Atomwise co-founders Abe Heifets and Izhar Wallach (photo courtesy Atomwise)

Plot­ting to be the Bridge­Bio of AI, Atom­wise lands $123 mil­lion Se­ries B for hype-heavy plat­form

The PR-friend­ly, well-part­nered AI biotech that’s pro­voked stern skep­ti­cism in some sci­en­tif­ic cor­ners is get­ting a boat­load of new cash.

Atom­wise has an­nounced a $123 mil­lion Se­ries B round led by San­abil In­vest­ments — a sub­sidiary of the Sau­di roy­al fund — and B Cap­i­tal Group and joined by DCVC and Y Com­bi­na­tor, among oth­ers. The new round is near­ly triple what Atom­wise had raised pri­or and will go to­wards both scal­ing their mol­e­cule-hunt­ing soft­ware and build­ing the grow­ing net­work of spin­outs they’re launch­ing to de­vel­op some of the mol­e­cules that soft­ware has turned up.

The goal ul­ti­mate­ly, said CEO Abe Heifets, is to build a port­fo­lio of small­er biotechs be­neath theirs — a kind of Bridge­Bio for AI.

“We want to grow in scale,” Heifets told End­points News. “The tech­nol­o­gy is small mol­e­cule — that’s a very broad um­brel­la so there’s in­creas­ing­ly an in­ter­est in a port­fo­lio ap­proach”

The round could be a le­git­i­mat­ing one for Atom­wise, a com­pa­ny that over the last few years has found it­self at the cen­ter of a de­bate be­tween en­gi­neers who promised that ma­chine learn­ing and AI net­works could re­make drug de­vel­op­ment and sci­en­tists who saw a lot of buzz but lit­tle sub­stance. Since its days at Y Com­bi­na­tor, the com­pa­ny has promised to use an AI con­vo­lu­tion­al net­work to rapid­ly screen bil­lions of mol­e­cules for their abil­i­ty to hit a tar­get or bind to a pro­tein, and in do­ing so speed from “years to days” the process of se­lect­ing drug can­di­dates. In do­ing so, they said, they could cut short the ar­du­ous and ex­pen­sive drug de­vel­op­ment path.

The prob­lem, crit­ics such as sci­ence blog­ger and med­i­c­i­nal chemist Derek Lowe ar­gued, is that it just doesn’t take that long to screen mol­e­cules. It’s a bump in the drug dis­cov­ery moun­tain.

“You can do a mil­lion in six weeks. The whole com­pound screen­ing step is just an­oth­er ear­ly thing in pre­clin­i­cal space,” Lowe wrote in one piece that al­so not­ed Atom­wise’s “ten­den­cy to­ward over­state­ment.”

“I’ve nev­er seen a suc­cess­ful project in which it was a rate-lim­it­ing step. But ‘shave a few weeks off some­thing at the very be­gin­ning’ isn’t as com­pelling an of­fer, is it?” he said.

Though just one of many com­pa­nies now of­fer­ing rapid, AI-en­abled screen­ing, Atom­wise might be the most pro­lif­ic, claim­ing “over 750 re­search col­lab­o­ra­tions ad­dress­ing over 600 dis­ease tar­gets” and part­ner­ships with ma­jor phar­ma com­pa­nies, in­clud­ing Eli Lil­ly, Mer­ck, Ko­rea’s Han­soh Phar­ma­ceu­ti­cals, Bay­er and Bridge­Bio.

Yet it has ad­ver­tised those big-name part­ner­ships with par­tic­u­lar fan­fare. Rather than cal­cu­late the over­all po­ten­tial deal val­ue by up­front fees and mile­stones, as most biotechs do, they have of­ten list­ed val­ues that in­clude roy­al­ty es­ti­mates “based on his­tor­i­cal av­er­age rev­enues for small mol­e­cule drugs … with suc­cess in all projects” — in an in­dus­try where suc­cess is fleet­ing­ly rare. That’s al­lowed the com­pa­ny to ad­ver­tise that “Atom­wise has signed more than $5.5 bil­lion in to­tal deal val­ue with cor­po­rate part­ners to date” with­out dis­clos­ing any in­di­vid­ual pay­ments.

