AI firm Generate signs $1bn discovery deal with Novartis
Michael Nally, chief executive of Generate:Biomedicines and CEO-Partner of Flagship Pioneering
Flagship Pioneering-backed artificial intelligence start-up Generate:Biomedicines has attracted another big pharma partnership, this time with Novartis.
The wide-ranging deal, worth up to $1 billion, covers multiple targets and disease areas and focuses on the discovery and development of protein-based therapeutics using Generate's generative AI (GenAI) platform. Novartis is paying an upfront fee of $50 million to get the ball rolling and taking a $15 million stake in Generate.
The Massachusetts-based biotech's approach involves teasing out the three-dimensional structure of human proteins, including how they are folded, to determine function – something that is almost impossible to work out simply from an amino acid sequence.
From there, its drug discovery engine can be used to predict the structures of drugs that will bind to a chosen target, a process that should take a lot less time than conventional high-throughput screening and, at least in theory, make it possible to hit multiple sites on a protein and address targets that have been hard to unlock.
It's the biggest deal signed by Generate since it formed a $1.9 billion partnership with Amgen in 2022 – including $370 million upfront – which initially focused on five therapeutic programmes, but was expanded earlier this year to include a sixth, adding another $370 million in potential future payments.
The number of targets and therapeutic areas covered by the Novartis deal are not being disclosed for now.
Generate also recently concluded a $273 million Series C backed by Amgen and tech giant NVIDIA, amongst other investors, which came after a $370 million second round in 2021 and took the total amount raised since its founding in 2020 to around $700 million.
In a statement, Novartis' president of biomedical research, Fiona Marshall, said the alliance "offers an opportunity to leverage the unique strengths of our respective companies, from target biology and biologics discovery to machine learning/AI and clinical development, in order to bring forward new medicines with transformative potential for patients."
Generate's internal pipeline spans around 17 programmes across oncology, immunology, and infectious disease and is currently headed by an anti-TSLP monoclonal antibody for asthma. It has said it expects to file multiple applications to start clinical trials of new therapies in 2024, as well as in subsequent years.
"Partnering with a world-leading drug discovery and development organisation like Novartis allows us to broaden the use of our cutting-edge generative biology platform to tackle even more areas of unmet medical need," said Generate's chief executive, Mike Nally.
