Eli Lilly has been doing business with Insilico Medicine for two years before they announced plans this week to partner in artificial intelligence (AI)-based drug development, through a collaboration they said could generate “over $100 million” for the AI drug discovery company.
Insilico and the biopharma giant have been partners since 2023, when Lilly inked a licensing agreement allowing it to access Insilico’s Pharma.AI software suite.
Now, Lilly and Insilico are full-fledged partners in drug discovery. The companies plan to marry Insilico’s Pharma.AI platforms with Lilly’s development and disease expertise to jointly discover and advance innovative therapies.
The disclosed collaboration value of over $100 million including an upfront payment, milestone payments, and tiered royalties on net sales upon commercialization of drug products resulting from the partnership, says Alex Zhavoronkov, PhD, Insilico’s founder, chairman, executive director, and CEO.
“The collaboration represents a further deepening of our general partnership which originated with the AI-based software licensing agreement in 2023 and now is expanding to jointly discover and advance therapies on Lilly-defined targets,” Zhavoronkov told GEN.
Insilico and Lilly are not saying which targets they plan to pursue—or whether the partnership will have the effect of expanding Insilico’s pipeline into therapeutic areas beyond its current concentrations in idiopathic pulmonary fibrosis (IPF), cancer, metabolic diseases, and inflammation.
Can Insilico envision being acquired by Lilly someday? “We can’t comment on M&A [merger-and-acquisition] speculation, but are committed to our current collaborations,” Zhavoronkov said.
Insilico is also not commenting on how its new collaboration with Lilly might intersect with another AI initiative recently announced by the pharma giant.
AI “factory”
Lilly joined the Silicon Valley-based microprocessing giant Nvidia on October 28 to announce they were deploying what they said was the largest, most powerful AI platform or “factory” wholly owned and operated by a pharmaceutical company—the world’s first NVIDIA DGX SuperPOD with DGX B300 systems.
The AI factory, built with 1,016 NVIDIA Blackwell Ultra GPUs, is designed to enable accelerated, industrial scale discoveries in genomics, personalized medicine, and molecular design—and dramatically shorten drug discovery timelines, thus fulfilling the time- and cost-saving promise of AI technology. The factory delivers over 9,000 petaflops of AI performance, enough power to carry out more than nine quintillion math problems every second.
Lilly plans to use the AI factory to train large scale biomedical foundation and frontier models for drug discovery and development. Some of those models will be made available on Lilly TuneLab, an AI and machine learning platform designed to provide biopharmas with access to AI/machine learning tools applying the company’s drug discovery models, and created using $1 billion worth of Lilly’s proprietary data.
Lilly is among collaboration partners that are using Insilico’s Generative Chemistry application, a core component of the Chemistry42 drug discovery engine used for designing and optimizing novel small molecule drug candidates with desired properties from scratch, by using various AI models to streamline hit identification, hit-to-lead, and lead optimization.
Chemistry42 is part of Pharma.AI, a commercially available end-to-end generative Al software and automation platform designed to help users improve the quality and productivity of their pharmaceutical research.
Between 2021 and 2024, Insilico nominated 20 preclinical candidates, achieving an average turnaround of 12-18 months per program, from project initiation to preclinical candidate nomination, with only 60 to 200 molecules synthesized and tested in each program, according to the company. Traditional early-stage drug development typically requires three to six years, according to Thermo Fisher Scientific PPD, and entails screening of millions to billions of compounds for a particular target, according to a 2021 study.
Insilico Medicine’s pipeline now consists of 31 programs, of which 10 have received investigational new drug (IND) approvals enabling their advancement into clinical phases. Furthest along in clinical studies is rentosertib (formerly called ISM001-055), designed to treat IPF by targeting Traf2- and NCK- interacting kinase (TNIK), a serine/threonine kinase whose activation plays a crucial role in cellular processes that include signal transduction pathways essential for fibrosis development.
In June, Insilico published in Nature Medicine positive mid-stage safety and efficacy data for rentosertib generated through a double-blind, placebo-controlled Phase IIa trial (NCT05938920) conducted across 22 sites in China. Insilico is not commenting on updates regarding a later-stage trial in China, but did say a parallel Phase IIa trial in the U.S. (NCT05975983) is resuming enrollment after having paused (the company had yet to explain why at deadline)—and that a Chinese Phase I trial of an inhaled form of rentosertib plans to open for enrollment in mid-2026.
“Rentosertib, the Movie”
“Hopefully, if it ever gets approved, we could produce ‘Rentosertib, the Movie’,” Zhavoronkov quipped on LinkedIn after sharing a 15-minute video documentary posted to YouTube about the discovery and development of the drug.
Lilly is now the largest biopharma to partner with Insilico, joining with significant albeit lower profile partners in ongoing drug development efforts:
- Exelixis—The cancer drug developer committed $80 million upfront and undisclosed development, commercial, and sales-based milestone payments to Insilico in return for licensing rights to Insilico’s SM3091 (now XL309), a small molecule ubiquitin specific protease 1 (USP1) inhibitor being developed to treat BRCA-mutant tumors. Last year, Insilico received a $10 million clinical milestone payment for XL309, now in a Phase I trial (NCT05932862) estimated to be completed in 2029.
- Fosun Group—The Chinese biopharma and Insilico are co-developing ISM8207, a small molecule glutaminyl-peptide cyclotransferase-like protein (QPCTL) inhibitor which Insilico says is potentially first-in-class, as a treatment for advanced malignant tumors, such as those with high engagement of the CD47-Signal Regulatory Protein α (SIRPα) axis, in a Phase I trial (NCT06445517) with an estimated primary completion date of November 2026.
- Menarini Group—An oncology-focused subsidiary of the Italian biopharma and diagnostics developer called Stemline Therapeutics launched a second, up-to-$550 million partnership in January to develop a preclinical small molecule with an undisclosed “high unmet needs” target in cancer. The companies are also partnering on MEN2312, a KAT6 inhibitor outlicensed by Insilico to Menarini in 2024.
Lilly’s involvement with Insilico has gone beyond software and drug discovery. Earlier this year, Lilly’s venture arm Lilly Ventures joined other existing investors such as Warburg Pincus and OrbiMed Advisors, plus new undisclosed investors, to complete a $110 million Series E financing led by Hong Kong-based Value Partners, one of Asia’s largest independent asset management firms.
And while Lilly Asia Ventures was listed among investors in Insilico’s $37 million Series B round completed in 2019, followed two years later by a $255 million Series C, the firm has been independent of Lilly since being spun out of the biopharma giant in 2011 and today is known as LAV.
Insilico has raised more than $500 million in private financings, and earlier this year submitted a revised prospectus to begin trading stock on the Hong Kong Exchange.
