HONG KONG – SK Holdings Co. Ltd. invested ₩10 billion (US$8.6 million) in Standigm Inc., an artificial intelligence (AI)-powered biotech company based in Seoul, Korea. It is the second big investment Standigm has attracted this year after a ₩13 billion series B round in March.

SK Holdings is a unit of SK Group, the third largest conglomerate in South Korea. The company aims to use the new investment to enhance the AI-based drug development platform of SK Biopharmaceuticals Co. Ltd., a Korean biopharmaceutical firm wholly owned by SK Holdings.

“Based on the investment, we expect to strengthen our AI-powered drug development platform capability,” a spokesman at SK Holdings told BioWorld. “We believe that AI technology is quintessential to improve drug development systems, and this partnership will grow the two companies as global AI technology leaders.”

“Through the collaboration with SK, we will accelerate our endeavour to set up a new standard of AI-based drug development,” said Standigm CEO Jinhan Kim.

Standigm develops its own AI systems designed to quickly examine biomedical databases, generate drug candidates and filter final compounds in a virtual environment. The company goes through three processes in using its AI technology: dataset parsing to make the data actionable; AI modeling with explanation of how the models are generated; and biological interpretation of how the drug compounds would interact with patients. The interpretation assists researchers when deciding which drugs to assemble and test for viable solutions.

The company has in-house AI technologies, Standigm Insight and Standigm Best, to discover and develop candidates.

Standigm Insight strengthens drug compounds through the discovery of hidden indications and pathways with potential target prediction. The technology considers about 2 million cases of how drug candidates react to certain cell or genes. Based on those deep learning efforts, the company can develop an expectation about how effective a drug will be to treat certain diseases. Using Standigm Insight, the company has developed therapeutics targeting various diseases, including nonalcoholic steatohepatitis, Parkinson’s disease and autism.

Standigm Best, meanwhile, is designed to generate novel compounds by a exploring drug discovery space and virtually altering molecular structures. The drug discovery space is described as an AI-generated latent chemical space. It maps compound structure patterns into information representations. Both existing or new compounds are created by decoding points.

The discovery space has two functionalities: analogue structure generation and lead optimization. It first preserves the chemical similarity and can be used to generate analogue structures based on the seed molecule. Second, the space can be explored to discover and optimize structures with desired chemical properties such as target binding affinity or ADME/tox (absorption, distribution, metabolism, excretion and toxicity).

The biotech was founded in 2015 by three former researchers of Samsung Advanced Institute of Technology. In 2016, it won third place among 71 global teams at the Astrazeneca-Sanger Drug Combination Prediction Dream Challenge of the year. The challenge aims to explore fundamental traits that consist of effective combination treatments and synergistic drug behavior using genomic data, hosted by the U.K. pharmaceutical giant Astrazeneca plc and partnered with the European Bioinformatic Institute, the Sanger Institute and Sage Bionetworks.

Meanwhile, SK Holdings has expanded its biopharmaceutical business by enhancing both drug production and R&D.

In September, it founded U.S.-based SK Pharmteco Co. Ltd., a contract manufacturing organization (CMO) to combine SK Biotek Co. in Korea, SK Biotek Ltd. in Ireland and AMPAC Fine Chemicals LLC. in the U.S. under SK Pharmteco. By integrating the drug production businesses, the U.S.-based entity aims to raise its CMO business value to ₩10 trillion by 2025.

SK Holdings’ 100% subsidiary, SK Biopharmaceuticals, is preparing for an IPO in which it expects to raise ₩5 trillion. In late October, SK Biopharmaceuticals filed a pre-screening application to list on the Korea Exchange. The company’s funding for Standigm is expected to raise its investment value.

On Nov. 15, SK Biopharmaceuticals’ narcolepsy drug, Sunosi (solriamfetol) received a positive opinion from the Committee for Medicinal EMA’s Committee for Medicinal Products for Human Use (CHMP). The final marketing approval will be announced in 67 days. Irish drugmaker Jazz Pharmaceuticals plc, which has the rights to sell the drug in the U.S. and Europe, applied for the marketing approval last year. Jazz also won FDA marketing approval in March this year and is selling solriamfetol in the U.S.

SK Biopharmaceuticals’ cenobamate, an antiepileptic drug, is expected to receive FDA approval on Nov. 21. The Lancet Neurology recently published a key pivotal trial that showed treatment with cenobamate significantly improved seizure control for partial-onset (focal) seizures in adult patients with epilepsy.