The archive · Bio & Materials · Strategic decision · 2021–2025
Isomorphic Labs' AI-first drug bet: $600M raise, $2.9B in pharma deals, no drugs yet
DeepMind's London spinout bets AI-first protein design can reinvent drug discovery; $600M from Thrive (2025) plus up to $2.9B Lilly/Novartis milestones.
Isomorphic Labs
What the business is
Isomorphic Labs is a London-based company spun out of Google DeepMind in 2021 that uses AI models built on AlphaFold to design small-molecule drugs and license discovery programs to pharma partners.
Starting capital：$600M first external round led by Thrive Capital with GV and Alphabet (announced 2025-03-31); earlier, Lilly paid $45M upfront (up to $1.7B milestones) and Novartis $37.5M upfront (up to $1.2B milestones).
How it started
Demis Hassabis launched Isomorphic Labs in 2021 under Alphabet, spinning it out of DeepMind to apply AlphaFold — the AI that predicts protein structures — to drug design. The thesis: biology is information, and a model that can read it will find drug targets and molecules faster than wet-lab screening. Isomorphic co-designed AlphaFold 3 with DeepMind, and in January 2024 it signed its first pharma deals: Eli Lilly ($45M upfront, up to $1.7B in milestones) and Novartis ($37.5M upfront, up to $1.2B), together worth nearly $3B excluding royalties.
What happened
The partnerships were validation without a product: no Isomorphic-discovered drug had reached trials, and the company's 2021 accounts showed a £2.4M loss as it hired ahead of opening a Lausanne office. In March 2025 Isomorphic raised $600M — its first external round — led by Thrive Capital with GV and Alphabet participating; Hassabis told the New York Times the company didn't need the capital but would use it to hire top research scientists. The stated goal was to bring AI-designed drugs to clinical trials.
How it ended up
Still scaling, unproven: as of 2025-03-31 Isomorphic had $600M in new capital, pharma partnerships worth up to ~$3B, and a goal of getting its first AI-discovered drugs into clinical trials — the bet had won funding and partners, but no clinical proof yet.
Background
Isomorphic Labs, launched in 2021 by DeepMind co-founder Demis Hassabis under Alphabet, is the bet that AI-first protein design can reinvent drug discovery. Spun out of DeepMind and built on AlphaFold — the Nobel-winning model that predicts protein structures — it designs small-molecule drugs computationally and licenses discovery programs to pharma partners rather than owning clinical development itself.
In January 2024 the strategy got its first external validation: Eli Lilly agreed to pay $45M upfront plus up to $1.7B in milestones, and Novartis $37.5M upfront plus up to $1.2B — nearly $3B combined, excluding royalties, for access to Isomorphic's platform. No Isomorphic-discovered drug had reached trials, and its 2021 accounts showed a £2.4M loss, but the deals signaled that large pharma accepted the thesis.
In March 2025 Isomorphic raised its first external capital: $600M led by Thrive Capital, with GV and Alphabet, which Hassabis said would go mainly toward hiring top research scientists as the company aimed to take its first AI-designed drugs into clinical trials. As of that date the bet had won money and partners but had not yet produced clinical proof — making it a funded, high-profile experiment in whether computational biology can replace decades of wet-lab trial and error.
What has to be true
- It isolates the strongest possible signal for an AI-first biotech thesis: two top pharma companies prepaying billions before any drug existed.
- The case is genuinely unfinished — $600M raised, zero clinical candidates — so it documents a bet still being tested rather than a hindsight story.
- It shows how a corporate spinout (Alphabet/DeepMind) used Nobel-grade science and licensing economics instead of consumer products.
- The numbers are all sourced and dated: $45M/$37.5M upfront (2024-01-07), up to $2.9B milestones, $600M round (2025-03-31).
What can be applied
Validation can precede product: Isomorphic monetized an AI engine pharma trusted enough to prepay billions in milestones — but the licensing strategy has yet to prove a molecule.
Aftermath
As of 2025-03-31, Isomorphic Labs remains pre-clinical, having closed a $600M round led by Thrive Capital with GV and Alphabet, following 2024 partnerships with Eli Lilly and Novartis potentially worth nearly $3B in milestones. It continues building on AlphaFold 3, co-designed with DeepMind, and aims to bring its first AI-designed drugs to clinical trials. Founder Demis Hassabis, who shared the 2024 Nobel Prize in Chemistry for AlphaFold, remained CEO, and the company was hiring for London and Lausanne.
Sources
- Alphabet's AI drug discovery platform Isomorphic Labs raises $600M from Thrive
- Isomorphic inks deals with Eli Lilly and Novartis for drug discovery
- Isomorphic Labs kicks off 2024 with two pharmaceutical collaborations
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