$167 Billion Pharma R&D Market Largely Untapped by AI Creates Major Growth Runway for KALA Bios Data-Sovereign AI Strategy: N A S D A Q: KALA
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ARLINGTON, Mass. - Washingtoner -- KALA BIO, Inc. (N A S D A Q: KALA) is positioning itself at the intersection of two of the fastest-growing sectors in the global economy: biotechnology and artificial intelligence. With pharmaceutical companies collectively investing approximately $167 billion in research and development in 2024, KALA believes the biotechnology industry remains dramatically underserved by modern AI infrastructure.

The clinical-stage biopharmaceutical company is launching a dedicated on-premises AI infrastructure platform designed specifically for biotechnology and pharmaceutical organizations, allowing companies to deploy institutional-grade AI systems without surrendering control of their most valuable asset—proprietary biological data.

Through a unique platform-as-a-service model, KALA aims to generate recurring revenue by licensing secure AI capabilities directly to biotech companies, addressing one of the most significant technology gaps in modern drug development.

A New AI Infrastructure Model for Biotechnology

KALA's Platform Keeps Proprietary Scientific Data Inside Client Environments

Unlike centralized AI platforms that require companies to upload sensitive datasets to third-party cloud environments, KALA's architecture is designed to operate directly within a client's own secure infrastructure.

This on-premises model ensures that:

• Proprietary biological data never leaves the client environment
• Intellectual property remains fully controlled by the biotech company
• Trade secrets and regulatory-sensitive datasets stay protected

KALA believes this data-sovereign approach represents a fundamental shift in how AI can be deployed across the life sciences sector, particularly for companies unwilling to expose proprietary research data to external platforms.

The company's vision is to become the dedicated AI infrastructure partner for the biotechnology industry, enabling organizations of all sizes to unlock the value of their internal scientific datasets.

Strategic Licensing Agreement Powers Platform Development

Exclusive Access to Researgency AI Platform Designed for Biomedical Research

To accelerate the initiative, KALA entered into a Platform Development and Exclusive License Agreement with 2624465 Ontario Inc., operating as Younet AI, for a proprietary AI research platform known internally as "Researgency."

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The platform is designed to deploy custom large language models specifically built for biomedical research, data science, and life sciences applications.

Key features of the agreement include:

• Exclusive worldwide license for an initial 12-month term
• Option for successive 12-month renewals
• Architecture designed for multi-client deployment
• Custom AI agents built for scientific and biomedical workflows

KALA will serve as the first deployment client, applying the Researgency platform to its own proprietary datasets related to its mesenchymal stem cell secretome (MSC-S) biologics platform and KPI-012 clinical program.

This internal deployment provides both validation and optimization opportunities before broader commercial rollout.

Solving a Structural Problem in Biotechnology

Thousands of Biotechs Generate Data but Lack AI Infrastructure

The biotechnology sector faces a major structural challenge. While thousands of biotech companies generate enormous volumes of data—from genomic sequencing and protein interaction mapping to clinical trial outcomes—most lack the resources to deploy advanced AI systems.

At the same time, these companies are understandably reluctant to upload their proprietary biological data to centralized platforms where control may be compromised.

KALA believes this creates a significant opportunity.

By delivering purpose-built AI systems installed directly inside client environments, the company aims to unlock the analytical potential of vast datasets that currently remain underutilized.

There are more than 3,200 biotechnology companies in the United States alone, the majority of which could benefit from AI-driven research tools but lack secure infrastructure to deploy them.

AI Is Transforming Drug Discovery

Market Expected to Expand Rapidly as Development Costs Continue to Rise

The global AI drug discovery market is projected to grow at approximately 25% compound annual growth, fueled by the potential to dramatically reduce the time and cost of developing new medicines.

Traditional drug development can take 10 to 15 years and cost up to $2.6 billion per approved drug. AI-driven approaches may shorten the time required to identify viable drug candidates to as little as 12 to 18 months, while potentially reducing development costs by 30% to 40%.

Dozens of AI-designed drug candidates are currently advancing through clinical trials worldwide, a sharp increase from only three in 2016. Industry observers anticipate the first wave of AI-discovered drug approvals in the near future.

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Despite this progress, the pharmaceutical industry's investment in AI—estimated at approximately $4 billion in 2025 and projected to reach $25 billion by 2030—remains small compared to the $167 billion spent annually on research and development.

KALA believes this gap represents one of the largest untapped technology adoption opportunities in the life sciences industry.

Dual-Strategy Business Model Combines Biologics Pipeline and AI Platform

KALA Expanding Beyond Traditional Biopharma Model

KALA's strategy combines two complementary growth engines.

The company continues to advance its clinical-stage biologics pipeline, including its MSC-S platform and product candidates with FDA Orphan Drug and Fast Track designations.

At the same time, KALA is developing a scalable AI platform-as-a-service infrastructure business, which could deliver recurring revenue through licensing agreements with biotech and pharmaceutical companies.

This dual-strategy model allows KALA to benefit both from therapeutic innovation and the rapidly expanding demand for AI-driven scientific analysis.

Strengthened Financial Position Following Debt Settlement

$10.6 Million Obligation Fully Resolved

KALA recently completed a major financial milestone by settling its debt obligations with Oxford Finance, LLC.

Following a $2 million payment in January, the company fully resolved approximately $10.6 million in outstanding debt, eliminating all obligations under both the settlement agreement and the underlying loan agreement.

Management views the settlement as a transformational step that strengthens the company's balance sheet and supports its strategic growth initiatives.

Positioning for Leadership at the Intersection of AI and Biotech

As artificial intelligence becomes increasingly central to scientific discovery, companies capable of delivering secure, specialized infrastructure may capture substantial value.

By focusing on on-premises AI systems that preserve data ownership and intellectual property, KALA is targeting a market segment that has remained largely underserved.

With a growing biotechnology ecosystem, expanding demand for AI-driven research capabilities, and billions of dollars flowing into drug development each year, KALA believes its platform could become a critical enabler of the next generation of biomedical innovation.

For more information on KALA visit www.kalarx.com

Media Contact:
Company: KALA BIO, Inc. (N A S D A Q: KALA)
Contact: Avi Minkowitz, CEO
Email: AM@kalarx.com
Phone: (781) 996-5252
Country: United States
Website: www.kalarx.com

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