Investors are pouring fresh money into AI‑driven drug discovery even though the technology has yet to produce an approved medicine, as specialist venture firm Dimension Capital has closed an $800mn third fund dedicated to computational biotech.

The fund underscores growing enthusiasm for the niche, which attracted $2.2bn of venture funding in 2025, up from $599mn two years earlier, and Dimension Capital has become the most active early‑stage investor in the sector.

Co‑founder Zavain Dar said a “SaaS‑pocalypse” is driving talent and capital from software into machine‑learning biology, while big pharma such as Eli Lilly and Astra Zeneca strike partnerships; around 850 AI‑developed drugs are in progress globally, yet none has won US regulatory approval.

Traditional tech investors are also entering: Andreessen Horowitz launched a $700mn AI‑biotech fund, and HSBC’s Jonathan Norris notes heightened competition. Dimension Capital’s portfolio includes Earendil Labs, Coefficient Bio (acquired by Anthropic), Chai Discovery (backed by Open AI) and New Limit, co‑founded by Coinbase CEO Brian Armstrong.