Artificial intelligence has shifted from buzzword to market-moving reality in drug discovery. Once the slowest and most expensive corner of healthcare, drug development is now being accelerated by machine learning models that can screen billions of molecules, predict binding affinities, and prioritize drug candidates in silico before they ever touch a lab bench.

For investors, this is a structural revolution: the market has already rewarded AI-biotechs with valuations in the billions, reflecting a belief that data-driven discovery will define the next generation of pharmaceuticals. At the same time, this new sector is still young — meaning small, under-the-radar innovators are emerging alongside much larger peers.

That’s why we’re spotlighting four of the sector’s most established AI healthcare companies, all with valuations above $1 billion, and then turning to Rakovina Therapeutics (TSXV: RKV) (OTC: RKVTF) — a micro-cap innovator applying AI to DNA-damage response oncology, valued at just CAD 9 million (~USD 6-7 million).

Big AI Players in Healthcare Drug Discovery

1. Tempus AI (NASDAQ: TEM) — ~$14.0 Billion USD

Tempus AI has become synonymous with data-driven precision medicine. Leveraging massive clinical and genomic datasets, its AI systems help oncologists tailor treatments in real-time. Its market cap of $14 billion underscores how investors view Tempus as both a healthcare company and a technology platform.

2. Recursion Pharmaceuticals (NASDAQ: RXRX) — ~$2 Billion USD

Recursion pioneered high-throughput biology paired with deep learning, using AI to map disease biology at scale. With multiple partnerships in place, Recursion shows how AI can transform the economics of discovery. Its $2+ billion valuation reflects both execution and strong long-term optionality.

3. AbCellera Biologics (NASDAQ: ABCL) — ~$1.25 Billion USD

AbCellera’s AI- and microfluidics-powered antibody platform allows pharma partners to discover novel candidates more efficiently. Based in Vancouver, AbCellera has validated its platform through collaborations with top-tier industry players, helping drive its market value above $1 billion.

4. Schrödinger, Inc. (NASDAQ: SDGR) — ~$1.4 Billion USD

Schrödinger sits at the intersection of computational chemistry and biotech. Its AI-powered modeling software is licensed widely across pharma, creating a revenue base that supports its own internal pipeline. This dual business model has sustained its $1.4 billion valuation.

Rakovina Therapeutics (TSXV: RKV) (OTC: RKVTF)  — ~$9 Million CAD (~USD 6–7 Million)

By comparison, Rakovina Therapeutics represents the micro-cap end of the AI-drug discovery spectrum. The company is leveraging AI tools through valuable collaborations to identify DNA-damage response (DDR) therapeutics — a critical class of oncology targets. The company utilizes two powerful tech platforms: Deep Docking™ (developed at UBC) and ENKI™ (through a collaboration with Variational AI). 

Recent strategic steps show intent and positioning:

• Financing in place: A CAD 4.9 million, oversubscribed private placement strengthens the balance sheet.
  
  
  

• Clean capital structure: A 10-for-1 share consolidation provides a tighter float and better optics for U.S. investors.
  
  
  

• Focused AI strategy: Unlike larger peers with diversified platforms, Rakovina is concentrated on cancer programs as the management team is highly experienced in cancer translational research. This precision approach allows the company to stay laser focused on bringing forward next-generation cancer therapies.
  
  

An important question arises for investors:

If Rakovina were to expand into the U.S. capital markets - where investor awareness of AI in healthcare is stronger and peer valuations are significantly higher, what could that mean for its stock profile and trading dynamics?

While the answer depends on execution, regulation, and investor reception, it highlights the contrast between Rakovina’s current valuation and the established presence of larger U.S.-listed peers.

Comparative Snapshot (Aug 2025)

The Sunrise Investor Take

The AI-drug discovery sector is being validated by billion-dollar valuations — but the story is incomplete without companies like Rakovina. The large-cap players prove the thesis that AI can create real-world efficiencies in R&D. Micro-cap innovators, meanwhile, often signal where the next breakthrough opportunities are likely to emerge.

Rakovina is our favourite pick not because it is the biggest, but because it is the smallest — and in this case, that’s the point. With a market cap under CAD 10 million, Rakovina provides asymmetric exposure to the same secular trend that has driven valuations at Tempus, Recursion, AbCellera, and Schrödinger. The company has strengthened its capital structure, aligned its AI focus tightly to oncology, and positioned itself for potential partnerships or future clinical milestones.

For investors seeking diversification within the AI-biotech theme, Rakovina offers an early-stage opportunity that complements exposure to the larger incumbents.

Disclaimer

This article was prepared by The Sunrise Investor, a publication of Fairfax Partners Inc. Fairfax Partners Inc. has been compensated by Rakovina Therapeutics for investor relations and media services. However, the opinions expressed in this article are strictly our own, are based on publicly available information, and are presented in good faith as factual analysis. This article is provided for informational purposes only and does not constitute investment advice or a recommendation to buy or sell any security. Investors should perform their own due diligence and consult a licensed financial advisor before making any investment decisions.