Good day. Physical AI—a new field that bridges artificial intelligence with the physical world—is vital to sectors like self-driving cars. Entrepreneur Michelle Lee thinks it can also supercharge biotechnology research.

Lee is chief executive of Medra, which has raised a $52 million Series A financing led by Human Capital. The San Francisco-based startup partners with drugmakers to provide them access to robotics and software designed to accelerate experimentation and improve research processes.

Conventional industrial automation involves preprogrammed robots performing repetitive tasks. Drugmakers, for example, have long used lab automation to screen libraries of compounds against biochemical targets, Lee said.

Physical AI links robotics with AI that learns from experiments and can suggest ways to optimize them or run new experiments, said Lee, who has a doctorate in robotics from Stanford University and founded Medra in 2022.

Instead of obviating the need for humans, Lee says physical AI will lure more people to research by automating rote tasks scientists now perform.

“More people will become scientists because they can now focus on their scientific vision and the scientific thinking that’s necessary to make breakthroughs,” she added.

Medra outfits off-the-shelf robotic arms with sensors and cameras and provides its partners with this hardware and software for AI predictions. With this new financing, Medra is establishing its own lab so partner companies can conduct work there as well.

Medra, which has been commercial-stage since late 2024, has delivered a handful of systems to drug companies this year, Lee said.

And now on to the news...

Biotech venture capital. Few sectors are as risky for investors as biotechnology, an industry where fortunes ride on the success of drugs in clinical trials. Bruce Booth knows this well—he has been at it for two decades. 

• Booth, a partner with Atlas Venture, joined the firm in 2005 and is a leading investor and voice in life sciences venture capital. For example, he is the chairman and was the founding chief executive of Kymera Therapeutics, a developer of oral drugs for immunological diseases that went public in 2020 and has a market capitalization of $6.4 billion.
   
• In 2011, Booth, who holds a doctorate in molecular immunology from Oxford University, started Life Sci VC, a blog where he examines topics such as new fields of biotech research, the venture-financing market, and building startup teams. In October, he published a three-part reflection on his experience as a biotech investor.
   
• In the posts he provides advice, such as postponing initial public offerings as long as a biotech can finance itself privately. He also criticizes bad behavior, like board members who cheer the chief executive’s every move, and discusses the role of luck. WSJ Pro spoke with him about his career and building biotechs.

A fund run by life sciences venture firm Apple Tree Partners filed for bankruptcy months after alleging that its Russian billionaire backer, Dmitry Rybolovlev, hasn’t met financing commitments because of liquidity problems at his family office. New York-based Apple Tree Life Sciences filed for chapter 11 reorganization Tuesday in the U.S. Bankruptcy Court in Wilmington, Del., with assets of more than $1 billion and liabilities of less than $500,000. In a lawsuit earlier in the year in the Court of Chancery of the State of Delaware, Apple Tree sued Rybolovlev’s family office, Rigmora Biotech, to enforce funding commitments for its portfolio companies. Apple Tree said Rigmora had waning interest in the portfolio since late 2021 and that its interest “disappeared entirely” after Russia invaded Ukraine in early 2022.

Exits

Bluejay Therapeutics, a private biotechnology company focused on viral and liver diseases, has agreed to be acquired by publicly traded Mirum Pharmaceuticals. Mirum said it would acquire Bluejay for $250 million in cash and $370 million in Mirum common stock, plus potential tiered sales-based milestone payments of up to $200 million in cash.

D3 Bio, a clinical-stage biotechnology company focused on discovering and developing oncology drugs, said it completed a $108 million Series B round. The financing will primarily support the planned global Phase 3 pivotal program for the company's lead asset, D3 said.

Aradigm, a benefits platform for cell and gene therapies, said it raised a $20 million Series A round led by Frist Cressey Ventures, with participation from Andreessen Horowitz and other investors. Aradigm’s platform applies a cost-plus, transparent pricing model to manage high-cost cell and gene therapies, the company said.

Subsense, a developer of non-surgical invasive, nanoparticle-based brain-computer interfaces, said it has added $10 million in new capital, bringing total funding to $27 million. The company said the investment will accelerate research and development in nanoparticle sensing, in vivo biosafety programs, next-generation nanoparticle design and hardware miniaturization. Golden Falcon Capital provided the new capital.

AngelEye Health, a company involved in neonatal and pediatric services, said it closed a $9 million Series C round. Existing investor Mountain Group Partners led the round.

• Drugmakers Are Ditching Middlemen to Sell Directly to Patients
   
• The Unexpected Ways Vaccines Could Boost Your Health 
   
• Roche Says Breast-Cancer Drug Shows Potential to Become Standard-Of-Care

• Why some doctors say there are cancers that shouldn’t be treated (New York Times) 
   
• MAHA wants to tackle chronic diseases. This country had that idea decades ago. (STAT)
   
• Scientists explain how mRNA Covid vaccines may rarely cause myocarditis (Scientific American)
   
• Scientists thought Parkinson’s was in our genes. It might be in the water. (Wired)

This newsletter was compiled by Matthew Strozier and Brian Gormley. 

WSJ Pro Venture Capital is a premium service of The Wall Street Journal. We cover venture capital and the global startup ecosystem. Share your tips, comments and questions: vcnews@wsj.com

The Team: Matthew Strozier, Yuliya Chernova, Brian Gormley and Marc Vartabedian.