REHOVOT, Israel - Evogene Ltd . (NASDAQ: NASDAQ:EVGN) (TASE: EVGN), a computational biology company, has announced a collaboration with Google (NASDAQ:GOOGL) Cloud aimed at advancing the design of small molecules through artificial intelligence (AI). This partnership will focus on creating a foundation model for generative small molecule de novo design, enhancing Evogene's ChemPass AI tech-engine.
The initiative will utilize Google Cloud's Vertex (NASDAQ:VRTX) AI, GPUs on Google Compute Engine, and Google Cloud Storage to support the computational power and storage needed for this AI model. The model will be trained on approximately 40 billion molecular structures to assist in generating and evaluating new potential life science-based product candidates.
This collaboration combines Evogene's expertise in computational predictive biology with Google Cloud's AI and machine learning capabilities. The foundation model is expected to accelerate drug discovery, reduce costs, and improve the success rate of identifying promising drug candidates. In agriculture, it aims to foster the development of sustainable solutions for food security and crop protection.
Ofer Haviv, President and CEO of Evogene, expressed pride in the strategic partnership with Google Cloud, which he believes will accelerate the company's growth and deliver value to shareholders and partners. Boaz Maoz, Managing Director of Google Cloud Israel, echoed this sentiment, emphasizing the potential of Evogene's ChemPass AI to revolutionize small molecule design.
The collaboration also presents opportunities for potential partners in the pharmaceutical and agricultural industries to utilize ChemPass AI's generative small molecule discovery capabilities.
Evogene's approach to product development involves strategic partnerships and collaborations, utilizing its tech-engines for microbes (MicroBoost AI), small molecules (ChemPass AI), and genetic elements (GeneRator AI). The company's subsidiaries focus on applications ranging from microbiome-based therapeutics to ag-biologicals and crop protection.
The press release also contained forward-looking statements regarding the potential impact of the collaboration on the discovery and development of novel small molecules and the ability to address global challenges. These statements are based on current expectations and projections and involve risks and uncertainties that could cause actual results to differ.
The information provided is based on a press release statement from Evogene Ltd.
In other recent news, Evogene Ltd. has reported significant growth in revenue and strategic advancements within its subsidiaries. The company's total revenues for the first half of 2024 amounted to approximately $5.1 million, a substantial increase from $1.3 million in the same period of 2023. This growth in revenue is primarily expected to be driven by seed orders from its subsidiary, Casterra. In addition, Evogene has announced a reduced net loss for the first half of 2024, which decreased to approximately $9.8 million, compared to $14.8 million in the same period last year.
Evogene Ltd. also secured approximately $5.5 million from a registered direct offering and concurrent private placement, with A.G.P./Alliance Global Partners (NYSE:GLP) serving as the sole placement agent. The offering involved the sale of ordinary shares and warrants, with the closing anticipated contingent on customary closing conditions. The net proceeds are planned to be allocated for working capital and general corporate purposes.
Moreover, Evogene's subsidiaries, Biomica and Lavie Bio, have made significant advancements. Biomica is showing promising trends in its Phase 1 trial for BMC128, a microbiome-based therapeutic for various cancers, while Lavie Bio's pipeline is progressing on schedule with field trial results expected later this year. These recent developments highlight Evogene's strategic positioning for growth within the agricultural biotechnology sector.
InvestingPro Insights
Evogene's collaboration with Google Cloud comes at a critical time for the company, as reflected in recent financial data and market performance. According to InvestingPro data, Evogene's market capitalization stands at a modest $12.34 million, indicating its current position as a small-cap biotech firm. This valuation aligns with the company's strategic move to leverage partnerships for growth and innovation.
The company's financial health presents a mixed picture. An InvestingPro Tip highlights that Evogene holds more cash than debt on its balance sheet, which could provide some financial flexibility as it pursues this AI-driven initiative. However, another tip warns that the company is quickly burning through cash, underscoring the importance of this Google Cloud collaboration in potentially accelerating product development and improving cost efficiency.
Evogene's revenue growth is a bright spot, with a remarkable 290.29% increase in the last twelve months as of Q2 2024. This growth trajectory supports another InvestingPro Tip suggesting that analysts anticipate sales growth in the current year. The partnership with Google Cloud could further boost this trend by enhancing the company's product pipeline and market offerings.
Despite these positive indicators, investors should note that Evogene's stock has faced significant headwinds. The company's share price has fallen by 50.3% over the last three months and is trading near its 52-week low. This market performance, combined with the fact that Evogene is not currently profitable, highlights the speculative nature of investing in early-stage biotech companies.
For those interested in a deeper analysis, InvestingPro offers 11 additional tips for Evogene, providing a more comprehensive view of the company's prospects and challenges.
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