Japan-based Takeda Pharmaceutical has entered a multi-year partnership worth more than $1.7 billion (€1.44 billion) with US-based privately held biotech company Iambic to use artificial intelligence to design small-molecule drugs targeting cancer and gastrointestinal diseases, according to Reuters.

Under the agreement, Iambic will receive upfront payments and could earn more than $1.7 billion (€1.44 billion) in development and commercial milestones, plus royalties on sales. The deal marks Takeda's latest move to embed artificial intelligence across its research operations, following a similar agreement with Nabla Bio last year focused on protein-based drugs.

Takeda will gain access to NeuralPLexer, Iambic's model that predicts how drug molecules bind to proteins. Tom Miller, chief executive of Iambic, told Reuters that understanding protein structure is critical in drug development.

Miller said: "If you don't know the shape of what you're trying to engage, it's a lot like trying to make a sculpture in the dark."

Traditional drug discovery can take around six years before a compound reaches clinical trials. Iambic said its approach, combining AI predictions with automated laboratories, can compress that timeline to less than two years.

Christopher Arendt, chief scientific officer at Takeda, said: "When you start to add an AI engine to your small-molecule drug development, it means you can go faster."

Drug developers are increasingly turning to AI technologies to speed up discovery and cut costs, with experts predicting timelines could be halved in coming years. Miller said AI tools can save months of traditional laboratory work, but noted that molecular quality remains equally critical.

Find out how Takeda and Iambic plan to accelerate cancer and GI drug development through AI by reading the complete article.