Advanced Micro Devices (NASDAQ: AMD) offered what seemed like encouraging news Wednesday when it announced its first collaboration with a partner in the life sciences, the artificial intelligence (AI)-based drug developer Absci (NASDAQ: ABSI). The Silicon Valley (Santa Clara, CA) chipmaker’s AMD Instinct
accelerators and ROCm software will be used by Absci in its AI drug discovery workloads that include its advanced de novo antibody design models.
At the 43rd J.P. Morgan Healthcare Conference in San Francisco, Absci founder and CEO Sean McClain is expected on Wednesday to discuss the strategic partnership with AMD and showcase what Absci calls the exceptional performance of AMD’s Instinct accelerators in addressing complex biological applications. These include Absci’s proprietary IgDesign1 model, which according to the company is the first in vitro validated inverse folding model for antibody design.
“As we scale, we need hardware capable of scaling with us,” McClain told GEN Edge. “We’ve worked with AMD over the last little while and seen that their hardware performs exceptionally for some of our most complex AI workloads, which we’ll share together at JPM. We’ve also seen the AMD team to be incredibly eager to work together with us to refine and optimize their hardware for our needs, and the life sciences more broadly.”
The collaboration with AMD does not preclude Absci from launching partnerships with other AI chip companies, McClain added.
Just as important as the partnership, however, AMD agreed to invest $20 million in Absci through a private investment in public equity (PIPE), a move the chipmaker said reflected growing demand for innovative AI applications in drug discovery.
Investors, however, appeared to blow past AMD’s pivot to life sciences as seen in the Absci partnership and investment, instead selling off AMD shares enough to send its stock price down 4%, from $127.33 to $121.84. Shares slid another 5% Friday, to $116.04.
“Less competitive,” says analyst
Driving that decline was a downgrade of AMD’s shares by HSBC analyst Frank Lee. He lowered the firm’s rating on AMD shares from “Buy” to “Reduce” and cut its price target 18%, from $110 to $90, after concluding that AMD will continue to trail the market leader in graphics processing units (GPUs), Nvidia (NASDAQ: NVDA) well into 2025.
Nvidia is expected to maintain and build on that leadership by stepping up production of its next-generation NVIDIA Blackwell GPU architecture, announced last March, as well as new gaming and PC technologies, announced this past week at this year’s Consumer Electronics Show (CES 2025) held in Las Vegas, Lee observed.
As AMD is now doing, Nvidia has spent the past few years expanding its considerable footprint in the life sciences. During 2024, Nvidia’s venture capital arm NVentures recently raised its stake in AI drug discoverer Genesis Therapeutics while Nvidia launched a reference workflow for drug discoverers, joined Ultima Genomics and Scale Biosciences to launch the 100 Million Cell Challenge to support single-cell genomics projects worldwide, partnered with AI drug developer Recursion to complete the BioHive-2 supercomputer, and expanded its NVIDIA BioNeMo generative AI platform for drug discovery.
“It turns out that we’ve digitized a lot of things: Proteins and genes and brainwaves. Anything you can digitize, so long as there’s structure, we can probably learn some patterns from it. And if we can learn the patterns from it, we can understand its meaning. If we can understand its meaning, we might be able to generate it as well. And so therefore, the generative revolution is here,” Huang declared at Nvidia’s GTC 2024 conference last March.
In its first life-sci partnership, AMD aims to help Absci optimize its hardware and software to power its de novo antibody design models and the rest of its AI drug discovery workloads. AMD says its hardware will provide Absci with customized solutions designed to increase its performance, reduce infrastructure costs, and speed up its drug discovery and development processes in order to bring drug candidates to clinic faster.
“We’re now expanding our focus into vertical markets and prioritizing healthcare, where we can immediately have an impact on society,” Mark Papermaster, AMD’s executive vice president and chief technology officer of technology and engineering, told The Wall Street Journal.
Absci plans this year to advance its lead AI-designed candidate into the clinic, with a first-in-human trial planned for the first half of this year for ABS-101, now in the Investigational New Drug (IND)-enabling phase. ABS-101 is designed to treat inflammatory bowel disease (IBD) by targeting tumor necrosis factor-like cytokine 1A (TL1A). Last year, Absci presented preclinical data showing that ABS-101, a backup version, and a third version of the drug could bind both the TL1A monomer and trimer—activity that the company said could potentially lead to differentiated clinical efficacy.
Into the clinic
Absci is also pursuing preclinical development for its three other disclosed pipeline programs:
• ABS-201, an anti-prolactin receptor (PRLR) antibody being developed for androgenic alopecia, also in IND-enabling phase.
• ABS-301, a lead optimization phase, potential first-in-class fully human antibody for an undisclosed immuno-oncology target, discovered through Absci’s AI Reverse Immunology target discovery platform.
• ABS-501, an AI-designed anti-HER2 antibody now in candidate ID phase.
