Isomorphic Labs closed a $2.1 billion Series B on May 12, 2026, led by Thrive Capital. This brings the company’s cumulative disclosed equity to approximately $2.7 billion. The concentration of venture capital in companies like Isomorphic Labs suggests that the industry is shifting away from single-asset bets toward massive, compute-heavy platforms that own the underlying biological data used to train their models. This round follows a $600 million Series A from April 2024. Isomorphic maintains partnerships with Novartis and Eli Lilly worth nearly $3 billion. Novartis will pay $37.5 million upfront and up to $1.2 billion in performance-based incentives, while Eli Lilly provides $45 million upfront and up to $1.7 billion in milestones. I see that this investment scale reflects a shift where Isomorphic is treated like a foundation model lab. In the first half of 2026, at least 68 venture-backed biotech companies raised more than $9.1 billion. This is the highest first-half total for these firms since 2022. Isomorphic operates out of London, Cambridge, and Lausanne.
Recursion Pharmaceuticals grew through a merger with Exscientia in August 2024, a deal that valued Exscientia at approximately $688 million. Recursion operates the Recursion OS, which combines machine learning, chemistry, and clinical data to manage five clinical-stage programs. The company generated more than $500 million in realized inflows from pharmaceutical partnerships. Insilico Medicine reported expected first-half 2026 revenue of $102.5 million to $106.5 million, which is a 273% to 287% year-over-year growth.
The clinical translation gap
The industry faces a translation problem where speed in the lab does not guarantee success in the clinic. BenevolentAI saw its Pan-Trk inhibitor BEN-2293 fail a Phase 2a trial for atopic dermatitis in April 2023. As of August 2026, not a single AI-discovered drug holds full FDA approval. You know that preclinical speed does not mean clinical efficacy. Insilico Medicine remains one of the most advanced, with its Rentosertib program entering a Phase III trial in July 2026. In China, an AI-designed obesity drug has already advanced to Phase III clinical trials.
The FDA published a draft guidance in 2025 titled, "Considerations for the Use of Artificial Intelligence to Support Regulatory Decision Making for Drug and Biological Products." This guidance provides recommendations to industry on using AI to produce data for regulatory decisions. The Takeda acquisition of Nimbus Therapeutics’ TYK2 subsidiary for $4 billion in 2023 shows the difficulty of attributing success to AI, as the drug zasocitinib originated from a physics-based computational chemistry method. Exscientia’s first AI-designed drug, DSP-1181, was discontinued after Phase I despite a favorable safety profile.
| Company | Event | Value or Status | Date |
|---|---|---|---|
| Isomorphic Labs | Series B | $2.1 billion | May 2026 |
| Chai Discovery | Series B | $130 million | December 2025 |
| Generate Biomedicines | IPO | $400 million | February 2026 |
| Superluminal Medicines | Series B | $60 million | September 2026 |
Does the first FDA approval in 2026 or 2027 validate the entire sector?
Generative biology and specialized models
New players use generative AI to design proteins and molecules. Generate Biomedicines completed a $400 million IPO in February 2026. Its GB-0895 program is in two global Phase III studies for severe asthma. EvolutionaryScale raised $142 million from a16z and Nvidia Ventures for its ESM3 protein language model. Chai Discovery raised a $130 million Series B in December 2025 at a $1.3 billion valuation. These models predict the 3D structure of protein complexes. NewLimit closed a $435 million Series C in June. Verdiva Bio completed enrollment in its Phase IIb EVOLVE-2 study in February 2026 and targets a once-weekly oral GLP-1 treatment. Encoded Therapeutics raised $275 million in a Series F led by GV to advance its ETX101 candidate in Phase 1/2 trials. Superluminal Medicines closed a $60 million Series B on September 3, 2026, to advance its lead program for rare genetic forms of obesity. The company expects to begin a Phase 1 clinical trial by the end of 2026. Peptris Technologies raised a $7.7 million Series A on February 18, 2026.
Stanford researchers built a multi-agent AI system that mirrors a drug discovery organization. This system uses specialized agents for genetics, single-cell biology, clinical trials, and safety. The team spent $46 in API costs to have the agents analyze 56,000 clinical trials. The system concluded that drugs targeting cell-type-specific genes are 48% more likely to reach the market and have 32% lower adverse event rates. Superluminal Medicines uses Agentic Cryo-EM capabilities to generate hundreds of empirical GPCR structures.