Heifets says that their deal re­leas­es are in line with how oth­er biotechs talk about their deals and what their part­ners are will­ing to dis­close. He al­so says Atom­wise pro­vides ben­e­fits be­yond that ini­tial screen­ing step.

“If you think of AI as on­ly be­ing ap­plied for high through­put screen­ing, then I agree with Derek,” he said. “That’s a be­gin­ning part and that’s pret­ty quick.”

Heifets said that Atom­wise al­so pro­vides ser­vices for lead op­ti­miza­tion, a longer and more dif­fi­cult step. And he said that they’ve shown the soft­ware can not on­ly find mol­e­cules faster but al­so find mol­e­cules for tar­gets that ma­jor com­pa­nies have spent years and mil­lions of dol­lars fail­ing to hit.

Most no­tably, Atom­wise launched X-37 last year in part around the dis­cov­ery of mol­e­cules that can bind to the PIM3 path­way with­out harm­ing healthy tis­sue, which Heifets said Roche, No­var­tis and As­traZeneca had tried and failed to do. The com­pa­ny raised $14.5 mil­lion in Se­ries A fund­ing. They al­so qui­et­ly launched Theia Bio­sciences around mol­e­cules that can hit the HTRA1 path­way and might be used to treat age-re­lat­ed mac­u­lar de­gen­er­a­tion.

Over the next few years, Heifets said, they plan to launch more biotech sub­sidiaries, hope­ful­ly even­tu­al­ly putting mul­ti­ple drugs in the clin­ic. If the mar­kets keep their his­toric pace, he said, an IPO could al­so be in their for­tunes.

That would like­ly mean a hefty S-1 and an­oth­er round of ar­gu­ments over the role of AI in biotech, and what’s hype and what’s re­al­i­ty.

“I think that will de­pend on what the mar­kets are do­ing,” Heifets said. “There have been a num­ber of very suc­cess­ful IPOs re­cent­ly in the biotech sec­tor, so it’s a very in­ter­est­ing time.”

The DCT-OS: A Tech­nol­o­gy-first Op­er­at­ing Sys­tem - En­abling Clin­i­cal Tri­als

As technology-enabled clinical research becomes the new normal, an integrated decentralized clinical trial operating system can ensure quality, deliver consistency and improve the patient experience.

The increasing availability of COVID-19 vaccines has many of us looking forward to a time when everyday things return to a state of normal. Schools and teachers are returning to classrooms, offices and small businesses are reopening, and there’s a palpable sense of optimism that the often-awkward adjustments we’ve all made personally and professionally in the last year are behind us, never to return. In the world of clinical research, however, some pandemic-necessitated adjustments are proving to be more than emergency stopgap measures to ensure trial continuity — and numerous decentralized clinical trial (DCT) tools and methodologies employed within the last year are likely here to stay as part of biopharma’s new normal.

Onno van de Stolpe, Galapagos CEO (Thierry Roge/Belga Mag/AFP via Getty Images)

Gala­pa­gos chops in­to their pipeline, drop­ping core fields and re­or­ga­niz­ing R&D as the BD team hunts for some­thing 'trans­for­ma­tive'

Just 5 months after Gilead gutted its rich partnership with Galapagos following a bitter setback at the FDA, the Belgian biotech is hunkering down and chopping the pipeline in an effort to conserve cash while their BD team pursues a mission to find a “transformative” deal for the company.

The filgotinib disaster didn’t warrant a mention as Galapagos laid out its Darwinian restructuring plans. Forced to make choices, the company is ditching its IPF molecule ’1205, while moving ahead with a Phase II IPF study for its chitinase inhibitor ’4617.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 104,800+ biopharma pros reading Endpoints daily — and it's free.

Stéphane Bancel, Getty

Mod­er­na CEO brush­es off US sup­port for IP waiv­er, eyes more than $19B in Covid-19 vac­cine sales in 2021

Moderna is definitively more concerned with keeping pace with Pfizer in the race to vaccinate the world against Covid-19 than it is with Wednesday’s decision from the Biden administration to back an intellectual property waiver that aims to increase vaccine supplies worldwide.

