Recursion Inc.’s combination of machine learning and artificial intelligence, coupled to its wet lab work, caught Bayer AG’s attention so solidly that its investment unit, Leaps by Bayer, led the charge on Recursion’s new and oversubscribed $239 million series D financing.
Leaps, headed by Juergen Eckhardt, is in the business of making early stage investments into new technology platforms.
Bayer also decided to collaborate with Recursion to discover and develop treatments for fibrotic disease of the lung, kidney, heart and more. The two companies may initiate more than 10 fibrosis programs that could culminate in more than $100 million in development and commercial milestone payments plus royalties on future sales.
Recursion, which plans to continue advancing its internal programs focusing mainly on genetic diseases, will receive an up-front payment of $30 million in addition to a $50 million lead equity investment.
It’s revolutionary when a company like Recursion combines wet labs with artificial intelligence, Eckhardt told BioWorld. Recursion took the untraditional biopharma path when it built AI and machine learning tools alongside its wet lab, where the company performs millions of experiments every month, according to Chris Gibson, Recursion’s CEO and a co-founder. But putting the right technology and the wet labs together doesn’t always get the job done properly. The biologists and the technologists need to be able to communicate effectively.
“Creating the right culture is an important element, and Bayer saw that,” Gibson told BioWorld. “We were attracted to work with Bayer and Jurgen at Leaps because it felt like more than any other company, they understood the culture clash and how we are addressing it internally.”
Recursion, in its six and a half years of existence, has worked more on creating that culture and a shared language than the technology itself, Gibson said. It takes a certain kind of worker who can understand the junction of biology and technology to become comfortable. That means integrating the members of all teams into the steps of the R&D process so they are able to learn each other’s pain points and ultimately find common ground.
Gibson cited a data scientist who joined Recursion and, having found himself at the junction of technology and biology, went on to become one of the company’s best biologists.
“We hire for a growth mindset,” Gibson said. “Bayer impressed us by being open to thinking about the way the industry may change in the coming decades and making savvy bets.”
Salt Lake City-based Recursion said it will use the series D to help develop its pipeline, which contains more than 30 programs stretching from the early discovery stage to the clinic. The company claimed it has the broadest and deepest pipeline to date of any company operating within the space of digitally powered drug discovery. Gibson said he believes the company can double its clinical and preclinical programs with the pipeline with each successive year. The platform is based on a library of more than a half billion images of human cells taken from more than 33 million experiments conducted by Recursion, which has more than 750 cellular disease models to interrogate diverse therapeutic areas.
“The idea is that we can create a dataset that grows over time to give us increasing insight into the biology we explore,” Gibson said.
The syndicate involved with Recursion’s series D also included new investors Casdin Capital, Catalio Capital Management LP, Laurion Capital Management and Samsara Biocapital and all its existing major institutional investors: Baillie Gifford, Mubadala, DCVC, Lux Capital, Obvious Ventures, Felicis Ventures, EPIC Ventures, Two Sigma Ventures, Advantage Capital and Intermountain Ventures.
Aside from being invested in, Recursion has also been active in spurring on others. Altitude Lab, of Salt Lake City, is a new 14,500-square-foot incubator founded by Recursion and the University of Utah’s Center for Technology & Venture Commercialization. It will initially house Known Med, 3Helix and Nexeos Bio. The incubator, which is scheduled to open its wet lab facility in October, is accepting applications for additional residents.
In July, Recursion acquired Vium, a digital vivarium company boasting a platform that combines computer vision, machine learning and sensor technologies to non-invasively collect and derive insights from digital biomarkers in preclinical in vivo research.