PathAI finds its way to $165M series C for diagnostic and drug development software

If its hundreds of millions in venture funding and wide-ranging cadre of big-named partners are any indication, PathAI’s (ahem) path forward appears to be paved in gold.

The five-year-old startup develops artificial-intelligence-based technologies to augment the work of pathologists. The platform uses machine learning and deep learning to improve both diagnostic and treatment capabilities by identifying disease biomarkers and predicting how individual patients will respond to various treatments.

To continue this development, PathAI has raised $165 million in a newly closed series C. The financing was co-led by D1 Capital Partners and Kaiser Permanente. Another dozen investors joined in the round, including Bristol Myers Squibb, Labcorp and Merck’s Global Health Innovation Fund.

The latest funding round follows PathAI’s series B, which initially closed in April 2019 with $60 million from a group of investors led by General Atlantic. About six months later, the round officially closed with an extra $15 million from the Merck Global Health Innovation Fund and Bristol Myers Squibb.

RELATED: Merck, BMS chip in to PathAI's series B, bringing total to $75M

PathAI’s newest influx of funds will be put toward growing its commercial reach and the platform’s clinical research capabilities. The Boston-based startup is planning to adapt its technology for use in new disease indications beyond its current work in the diagnosis and treatment of cancer and nonalcoholic steatohepatitis, or NASH.

The financing will also help bring PathAI’s platform into all facets of biopharmaceutical research and drug development, from the identification of potential drug targets to clinical trials and the commercialization process.

PathAI currently works with pharmaceutical researchers, diagnostic developers and digital pathology companies in its efforts to build out and deploy its AI-powered technology for disease diagnosis and treatment.

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Labcorp, for example, expanded its existing collaboration with PathAI earlier this year. The extended partnership will see Labcorp use PathAI’s algorithms to identify disease-specific biomarkers and the biomarker-positive patients who will respond best to certain treatments to improve clinical trials managed by Labcorp’s drug development arm.

Through the collaboration, Labcorp will also explore the possibility of using those same AI algorithms to create and commercialize companion diagnostic devices to accompany the drugs in development.

And, last fall, PathAI and longtime partner Gilead unveiled results of a joint study demonstrating that PathAI’s machine learning technology was able to analyze liver biopsies to accurately predict the progression of NASH and chronic hepatitis B virus infection and determine how effective standard treatments might be, indicating the AI’s potential use in ultimately improving diagnosis and treatment of liver disease.