Pathos AI secures $62M Series C for Phase 1 drug discovery with AI

Chicago-based startup Pathos AI has successfully raised $62 million in a Series C funding round to further its mission of identifying Phase 1 cancer drugs for testing in specific patient groups. Announced on Tuesday morning, the funding round values the three-year-old biotech firm at $600 million post-money and brings its total funding to $102 million. Pathos AI's leadership comes from executives of Tempus, an AI healthcare company that collaborates with major pharmaceutical companies.

Unlike many AI-driven biotech firms that focus on developing new drugs, Pathos AI leverages artificial intelligence to find experimental treatments already in clinical trials that can be tested on new patient groups. The company believes this approach can significantly enhance the likelihood of successful trials, speed up clinical development, and help repurpose drugs that had previously failed or been shelved. CEO Ryan Fukushima, who also serves as the Chief Operating Officer of Tempus, emphasized the company's mission in a press release.

Since its inception, Pathos AI has acquired three clinical-stage drugs: Prelude Therapeutics' PRMT5 inhibitor, a takeover of Rain Oncology, and a licensing agreement for Novo Nordisk’s CBP/p300 inhibitor. In addition, the company acquired Known Medicine, a machine learning startup, in 2023. Pathos AI plans to initiate new clinical trials next year for the medications it has acquired.

The Series C funding round was led by New Enterprise Associates, with additional investments from Revolution Growth, Builders VC, and Lightbank, a venture capital firm co-founded by Tempus CEO Eric Lefkofsky.

Pathos AI's innovative approach aims to match existing experimental treatments with patient populations that are more likely to benefit from them. This strategy is intended to increase the success rates of clinical trials and expedite the development process. By focusing on drugs that have already shown some potential but may have been set aside, Pathos AI hopes to bring new treatment options to patients in need.