XtalPi closes $15mn Series B funding round, attracting tech giant Google
XtalPi Inc., a computation-driven pharmaceutical technology company, has announced the closure of its $15 million Series B funding round. Led by Sequoia China, participation from Google and existing investor Tencent has seen the company raise over $20 million, making it one of the top-funded AI-powered biotech companies.
Founded in 2014 by a group of quantum physicists at MIT, XtalPi encompasses an elite team of researchers with multi-disciplinary expertise in physics, chemistry, pharmaceutical R&D, and algorithm design. It now houses offices in Cambridge (UK), Beijing and Shenzhen.
XtalPi offers Intelligent Digital Drug Discovery and Development (ID4) that improves the efficiency, accuracy, and success rate of drug design, solid-form drug selection, and other critical aspects of preclinical drug development.
Although Google’s search engine remains inaccessible within the Chinese market, it is ahead of the curve in investing in companies, particularly within healthcare, where it sees vast potential. The company has recently invested in a new AI facility in the country, where it has also recently signed a patent with Chinese giant Tencent.
By combining artificial intelligence, quantum physics, and high-performance cloud computing, XtalPi can quickly and accurately predict important characteristics of small-molecule drugs and solid forms, providing time-saving insights into the safety, stability, and efficacy of drug candidates. XtalPi currently looks to partner with top global pharmaceutical companies and research organisations to further its development.
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"We believe that algorithmic power is the key to finding smarter, more effective routes for drug research and development, and we are focused on building a computational engine that empowers and expedites pharmaceutical innovation for companies worldwide," explained XtalPi Co-founder and Chairman of the Board Dr. Shuhao Frank Wen.
"The financing from Sequoia China, Google, and Tencent, who are among the top investors and innovators in AI and computer science, represents a strong endorsement of our vision and technology."
Funding will be used to further develop new computational models built on big data generated from XtalPi's high-precision computing platform, which will see the company expand its business into adjacent areas along the pharmaceutical value chain.
It will also support the construction of a prediction-driven research lab that integrates XtalPi's R&D platform with state-of-the-art wet-bench laboratory technologies. This hybrid computational-experimental facility will provide enhanced capabilities for the rational design of solid forms of drugs.
Neil Shen, Founding and Managing Partner of Sequoia China said: "XtalPi offers a unique solution to the highly empirical and challenging nature of the drug discovery and development process. Sequoia China's investment in XtalPi reflects our view that AI will transform the future of the pharmaceutical industry."
Getting ready for cloud data-driven healthcare
As healthcare continues to recognise the value of data and digital transformation, many organisations are relying on the cloud to make their future-forward and data-centric thinking a reality. In fact, the global healthcare cloud computing market was valued at approximately $18 billion and is expected to generate around $61 billion USD by 2025.
At the forefront of these changes is the rapid adoption of cloud-based, or software-as-a-service (SaaS), applications. These apps can be used to handle patient interactions, track prescriptions, care, billing and more, and the insights derived from this important data can vastly improve operations, procurement and courses of treatment. However, before healthcare organisations can begin to dream about a true data-driven future, they have to deal with a data-driven dilemma: compliance.
Meeting regulation requirements
It’s no secret that healthcare is a highly regulated industry when it comes to data and privacy – and rightfully so. Patient records contain extremely sensitive data that, if changed or erased, could cost someone their life. This is why healthcare systems rely on legacy technologies, like Cerner and Epic EHRs, to manage patient information – the industry knows the vendors put an emphasis on making them as secure as possible.
Yet when SaaS applications are introduced and data starts being moved into them, compliance gets complicated. For example, every time a new application is introduced into an organisation, that organisation must have the vendor complete a BAA (Business Associate Agreement). This agreement essentially puts the responsibility for the safety of patients’ information — maintaining appropriate safeguards and complying with regulations — on the vendor.
However, even with these agreements in place, healthcare systems still are at risk of failing to meet compliance requirements. To comply with HIPAA, U.S. Food and Drug Administration 21 CFR Part 11 and other regulations that stipulate the need to exercise best practices to keep electronic patient data safe, healthcare organisations must maintain comprehensive audit trails – something that gets increasingly difficult when data sits in an application that resides in the vendor’s infrastructure.
Additionally, data often does not stay in the applications – instead healthcare users download, save and copy it into other business intelligence tools, creating data sprawl across the organisation and exposing patient privacy to greater risk.
With so many of these tools that are meant to spur growth and more effective care creating compliance challenges, it begs the question: how can healthcare organisations take advantage of the data they have without risking non-compliance?
Yes, healthcare organisations can adhere to regulations while also getting valuable insights from the wealth of data they have available. However, to help do this, organisations must own their data. This means data must be backed up and stored in an environment that they have control over, rather than in the SaaS vendors’ applications.
Backing up historical SaaS application data directly from an app into an organisation’s own secure cloud infrastructure, such as AWS or Microsoft Azure, makes it easier, and less costly, to maintain a digital chain of custody – or a trail of the different touchpoints of data. This not only increases the visibility and auditability of that data, but organisations can then set appropriate controls around who can access the data.
Likewise, having data from these apps located in one central, easily accessible location can decrease the number of copies floating around an organisation, reducing the surface area of exposure while also making it easier for organisations to securely pull data into business intelligence tools.
When healthcare providers have unfettered access to all their historical data, the possibilities for growth and insights are endless. For example, having ownership and ready access to authorised data can help organisations further implement and support outcome-based care. Insights enabled by this data will help inform diagnoses, prescriptions, treatment plans and more, which benefits not only the patient, but the healthcare ecosystem as a whole.
To keep optimising and improving care, healthcare systems must take advantage of new tools like SaaS applications. By backing up and owning their historical SaaS application data, they can do so while minimising the risk to patient privacy or compliance requirements. Having this ownership and access can propel healthcare organisations to be more data-driven – creating better outcomes for everyone.