In its first quarter earnings call on Thursday, Moderna CEO Stéphane Bancel shrugged off any suggestion that the newly US-backed intellectual property waiver would impact his company’s vaccine or bottom line. Still, the company’s stock price fell by about 9% in early morning trading.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 104,800+ biopharma pros reading Endpoints daily — and it's free.

'Chang­ing the whole game of drug dis­cov­ery': Leg­endary R&D vet Roger Perl­mut­ter leaps back in­to work as a biotech CEO

Roger Perlmutter needs no introduction to anyone remotely involved in biopharma. As the R&D chief first at Amgen and then Merck, he’s built a stellar reputation and a prolific career steering new drugs toward the market for everything from cancer to infectious diseases.

But for years, he’s also held a less known title: science partner at The Column Group, where he’s regularly consulted about the various ideas the VCs had for new startups.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 104,800+ biopharma pros reading Endpoints daily — and it's free.

Eric Kelsic, Dyno Therapeutics CEO

Dyno's Er­ic Kel­sic fills the tank in his quest for bet­ter AAV with a group of big-name sup­port­ers on board

Adeno-associated viruses (AAV) for gene therapy have received a ton of scrutiny throughout the field’s history after a smattering of safety scares and their limited therapeutic range. Hoping to crack the field wide open through a capsid design revolution, Eric Kelsic and his team at Dyno have drummed up immense excitement — and now a hefty war chest.

Dyno Therapeutics has bagged a $100 million Series A with backing from the likes of round leader Andreessen Horowitz and new investor Casdin Capital in its quest to use AI to design better AAV capsids for gene therapy, the company said Thursday.

Ad­comm splits slight­ly in fa­vor of FDA ap­prov­ing Chemo­Cen­tryx’s rare dis­ease drug

The FDA’s Arthritis Advisory Committee on Thursday voted 10 for and 8 against the approval of ChemoCentryx’s $CCXI investigational drug avacopan as a treatment for adults with a rare and serious disease known as anti-neutrophil cytoplasmic autoantibody (ANCA)-vasculitis.

The vote on whether the FDA should approve the drug was preceded by a split vote of 9 to 9 on whether the efficacy data support approval, and 10 to 8 that the safety profile of avacopan is adequate enough to support approval.

Gold­man Sachs jumps aboard Bain-backed 503(b) com­pound­ing phar­ma­cy with a $275M debt loan to sup­ply hos­pi­tals

Long the bane of the FDA’s existence, compounding pharmacies have seen a minor resurgence in the past year as short-term saviors for hospital drug shortages. Now, a 503(b) company specializing in hospital meds has earned a big backer to keep expanding its 200-drug strong portfolio.

Goldman Sachs and Owl Rock Capital Partners have doled out a $275 million debt loan to QuVa Pharma, a 503(b)-certified outsourcing facility providing compounded drugs to hospitals, the company said Thursday.

Bill Lis, Jasper Therapeutics

Jasper and its stem cell con­di­tion­ing an­ti­body earn a tick­et to Nas­daq in lat­est SPAC re­verse merg­er

Editor’s note: Interested in following biopharma’s fast-paced IPO market? You can bookmark our IPO Tracker here.

Another biotech SPAC deal has landed as the glut of blank-check companies continues to make waves in the industry.

Thursday’s winner is Jasper Therapeutics, joining forces with Amplitude Healthcare Acquisition Corp. in a $100 million reverse-merger, Jasper announced. The deal also comes with a PIPE financing of an additional $100 million, setting Jasper up with a $490 million market cap once the merger closes in the third quarter.

Brent Saunders (Richard Drew, AP Images)

OcuWho? Star deal­mak­er turned aes­thet­ics czar Brent Saun­ders flips back in­to biotech. But who’s he team­ing up with now?

Brent Saunders went on a tear of headline-blazing deals building Allergan, merging and rearranging a variety of big companies into one before an M&A pact with Pfizer blew up and sent him on a bout of biotech drug deals. That didn’t work so well, so under pressure, he got his buyout at AbbVie — which needed a big franchise like Botox. And it was no big surprise to see him riding the SPAC wave into a recent $1 billion-plus deal that left him in the executive chairman’s seat at an aesthetics outfit — now redubbed The Beauty Health Company — holding a big chunk of the equity.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 104,800+ biopharma pros reading Endpoints daily — and it's free.