Tempus AI Inc. is a leader in the intersection of AI and precision medicine, offering significant potential for growth in 2025 and beyond

 

Business/Investment Report on Tempus AI Inc. (TEM) - Class A Shares

Overview

Tempus AI Inc. (Ticker: TEM) is a technology-driven healthcare company specializing in artificial intelligence and precision medicine. Founded in 2015.

$TEM leverages its proprietary data platform to enable personalized treatments by analyzing large-scale clinical and molecular data. Tempus AI focuses on areas such as oncology, neurology, cardiology, and infectious diseases.

---

Technology Innovations

Tempus AI is at the forefront of precision medicine with several notable innovations:

• AI-Powered Data Integration Platform: Tempus’ flagship technology integrates clinical and molecular data from diverse sources to provide actionable insights. This platform uses natural language processing (NLP) to analyze unstructured data, including physician notes and pathology reports.

• Genomic Sequencing: The company offers advanced genomic sequencing services to help physicians tailor treatments to the genetic profile of their patients.

• Companion Diagnostics: Tempus develops AI-driven companion diagnostics tools to identify patients most likely to benefit from specific therapies.

• Clinical Trial Matching: The company’s AI algorithms efficiently match patients with clinical trials based on their unique medical history and genetic makeup.

---

Partnerships

Tempus AI has established several high-impact partnerships:

• Pharmaceutical Companies: Collaborations with Pfizer, AstraZeneca, and Novartis to co-develop AI-driven drug discovery and companion diagnostics.

• Healthcare Providers: Partnerships with leading hospital networks like Cleveland Clinic, Mayo Clinic, and Johns Hopkins to implement its AI platforms in patient care.

• Tech Giants: A strategic alliance with Microsoft and Amazon Web Services for cloud computing and data storage solutions.

• Government and Academia: Research partnerships with NIH and prominent universities for AI-enabled public health research.

---

Clients/Customers

Tempus serves a diverse clientele, including:

• Hospitals and Clinics: Over 300 healthcare systems globally use Tempus’ platforms.

• Biotech and Pharma: Leading biopharma companies utilize Tempus’ data to inform clinical trials and drug development.

• Payors: Insurance companies leverage Tempus’ predictive analytics to optimize costs and improve patient outcomes.

---

Potential for New Business

• Expanding Disease Coverage: Moving beyond oncology into cardiology, mental health, and rare diseases.

• International Markets: Growing presence in Europe and Asia through regulatory approvals and localized partnerships.

• Real-World Evidence: Increasing demand for real-world data in regulatory decision-making creates new revenue streams.

• AI as a Service (AIaaS): Monetizing its platform by offering modular AI solutions to smaller healthcare providers and startups.

---

Financials

• Revenue: Tempus AI Inc Reports 33% Revenue Growth to $180.9 Million in Q3 2024 Amid Strategic Acquisition.

• Net Income: Tempus AI net income for the quarter ending September 30, 2024 was $-0.076B, a 16.08% increase year-over-year.

  Tempus AI net income for the twelve months ending September 30, 2024 was $-0.859B, a 332.83% increase year-over-year.

  Tempus AI annual net income for 2023 was $-0.334B, a 25.55% increase from 2022.

  Cash Flow: Tempus AI cash flow from financial activities for the twelve months ending June 30, 2024 was $0.658B, a 165.74% increase year-over-year.

• Debt-to-Equity Ratio: Tempus AI debt/equity for the three months ending September 30, 2024 was 8.17.

---

Current Stock Information at MarketBeat

---

Potential for Growth in 2025

• Market Trends: Growing demand for personalized medicine and AI in healthcare positions Tempus AI for significant growth.

• Revenue Projections: Analysts project a revenue increase for 2025.

• R&D Investments: Increasing investment in R&D to expand its AI capabilities and product offerings.

• Mergers and Acquisitions: Potential acquisitions of smaller AI startups could enhance technological capabilities and market reach.

---

Moat

Tempus AI’s competitive advantages include:

• Proprietary Data: Access to one of the largest integrated datasets in healthcare.

• AI Expertise: A robust AI-driven platform that is difficult to replicate.

• Regulatory Approvals: Multiple FDA-cleared products.

• Customer Loyalty: Deeply embedded solutions in clinical workflows of major healthcare providers.

---

Competitors

• Flatiron Health: A Roche subsidiary specializing in oncology-focused data analytics.

• IBM Watson Health: Offers AI-driven healthcare solutions but has struggled with commercialization.

• Foundation Medicine: Focuses on genomic profiling and personalized oncology.

• Invitae Corporation: Competes in genetic testing and data-driven precision medicine.

---

Conclusion

Tempus AI Inc. is a leader in the intersection of AI and precision medicine, offering significant potential for growth in 2025 and beyond. While the company faces competition, its robust data infrastructure, partnerships, and innovative capabilities provide a strong moat. Investors should monitor its financials, regulatory developments, and expansion strategies to evaluate long-term value.

