XtalPi Jumps on $6 Billion DoveTree AI Drug Discovery Partnership

Shares of XtalPi Holdings climbed 12% to HK$7.39 in Hong Kong trading after the artificial-intelligence drug-discovery firm finalised a partnership with U.S. biotech start-up DoveTree that could be worth as much as US$6 billion. Under the agreement, DoveTree will pay US$51 million immediately and a further US$49 million within 180 days for access to XtalPi’s AI- and robotics-driven platform. The rest of the consideration—up to US$5.9 billion—will be tied to development, commercial milestones and sales royalties on small-molecule and antibody therapies targeting oncology, autoimmune and neurological diseases. DoveTree was founded by Harvard chemistry professor and serial entrepreneur Gregory Verdine, who said the alliance gives the companies “a unique opportunity to deliver transformative therapies.” The transaction ranks among the largest AI-enabled drug-discovery deals to date and extends a string of high-value tie-ups between Western drugmakers and Chinese biotech groups. In June, AstraZeneca agreed to pay more than US$5 billion for access to CSPC Pharmaceutical’s AI platform and cancer pipeline, while Pfizer recently deepened its collaboration with XtalPi. Earlier this year, Sanofi committed up to US$1.7 billion to license antibody candidates discovered by Beijing-based Helixon’s U.S. arm Earendil Labs. Chinese companies accounted for 32% of global biotech licensing deal value in the first quarter, up from 21% in each of the previous two years, according to Jefferies. Analysts attribute the surge to China’s expanding pool of AI and chemistry talent, lower R&D costs and government backing for biomedical innovation, factors that are making the country an increasingly important partner for multinational pharmaceutical firms seeking to replenish product pipelines.