From OpenAI’s offices to a deal with Eli Lilly — how Chai Discovery became one of the flashiest names in AI drug development

Summary

Drug discovery, the art of identifying new molecules to develop pharmaceuticals, is a notoriously time-consuming and difficult process. Traditional techniques, like high-throughput screening, offer an expensive scattershot approach—one that is not often successful. However, a new breed of biotech companies are leveraging AI and advanced data technologies in an attempt to accelerate and streamline the process. Chai Discovery, an AI startup founded in 2024, is one such company. In a little over 12 months, its young co-founders have managed to raise hundreds of millions of dollars and rally the backing of some of Silicon Valley’s most influential investors, making it one of the flashiest firms in a growing industry. In December, the company completed its series B, bringing in an additional $130 million and a valuation of $1.3 billion. Last Friday, Chai also announced a partnership with Eli Lilly, a deal in which the pharmaceutical giant will use the startup’s software to help develop new medicines. Chai’s algorithm, called Chai-2, is designed to develop antibodies—the proteins necessary to fight illnesses. The startup has said it hopes to serve as a kind of “computer-aided design suite” for molecules. It’s a critical moment for Chai’s particular field. The startup’s deal was announced shortly before Eli Lilly said it would also collaborate with NVIDIA on a $1 billion partnership to create an AI drug discovery lab in San Francisco. This “co-innovation lab,” as it’s being called, will combine big data, compute resources, and scientific expertise, all in an attempt to accelerate the speed of new medicine development. The industry isn’t without its detractors. Some industry veterans seem to feel that—given how difficult traditional drug development is—these new technologies are unlikely to have a major impact. However, for every naysayer, there seem to be just as many believers. Elena Viboch, managing director at General Catalyst — one of Chai’s major backers — told TechCr...