AI-based drug discovery is supported by Greater Bay Area integration, says a Hong Kong-listed company

XtalPi Holdings, Inc Artificial Intelligence (AI) The drug discovery company, based in the Greater Bay Area, is disrupting the biopharmaceutical industry by leveraging artificial intelligence and robotics to transform traditional approaches to drug development.

The company’s self-developed Large Language Model (LLM), the technology underpinning it ChatGPTGenerative AI services, such as generative AI services, have helped increase the success rate of chemical experiments to 90 percent from 20 to 30 percent, according to Zhang Biu, chief scientific officer at Shenzhen-based XtalPi.

“There are many good opportunities (for artificial general intelligence) in vertical areas,” Zhang told the newspaper at its China: Greater Bay Area 2025 conference in Guangzhou. “For the pharmaceutical industry, we saw great potential for using MBAs in specialized areas.”

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Zhang expects the integration of robotics and artificial intelligence to reduce drug discovery timelines to just one or two years from four years.

Peggy Sito (left), business editor of the South China Morning Post moderates a panel with Fosun Health CEO Hu Hang, Professor Li Hongsheng, chief clinical model scientist at SenseTime Healthcare, MingMed vice president Tu Fuquan, and XtalPi chief scientific officer Zhang Peiyu in January 15 in Guangzhou. Photo: Nora Tam Alt = Peggy Seto (left), business editor of the South China Morning Post moderates a panel with Fosun Health CEO Hu Hang, Professor Li Hongsheng, chief clinical model scientist at SenseTime Healthcare, and MingMed vice president Tu Fuquan and chief executive officer Scientists at XtalPi Zhang Peiyu on January 15 in Guangzhou. Photography: Nora Tam>

XtalPi was founded in 2014 by three quantum physicists at MIT, and a year later, XtalPi established its own R&D base in Shenzhen. Located in the Hong Kong-Shenzhen Cooperation Zone on the border between the two cities, the company has leveraged local industrial policies to emerge as a major player in AI in drug development, serving nearly four out of five major pharmaceutical companies globally.

Zhang said the company’s development has been enhanced by regional synergies in the Bay Area blueprint, especially in talent acquisition, supply chain partnerships and cross-city fundraising.

Zhang said the cooperation zone has attracted diverse industry players, including emerging biotechnology and pharmaceutical companies, service providers and regulatory bodies.

The XtalPi automated chemical laboratory in Shenzhen, described as the largest in the world, uses about 200 robots to conduct AI-guided experiments, which requires significant hardware support. The abundance of robotics and hardware companies in the greater Bay Area has made things easier, Zhang said.

The company also benefited from Hong Kong’s status as a financial centre. It went public in the city last year, becoming the first company to list under a new rule designed to attract strategic start-ups.

Geographic and technological advantages have enabled XtalPi to grow in both domestic and international markets. Globally, the company’s primary focus remains biopharmaceutical innovation, particularly in the United States, Europe, and East and Southeast Asia. It is also expanding into materials science and renewable energy.

Currently, the company’s revenue is split between domestic and overseas markets, according to Zhang.

XtalPi is increasingly looking beyond China’s borders. In November, it partnered with Sinar Mas Multiarta, a leading financial services provider in Indonesia, to use quantum physics, artificial intelligence and robotics to catalyze the research and development of innovative products, including medicines and new materials, in the country.

China has been rapidly integrating generative AI into its biomedical industry over the past two years, with huge investments from major pharmaceutical companies to improve R&D efficiency. The chronic and autoimmune medications market is expected to be an important area of growth in the country, with the market size estimated to reach US$20 billion by 2030, according to a JPMorgan report released in May.

Despite these advances, Zhang noted that China still lags behind the United States in terms of first-in-class innovation and basic research in biomedicine.

“In the future, we need to develop drugs with new targets and new mechanisms,” Zhang said, adding that both Shenzhen and Hong Kong have a lot of good basic research results that have not yet been commercialized.

This article originally appeared on South China Morning Post (SCMP)the most authoritative audio reporting on China and Asia for over a century. For more SCMP stories, please explore SCMP application Or visit SCMP Facebook and twitter Pages. Copyright © 2025 South China Morning Post Publishers Ltd. All rights reserved.

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