A man wearing a mask walks past an Nvidia logo in Taipei, Taiwan.
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chip maker nvidia will invest $50 million in Recurrence Pharmaceuticals to accelerate the development of biotechnology company artificial intelligence models for drug discovery, the companies said Wednesday.
Recursion’s shares skyrocketed 80% following the announcement. Shares of Nvidia, which have helped drive stock market gains this year amid hopes about its artificial intelligence computer chips, rose more than 2%.
Recursion uses AI-powered models to identify and design new therapies and offers those models to other drug manufacturers, including Roche and bayer.
Salt Lake City, Utah-based Recursion will use its biological and chemical data sets that exceed 23,000 terabytes to train its AI models on Nvidia’s cloud platform. AI models typically require large amounts of data, usually measured in terabytes, to train them.
Nvidia can then potentially license those AI models into BioNeMo, the company’s cloud service for generative AI in drug discovery that launched earlier this year.
Recursion expects to use BioNeMo to support its internal drug portfolio and those of its current and future partners. Recursion is conducting human trials for five of its drugs.
“Our collaboration with NVIDIA represents two best-in-class companies coming together to help solve one of the world’s toughest challenges, drug discovery,” Recursion CEO Chris Gibson said in the statement.
Nvidia’s investment is the latest example of the AI frenzy making its way into the pharmaceutical industry. Drugmakers are increasingly recognizing the potential of AI to bring life-saving treatments to people faster.
modern It said in April that it will harness the power of AI to advance the company’s messenger RNA technology, which is used in Covid vaccines. One month after, Google Cloud launched two new AI-powered tools that aim to help biotech and pharmaceutical companies accelerate drug discovery.
Nvidia, which produces chips used to power artificial intelligence, is seen as a big winner in the AI boom.
The company hit a market value of $1 trillion for the first time in June, part of a more than 200% rise in share price since the beginning of this year due to strong demand for AI.
The investment in Recursion only deepens Nvidia’s commitment to the popular technology.
The announcement also comes as Recursion strengthens its focus on AI. The company in May acquired two companies in the AI-powered drug discovery space for $87.5 million.
Other AI-powered drugmakers also traded higher on Wednesday following the announcement.
excise shot up to 12%, while Biological products AbCellera jumped more than 13%.
– CNBC’s Benjamin Taubman contributed to this report.