Absci has numerous drug creation programs in undisclosed therapeutic areas being developed with partners that include AstraZeneca, Almirall, Caltech, Bill & Melinda Gates Foundation, Memorial Sloan Kettering Cancer Center, Merck & Co., and PrecisionLife.
On Friday, Absci announced it would join with its newest partner Owkin, to co-develop therapeutic candidates addressing novel targets in immuno-oncology and other indications, such as immunology and inflammation. The value of their collaboration was not disclosed.
“Downward momentum”
By contrast AMD, Lee reported, is seeing “downward momentum” in demand for its line of MI325 GPUs, launched in October, and said one factor in that momentum was the GPUs relying on the higher-end HBM3e memory chips made by Samsung Electronics (KRX: 005930).
“While AMD is set to launch its MI350 chip in [second-half 2025], it likely won’t have an AI-rack solution to compete with Nvidia’s NVL rack platform until late 2025 or early 2026, when we expect the MI400 to launch,” Lee wrote in a research note, as reported by TheStreet.com. “We now think AMD’s AI GPU roadmap is less competitive than previously anticipated, limiting its penetration into the AI GPU market.”
AMD shares have declined only 5% when compared year-over-year, from $146.18 on January 8, 2024. But from the stock’s 52-week high of $227.30 during trading on March 8, 2024, AMD shares have tumbled 46%. Over the past six months, Lee noted, AMD shares skidded 28%, more than triple the 9% decline of all stocks listed on the PHLX Semiconductor Sector (INDEXNASDAQ: SOX), which consists of the 30 largest companies primarily involved in the design, distribution, manufacture, and sale of semiconductors.
AMD is scheduled to report its fourth-quarter and full-year 2024 earnings on January 28. Nvidia is expected to do so on February 26, since its fiscal year runs from February to January.
Nvidia, by contrast, has seen its stock price rise 16% since the company carried out a 10-for-1 stock split on June 7, 2024, when shares closed at $120.89. Since the split, shares have risen to a 52-week high of $153.13 during trading Tuesday but have since slipped 8.5% to $140.11 Thursday and dipped another 3% to $135.91 Friday.
Over the past year, Nvidia shares have nearly tripled, rocketing 168% from the equivalent of $52.25 on January 8, 2024, and the company attained a market capitalization (share price times the number of outstanding shares) of more than $3 trillion.
As GEN recently reported, at least one Wall Street watcher has predicted that Nvidia’s stock “could double in 2025” based on Blackwell and Taiwanese media reports that Nvidia is one of four global tech giants for which Taiwan Semiconductor Manufacturing (TWSE: 2330 and NYSE: TSM) plans to ramp up production of 4 nm wafers at its $12 billion semiconductor fabrication plant in Phoenix, set to begin phased operations this year.
Nvidia was 2024’s most bought stock by retail investors, who spent about $30 billion investing in shares of the Silicon Valley (Santa Clara, CA)-based microprocessing giant Nvidia as of December 17, according to Vanda Research. (The most popular retail stock in 2023 was Tesla (NASDAQ: TSLA).)
Leaders and laggards
• Sana Biotechnology (NASDAQ: SANA) shares nearly tripled, zooming 161% Wednesday from $1.65 to $4.30 after the company announced positive results from a first-in-human Phase I trial (NCT06239636) by researchers from Sana and Uppsala University Hospital, showing that Sana’s Hypoimmune (HIP) Technology enabled patients receiving an allogeneic primary islet cell therapy to avoid immune rejection and produce insulin without immunosuppression. Researchers transplanted UP421 engineered with HIP into a patient with type 1 diabetes. Four weeks after cell transplantation, pancreatic beta cells showed survival and function as measured by the presence of circulating C-peptide, a biomarker indicating that transplanted beta cells are producing insulin. C-peptide levels also increased with a mixed meal tolerance test, consistent with insulin secretion in response to a meal. MRI scanning also demonstrated a sustained signal at the site of transplanted cells over time, which is consistent with graft survival.
• Vir Biotechnology (NASDAQ: VIR) shares soared 58% from $7.89 to $12.48 Wednesday after the company presented positive initial Phase I data for two of its dual-masked T-cell engagers (TCEs): VIR-5818, targeting a variety of HER2-expressing solid tumors; and VIR-5500, targeting PSMA in metastatic castration-resistant prostate cancer (mCRPC). In a Phase I trial (NCT05356741), 10 of 20 patients (50%) with various HER2-expressing cancers who received ≥400 µg/kg of VIR-5818 showed tumor shrinkage, while 2 of 6 patients (33%) with HER2-positive CRC showed confirmed partial responses. In another Phase I trial (NCT05997615), all 12 mCRPC patients treated with a first step dose of ≥120 µg/kg VIR-5500 showed PSA declines, with 7 of the 12 (58%) showing a PSA 50 response.
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