Recently, the AI biotechnology company Yingsi Intelligence applied for listing in Hong Kong. Once the IPO is successful, the company will become the first domestic AI pharmaceutical company.
With the generative AI platform Pharma.AI, Insilicon Intelligence can provide end-to-end efficient solutions in the pipeline development process, and rapidly advance the fully self-generated AIDD (AI Drug Discovery and Development) pipeline mainly composed of new drug candidates.
Currently, using Pharma.AI, the company has established a diverse and fully internally generated pipeline of 31 projects covering 29 drug targets. Among them, there is one clinical stage asset of phase II study and two clinical stage assets of phase I study.
Since the drug has not yet been commercialized, Insilicon Intelligence’s revenue mainly comes from drug discovery services and software solution services, with a revenue of more than 34 million US dollars in two years. The company is currently working with 10 of the top 20 global pharmaceutical companies based on reported sales in 2021.
With the increasing importance of AI pharmaceuticals and the rapid development of its own business, Yingsi Intelligence has been recognized by many investors. Before listing, the company had raised more than US$400 million in total, with a valuation of US$895 million. Investors included Warburg Pincus, CPE Yuanfeng, WuXi AppTec, Saudi Aramco, OrbiMed, Korea Mirae Asset Group, Boston Investment Group B Capital Group, Sequoia China, Hillhouse, Qiming Venture Partners, Lanting Ventures, Eight Roads Capital, Sinovation Ventures, BOLD Capital Partners, BV Baidu Ventures, etc.
In 2 years, the account has exceeded 34 million US dollars, and the drug has not yet been commercialized
From designing new molecules, to predicting clinical trial outcomes, AI can be incorporated into every stage of the drug discovery process.
According to Frost & Sullivan, AI can help researchers identify new drug targets, design new drugs, and predict drug efficacy and toxicity, thereby reducing the time and cost associated with drug discovery and development. For pharmaceutical companies, AIDD is also growing in importance.
According to Insilicon Intelligence, the pharmaceutical industry takes an average of 4.5 years from project initiation to IND (new drug clinical trial application) preparatory research stage, while Pharma.AI and the pipeline development process enable it to complete this process for a typical candidate pipeline within 12 months.
Currently, using Pharma.AI, the company has established a diverse and fully internally generated pipeline of 31 projects covering 29 drug targets. Among them, ISM001-055, the core product of Insilicon Intelligence, is a small molecule candidate drug currently in Phase II clinical trials, mainly used to treat fibrosis-related indications by inhibiting TNIK, which is a new anti-fibrosis target identified through the Pharma.AI platform.
ISM001-055 took about 30 months from the formation of the disease hypothesis to the advancement to phase I clinical trials. Ren Feng, Co-CEO and Chief Scientific Officer of Insilicon Intelligence, said in an interview, “From the discovery of targets to the identification of clinical candidate compounds, the product took 18 months, which is only 1/3 of the average time in the industry (4 years).
Such achievements have also won the recognition of many pharmaceutical companies. The company is currently working with 10 of the top 20 global pharmaceutical companies based on reported sales in 2021.
Since the drug has not yet been commercialized, Insilicon Intelligence’s revenue mainly comes from drug discovery services and software solution services. Among them, revenue from drug discovery services comes from research and development cooperation, including upfront payments and other successful development milestone payments; revenue from software solution services comes from subscription fees related to Pharma.AI’s authorized components.
As a result, the company’s revenue has grown year after year, but it is still losing money. The prospectus shows that during the reporting period from 2021 to 2022, its revenue will be US$4.713 million and US$30.147 million, and its net loss will be US$131 million and US$222 million respectively. However, after excluding the impact of changes in the fair value of preferred shares and share-based compensation expenses, the company’s adjusted losses were US$42.9 million and US$67.6 million, respectively.
Whether it is the R&D of the pipeline or the upgrade of the generative AI platform, it will undoubtedly require a lot of funds. Insilicon Intelligence’s investment in research and development has also risen from US$38.489 million in 2021 to US$78.175 million in 2022. In the process, the company eventually has a research and development team of 255 senior biologists, chemists, drug developers and AI experts, and holds 259 patents and patent applications.
Recognized by Fosun Pharma, Sanofi, etc., and won a contract of up to 1.2 billion US dollars
In research in the field of anti-aging, Alex Zhavoronkov found that there is a greater room for exploration in the use of AI for medicine. In 2014, he established Insilicon Intelligence at the Center for Emerging Technologies at Johns Hopkins University.
