Molecule prospector Atomwise co-founded a drug research company alongside Velocity Pharmaceutical Development designed to shepherd its artificial intelligence-derived candidates through preclinical testing and into potential takeout deals with pharma industry partners. Dubbed X-37, the new firm will maintain a flexible LLC structure that will house each development program within its own virtual subcompany. This will allow X-37 to divest individual properties in the future while maintaining its parent organization and team, the company said. And to kick things off, X-37 is debuting with a $14.5 million series A round to fund operations and early development, starting in autoimmune diseases, cancer and anticoagulation. It began research work in 2018 and aims to have novel candidates ready to begin human testing by 2022.

Firm leverages AI technology similar to facial recognition to figure out which small molecules can bind most effectively with targeted enzymes. Does the future of drug development lie in a kind of facial-recognition technology for enzymes? That is the hope of X-37 LLC, a drug-development startup that is using artificial intelligence and a deep neural network developed by San Francisco-based Atomwise. "We think that this is an approach and a technology that is really going to transform drug discovery across the board," said Dr. David Collier, CEO of X-37, which is partly owned by Atomwise and is based in South San Francisco, California. It was founded last year.

X-37 was cofounded by Atomwise Inc. and a team of experienced pharmaceutical developers from Velocity Pharmaceutical Development. In addition to the above development programs, the team at X-37 will identify additional high-value drug targets, generate novel drug leads against these targets using Atomwise's world-class AI platform for structure-based drug design, and develop each of these drug programs to a medically-relevant inflection point, where it can be acquired by or partnered with a major pharmaceutical company to be brought to market. X-37 makes use of an LLC structure permitting each drug development program to be housed in a separate virtual company under the parent LLC. This structure is tax efficient and flexible, in that it allows X-37 to divest individual drug development programs, while maintaining the parent company and team. X-37 began operation in 2018 and has already generated promising novel hit molecules against several targets of high interest to the pharmaceutical industry.