Scottish Mortgage leads $121m round in AI-based biotech Recursion – Baillie Gifford-managed Scottish Mortgage lnvestment Trust (SMT) has led a $121m Series C private financing in Recursion Pharmaceuticals, a US-based company that combines automated experimental biology with artificial intelligence tools. The financing brought in three new institutional investors – Intermountain Ventures, University of Minnesota, Texas Tech University System – and some angel investors, while all of its prior institutional investors also participated, including Lux Capital, Data Collective, Mubadala Ventures (the UAE sovereign wealth fund), Two Sigma Ventures, Obvious Ventures, Felicis Ventures, Epic Ventures, Menlo Ventures, AME Cloud Ventures, and CRV (Cancer Research Ventures).
Scottish Mortgage lists its stake in Recursion at 0.5% of total assets (as of 31 May), which would suggest it has a value of c£40m. it also holds a number of other biotech companies including Bluebird Bio and Grail (both 1.0% of total assets), Denali (0.6%), Unity Biotechnology (0.3%) and Alnylam (0.2%).
Recursion says the financing will support its build-out of its machine learning-enabled drug discovery platform alongside new capabilities designed to radically accelerate new chemical entity chemistry and predict safety pharmacology. Recursion, which was founded in 2013, claims to have generated the industry’s largest biological images dataset – with more than 2.5 petabytes of data – which is being exploited via AI/machine learning.
Recursion has developed robotic drug screening that can generate 5-10m cellular images/week. Machine-learning algorithms then scan the images, searching for compounds that disrupt disease without harming healthy cells. Recursion has to licensed in two clinical-stage compounds: REC-994, a superoxide dismutase mimetic that is in Phase I studies for the treatment of cerebral cavernous malformation and REC-2282, a broad-spectrum deacetylation inhibitor of histone and non-histone proteins for neurofibromatosis type 2. REC-2282 as previously been under development by Arno Therapeutics (as AR-42) for relapsed or refractory hematologic malignancies and solid tumors.
Recursion plans to prioritise treatments for rare diseases within its own pipeline and will forge partnerships with pharmaceutical companies in a variety of therapeutic areas, including immuno-oncology, oncology, aging, and inflammation. It already has partnerships with Takeda and Sanofi.