AstraZeneca converges with Verge's AI tech in $42M neurodegenerative disease R&D pact

Verge Genomics is adding AstraZeneca to its Big Pharma AI collection with a $42 million upfront deal to find new targets for rare neurodegenerative diseases.

The four-year deal will see the AI-drug discovery biotech work with AstraZeneca’s rare disease wing Alexion. Beyond the upfront fee, Verge will be eligible for $840 million in milestones plus royalties later on. At the same time, Alexion will take an equity position in Verge.

AstraZeneca already has a presence in neurodegenerative diseases with candidates in development for Alzheimer’s disease, Parkinson’s and amyotrophic lateral sclerosis. The new pact will reinvigorate the U.K.-based pharma's pipeline courtesy of Verge's high-tech AI- and machine-learning-enabled Converge drug discovery engine. The platform uses human tissue data sets combined with computational analysis to find drug targets that may have a higher chance of success.

Verge has already taken one internal ALS program from discovery to the clinic. Other preclinical programs include Parkinson’s, schizophrenia and frontotemporal dementia.

The biotech inked high-profile deals with Eli Lilly and Merck & Co. in 2021. The two companies contributed to a nearly $100 million fundraising round in December of that year, and both have equity stakes in Verge as well. Lilly has a three-year research program to work on up to four ALS targets, which included $25 million upfront plus $694 million down the line in milestones. That program is in late-stage discovery, according to Verge’s pipeline.

With all those deals, Verge has $67 million in non-dilutive capital and the possibility to tap into $1.5 billion in milestones plus royalties as the programs progress.