From the offices of OpenAI to a deal with Eli Lilly – how Chai Discovery became one of the brightest names in AI drug development

Drug discovery, the art of identifying new molecules for drug development, is a difficult and time-consuming process. Traditional techniques, e.g High throughput screeningoffers an expensive scattershot approach – one that often doesn’t work. However, a new generation of biotech companies is leveraging artificial intelligence and advanced data technologies in an attempt to speed up and simplify the process.

Chai Discovery, an AI startup founded in 2024, is one such company. In just over 12 months, its young founders have raised hundreds of millions of dollars and enlisted the support of some of Silicon Valley’s most influential investors, making it one of the brightest companies in a growing industry. In December the company Series B completedbringing in an additional $130 million and a $1.3 billion valuation.

Last Friday, Chai also announced a partnership with Eli Lilly, a company deal The pharmaceutical giant will use the startup’s program to help develop new medicines. Chai’s algorithm, called Chai-2, is designed to develop antibodies, which are proteins needed to fight diseases. The startup said it hopes to serve as a “computer-aided design suite” for molecules.

It is a critical moment for Zhai’s specific domain. The startup deal was announced shortly before Eli Lilly announced that it would also collaborate with Nvidia In a billion dollar partnership To create an AI drug discovery lab in San Francisco. The “co-innovation lab,” as it is called, will combine big data, computational resources and scientific expertise, all in an effort to accelerate the speed of development of new medicine.

The industry is not like that Without her critics. Some industry veterans seem to feel that these are new technologies – given how difficult it is to develop traditional drugs It is unlikely to have a significant impact. However, there seem to be a similar number of believers for every naysayer.

Elena Feibush, Managing Director at General Catalyst – one of Main supporters of Zhai She told TechCrunch that her company is confident that companies that adopt the startup’s services will see results. “We believe that the biopharma companies that move most quickly to partner with companies like CHAI will be the first to get molecules into the clinic and will make important medicines,” Feibush said. “In practice, this means partnering in 2026 and by the end of 2027, seeing first-in-class drugs enter clinical trials.”

Alisa Apple, head of Lilly’s TuneLab program — which uses artificial intelligence and machine learning to enhance drug discovery — also expressed confidence in Chai’s product. “By combining Chai’s generative design models with Lilly’s deep expertise in biology and proprietary data, we intend to push the boundaries of how AI designs better molecules from the beginning, with the ultimate goal of helping accelerate the development of innovative medicines for patients,” she said.

Chai may have been founded less than two years ago, but the startup’s origins began about six years ago, amid talks between its founders and OpenAI CEO Sam Altman. One of those founders, Josh Mayer, previously worked at OpenAI in 2018 on its research and engineering team. After he left the company, Altman wrote to Mayer’s old college friend, Jack Dent, to ask him about a possible job opportunity. Mayer and Dent had originally met in computer science classes at Harvard, but at the time, Dent was an engineer for Stripe (another company of which Altman was an early backer). Altman asked him if he thought Mayer would be open to collaborating on a proteomics startup, that is, one focused on studying proteins.

“Altman wrote to me to say that everyone at OpenAI thought very highly of him and to ask if I thought I would be open to working with them on proteomics,” Dent said. “Of course,” Dent told Altman, but there was just one hitch: Mayer didn’t feel the technology was quite “there” yet. The AI ​​technology behind such companies — which leverages powerful algorithms — was still a growing field and far from where it needed to be.

Mayer was also very intent on joining Facebook’s research and engineering team, which he will continue to do. At Facebook, Mayer helped grow ESM1the first model of a transformative protein language, and is an important introduction to the work Zhai is currently doing. After his time at Facebook, Mayer spent three years at Absci, another AI biotech company centered around drug production.

By 2024, Mayer and Dent finally felt ready to take on the protein company they had originally discussed with Altman. “Josh and I reached out to Sam and told him that we should pick up that conversation where we left off, and that we should start Chai together,” Dent said.

OpenAI ended up becoming one of Chai’s early investors. In fact, Mayer and Dent founded Chai — along with their co-founders, Matthew McPartlon and Jack Poitreau — while working at the AI ​​giant’s offices in San Francisco’s Mission District. “They were kind enough to give us some office space,” Dent revealed.

Now, a little more than a year later, as Chai relishes her new partnership with Eli Lilly, Dent says the key to the company’s rapid growth has been assembling a team of extremely talented people. “We put our heads down and pushed the limits of what these models can do,” Dent said. “Every line of code in our code base is native. We’re not taking LLMs off the shelf that are in the open source (ecosystem) and fine-tuning them. These are very custom builds.”

General Catalyst’s Viboch told TechCrunch that she felt Chai was ready to hit the ground running. “There are no fundamental barriers to deploying these models in drug discovery,” she said. “Companies will still need to conduct testing and clinical trials on drug candidates, but we believe there will be significant benefits for those who embrace these technologies – not only in compressing discovery timelines, but also in opening up drug classes that have historically been difficult to develop.”