Catenaa, Sunday, March 29, 2026- Eli Lilly has reached a $2.75 billion deal to bring drugs developed using AI by Hong Kong-based Insilico Medicine to the global market.
The agreement will give Insilico $115 million up front, with the remainder subject to regulatory and commercial milestones, along with royalties on future sales, according to the companies’ announcement Monday.
Insilico has developed at least 28 drugs using generative AI tools, with nearly half already at a clinical stage, Alex Zhavoronkov, Founder and CEO of Insilico, told CNBC. The company went public in Hong Kong in December. Its shares are up more than 50% year-to-date.
“In many ways, Lilly is better than us in some areas of AI,” Zhavoronkov said, noting the US pharma giant has “one person” who has brought biology, chemistry, and automation under one roof. He added that as part of the deal, Insilico will join Lilly’s Gateway Labs community for biotech development.
The two companies have worked together since signing an AI-based software licensing agreement in 2023.
“This collaboration allows us to explore novel mechanisms and accelerate the identification of promising therapeutic candidates across multiple disease areas,” Andrew Adams, group vice president of Molecule Discovery at Lilly, said in a statement. He called Insilico’s AI-enabled discovery “a powerful complement” to Lilly’s clinical development.
Eli Lilly CEO David A. Ricks attended a high-level forum in Beijing earlier this month, just weeks after the company announced plans to invest $3 billion in China over the next decade. The company reported that slightly less than 3% of its revenue came from China last year.
Insilico develops its AI outside of China, in Canada and the Middle East, but conducts early preclinical drug development in China based on that AI research, Zhavoronkov said. In addition to reducing research time, he said AI can synthesize molecules more quickly than those discovered using more traditional methods.
A record number of pharmaceutical companies from outside China licensed drugs made by Chinese businesses in 2025, totalling $5.6bn in upfront payments, according to data from Evaluate, a data provider.
In February, Lilly signed a licensing agreement for cancer and immune drugs with Chinese pharmaceutical company Innovent Biologics that included a $350mn upfront payment and an $8 billion potential deal value.
Lilly’s Asian venture arm also invested in March in Shanghai-based biotech start-up Excalipoint. AstraZeneca in January signed a licensing deal worth up to $4.7 billion with Chinese group CSPC Pharmaceuticals to develop weight-loss and diabetes drugs.
Lilly’s deal also casts a spotlight on the pharmaceutical sector’s interest in AI for drug development. In November, Lilly announced a $345 million deal with a subsidiary of XtalPi, a Shanghai-based biotech. The deal gives Lilly access to the company’s AI platform.
Speaking at a conference in March, Lilly’s Chief Financial Officer Lucas Montarce, said the company “[is] investing heavily” in AI for research and development. “But it will take more time” to get AI drugs from a research phase to clinical testing, he said.
