Eli Lilly signs agreement to bring AI-developed drugs to global market

BEIJING — US pharmaceutical giant Eli Lilly Hong Kong-based Insilico Medicine has reached a $2.75 billion deal to bring medicines developed using artificial intelligence to the global market.

The deal will give Insilico $115 million upfront, with the remainder subject to regulatory and commercial milestones, as well as royalties on future sales, the companies announced Monday.

Insilico has used generative AI tools to develop at least 28 drugs, nearly half of which are already in the clinical stage, Insilico founder and CEO Alex Zaboronkov told CNBC. The company went public in Hong Kong in December. The company’s stock price has increased more than 50% since the beginning of the year.

“In some areas of AI, Lilly is better than us in many ways,” Zaboronkov said, noting that the U.S. pharmaceutical giant has “one person” who brought biology, chemistry and automation under one roof. He added that as part of the deal, Insilico will join Lilly’s biotechnology development community, Gateway Labs.

The two companies have been working together since signing an AI-based software license agreement in 2023.

“This collaboration will allow us to explore new mechanisms and accelerate the identification of promising therapeutic candidates across multiple disease areas,” Andrew Adams, vice president of Lilly’s molecular discovery group, said in a statement. He said Insilico’s AI-powered discovery is a “strong complement” to Lilly’s clinical development.

Eli Lilly CEO David A. Ricks attended a high-level forum in Beijing earlier this month, just weeks after the company announced plans to invest $3 billion in China over the next 10 years. The company reported that just under 3% of its revenue last year came from China.

Insilico develops AI outside of China, in Canada and the Middle East, and is conducting early preclinical drug development in China based on its AI research, Zaboronkov said. In addition to reducing research time, he said, AI can synthesize molecules faster than molecules discovered using traditional methods.