A mostly black box since emerging with more than a billion dollars in hand, Xaira Therapeutics is slowly pulling back the curtain, revealing plans to find partners and validate its pipeline.
Xaira Therapeutics’ first virtual cell model already queries 4.9 billion parameters. So, when considering business development, what could the company possibly want?
More data, of course, according to newly hired Senior VP of Business Development and Operations Rachel Lane, who spoke to BioSpace on the sidelines of the BIO International Convention in June.
“You have this complex internal dialog amongst the team about how do you ensure that you can maintain priorities, strategic priorities internally, while also being the best partner that you can?” Lane explained. “That raises a bar then of what type of partnership you’re going to do, and making sure that there’s really strategic value, and the deal can be crafted in a way that is a win-win for both sides.”
Lane, who joined at the end of March, has been tasked with finding those partners. Whether they are Big Pharma, smaller biotechs or a research lab, she was mum. She did preview that Xaira is looking to build up its preclinical models and that would be the focus of dealmaking—it’s just that those data can come from anywhere.
Xaira doesn’t need partners for the cash, having already raised $1.3 billion to date, according to PitchBook. The next phase of Xaira’s existence will be about building proof of concept.
“When you have to do partnerships because you need non-dilutive capital and that’s your only source, those deals can look very different than when you’re in a position of strength and you’re really looking for that deal structure that can be a benefit for both sides,” Lane said.
In her hunt, Lane is considering what a partner could provide in terms of preclinical models for a specific disease area of interest. “That’s where we see a sweet spot for partnerships, to help further build the data moat that we’ve built internally to train and differentiate the models,” Lane said.
She pointed to the recent spate of Big Pharma–tech licensing deals, which have in some cases reached into the billions when milestones and other payouts are considered.
“We also think about, what are the opportunities where we can really bolster our capabilities across that sector as well, not just biopharma,” Lane added.
A covert pipeline
Since emerging in 2024 with $1 billion, Xaira has mostly been a black box. The AI drug hunter’s capabilities are sparsely displayed in an alphabet soup of tech jargon. No disease areas, programs or candidates have been declared on their site. But the C-suite has been packed with biotech veterans and tech giants, including the most recent addition of AbbVie vet Ian McCaffery. That team has sent a signal to the industry.
In March, the secretive biotech launched its first virtual cell model, opening up the curtain for the first time. Lane said that, with that model out, the company is getting ready to reveal even more.
For instance, Xaira does indeed have a pipeline, according to Lane. She was tight lipped about the specifics but said they are focused on “really hard targets and large molecule therapeutics.” Immunology is one area of interest, but Lane said the biotech has been “agnostic to therapeutics area.”
“One of the thresholds for targets that we go after is obviously that there’s a lot of rationale and validation of the target and clinical opportunity, but that it’s not being able to be addressed by different means,” Lane said.
The pipeline will be crucial to proving that Xaira is worth the hype—and the billion dollars in financing.
“Our priority has always got to be on advancing our pipeline, because ultimately that’s how we’re going to be valued,” Lane said.
Lane is new to the AI biotech world, having arrived from Belharra Therapeutics, which focused on undruggable targets in oncology and immunology. She’s had to get up to speed quickly at Xaira, which bridges biotech and AI science experts.
But at BIO, she was taking things slow to build relationships for the future partnerships she will execute on.
“I’m not doing the speed dating approach,” she said. “We have the relationships I think that we need to be able to get us to our end point.”
