Generate:Biomedicines has hit the public markets as the world begins to question the usefulness of AI technology. CEO Mike Nally says biology is the key to unlocking the technology’s full potential.
The world is oversaturated with news about the impact of AI—good and bad. With that in mind, Generate:Biomedicines CEO Mike Nally stepped to the podium at the Nasdaq in New York on Friday to ring the opening bell as his generative biology company entered the public markets with a $425 million IPO.
Confetti shot into the sky, and the biotech’s team cheered. A little boy held aloft by his parent pumped his arm at the excitement. Generate was now on the Nasdaq. So what comes next? In an interview shortly after the bell ceremony, Nally told BioSpace it’s time to show the world that AI can meet the hype.
“That’s been the big question that I think has persisted in the field. Like, all right, I hear a lot about these AI, [machine learning] biotech companies, but where are the medicines?” Nally said.
Generate has some hope it will build the case for the technology. The main focus of the IPO was to raise funding for two Phase 3 trials of the anti-TSLP antibody GB-0895 in severe asthma. Other funding will go toward a Phase 1b trial for a chronic obstructive pulmonary disease (COPD) therapy and two cancer assets in early-stage trials.
This latest milestone for Generate has arrived as the debate about AI swings toward negativity. Americans are beginning to protest the massive data centers required to house the computers behind the technology. Language models are infiltrating every social media space and professional circumstance. People are beginning to question whether the technology is doing any good.
Nally insists that the pursuit of understanding in biology is where the technology needs to prove itself.
“Generative AI is the story of the day,” he said. “When you think about where generative AI is going to have the greatest impact on humanity, it may be within biology and drug discovery.”
He acknowledged that, to the non-biotech crowd, the progress appears slow. When a large language model like ChatGPT is released, consumers get to engage with it immediately. AI biotechs, on the other hand, may be churning out candidates by the hundreds but no one is going to get to take them for years given the nature of drug development. Still, Generate, which has been around for less than a decade, has accelerated the discovery process significantly with GB-0895, Nally said.
“If you think about going from a concept in 2021 to a Phase 3 asset in December of 2025, that’s actually probably in the drug discovery and development space one of the most expeditious timelines we’ve seen,” Nally said. “These lead times in some ways are hiding what’s actually the real promise of these technologies.”
Nally pointed to the chief executives of the major AI companies—like Open AI’s Sam Altman and Anthropic’s Dario Amodei—who are now considering biology to be the next frontier. Another example is Google DeepMind founder Demis Hassabis, who formed the biotech Isomorphic Labs based on the generation model AlphaFold.
Biotech investors are willing to wait—and to invest in something that might just make drug discovery faster. Nally said Generate had a strong syndicate backing the IPO, including Novartis, Samsung and NVIDIA.
“I think we’ve been able to translate what has been promised of the technology into now meaningful products that both technology investors as well as healthcare investors can appreciate,” he said.
The IPO markets have not been wide open for biotechs—but that is beginning to change. Generate went public a few after another AI-enhanced company, Eikon Therapeutics, raised $381 million in a Nasdaq debut.
“Geopolitically, the world is volatile right now. The markets are volatile,” Nally said. “People have been encouraged by the early flurry of biotech IPOs, but I’ll say there’s some trepidation around the future.” But the CEO added that he sees declining interest rates as “a good predictor of biotech success.”
Meanwhile, after the IPO, Generate is headed back to the clinic to work on the many clinical trials that are already underway. The biotech also has key partnerships with Amgen and Novartis, and given how prolific the platform is, Nally could see more in the future.
“We feel really fortunate that we have a great opportunity in front of us, and we’re just scratching the surface of the potential of this technology.”
