Alphabet’s digital biotech company Isomorphic Labs on Sunday bagged two big-ticket partners in Eli Lilly and Novartis, which will leverage its artificial intelligence platform to develop small molecule drugs for still-undisclosed targets.
Isomorphic’s AI technology—developed through pioneering research at Google DeepMind and other work across the Alphabet family of companies—seeks to improve the drug discovery process “to treat and cure disease faster,” according to the biotech’s website. Isomorphic focuses on developing novel computational techniques to “solve some of the most stubborn scientific problems in biology, chemistry and medical research.”
In return for its work with Lilly identifying small molecule drug candidates agains “multiple targets,” the Alphabet biotech will receive $45 million upfront and is eligible for up to $1.7 billion in performance-based milestones, on top of tiered royalties up to low double digits on net sales of any product that might arise from the partnership.
The Novartis contract is similar, with Isomorphic receiving $37.5 million upfront and up to $1.2 billion in milestones, plus royalties. The partners have likewise not specified what conditions they are targeting, but have revealed that they plan to collaborate on three targets using Isomorphic’s AI approach.
Novartis will also fund “select research costs” of the Alphabet company, according to the Sunday press release.
The Lilly and Novartis partnerships come as the industry prepares for the J.P. Morgan Healthcare Conference in San Francisco, California, which will kick off what is likely to be an active and dynamic year for biopharma.
In December 2023, professional services form PwC released its US Deals 2024 Outlook report, indicating that the industry is likely to see a “healthy” level of dealmaking this year, potentially even reaching pre-pandemic levels. In particular, the firm anticipates high investor interest in precision medicine in oncology and immunology, as well as cardiovascular diseases and weight loss, both of which saw explosive growth in 2023. Initial public offerings will also likely see a small uptick in activity, particularly for young start-ups armed with strong and promising clinical data.
Seemingly bearing out PwC’s predictions, biopharma closed 2023 out with a flurry of dealmaking activity, including AstraZeneca’s $1.2 billion acquisition of China-based Gracell Biotechnologies, BMS’s $3.6 billion buy of RayzeBio and Roche’s $295 million purchase of companies under the LumiraDx group.
Similarly, the industry rang in the new year with several big-ticket deals. Last week, Boehringer Ingelheim inked a $2 billion siRNA contract with Ribo, Novo dropped $1 billion in separate research partnerships with two Flagship companies and AbbVie pledged up to $1.44 billion for two CAR-T deals with Umoja.
Source: BioSpace, Tristan Manalac