Key Takeaways:
- RXRX stock is powered by AI technology and is projected to grow revenue at a 65% CAGR through 2027.
- The RXRX stock price could benefit from $20 billion in potential milestone payments from partnerships with pharmaceutical giants.
- With a $600 million cash runway, RXRX stock shows potential despite projected near-term losses.
- Analysts’ RXRX stock price forecast suggests 50% upside as the company aims to transform pharmaceutical R&D economics.
- Get accurate financial data on over 100,000 global stocks for free on TIKR >>>
The golden age of biotechnology is here as artificial intelligence is expected to accelerate the treatment and prevention of diseases over the next decade. In this article, I have identified one high-growth clinical-stage biotech stock called Recursion Pharmaceuticals (RXRX) that should be on your watchlist right now.
RXRX’s stock price has shown volatility that’s typical for innovative biotech companies, but its long-term potential remains compelling. Let’s take a look at some of the key drivers for RXRX stock right now.
Find the best stocks to buy today with TIKR. (It’s free) >>>
What Does Recursion Pharmaceuticals Do?
Valued at a market cap of $2.3 billion, Recursion Pharmaceuticals is advancing multiple clinical programs targeting rare diseases and cancer through its AI-powered drug discovery platform.
The biotech firm’s lead candidates include REC-994 for cerebral cavernous malformation and REC-2282 for neurofibromatosis type 2, both in mid-to-late-stage trials. The Utah-based company is also developing treatments for familial adenomatous polyposis and C. difficile infection.
Founded in 2013, Recursion uses computational approaches across biology, chemistry, and data science to accelerate the traditional drug development process.
Notably, it has established strategic partnerships with pharmaceutical giants including Bayer (BAYER), Roche (ROG), and Takeda (TAK) to expand its pipeline and validate its technology platform.
The Bull Case for RXRX Stock
Recursion’s pipeline has expanded significantly, now boasting 10 clinical and preclinical programs spanning oncology, rare diseases, and other areas with high unmet needs. It expects approximately 10 milestones over the next 18 months, including new clinical starts and data readouts. The RXRX stock price forecast from Wall Street analysts takes these potential catalysts into account, which is part of the reason why they have a bullish outlook.
Key early-stage programs include REC-617, a CDK7 inhibitor showing promising early efficacy in heavily pretreated cancer patients, and REC-1245, an RBM39 degrader for solid tumors. In rare diseases, Recursion is advancing REC-4881 for familial adenomatous polyposis and REV102 for hypophosphatasia.
The RXRX platform demonstrates remarkable efficiency, reducing the number of compounds required to reach clinical candidates from the industry standard of 2,000 to 3,000 to just 136-200 compounds, while shortening development timelines to under a year in some cases.
This efficiency is translating to clinical success, with Recursion reporting a partial response in a Phase I ovarian cancer patient who had previously failed four prior therapies.
View RXRX’s full analyst estimates (It’s free) >>>
Recursion Focuses on Strategic Partnerships
Recursion has established partnerships with pharmaceutical giants, including Roche/Genentech, Sanofi (SNY), Bayer, and Merck KGaA (MKKGY), validating its approach and technology. These collaborations have already generated $450 million in upfront and milestone payments, with potential for over $20 billion in additional milestones before royalties.
Recursion is delivering on these partnerships, with three milestone achievements in Sanofi programs and completion of 25 data packages for Bayer in Q3 alone.
Beyond pharma partnerships, RXRX has strategic collaborations with technology and data providers, including NVIDIA (NVDA), Google Cloud (GOOGL), Tempus (TEM), and Helix (HLX), which enhance its computational capabilities and expand its data universe. The company’s BioHive-2 supercomputer, built with NVIDIA, is described as the most powerful computing system wholly owned by any biopharma company.
Analysts tracking RXRX stock expect revenue to rise from $58.8 million in 2024 to $263 million in 2027, indicating a compounded annual growth rate of almost 65%. These growth projections are reflected in the current RXRX stock price forecast, which suggests significant upside potential from current levels.
Value stocks quicker with TIKR (It’s free, no card required) >>>
What Next for RXRX Stock?
Recursion’s vision extends beyond incremental improvements because the company aims to transform the economics of drug development fundamentally. It is building toward what CEO Chris Gibson describes as a “virtual cell,” which is a system where AI models become so accurate that they can reliably simulate biological processes, allowing wet labs to shift from data generation to validating computational predictions.
This approach addresses the fundamental challenge in pharmaceuticals: the current 95% failure rate in drug development. By combining multimodal data generation across genomics, transcriptomics, and phenomics with advanced modeling, RXRX is betting it can significantly improve success rates while reducing costs and timelines.
Recursion ended 2024 with a pro forma cash position of over $600 million, providing it with enough runway into 2027. As the biotech disruptor continues to demonstrate the clinical validation of its platform approach, RXRX stock represents a pure-play investment in the convergence of technology and biology that could redefine pharmaceutical research and development for decades to come.
What is the Target Price for RXRX Stock?
According to Wall Street, Recursion is forecast to report net losses of $571 million in 2025, $487 million in 2026, and $373 million in 2027. While the company’s net losses are forecast to narrow, it will have to raise equity capital to support its cash burn rates, which could impact the RXRX stock price in the short term.
As Recursion Pharmaceuticals is still unprofitable, it’s not possible to value the biotech stock using traditional multiples such as price-to-earnings or price-to-free-cash-flow.
However, analysts remain bullish on RXRX stock and expect it to increase by over 50%, based on consensus price target estimates.
Despite ongoing losses, the optimistic RXRX stock price forecast reflects confidence in the company’s innovative approach to drug discovery and its potential to disrupt the pharmaceutical industry’s traditional R&D model.
Is RXRX stock a buy over the next 24 months? Use TIKR to check the stock’s analyst price targets, growth forecasts, and see if the stock is undervalued today.
Looking for New Opportunities?
- See what stocks billionaire investors are buying so you can follow the smart money.
- Analyze stocks in as little as 5 minutes with TIKR’s all-in-one, easy-to-use platform.
- The more rocks you overturn… the more opportunities you’ll uncover. Search 100K+ global stocks, global top investor holdings, and more with TIKR.
Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
