Forget Recursion Pharmaceuticals Stock. This Is a Much Better Buy.

• Recursion Pharmaceuticals' AI-based attack has the imaginable to alteration the pharmaceutical industry.

• However, it is inactive chasing objective wins that would show the powerfulness of its strategy.

• Eli Lilly is simply a safer mode to capitalize connected AI-driven cause discovery.

• 10 stocks we similar amended than Recursion Pharmaceuticals ›

Recursion Pharmaceuticals (NASDAQ: RXRX), a small-cap biotech company, has 1 assertion to fame: It presently owns the largest artificial quality (AI) supercomputer successful the pharmaceutical industry, which it is utilizing to assistance accelerate the dilatory process of cause development. If successful, Recursion Pharmaceuticals could present outstanding returns to investors. However, determination is arguably a acold amended -- and safer -- mode for investors to nett from the imaginable gyration AI could bring successful cause discovery, and that's to put successful Eli Lilly (NYSE: LLY).

Recursion Pharmaceuticals utilizes a proprietary operating strategy (OS) and an AI-powered algorithm that continuously runs virtual experiments, investigating compounds against a room of quality genes to foretell which ones are astir apt to beryllium effectual successful treating circumstantial diseases. The biotech hopes that its strategy volition assistance amended the occurrence complaint of compounds that participate quality objective trials, the bulk of which ne'er scope the market.

Recursion Pharmaceuticals besides argues that it could trim the clip from find to the commencement of objective trials. All of this would pb to little clip and wealth spent connected processing therapies that are conscionable arsenic effectual arsenic those of its peers. However, Recursion Pharmaceuticals has yet to show that it tin present connected its claims. It doesn't person a azygous merchandise connected the market. None successful signifier 3 studies either.

Despite its partnerships with respective pharmaceutical leaders, including Merck and Roche, its probe has yielded mostly bare results truthful far. At this point, the banal looks precise risky -- conscionable arsenic pre-commercial biotech companies thin to be.

Eli Lilly is simply a well-established pharmaceutical institution with a portfolio of products that consistently make gross and earnings. The company's apical enactment has been increasing astatine a bully clip successful caller quarters, and, arsenic the person successful the value nonaccomplishment market, its outlook for the adjacent 5 years (or so) appears attractive.

Here's the relevance to Recursion Pharmaceuticals. Eli Lilly precocious announced that it would physique an AI supercomputer, which, erstwhile complete, volition beryllium the largest successful the pharmaceutical industry, overtaking Recursion's. Eli Lilly volition question to usage the aforesaid attack arsenic its overmuch smaller peer. The pharmaceutical elephantine has an advantage: It possesses a wealthiness of information connected past objective proceedings successes and failures that it tin utilize to bid its AI cause find models.