Flagship Pioneering–backed Generate:Biomedicines has signed its second major Big Pharma partnership, bringing in $65 million upfront to use its AI platform to discover novel protein drug candidates.
AI biotech Generate:Biomedicines has notched its second Big Pharma partnership, teaming up with Novartis to find new protein therapeutics in a deal valued up to $1 billion.
Details about the partnership’s targets are thin as the companies are not disclosing the number of targets or therapeutic areas to be explored. But Generate CEO Mike Nally said the Novartis deal will focus on areas not currently being interrogated in the biotech’s existing pipeline.
“We can’t have expertise across all disease areas and all domains,” Nally told BioSpace in an interview. “We work in oncology, immunology and infectious disease. We love to work with partners that want to explore domains outside of that.”
The deal starts out with a relatively small $65 million upfront, including $15 million in Generate equity for Novartis. The rest of the deal potential comes from performance-based milestones, plus royalties down the line. Nally said the deal was structured with heavy milestones on the back end because the partners wanted a long-term relationship.
“Ultimately, the goal here is not to do a quick project and not have something translate to human impact,” Nally said. “Our goal, very clearly, and as is Novartis’, is to make sure that whatever we work on together benefits as many people around the planet as possible.”
Novartis has brought three different challenges that Generate’s technology might be able to help with, Nally explained. The biotech’s generative biology platform has applicability across protein modalities, including antibodies, enzymes, peptides and cell and gene therapies. Generate will develop the molecule and then hand it to Novartis for further research.
This is the second major partnership for Generate, after Amgen signed a similar multi-target deal worth up to $1.9 billion with the Flagship Pioneering–backed biotech. Nally said that the two billion-plus-dollar deals show that Big Pharma is beginning to understand how AI—when applied effectively—can accelerate and otherwise improve drug discovery.
“It doesn’t solve all parts of the drug discovery and development challenge, but in certain key elements, we’re getting better answers. We’re getting faster answers, and we’re getting answers that ultimately are distinctive from what traditional technologies would allow,” Nally said. “And that’s what’s exciting to us. That’s what I think is exciting to Novartis and to the field.”
The Amgen partnership has been ongoing for the past two and a half years, with the pharma opting into a sixth program at the start of this year. Amgen had pledged $370 million in future milestones and royalties per program. Nally said that Generate isn’t in a hurry to add any more big partnerships like this and instead will focus on making the two they have as successful as possible.
