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Israeli innovation lab backed by pharmaceutical, biotech giants mints 1st AI startup

AION Labs, a Rehovot-based consortium formed by Pfizer, Merck, AstraZeneca, Teva and others, sets up company that will help drug firms improve chances of success in clinical trials

Ricky Ben-David is The Times of Israel’s Tech Israel editor and reporter.

OMEC.AI co-founders Ori Shachar, left, and Amir Harel, right. (Elad Malka)
OMEC.AI co-founders Ori Shachar, left, and Amir Harel, right. (Elad Malka)

An Israeli biotechnology innovation lab set up last year and backed by some of the world’s leading pharmaceutical companies like Pfizer and Merck has formed a new startup that will harness artificial intelligence (AI) to assess drug efficacy in pre-clinical trials and improve chances for success in later stages.

The startup, OMEC.AI, is the first company established with funding and support from AION Labs, a Rehovot-based organization launched last October with a mission to create and invest in early-stage startups focused on AI and computational biology in drug discovery and development. AION Labs is a collaboration between pharmaceutical giants Pfizer, AstraZeneca, Merck, and Teva Pharmaceuticals, together with Amazon’s AWS and the Israel Biotech Fund, and is headed by Mati Gill, a former senior executive at Teva, and Dr. Yair Benita, the former head of computational biology at Compugen, science operations at CytoReason, and principal scientist at MSD (Merck).

AION Labs ran three bootcamps over the past year to field scientist founders and inventors focused on addressing key industry challenges identified by the global pharma companies such as designing antibodies for targeted therapeutics and analyzing data using AI to assess and predict the clinical readiness of drug candidates.

The latter challenge produced OMEC.AI, founded this summer with $2 million (NIS 7 million) in seed funding by AI experts Ori Shachar and Amir Harel, both of whom previously led AI teams at Mobileye, Intel’s Jerusalem-based autonomous driving subsidiary. The two co-founders also led teams at SeeTree, a Tel Aviv startup that uses data to evaluate the health and productivity of tree networks, and hold computer science and bioinformatics degrees from the Hebrew University of Jerusalem.

Shachar and Harel were selected as the winners of the challenge (out of 15 participating groups) by AION Labs’ investment committee and will now work closely with the partnered pharmaceutical companies to develop their AI systems.

“Our mission is to help pharmaceutical companies have better chances in clinical trials by taking better data-driven decisions in the pre-clinical process,” Shachar told The Times of Israel on Tuesday.

It can take several years for pharma firms to reach a stage where a drug candidate’s effects and toxicity can be studied on humans — an important, expensive, and difficult process often marred by obstacles and high rates of failure (25% failure rate on toxicity and 50% on efficacy).

One of the key issues is that pharmaceutical companies use a number of non-human models, “some of them outdated like mice and rats” as part of in-vivo studies (performed on living organisms), as well as in-vitro experiments (performed in controlled laboratory environments) to evaluate new drugs before they can be tested on humans, Shachar explained.

In these pre-clinical stages, pharmaceutical companies often rely on “what we call low-dimension data, so when they do trials on mice, they usually use weight, and enzymes and blood tests,” to make decisions based on the factors “even when they know that these models are not the best and don’t even necessarily resemble humans,” said Shachar, who serves as CEO.

Illustrative: Research assistant Katie McCullough holds a mouse in a Washington University lab where doctors study a rare form of autism, December 15, 2021. (AP Photo/Jeff Roberson)

“We use the latest technique called gene expression where we can understand the function of each [human] cell by what genes are expressed in the body [as a response]. This gives more information to researchers; it exposes more about what the drug does. But these methods are difficult for biologists to work with because it’s a lot of data and cells and they don’t have the methods to derive the insights they are looking for,” he said. “We joined these technologies with the latest AI that allows for better decision-making based on rich data systems.”

“We see a future where such methods will change how we interpret biology, and will redesign how pharmaceutical drug development will be done,” Shachar went on. The startup’s name, OMEC.AI, reflects this vision, as it derives from omics, a multidisciplinary field in biology that encompasses genomics (the study of genes), proteomics (the study of proteins), metabolomics (the study of metabolites), and epigenomics (the study of genetic modifications of cells).

The idea is to provide an automated data-focused solution that can produce a reliable assessment of the clinical trial readiness of a proposed drug, a gap the industry has identified, said Harel, OMEC.AI’s CTO.

“We are bringing a new approach — computational tools — to change the situation. The opportunity for us is to work with pharma experts who are developing drugs, and they admit that they need help,” Harel explained.

The new startup will work with pharma companies in the planning stages as well during the clinical stages to offer their analyses, the founders said, emphasizing the “huge opportunity” derived from combining the strengths of AI technology and biology.

“It’s a huge shift in the field. There is a lot to gain. AI experts will become an inseparable part of the pharmaceutical industry,” said Shachar.

“But there’s a big learning curve, for everyone, on the biology side and on the business side. This is where AION Labs helps; they have mentors, advisers, and executives [from pharmaceutical companies] who are just a phone call away,” he added.

Sweet spots

The challenge OMEC.AI seeks to address “is particularly suited for Israel’s sweet spot” as a leader in AI technologies, Gill, AION Labs’ CEO, told The Times of Israel. “AI entrepreneurs come and apply but they don’t necessarily have to have expertise in the biotech space because we bring in that piece of the puzzle. The challenge is really about data integration at its core.”

“There is a lot of opportunity for AI, machine learning, and computational biology to propel the understanding of human biology in the pharma industry… in a way that has not been done,” said Gill, suggesting that in the future “we may eliminate the need for animal studies.”

AION Labs CEO Mati Gill, left, and CTO Yair Benita, Ph.D. (Elad Malka)

The formation of OMEC.AI is a big milestone for AION Labs and a “real-life example of solving an unmet need, finding a product market fit, and the exact model for tech entrepreneurs to go into the biotech field” to produce “groundbreaking technology,” Gill went on.

Israel has identified bio-convergence — the intersection of biology, engineering, and AI — as a national R&D priority, with a number of already running programs.

The consortium of companies that formed AION Labs won a government tender to do so by the Israel Innovation Authority (IIA) in 2020. The IIA had launched an innovation labs program four years ago to prod international corporations into setting up shop in Israel and gain exposure to a variety of innovative developments in the life sciences field.

AION Labs is modeled after BioMed X, an independent biomedical research institute based in Heidelberg, Germany, that identifies industry R&D challenges and carries out a global talent search for scientist founders.

With OMEC.IA, “we have very real example of bringing in AI experts that will help revolutionize biotech,” Gill said. Pfizer, AstraZeneca, and Merck are directly invested in the new startup, which also benefits from government funding, amounting to a total of some $2 million in its initial stages.

The Pfizer building on East 42nd Street in New York City. (ChainGangPictures via iStock by Getty Images)

Gill said AION Labs’ activities were going according to plan but there are significant challenges, chief among them “the different set of expectations in tech and in biotech,” he explained. “With biotech, you have an IP [intellectual property], and you build a team to develop it. It can be a good team or a not-good team but you have a protected asset. In tech, if the team leaves, you have no company. So there’s a process of educating our industry on these gaps.

“Our goal is to find the right entrepreneurs, the best-in-class, who can appreciate the potential of biotech. It’s a lot like building a coalition, we all have a North Star.”

AION Labs is now gearing up to run a fourth bootcamp this winter to address a new pharma industry challenge, and will soon announce the formation of its second company.

“We’re set to be working with four founders by the end of the year,” Gill said.

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