Novartis has announced a partnership with London-based biotech company Relation, in a deal that could be worth more than $1.7 billion. The collaboration aims to use Relation’s artificial intelligence technology to develop new treatments for atopic diseases.
The companies revealed few details about the specific diseases or drug candidates they will focus on. According to their announcement, Novartis will use Relation’s Lab-in-the-Loop platform, which integrates AI models with multi-omic data from patients. The goal is to design and develop novel targets for inflammatory skin conditions.
Under the terms of the agreement, Novartis will make an initial payment of $55 million. This amount covers an upfront commitment, an equity investment in Relation, and additional research funding. If certain preclinical, development, regulatory, and sales milestones are met, Relation could receive up to $1.7 billion more. Novartis has also agreed to pay tiered royalties on future net product sales.
Relation’s Lab-in-the-Loop technology uses patient tissues to generate “functional cell atlases,” which help “capture the disease state in humans with unprecedented resolution.” As stated by the company’s website, this approach helps “understand the basis of clinical phenotypes.” These findings will inform Novartis’ clinical development strategy. In exchange for its investment, Novartis receives global rights to develop and commercialize any targets identified through this process.
GSK previously signed agreements with Relation involving its Lab-in-the-Loop platform last December for therapies targeting osteoarthritis and fibrotic diseases. GSK paid a total of $45 million for those deals.
This new partnership is expected to reinforce Novartis’ position in immuno-dermatology—a field where it already holds several key products. Its recently approved kinase inhibitor Rhapsido became the first oral BTK inhibitor for chronic spontaneous urticaria earlier this year. Another leading product is Cosentyx (anti-IL-17A antibody), which treats severe plaque psoriasis as well as other conditions such as psoriatic arthritis and ankylosing spondylitis.
Cosentyx sales increased by 7% year-on-year during the first nine months of 2025, reaching $4.86 billion (https://www.novartis.com/news/media-releases/novartis-q3-and-nine-months-2025-results). However, Cosentyx did not meet expectations in July when it failed a Phase III study in giant cell arteritis.
