kyndi
29
Molecular Health
27
Intelligencia
12
InveniAI
Unknown
Watchlist
?
PostEra
OccamzRazor
Cambridge Cancer Genomics
Ozette
Rhino Health
Molecule.one
WorldQuant Predictive

AI SaaS | Biomarker Development

?

Disruptors

?
Funding in USD Millions
Nautilus Biotechnology
Public - Market cap Unknown
PathAI
255
Biodesix
240
PAIGE
220
Iterative Scopes
194
Glympse Bio
96
Ibex Medical Analytics
52
Watchlist
?
Visiopharm

AI SaaS | Preclinical Experiments

?

Disruptors

?
Funding in USD Millions
Berkeley Lights
Public - Market cap USD 649.1 mn
BenchSci
95
Emerald Cloud Lab
92
Synthace
81
Watchlist
?
VeriSIM Life
Arctoris

AI SaaS | Drug Discovery

?

Disruptors

?
Funding in USD Millions
AbCellera Biologics
Public - Market cap USD 2.4 bn
AbSci
Public - Market cap USD 625.9 mn
XtalPi
786
Insitro
743
BenevolentAI
292
Atomwise
177
Dyno Therapeutics
109
Nuritas
106
Entos
53
Empirico
30
BigHat Biosciences
24
Cyclica
24
Spring Discovery
22
Tara Biosystems
21
Watchlist
?
Arzeda
Pepticom
NuMedii
OneThree Biotech
Peptone
Antiverse
Optibrium
BioSimulytics
Iktos

Recursion Pharmaceuticals

Recursion Pharmaceuticals is a biotechnology company that combines experimental biology and artificial intelligence (AI) to identify treatments for rare diseases, aging, inflammation, infectious diseases, and immunology. The company's approach is based on experimenting by making healthy cells sick, scanning images, and experimenting with its AI platform to understand how they differ from healthy cells. Its lab can perform one million such experiments a week.

Recursion operates as a full-stack player engaged in drug discovery as well as development. It has four drugs targeted at rare diseases in the clinical trial stage. It is also partnering with large pharma companies in more competitive areas. Bayer became a strategic investor and entered into a partnership to jointly develop at least 10 new treatment programs. Both companies will jointly own the projects, and Recursion will generate milestone payments of USD 100 million per program and royalties on future sales. Bayer’s partnership is the company’s third big pharma collaboration, following partnerships with Sanofi and Takeda. 

In June 2021, the company entered into a collaboration with the Montreal-based Mila - Quebec Artificial Intelligence (AI) Institute, to leverage its network of expert scientists and professionals to accelerate the company’s machine learning capabilities. The company also announced it will launch its first major multidisciplinary expansion, in Toronto, to further enhance tech-enabled drug discovery, by the end of 2021. 

The company went public on the Nasdaq in April 2021, raising USD 508.1 million.

Segment:
AI Drug Discovery & Development
Total funding:
USD 465.4 million
Competitors:
Relay Therapeutics, Erasca, BlackThorn Therapeutics
Disruptor Funding History

AI Drug Discovery & Development:

Recursion Pharmaceuticals
Relay Therapeutics
Schrödinger
Exscientia
Erasca
Gritstone Oncology
eTherapeutics
Evaxion Biotech
Lantern Pharma
Valo Health
Generate Biomedicines
Insilico Medicine
Nimbus Therapeutics
Deep Genomics
HotSpot Therapeutics
Cellarity
Pharnext
Frontier Medicines
BlackThorn Therapeutics
Verge Genomics
BIOAGE LABS
Neuron23
METiS Therapeutics
Standigm
Healx
Celsius Therapeutics
Genesis Therapeutics
Drug Farm
Engine Biosciences
LabGenius
Quris
Reverie Labs
ReviR Therapeutics
PharmCADD
Protai
Arbor Biotechnologies
Endogena Therapeutics
Fountain Therapeutics
Envisagenics
Lodo Therapeutics
X-37
Aria Pharmaceuticals
Phenomic AI
SEngine Precision Medicine
Turbine
Unnatural Products
Kuano

AI SaaS | Data Aggregation and Research:

Nautilus Biotechnology
Genuity Science
PatSnap
Verana Health
DNAnexus
Owkin
Axtria
nference
Zilliz
Flywheel
Kyndi
Molecular Health
Intelligencia
PostEra
OccamzRazor
Cambridge Cancer Genomics
Ozette
Rhino Health
Molecule.one

AI SaaS | Biomarker Development:

The Incumbents

Collaborations with artificial intelligence companies companies remain common among big pharma

Incumbents consist of large pharma companies which have integrated artificial intelligence (AI) into their drug development process in some form or entered into collaborations with AI startups and technology companies that offer AI-driven solutions for drug discovery.

Leading big pharma companies have developed in-house AI capabilities, but have not disclosed the extent to which AI is being used in the drug development process. All leading big pharma companies are actively engaged in collaborations with AI startups or tech companies. This is because building in-house capabilities to match the specialization offered by startups is challenging, especially with the scarcity of personnel skilled in both AI and biology.

AI Drug Discovery & Development
AI SaaS | Data Aggregation and Research
AI SaaS | Biomarker Development
AI SaaS | Preclinical Experiments
AI SaaS | Drug Discovery
In House Development
M&A
Partnership
Investment

Notable Investors

No investor data is available

Funding data are powered by Crunchbase
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