DeepMind spinout Isomorphic Labs has issued £182m in new shares, according to Companies House filings.
The UK-based company, which has developed an AI drug discovery platform for the pharma and biotech industries and is ultimately owned by Google’s parent company Alphabet, filed the document earlier this month.
The shares were priced at £1.65 each, a 65% increase since Isomorphic last issued £89m-worth of shares in 2021, priced at £1 each.
The news follows Isomorphic Labs announcing two partnerships worth up to $2.9bn with pharma giants Eli Lilly and Novartis in January this year.
Isomorphic Labs did not provide a comment before publication.
Halving drug discovery timelines
Isomorphic is looking to halve the time it takes to find new medicines.
In January, Demis Hassabis — who serves as CEO and founder of both DeepMind and Isomorphic Labs — told the Financial Times that he hopes the spinout can reduce the drug discovery stage that comes before pre-clinical trials from an average of five years to two.
Launched in 2021, Isomorphic has built its platform based on DeepMind’s breakthrough AlphaFold technology — which predicts how protein structures might interact with other molecules — to apply it to a wider range of biological molecules than just proteins.
The company’s AI platform can recommend which potential molecule combinations will have the intended result on the body in a prospective new drug.
In May, Google announced that Isomorphic and DeepMind had developed AlphaFold 3 — a new AI model that it said could predict the structure of “proteins, DNA, RNA [and] ligands” and how they’d interact with other molecules with greater accuracy than previous models.
“Isomorphic Labs is already collaborating with pharmaceutical companies to apply it to real-world drug design challenges and, ultimately, develop new life-changing treatments for patients,” the company said in the statement.
If Isomorphic succeeds in slashing drug discovery timelines, there’s potentially huge upsides for the companies it works with. It can take between 10-15 years to develop a drug, according to Cancer Research UK, and cost up to $2.8bn, according to one study.
The partnerships with Lilly and Novartis are the first to be publicly announced. The deal with Lilly paid Isomorphic $45m upfront with another $1.7bn to be paid when the company reached certain milestones, while the Novartis contract was worth $37.5m upfront and a possible $1.2bn further down the line.
AI for drug discovery
Drug discovery has long been mooted as an industry ripe for disruption with AI, and Europe has seen its fair share of tech companies pick up big money from VCs.
In the UK, Exscientia raised more than $600m before IPO’ing via an ill-fated SPAC in 2021, and then got acquired by Recursion Pharma for $688m in August this year. BenevolentAI picked up more than $300m before listing — also via a SPAC — in 2021.
France-founded Owkin, which has since moved its HQ to the US, has also raised more than $300m from VCs.
2024 has seen European startups using AI to develop medicine discovery platforms like LabGenius, Healx and Baseimmune all pick up investment — and there are signs that funding is picking up on a global scale, too.
So far this year, startups using AI in drug discovery have raised $3.6bn, according to data platform Dealroom, already topping 2023’s $2.9bn.
Some see that investor confidence as driven by the upcoming “patent cliff” faced by big pharmaceutical companies. As a number of drug patents expire in the years to 2030, it could see them lose hundreds of billions of dollars in revenue — meaning many are looking to partner with startups promising to reduce the timelines of bringing new drugs to market, investors tell Sifted.
Read the orginal article: https://sifted.eu/articles/deepmind-spinout-isomorphic-labs-shares-news/
