University of Utah's drug discovery technology producer has raised series D funding to increase its post-money valuation to some $1.2bn.

Recursion, a US-based drug discovery technology spinout of University of Utah, raised $239m in a series D round led by pharmaceutical and agricultural product manufacturer Bayer yesterday. Casdin Capital, Catalio Capital Management, Laurion Capital Management and Samsara BioCapital also took part in the round, which valued Recursion just below $1bn pre-money, a person with knowledge of the matter told The Information. Intermountain Ventures, care provider Intermountain Healthcare’s investment unit, as well as Baillie Gifford, Mubadala Investment, DCVC, Lux Capital, Obvious Ventures, Felicis Ventures, Epic Ventures, Advantage Capital and Two Sigma Ventures filled out the round. Recursion is combining automation and machine learning technology with what it claims is the largest biological image dataset in the world to discover drug treatments for a range of conditions including cancer and genetic disorders such as neurofibromatosis or GM2 gangliosidosis. Bayer’s investment was made in connection with a strategic partnership deal that will involve it utilising Recursion’s platform to discover treatments for fibrotic diseases affecting the lungs, kidney and heart. The corporate is also providing Recursion with a $30m upfront payment and will add up to $100m for each program in addition to royalty payments. Recursion had raised approximately $2.5m in debt financing as of 2015 before it secured $15.1m in series A funding from Felicis Ventures, Lux Capital, Obvious Ventures, Epic Ventures, AME Cloud Ventures, Data Collective (DCVC), Wild Basin Investments and unnamed angel investors the following year. All the series A investors bar Wild Basin returned for a $60m series B round in 2017 that also featured Mubadala Investment, Menlo Ventures, CRV and Two Sigma Ventures. The company then completed a $121m series C round in July 2019 led by Baillie Gifford’s Scottish Mortgage Investment Trust unit that included University of Minnesota, Texas Tech University System, Intermountain Ventures various individuals and all its existing backers. – A version of this article first appeared on our sister site, Global Corporate Venturing.

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