Insilico Medicine, SK Biopharmaceuticals strike $2.5B AI drug discovery deal targeting neuroimmune therapies

Insilico Medicine, the Hong Kong-listed AI drug discovery company, has signed a partnership with Korea’s SK Biopharmaceuticals to help develop new drugs for neuroimmune conditions in a deal valued at more than $2.5 billion. Inscilico will use its Pharma.AI platform to help design new candidates for neuroimmune treatments, while SK Biopharmaceuticals will then steer the late-stage development and commercialization of discovered treatments. While Insilico is expected to get $18 million in payments in the near-term, the deal could bring in up to $2.5 billion if the firm reaches certain development and commercial milestones, in addition to royalties. The agreement marks Insilico’s largest tie‑up to date with an Asia‑Pacific partner; it’s also the second deal of this size that Insilico has agreed to with Big Pharma. In late March, Insilico signed a deal valued at $2.75 billion with U.S. drug giant Eli Lilly to target the “best-in-class, novel oral therapeutics in preclinical development.” (Andrew Adams, Eli Lilly’s group vice president of molecular discovery, also serves as the chair of Insilico’s new “Longevity Board”). “We want to be the SpaceX of the pharmaceutical industry,” Alex Zhavoronkov, co-CEO of Insilico Medicine told Fortune. “The more I scale, the better my AI gets. I want to get to this escape velocity where nobody can even compete.” Insilico Medicine’s shares rose 5.6% in Hong Kong trading on Monday, surging after the deal was announced at midday local time. The firm’s shares have risen by 35% since its IPO in late December. SK Biopharmaceuticals’s shares dropped 1.7% on Monday, building on a 30% decline for the year thus far. “By combining Insilico’s AI-powered drug discovery platform with SK Biopharmaceuticals’ clinical development and U.S. commercialization capabilities, we believe we can accelerate the discovery of innovative CNS [central nervous systems] therapies for patients,” Donghoon Lee, president and CEO of SK Biopharmaceuticals, said in a state