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Xaira, an AI drug discovery startup, launches with a massive $1B, says it's 'ready' to start developing drugs | TechCrunch

Xaira, an AI drug discovery startup, launches with a massive $1B, says it's 'ready' to start developing drugs | TechCrunch

Advances in creative AI have taken the tech world by storm. Biotech investors are making a big bet that similar computational methods could revolutionize drug discovery.

on Tuesday, ARCH Venture Partners And Foresight LabsAffiliated with Foresite Capital, announced that they have been incubated. Zira treatment and provided $1 billion in funding to an AI biotech. Other investors in the new company, which has been operating in stealth mode for about six months, include F-Prime, NEA, Sequoia Capital, Lux Capital, Lightspeed Venture Partners, Menlo Ventures, Two Sigma Ventures and SV Angel.

Xaira CEO Marc Tessier-Lavigne, a former Stanford president and Genentech's chief scientific officer, says the company is poised to begin developing drugs that would have been impossible without recent advances in AI. “We have raised such a large amount of capital because we believe the technology is at a point where it can have a transformative impact on the field,” he said.

Advances in foundational models came from the Institute of Protein Design at the University of Washington, run by David Baker, one of Zira's co-founders. These models are similar to the diffusion models that power OpenAI's power image generators such as DALL-E and Midjourney. But rather than creating art, Baker's model aims to design molecular structures that can be built in the three-dimensional, physical world.

While Xaira's investors believe the company can revolutionize data design, they stress that creative AI applications in biology are still in their early innings.

Vic Bajaj, CEO of Foresite Labs and managing director of Foresite Capital, said that unlike in technology, where data to train AI models is created by users, in biology and medicine “data is poor. You have to create datasets.” will drive the development of the model.

Other biotech companies use generative AI to design drugs. Repetitionwhich goes public in 2021, and Genesis Therapeutics, a startup that last year raised a $200 million Series B led by Andreessen Horowitz.

The company declined to say when it expects to have its first drug available for human trials. However, Bob Nelson, managing director of ARCH Venture Partners, emphasized that Xaira and its investors are ready to play the long game.

“You need billions of dollars to be a real drug company and to think about AI. Both are expensive subjects,” he said.

Xaira wants to position itself as an AI drug discovery powerhouse. However, some believe that bringing on Tessier-Lavigne as CEO is an unexpected move. Tessier-Lavigne resigned as Stanford president last year amid explosive reports — including Stanford Daily – that his laboratory at Gentech, where he previously worked as chief scientific officer, had manipulated research data.

Tessier-Lavigne herself was not accused of manipulating any data and denied knowing that false research was being published from labs she supervised.

Investors, meanwhile, believe he is the right person for the job.

“I have known Mark for many years and know him to be a man of integrity and scientific vision who will be an exceptional CEO,” Nelson said in an email. “Stanford cleared him of any wrongdoing or scientific misconduct.”

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