The biotech will both contribute to and draw from its findings.
It'll also earn revenue from its participation.
Biotech stocks are famously volatile, due to the speculative nature of the drug discovery business. The good news about this is that when one reports good news, it can send its stock into the stratosphere.
On Wednesday, Twist Bioscience (NASDAQ: TWST) had an excellent development to divulge and investors plowed into the biotech company's stock. As a result, it finished the week up by more than 31%.
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Before market open that day, Twist announced that it had reached an agreement to participate in Lilly TuneLab. This is an advanced drug discovery initiative from U.S. pharmaceutical giant Eli Lilly, perhaps best known among the public these days for its Zepbound obesity treatment.
Image source: Getty Images.
Twist will provide antibody characterization data services for TuneLab, the company said. It added that this will include AbLab, an antibody developability prediction model.
TuneLab utilizes artificial intelligence (AI) and machine learning trained on many years of Eli Lilly's proprietary research data. TuneLab participants can use the system's models to screen candidate molecules for developement.
It quoted co-founder and CEO Emily Leproust as saying that "users can select preferred protocols to generate high-quality data with preferred pricing -- both helping them to more efficiently select antibody sequences against their targets and contribute that data back to TuneLab for federated training."
This feels like a clear win-win not only for Twist and Eli Lilly but also for the broader biotech space. I don't see many negatives with the biotech tapping into such a large and powerful research and discovery system -- and drawing revenue from it -- so I'd be very bullish on its future efforts.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Eli Lilly and Twist Bioscience. The Motley Fool has a disclosure policy.