Related Articles:

Cutting-Edge Healthcare Advancements: 2025 Outlook

---

notes

• We bought: Tempus AI for its growth potential in the AI-driven healthcare space.

• For Analysts: Keep track of revenue diversification and new product launches.

• For Partners: Leverage Tempus AI’s data analytics to enhance precision medicine initiatives.

Adaptive Biotechnologies (ADPT on Nasdaq) is making significant advancements in biotechnology, focusing on harnessing the adaptive immune system for diagnosing and treating diseases

 

One of their primary areas of development is in T-cell receptor (TCR) therapeutics. They have identified and characterized over 8,000 unique antigen-specific TCRs against 600 clinically relevant targets. This massive library of therapeutic-grade TCRs is being used to develop new treatments for cancer and autoimmune diseases, often in collaboration with Genentech​ (Adaptive Biotech)​​ (Adaptive Biotech)​.

Another key area of innovation is their Minimal Residual Disease (MRD) testing, particularly with their clonoSEQ® assay, which is used to detect and monitor MRD in blood cancers like multiple myeloma and acute lymphoblastic leukemia. Clinician attitudes towards MRD-guided decision-making are shifting, with increasing adoption in treatment strategies. Adaptive is actively partnering with researchers to deepen the understanding and impact of MRD use, which has shown promise in guiding therapy and improving patient outcomes​ (Adaptive Biotech)​.

Adaptive has also been working on large-scale mapping of TCRs to Human Leukocyte Antigens (HLAs), which is crucial for developing targeted therapies and vaccines. Their research, often in collaboration with Microsoft, has led to significant discoveries, such as constructing ECOclusters that represent public T-cell responses to common exposures like viruses​ (Adaptive Biotech)​.

Overall, Adaptive Biotechnologies is at the forefront of translating immune system genetics into clinical products, significantly advancing both diagnostics and therapeutics​ (Adaptive Biotech Investors)​​ (Adaptive Biotech)​.

Partnerships - Microsoft, Illumina, Genentech

Adaptive Biotechnologies has formed several key partnerships to advance their innovative biotechnology solutions. Notably, they have a significant partnership with Microsoft to leverage computational models and AI for mapping T-cell receptors (TCRs) to Human Leukocyte Antigens (HLAs), which aids in understanding immune responses and developing targeted therapies​ (Adaptive Biotech)​.

Another crucial partnership is with Illumina, aimed at developing distributable in vitro diagnostic (IVD) test kits for their clonoSEQ® and immunoSEQ Dx™ assays. 

This collaboration will enable hospitals and health systems to run these assays locally, expanding their accessibility and application in monitoring minimal residual disease (MRD) and other immunodiagnostic purposes​ (Adaptive Biotech Investors)​.

Additionally, Adaptive has a strategic collaboration with Genentech to develop neoantigen-directed T-cell therapies for cancer. 

This partnership focuses on creating both shared and personalized T-cell therapies, utilizing Adaptive's extensive TCR library to target cancer antigens present in many patients​ (markets.businessinsider.com)​.

These partnerships are integral to Adaptive's mission to translate the genetics of the adaptive immune system into clinical products that diagnose, monitor, and treat various diseases, including cancer, autoimmune disorders, and infectious diseases​ (Adaptive Biotech Investors)​​ (Adaptive Biotech)​​ (Adaptive Biotech Investors)​.

Financials

As of the first quarter of 2024, Adaptive Biotechnologies has reported a revenue of $41.9 million, an 11% increase from the same period in the previous year. The company's Minimal Residual Disease (MRD) business, a significant contributor, accounted for $32.6 million of this revenue, marking a 52% year-over-year growth. The Immune Medicine segment, however, saw a decline, contributing $9.2 million, down 43% from the previous year​ (Adaptive Biotech Investors)​​ (MarketScreener)​.

Despite this growth in revenue, Adaptive Biotechnologies reported a net loss of $47.5 million for Q1 2024, which is an improvement from the $57.7 million loss in Q1 2023. The company's operating expenses totaled $90.6 million, a slight reduction from $94.8 million in the prior year. Adjusted EBITDA (a non-GAAP measure) was a loss of $28.2 million, improved from a $37.1 million loss in the first quarter of the previous year​ (MarketScreener)​​ (Stock Market News Live | Stock Titan)​.

Adaptive's cash, cash equivalents, and marketable securities stood at $308.9 million as of March 31, 2024, providing a solid financial base to support ongoing operations and strategic initiatives​ (Stock Market News Live | Stock Titan)​. The company has updated its financial guidance for the full year, expecting MRD business revenue to be between $135 million and $140 million, while maintaining controlled operating expenses projected between $350 million and $360 million​ (Stock Market News Live | Stock Titan)​.

Overall, Adaptive Biotechnologies is focused on leveraging its strong cash position to bridge its MRD business to profitability and to continue advancing key programs in Immune Medicine​ (Adaptive Biotech Investors)​​ (MarketScreener)​.

