USA — Chip designer Nvidia has announced a US$50 million investment in biotech firm Recursion to enhance the training of artificial intelligence (AI) models for drug discovery.
The collaboration between the two companies caused Recursion’s shares to surge approximately 83% following the announcement.
The company, which went public in 2021 after raising US$436 million in an initial public offering, operates the Recursion OS platform that gives drugmakers access to datasets required for designing and developing therapeutics.
Recursion, which boasts AI pioneer Yoshua Bengio among its advisors, will leverage its vast biological and chemical datasets, surpassing 23,000 terabytes, to train AI models on Nvidia’s cloud platform.
In addition to the financial investment, Recursion is exploring potential licensing opportunities through Nvidia’s BioNeMo platform— a generative AI cloud service for drug discovery introduced earlier this year allowing the AI models to be disseminated across the biopharma industry easily.
As part of the deal, Recursion has sold over 7.7 million of its Class A common stock to Nvidia, giving the chip designer an approximate 4% stake in the company.
This investment comes on the heels of Recursion’s increased focus on AI capabilities, demonstrated by its recent acquisitions of two AI-driven drug discovery companies for a total of US$87.5 million.
The collaboration with Nvidia will not only support Recursion’s own drug development pipeline but also that of its partners, which currently include Bayer and Roche.
Recursion is currently conducting human trials for five of its drugs, including one candidate in mid-stage trials for the treatment of a neurovascular disease caused by malformations in small blood vessels in the brain.
Noteworthy investors in the biotech firm include Abu Dhabi’s sovereign investor Mubadala and UK-based investment firm Baillie Gifford & Co.
Following the news, Recursion’s shares experienced a substantial increase, trading at US$12.40 in heavy volumes. If the current gains hold through the session, the company will see its best day since going public in 2021.
The inclusion of Recursion’s data on BioNeMo has the potential to provide broad access to the company’s technology within biopharma companies.
It is important to note that Recursion retains full intellectual property rights to its data, requiring licensing for any third-party development.
Recursion’s collaboration with Nvidia and the integration of their software into its drug development pipeline and partnerships is considered a significant validation for the AI-driven drug/molecule development space.
Analysts suggest that the strategic alliance will have a far-reaching impact and facilitate the adoption of Recursion’s technology throughout the biopharma industry.
With ongoing clinical trials and recent acquisitions, Recursion is poised to advance its chemistry and generative AI capabilities with the support of Nvidia’s optimization and scaling expertise.
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