Wedoany.com Report-Dec.12, Novartis, the Swiss pharmaceutical company, has entered a strategic collaboration with Relation Therapeutics, an AI-driven biotechnology firm, in a partnership potentially valued at up to $1.7 billion. The agreement focuses on discovering and developing novel therapeutic targets for atopic diseases.

Novartis and Relation Therapeutics have teamed up to discover novel therapeutic targets for atopic diseases.

Under the terms, Novartis will provide $55 million in upfront payments, equity investment, and research funding. In return, it secures global development and commercialization rights to any targets emerging from the collaboration. Relation Therapeutics is eligible for up to $1.7 billion in future milestone payments, plus tiered royalties on net sales of approved products.

Relation will deploy its proprietary AI-powered platform, Lab-in-the-Loop, which integrates multi-omic and patient-derived data to identify and validate first-in-class targets. The partnership will also involve observational clinical studies to generate functional cell atlases, enabling detailed comparison of molecular pathways in diseased versus healthy tissue. According to Relation, this approach strengthens target validation and reduces development risk before candidates enter clinical testing.

While specific indications have not been disclosed, the atopic disease category includes conditions with significant patient populations, such as asthma, allergic rhinitis, and atopic dermatitis.

This marks the second major pharmaceutical partnership for Relation Therapeutics in recent months. In December 2024, the company signed a collaboration with GSK worth $45 million upfront, targeting fibrotic diseases and osteoarthritis. Supporting its growth, Relation also announced a $26 million venture funding round led by NVIDIA's NVentures, alongside DCVC and Magnetic Ventures, coinciding with the Novartis agreement.

The deal aligns with Novartis' ongoing expansion in immunology. The company already markets established therapies including Cosentyx (secukinumab) and Fabhalta (iptacopan). In recent years, it has pursued multiple transactions to strengthen this portfolio: exercising an option to acquire IFM Due and its portfolio of STING inhibitors for inflammation-related conditions; purchasing Calypso Biotech for $425 million to gain an anti-IL-15 monoclonal antibody for T-cell-mediated skin disorders; and securing an option agreement with Monte Rosa Therapeutics potentially worth $5.7 billion for rights to two preclinical immunology programs.

Through these initiatives, Novartis continues to invest in innovative technologies and platforms that accelerate the discovery of transformative treatments. The collaboration with Relation Therapeutics adds advanced machine learning and functional genomics capabilities to its research toolkit, enhancing the company's ability to address complex immune-mediated diseases with high unmet medical need.

As both companies combine expertise in large-scale clinical data, AI-driven target identification, and translational science, the partnership represents a significant step forward in precision medicine for atopic and related inflammatory conditions.