Photo by Mohamed Nohassi on Unsplash

An Introduction

Given that the drug development process is so expensive (about $900 million, on average, per discovery) and time-consuming (13.5 years, on average), it creates a huge shortage in drug candidates and programs. That being said, the advent of AI has significantly shortened and cheapened this process by automating that entire process. 

AI-powered Drug Discovery Growth Projections

The global "AI in drug discovery" market was worth about $1.1 billion last year and is expected to expand by a compound annual growth rate of 30% between now and 2030, according to Grand View Research leading to 50 novel therapies being brought to market over the next decade, with annual sales in excess of $50 billion Morgan Stanley.

The munKNEE AI-focused Drug Discovery Stocks Portfolio

To keep abreast of developments munKNEE.com has put together a portfolio that tracks the progress of 6 small cap ($500M to $2B) clinical stage companies focused on the use of AI to discover new drugs. They are listed below in descending order as to their performances in May and last week along with their market capitalizations, a description of each, and links to the most recent news, analyses and commentary where available.

1. Exscientia (EXAI): UP 33.4 % in May; DOWN 1.2% last week
   • Company Description:
     • EXAI reported the first AI-designed drug candidate to enter clinical trials and has expanded its AI-based platform to develop novel therapeutic antibodies through generative AI design.
     • Exscientia is collaborating with Bristol-Myers Squibb on a handful of drug candidates and has partnered with Sanofi, GSK and PathAI on drug discovery projects.
   • Market Capitalization: $680M
   • News, Analysis and Commentary:
     • Exscientia Upgraded to Buy: Here's What You Should Know
2. Relay Therapeutics (RLAY): UP 24.0% in May; UP 23.2% last week
   • Company Description:
     • RLAY specializes in developing an artificial intelligence-driven allosteric drug-discovery platform intended to detects and characterizes interactions that occur on a protein of interest and combines computational methods with experimental approaches across the fields of structural biology, biophysics, and chemistry. Its initial focus on precision oncology and genetic diseases.
   • Market Capitalization: $1.1B
   • News, Analysis and Commentary:
     • Relay Therapeutics Announces Clinical Trial Collaboration with Pfizer
3. Recursion Pharmaceuticals (RXRX): UP 1.3 % in May; UP 2.1% last week
   • Company Description:
     • RXRX specializes in drug discovery through machine learning using its proprietary Recursion Operating System and has one of the world’s most extensive biological and chemical datasets.
     • It has several compounds in phase 1 and 2 studies, including a small molecule therapeutic for cavernous cerebral malformation and another for neurofibromatosis type 2.
     • Recursion claims to conduct millions of experiments per week using supercomputers, machine learning and automated robotic labs.
   • Market Capitalization: $2.0B
   • News, Analysis and Commentary:
     • Recursion Pharmaceuticals Stock Could Be a 10-Bagger, but Only if It Comes Through on This Big Claim
4. AbCellera Biologics (ABCL): DOWN 3.1% in May; DOWN 1.7% last week
   • Company Description:
     • ABCL develops antibody therapeutics using AI focusing on searching and analyzing the immune systems to find potential antibodies, then outsourcing their initial findings to their partners for further drug discovery.
   • Market Capitalization: $1.1B
   • News, Analysis and Commentary:
     • Here's Why Analysts Cut Their AbCellera Price Target
5.  Schrödinger (SDGR): DOWN 3.3% in May; UP 1.0% last week
   • Company Description:
     • SDGR offers specialized solutions for both small molecule discovery and biologics discovery focusing on structure prediction and protein engineering, including antibody modeling.
   • Market Capitalization: $1.6B
   • News, Analysis and Commentary:
     • Schrödinger First Quarter 2024 Earnings Miss Expectations
6. Absci Corporation (ABSI): DOWN 8.0% in May; UP 4.0% last week
   • Company Description:
     • is focused on antibody design, creating new from scratch antibodies (“de novo antibodies”), and testing them in laboratories in a 6-week process.
   • Market Capitalization: $500M
   • News, Analysis and Commentary:
   • Absci Reports Business Updates and First Quarter 2024 Financial and Operating Results Financial Results

Summary

The munKNEE AI-powered Drug Discovery Stocks Index was DOWN 2.3% in May but was but was UP 3.8% last week.

More By This Author:

Largest Psychedelic Compound Based Drug Stocks Fell 13% Last Week - Here's Why
The 5 Largest Canadian Cannabis LPs Declined 11.5%, On Average, This Week
Pure Play Quantum Computing Portfolio Down 3% In May