The pharma-race is on, with new start-up, Inceptive, raising $100m in a new funding round following seed funding of $20m last year, led by NVIDIAs NVentures and Andreessen Horowitz. Founded by former Google AI researcher Jakob Uszkoreit, Inceptive uses AI to design biological molecules for vaccines, therapeutics and other treatments. The software designs and tests new molecular structures in the lab to then be developed into new medicines. This exciting progress in the Healthtech space demonstrates the power AI has on global expansion and human health advancement.
Drug development usually costs – on average – somewhere in the region of $3bn, and takes over a decade to discover, develop and pass approval, with 90% of experimental drugs failing. AI promises to speed up this process for both drug development and molecular advancement. Morgan Stanley estimates that over the next decade, AI will enhance early-stage drug development and translate into 50 novel therapies worth more than $50bn in sales.
Start-ups like Inceptive have encouraged investors to bet on Healthtech start-ups that merge biotech and AI, demonstrating the confidence investors have in the AI drug discovery service. Funding from industry giants such as NVIDIA gives Inceptive access to world-beating platforms and access to its latest chips, allowing for far higher levels of computational power than would otherwise be available. AI startups have been facing a chip shortage resulting in a lack of development in sophisticated AI algorithms.
Ibex Medical Analytics is another AI specialist which has raised $55m in a series C round of funding led by 83North, this will be used to drive take-up on its Galen cancer diagnostic technology. According to the company, Galen can detect over 100 types of cancer and non-cancer samples from medical images. Thyme Care is another cancer specialist which has brought in $60 million in second-round funding, its platform allows members to find the right support and resources through its app, offering “round-the-clock guidance”. Polestar expects bespoke platforms such as Thyme Care will maintain funding momentum throughout the next few years.
In France, pathology system, Tribun Health, has completed series B funding worth €15 million, which the company says will be used to increase momentum in the development and commercialisation of its AI-powered platform and pharmaceutical laboratories. The round is also expected to go towards its expansion in sales and marketing across Europe and North America, along with contributing to the funding for Tribun’s acquisition of Eyedo, another computational pathology company.
As we see continued investment and backing into the health tech space, Polestar predicts an increase in M&A activity over the coming year, with smaller technology-forward companies being acquired by larger, brand-focused counterparts. Polestar will continue work with all parties to secure funding and explore their M&A opportunities whilst also watching the space to see how new companies such as Inceptive navigate the climate and bring transformative technology to the sector.
The healthtech space remains a dynamic playing field, ready to develop the future of healthcare. If you have an interest in the healthcare space, read our September 2023 Health and Education Sector valuation to find out more in-depth information about the M&A activity within the sector. Otherwise reach out to us for bespoke information and advice in the space.