Incyte strikes $885M AI deal with Genesis to develop new drugs

In a strategic move to enhance its capabilities in early-stage drug development, Incyte has announced a significant partnership with Genesis Therapeutics. This collaboration aligns with Incyte CEO Hervé Hoppenot's vision of expanding the company's portfolio by investing in groundbreaking technologies that it currently lacks. The partnership involves an upfront payment of $30 million to Genesis Therapeutics for the use of its advanced artificial intelligence (AI) platform in developing small molecule medicines aimed at currently undisclosed targets.

Genesis Therapeutics, based in Burlingame, California, has developed an AI platform known as GEMS. This cutting-edge technology is designed to generate novel molecules and make predictions about their properties, including potency, selectivity, and pharmacokinetics. The biotech firm has a history of successful collaborations with industry giants like Genentech, Gilead Sciences, and Eli Lilly, with the partnership with Eli Lilly alone offering a potential total value of $670 million for up to five targets.

The collaboration with Genesis is a testament to the transformative potential of AI in drug discovery, as highlighted by Genesis CEO Evan Feinberg, Ph.D. He emphasized that this partnership brings together Genesis's technological prowess with Incyte’s expertise in drug discovery and development, with the shared goal of developing critical treatments for patients suffering from severe diseases.

Initially, the partnership will focus on two targets associated with severe diseases, with Incyte reserving the option to extend the collaboration to a third target for an additional undisclosed fee. The financial structure of the deal allows Genesis to potentially earn up to $295 million per target through development, regulatory, and commercial milestones, in addition to tiered royalties on sales.

Pablo Cagnoni, M.D., head of R&D at Incyte, expressed enthusiasm about the collaboration. He underscored that partnering with Genesis Therapeutics presents a unique opportunity to harness AI technologies to expedite the discovery of innovative small molecules for high-impact targets within Incyte's pipeline.

This strategic move is in line with Incyte’s broader objective of investing in early-stage technologies that are exotic and novel, as previously articulated by CEO Hervé Hoppenot. Hoppenot has expressed optimism for the company's future prospects, particularly looking forward to an eventful 2025. This outlook comes despite recent setbacks, including a preclinical toxicology discovery that affected INCB000262, a significant asset acquired through Incyte's $750 million purchase of Escient Pharmaceuticals. The safety concerns led to a halt in the clinical development of the MRGPRX2 inhibitor, less than six months post-acquisition.

Genesis Therapeutics has its roots in the Stanford laboratory of Professor Vijay Pande, Ph.D., concentrating on the application of machine-learning-powered simulations in chemistry, biology, and medicine. The company has gained significant financial backing, securing $52 million in a Series A funding round in 2020, followed by an impressive $200 million Series B in 2023.

In summary, the partnership between Incyte and Genesis Therapeutics marks a critical step in leveraging AI to revolutionize the discovery and development of small molecule medicines. This collaboration holds the promise of delivering innovative treatments for severe diseases, ensuring both companies remain at the forefront of pharmaceutical advancements.