AI Drug Discovery

AI drug discovery has entered tiered commercialization—the first revenue to materialize comes not from "AI inventing new drugs" but from the software, data, simulation, clinical and compliance platforms wrapped around pharma R&D workflows. The FDA received 500+ regulatory submissions containing AI components between 2016 and 2023. Five categories carry clear commercial value: computational chemistry software, biosimulation, clinical trials/RWD, R&D data platforms/ELN/LIMS, and lab automation. The near-to-mid-term profit pool sits with the "pick-and-shovel" vendors and "workflow platforms" (Veeva, IQVIA, Certara, Schrödinger, Tempus, Thermo Fisher, Danaher, 10x, Illumina); the mid-to-long-term upside is reserved for AI-native biotechs that combine platform + pipeline + closed-loop experimentation (Isomorphic, Insilico, Iambic, Generate:Biomedicines, Recursion). Recursion×Sanofi carries up to $5.2 billion in total potential milestones, but what actually lands is the upfront. Insilico has compressed target-to-PCC to roughly 18 months. The frothiest corner: single-point AI protein-design/antibody-design/molecule-generation tools—the structure-prediction moat is weakening (AlphaFold/RoseTTAFold All-Atom are commoditizing structural information). Rating Watch: own the workflow and data layers first, treat pure-model bets with caution.