U.S. pharmaceutical giant Eli Lilly (LLY) is partnering with chipmaker Nvidia (NVDA) on a new artificial intelligence (AI) research lab to be based in San Francisco, California.
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Eli Lilly and Nvidia say they will spend a combined $1 billion to build the AI research lab over the next five years. The laboratory will reportedly use Nvidia’s newest Vera Rubin AI chips, the companies said in a joint news release.
The AI lab announcement was made at the JPMorgan(JPM) Healthcare Conference that’s being held this week in San Francisco. The laboratory is being developed months after Eli Lilly announced plans to build a supercomputer that will use more than 1,000 of Nvidia’s Blackwell AI microchips and processors.
AI’s Impact on Healthcare
Eli Lilly is among several pharmaceutical companies that is experimenting with and harnessing the power of sophisticated AI models to discover new medical treatments. Analysts say that healthcare is one of the sectors most likely to be disrupted by AI through disease diagnoses and treatment.
For its part, Nvidia is looking to supply its AI processors, models and software to drug makers such as Eli Lilly so that they can build drug development platforms using Nvidia’s hardware. It is not clear if Nvidia’s investment in the new AI drug laboratory will flow directly to Eli Lilly or be used to buy Nvidia microchips.
Is LLY Stock a Buy?
The stock of Eli Lilly has a consensus Strong Buy rating among 21 Wall Street analysts. That rating is based on 19 Buy and two Hold recommendations issued in the last three months. The average LLY price target of $1,192.17 implies 11.52% upside from current levels.
