Dear Shareholders,
This month, I have been reflecting on our portfolio structure and the recent activities we have undertaken to maintain a diversified pipeline, such as our CNS programme. I want to take the opportunity to look in more detail into our artificial intelligence (AI) collaboration with Receptor.AI, announced last August and the recent activity within the sector. While our key focus has been on the ongoing Phase 2-enabling toxicology programme for SDC-1801, meaningful progress has been made on our neuroscience discovery effort and I think the wider context for AI-driven drug discovery makes this increasingly compelling.
The application of AI to drug discovery has moved rapidly from concept to clinical reality. Earlier this year, Insilico Medicine reported positive Phase IIa data for Rentosertib, a small molecule TNIK inhibitor for idiopathic pulmonary fibrosis that was discovered using a generative AI platform. This is widely regarded as the first clinical proof-of-concept for a fully AI-originated drug.[1][2] In parallel, the breadth and scale of AI collaboration activity across the sector continues to grow and AI is becoming embedded into the discovery engines of many large pharma companies.
Incyte, the $19 billion biopharma, recently signed expanded R&D agreements with two AI-focused startups, Genesis Molecular AI and Edison Scientific.[3] Incyte’s rationale centred not just on AI’s speed but also on the value of feeding its proprietary experimental data into AI models to improve their predictive power, a parallel to Sareum, where our deep TYK2 chemistry dataset represents a meaningful asset in our collaboration with Receptor.AI. Several other significant AI drug discovery deals have emerged including Eli Lilly’s $2.75 billion deal with Insilico Medicine and GSK’s $50 million deal with AI biotech, Noetik, for access to their proprietary lung and colon cancer models. Overall, these recent developments represent a shift in how early-stage drug discovery is conducted, and one that companies of all sizes are moving quickly to embrace.
Against this backdrop and the strong scientific and commercial interest in the role of JAK inhibitors in neuroinflammatory diseases, our own collaboration with Receptor.AI is well-positioned. Announced in August 2025, the partnership is focused on accelerating the discovery and optimisation of blood-brain barrier (BBB)-permeable, isoform-selective TYK2/JAK1 inhibitors for neuroinflammatory indications, including multiple sclerosis and Parkinson’s disease. The collaboration builds directly on our own preclinical work, where our proprietary Sareum Kinase Inhibitor Library platform identified three TYK2/JAK1 compounds with meaningful BBB penetration which is essential for CNS drug development. Receptor.AI brings to this work a tailored in silico programme, applying virtual screening, generative chemistry, and predictive modelling to identify targets with strong target binding, brain penetration, selectivity, and synthetic feasibility.
Progress within the collaboration has been steady. Following the initiation of lead optimisation work with Receptor.AI in August 2025, the initial rounds of AI-guided design, synthesis and in vitro assay have been completed with further assay work in progress. Sareum retains full ownership of all intellectual property and compounds arising from the collaboration, with no ongoing milestone payments due to Receptor.AI following conclusion of the project.
Beyond the neuroscience programme, our priorities across the portfolio remain unchanged. The Phase 2-enabling toxicology work for SDC-1801 continues to progress, and we are advancing business development discussions around our pipeline of assets.
As the industry’s experience with AI drug discovery deepens I am increasingly confident that our approach represents both sound science and sound strategy. Combining our deep TYK2 chemistry knowledge and clinical-stage expertise with Receptor.AI’s generative and predictive capabilities gives us access to tools that will help streamline the often-lengthy drug discovery and development process.
Thank you, as always, for your continued support and engagement.
Dr Stephen Parker,
Executive Chairman,
Sareum Holdings plc