According to Beating Monitor, ByteDance’s AI-driven drug discovery business line has initiated a spin-off and independent fundraising process. The new company is valued at approximately $1 billion, with its first round of financing nearing $200 million and set to be headquartered in Shanghai. Following the spin-off, ByteDance will retain a controlling stake in the new entity. The core AI drug discovery team, key algorithms, technology platforms, and existing early-stage drug pipeline assets will be fully transferred to the new company. The new company is led by ByteDance’s AI drug discovery team, established in 2021, with Liu Kai, former Managing Director of Huoshan Stone Investment, at its helm. Liu Kai leads a 50-person team distributed across Shanghai, Singapore, and San Jose, USA. To align with the rhythms of biotech R&D, the company has assembled an elite Scientific Advisory Board comprising industry experts such as Liu Yongjun, former President of Innovent Biologics, and Ji Ma, former Chief Scientist at Amgen, covering the entire drug development spectrum from target validation to clinical development. On the technology front, the team released the molecular structure prediction models Protenix and Seedfold in 2025, iterated them to Protenix-v1/v2 in 2026, and launched the protein binder design tool PXDesign. During drug pipeline validation, the team built the AI drug discovery platform Anew Labs and disclosed at the 2026 Annual Meeting of the American Association of Immunologists its IL-17 small-molecule project—the first globally successful demonstration of using a small molecule to inhibit all three dimers (AA/AF/FF) of the IL-17 family. Post-spin-off, the new company will gain greater operational flexibility to better attract top-tier talent and advance R&D at a pace aligned with biotech industry norms. After the separation, the new entity will continue to receive underlying computing power support from Volcengine. The lead investors for the first financing round have not yet been finalized, but several existing ByteDance shareholders and leading U.S.-style venture funds in China are already on the contact list.
ByteDance Spins Off AI Drug Discovery Unit, Valued at $1 Billion Following $200 Million Series A Round in Shanghai
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Summary
ByteDance has spun off its AI-driven drug development unit into a standalone entity valued at approximately $1 billion, following a Series A round nearing $200 million in Shanghai. The new company will operate under ByteDance’s control, led by Liu Kai, and supported by leading scientists and AI tools such as Protenix and Anew Labs. This move aligns with the growing momentum around AI and crypto, as the team advances drug development using AI models. ByteDance’s Volcano Engine will continue to provide computing infrastructure. The new token listing strategy may attract investment from existing shareholders and top U.S. dollar funds, though final investors remain unconfirmed.
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