Since then, the company has collected all publicly available and published data, including omics data, compound literature patent data, compound structure, property data, and more. At the same time, the development and iteration of the algorithm is also in progress. This kind of operation also lays a solid foundation for the establishment of Pharma.AI in the future.
With the continuous development of AI pharmaceuticals, coupled with the self-built AI teams of pharmaceutical companies, and the increasing difficulty of data acquisition, Insilicon Intelligence began to develop from a software platform service provider to an AI-driven Biotech. After an in-depth understanding of each step in the development of new drugs, the development of new drugs has also become the goal of this company.
It was during this process that Ren Feng, who served as the senior vice president of Medicilon and had a strong interest in computer-aided drug design, communicated with Alex Zhavoronkov many times, and finally joined Insilico in early 2021.
In order to better strengthen technological innovation and R&D execution, the company formed a unique dual CEO. At present, the company’s R&D team consists of two teams, led by Feng Ren, who are responsible for the development of therapeutic drug pipelines, and AI platform development, led by Alex Zhavoronkov.
The emergence of ISM001-055 stems from the joint efforts of two teams. When researching the implementation of the artificial intelligence platform into the project, the company got the first clinical project – the idiopathic pulmonary fibrosis project, and ISM001-055 was born from this.
Seeing the progress made by Insilicon Intelligence, customers such as Fosun Pharma and Sanofi have reached in-depth cooperation with it. In 2022, through cooperation with Fosun Pharma, the company will receive a down payment of US$13 million and milestone payments, and share the commercialization profits of related projects. In the cooperation with Sanofi, the company not only received a down payment of 21.5 million US dollars, but also signed an agreement with a total transaction value of up to 1.2 billion US dollars.
In addition, for drug discovery and translational medicine, Insilicon has also built a robotics laboratory. At the end of 2022, what the company calls the sixth-generation intelligent robot laboratory will officially start operation.
According to the data, as the world’s first fully automated robotics laboratory assisted by artificial intelligence in decision-making, the robotics laboratory will focus on target discovery, compound screening, personalized drug development and translational medicine research through the deep integration of artificial intelligence and automation, robotics and biological capabilities.
Warburg Pincus and Qiming have made heavy bets, and their valuation has risen by more than 800 million U.S. dollars in 4 years
Along the way, Yingsi Intelligent has won the recognition of many investors in the process of constantly proving itself.
In August of the following year, the company’s Pharma.AI was verified, and a series of papers were published. It received $36.8 million from Qiming Venture Partners, Eight Roads Capital, F-Prime Capital, Eli Lilly Asia Fund, Sinovation Ventures, BV Baidu Ventures, Lanting Investment, BOLD Capital Partners and other investors.
However, when the C round of financing was raised in the second half of 2020, the actual progress was not smooth because none of the landing projects had reached the PCC (preclinical candidate compound) stage. Until the performance of the drug effect was excellent, it finally attracted many investors.
In June 2021, the company received US$255 million in Series C financing. Investors include Warburg Pincus, CPE Yuanfeng, OrbiMed Capital, Korea Mirae Asset Group, Boston Investments, Deerfield Management, Maixing Investment, Qingchi Capital, Uni-President International Development under Uni-President Group, Sequoia Capital China Fund, Rui Zhi Capital, Qiming Venture Partners, Lanting Investment, Eight Roads Capital, Lilly Asia Fund, Innovation Works, BOLD Capital Partners, Formic Ventures, BV Baidu Wind Vote and so on.
In Ren Feng’s view, since the completion of the C round of financing, the company’s popularity has increased, and the project has been steadily advancing from PCC to clinical practice. “Relatively speaking, we have less pressure to prove ourselves.”
In 2022, Insilicon will complete D and D+ rounds of financing successively, with a total of 94.7 million US dollars. The investors are Saudi Aramco, Warburg Pincus, Boston Ventures, Qiming Venture Capital, BOLD Capital Partners, Deerfield Management, Lanting Investment, and Alex Zhavoronkov.
From June 2018 to July 2022, the company’s valuation also soared from US$54.4 million to US$895 million, which is equivalent to an increase of US$840 million in four years, a nearly 16-fold increase.
Before listing, Alex Zhavoronkov held 10.32%, Warburg Pincus held 9.71%, WuXi AppTec held 6.45%, Lanting Investment held 6.07%, Qiming Ventures held 5.61%, Saudi Aramco held 3.1%, Hillhouse held 2.54%, Fosun Pharma held 2.54%, Sequoia China held 0.85%, and Baidu Ventures held 0.29%.