In this article, we will discuss: 12 Best AI Drug Discovery Stocks Hedge Funds Are Loading Up On.
On May 27, Reuters reported that Biohub, a philanthropic venture formed by Meta CEO Mark Zuckerberg and Dr. Priscilla Chan, developed a global model of protein biology to speed up drug discovery. The AI system is based on fourth-generation evolutionary scale modeling, or ESM. As per the group, the open-source model is trained from protein sequences shaped by evolution and uses that data to design proteins. Chan told Reuters, “We’ve verified the model’s ability and validated many of its predictions in both immune diseases and cancer cases,” and expects widespread use across laboratories.
According to Biohub’s head of science, Alex Rives, the platform will run on Biohub.ai, partner systems, and cloud platforms such as AWS Bio Discovery and SandboxAQ, with researchers receiving computing credits. Biohub stated that researchers have already used the model to build protein binders for cancer and immune targets that reactivate immune cells in lab tests. It will integrate its biomedical research under Biohub in November 2025, following the acquisition of EvolutionaryScale. Rives said that the organization will also extend relationships with external partners to increase access and implementation across biological analysis platforms.
With that said, here are the 12 Best AI Drug Discovery Stocks Hedge Funds Are Loading Up On.
Methodology:
We used screeners to identify AI Drug Discovery Stocks and limited our final selection to companies that have recently reported noteworthy developments likely to impact investor sentiment. These stocks are also popular among analysts and elite hedge funds. We then identified those with the highest number of hedge fund holders, which we assessed using Insider Monkey’s database of hedge funds as of Q1 2026. The stocks are ranked in ascending order of the number of hedge fund holders.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Insider Monkey’s quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 599.2% since May 2014, beating its benchmark by 372 percentage points (see more details here).
12. SOPHiA GENETICS SA (NASDAQ:SOPH)
Number of Hedge Fund Holders: 9
On June 4, 2026, SOPHiA GENETICS SA (NASDAQ:SOPH) reported that it signed a Memorandum of Understanding with Memorial Sloan Kettering Cancer Center to form a proposed joint venture aimed at building a precision medicine hub for next-gen precision oncology.
The firms stated the initiative would combine MSK’s clinical diagnostics and genomic datasets. Over 150,000 tumor samples sequenced since 2014 with SOPHiA GENETICS’ SOPHiA DDM™ platform. It has analyzed more than 2.5 million cases to help the discovery and development of oncology tools.
SOPHiA GENETICS SA (NASDAQ:SOPH) President Ross Muken said the collaboration represents an expansion of prior MSK partnerships. Ross stated that SOPHiA DDM™ is a foundational AI and analytics layer designed to extend MSK clinical intelligence globally.
MSK Director of Digital Health Business Development Michael G. Frank said the effort plans to combine clinical expertise with AI and digital infrastructure to deliver customized insights and transform cancer care at scale.
SOPHiA GENETICS SA (NASDAQ:SOPH) is a healthcare technology company that practices data-driven medicine as the standard of care and for life sciences research. It functions through France, Italy, the United States, Spain, Turkey, Austria, Brazil, the United Kingdom, Switzerland, Germany, and Other segments.
11. Generate Biomedicines, Inc. (NASDAQ:GENB)
Number of Hedge Fund Holders: 16
On May 14, Morgan Stanley increased its price objective on Generate Biomedicines, Inc. (NASDAQ:GENB) to $22 from $20. The firm maintained an “Overweight” rating on the shares.
Separately, Generate Biomedicines, Inc. (NASDAQ:GENB)’s GB-0895 (anti-TSLP) program keeps advancing in Phase 3 global SOLAIRIA-1 and SOLAIRIA-2 trials for severe asthma. It is also making progress in an ongoing Phase 1b COPD study.
Chief Executive Officer Mike Nally said the corporation is moving forward with its clinical pipeline across inflammation and oncology. The firm is expecting to progress two oncology programs in 2026.
Generate Biomedicines, Inc. (NASDAQ:GENB) said GB-4362, an MMAE neutralizer with FDA Fast Track designation, has activated clinical trial sites with first patient dosing expected in mid-2026. Meanwhile, GB-5267, which is an MUC16 armored CAR T developed with Roswell Park Comprehensive Cancer Center, is expected to dose its first patient in the second half of 2026 in a Phase 1 solid tumor trial initially targeting ovarian cancer.
Generate Biomedicines, Inc. (NASDAQ:GENB) is a clinical-stage generative biology company that is leading the artificial intelligence revolution in biotechnology, drug design, and development.
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