Note: ADPT reports on August 1st

Discl: Long $ADPT

Related Articles:

Here are ten more small-caps that are incorporating cutting-edge AI technology into healthcare (Discl: we own 4 of them)!

Targetting Cancerous tumors- 

TransCode's technology is designed to target dysregulated microRNAs implicated in cancer progression, metastasis, and resistance to existing therapies.

These "Microcap" companies operate in innovative and emerging sectors, which may position them for significant growth.

Recursion Pharmaceuticals is at the forefront of AI-driven drug discovery!

 Recursion Pharmaceuticals has caught the attention of major pharmaceutical companies due to its innovative approach to drug discovery. More recently, nVidia bought $70 Million of shares in $RXRX

Here’s why it’s worth knowing about:

1. AI-Driven Drug Discovery:

   Recursion collaborates with major biopharma companies to reduce research and development (R&D) costs and timelines. It employs AI-enabled methods to identify promising biological targets and molecules. By using digital chemistry and machine learning, Recursion calculates potential drug development targets efficiently.

2. Massive Data Repository:

   Recursion maintains an extensive database with over 3.1 trillion relationships between chemical and biological components. This data helps identify potential drug targets and streamline the drug discovery process.

3. Recent Acquisitions:

   Recursion recently acquired AI-related biotechs, Cyclica and Valence, which will enhance its drug discovery capabilities. These acquisitions aim to make Recursion even more effective at identifying drug targets and collaborating with pharmaceutical companies1.

4. Existing Collaborations:

    As we pointed out, powerful players like Roche and Bayer are already among Recursion’s patrons. Collaborating with Recursion allows these companies to leverage AI-driven approaches for drug discovery2.

5. Rare Disease Pipeline:

   Recursion also has its own development pipeline, including three programs in phase 2 clinical trials for rare diseases. For example, one program targets neurofibromatosis type 2, a condition affecting only 33,000 people worldwide. These pipeline projects could significantly boost Recursion’s revenue in the long term

6. Recursion Pharmaceuticals (RXRX on the Nasdaq)
7. offers a unique blend of AI-driven drug discovery, a vast data repository, and promising collaborations, making it an attractive partner for big pharmaceutical companies

Recursion Pharmaceuticals collaborates with NVIDIA to accelerate drug discovery using AI technology. Their newest supercomputer, BioHive-2, powered by 504 NVIDIA H100 Tensor Core GPUs, delivers 2 exaflops of AI performance—nearly 5x faster than their previous system.

Latest news:

Recursion Pharmaceuticals, Inc. - Recursion Announces Completion of NVIDIA-Powered BioHive-2, the Largest Supercomputer in Pharmaceutical Industry

Recursion ($RXRX)

Has developed an impressive artificial intelligence system called BioHive-2, which is powered by NVIDIA AI.  

 This supercomputer is specifically designed to accelerate drug discovery in the field of biology.

 

Let me share some details about it:

1. BioHive-2: Recursion’s BioHive-2 is the largest system in the pharmaceutical industry. It’s located at Recursion’s headquarters in Salt Lake City.

   This supercomputer ranks No. 35 on the latest TOP500 list of the world’s fastest supercomputers. 

2. It’s a significant improvement over its predecessor, BioHive-1, and delivers an impressive 2 exaflops of AI performance1.

3. AI in Drug Discovery: Recursion uses AI models on BioHive-2 to accelerate drug discovery. The field of biology is incredibly complex, and finding new drug candidates often involves years of wet-lab experiments.

   Recursion’s scientists can now run over 2 million experiments per week! 

4. With AI assistance, they can focus on the most promising areas, significantly reducing the need for extensive wet lab work. The goal is to achieve 80% of the value with only 40% of the experiments, thanks to AI-guided decision-making.

5. Massive Biological Dataset: Recursion collaborates with biopharma companies like Bayer AG, Roche, and Genentech. Over time, they’ve built a 50-petabyte database containing biological, chemical, and patient data. 

6. This vast dataset fuels powerful AI models that accelerate drug discovery. In fact, Recursion believes it’s one of the largest biological datasets globally, intentionally spanning both biology and chemistry.

7. Phenom Models: Using BioHive-1, Recursion developed a family of foundation models called Phenom. These models transform microscopic cellular images into meaningful representations for understanding underlying biology. 

8. Phenom-Beta, a member of this family, is now available as a cloud API and the first third-party model on NVIDIA BioNeMo, a generative AI platform for drug discovery1.

In summary, Recursion’s AI-driven approach is revolutionizing drug discovery by leveraging massive datasets, powerful AI models, and BioHive-2’s computational prowess. 

Their work has the potential to transform our understanding of biology and improve patients’ lives through better drug treatments

Disclosure: we are long $RXRX

"The rapid and complete resolution of aggressive MSS colorectal cancer tumors observed in this study is unprecedented in the field" says the author Dr. Kasi

Adaptive Biotechnologies (ADPT on Nasdaq) is making significant advancements in biotechnology, focusing on harnessing the adaptive immune system for diagnosing and treating diseases