AI Firm Formation Bags $372 Series D Funding

In 2024, megarounds have been extremely uncommon. Nonetheless, Formation Bio was able to secure a remarkable series D funding round of $372 million as the artificial intelligence-focused biotech company looks to extend its pipeline.

A lot of AI firms choose to make grand claims, but Formation’s product is more regular than would be expected. Formation intends to collaborate with biotech companies to enhance the automation of their workflows. This could involve the generation of individualized patient recruiting content for particular groups of a clinical trial or the rapid production of adverse event reports generated by artificial intelligence.

“In the long term, the company’s goal is to build and train AI models that can better predict toxicity, tolerability, and one day, efficacy,” Formation said in a press release.

The firm also mentioned that it aims to give drug-producing groups the support they seek in terms of research and development through a so-called ‘AI R&D Scientist’ that it hopes to create in the near future.

Sanofi, which has additional AI-focused partnerships with partners such as Owkin and Exscientia, was a prominent participant in the series D, which was headed by a16z.

Formation, previously known as TrialSpark, has said that it intends to use this funds to continue investing in the acquisition and licensing of clinical-stage assets from its partners in the pharmaceutical and biotechnology industries.

There are currently three candidates in the firm’s clinical pipeline, one of which is a SYK/JAK inhibitor called gusacitinib, currently in phase 3 testing for the treatment of chronic hand eczema. A sodium channel blocker known as ASN008 is also being tested in phase 2 trials for the treatment of notalgia paresthetica and itching linked to atopic dermatitis. Additionally, an FGF18 medication known as sprifermin is also being tested in phase 2 for the treatment of knee osteoarthritis.

Gusacitinib and ASN008 were both acquired from Asana BioSciences in 2022, whereas sprifermin was obtained through a licensing agreement with Merck KGaA.

The company stated in the release that collaborating with Formation Bio allows smaller biotech firms to progress beyond their primary asset, paving the way for other drugs in their pipeline. For large pharmaceutical organizations, Formation Bio offers an off-balance-sheet method for development, helping them pursue more opportunities in a financially efficient manner.

A month ago, Sanofi announced that it would be forming a relationship with both Formation and OpenAI to develop new medications. This morning’s press announcement included a message from CEO Paul Hudson, in which he reaffirmed that the French pharmaceutical company is fully committed to artificial intelligence.

Hudson expressed pride in partnering with and investing in Formation Bio, emphasizing that their AI-driven approach to drug development will be extremely beneficial to the industry as a whole. He highlighted the shared goal of accelerating and enhancing the process of delivering new medicines to patients.

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