Tokyo, Japan - In a landmark move, SoftBank Group, the leading Japanese technology investment firm, has unveiled a strategic joint venture with Tempus AI, a pioneering company in AI-driven medical data analysis and treatment recommendations. This alliance, announced by SoftBank's CEO, Masayoshi Son, signals the company's aggressive push into the AI healthcare sector following a period of reduced activity in investments.
SoftBank had previously injected around $200 million into Tempus during its Series G funding round earlier this year, prior to Tempus's successful Nasdaq listing in June. Tempus, known for its genomic testing services and AI-powered treatment suggestions in the United States, harnesses a vast database encompassing millions of patient records to offer personalized healthcare solutions.
According to Reuters, the collaboration aims to bring these cutting-edge services to Japan, positioning the country as a frontrunner among non-U.S. healthcare markets in adopting connected health capabilities. "In partnership with Tempus, we will rapidly advance healthcare services in Japan, benefiting from a head start with access to a database of 7.7 million U.S. patients," remarked Son.
The joint venture is expected to materialize in July, contingent upon customary closing conditions, with each party committing an investment of 15 billion yen (approximately $93 million). This partnership marks a significant step forward in SoftBank's commitment to revolutionizing healthcare through AI.
Tempus AI has also garnered attention from Google, an Alphabet company that remains committed to acquiring and developing AI technologies. Google's backing is pivotal for Tempus, given the search giant's track record in deploying AI across various domains, including the notable achievements of systems like AlphaGo and foundational innovations such as the transformer architecture utilized in ChatGPT.
Tempus utilizes AI to create what it refers to as "intelligent diagnostics" - diagnostic tests tailored to individual patients. This initiative aims to enhance the effectiveness of existing treatments and expedite the development of novel therapies. Upon its initial public offering (IPO) on the Nasdaq stock exchange on June 14, 2024, Tempus's stock soared by up to 15% on its debut day and closed nearly 9% higher, reaching a market capitalization of $6 billion.
Google's financial engagement with Tempus AI commenced in June 2020 when Tempus issued a $330 million convertible promissory note to Google under a cloud services agreement. Subsequently, Tempus granted Google $80 million worth of preferred stock to partially settle the original note.
From 2002 to 2023, Tempus AI experienced an impressive 183% growth in revenue. Although the company has not yet achieved profitability, its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) have shown improvement. The quality of Tempus's technology is reflected in its extensive client base, which includes partnerships with roughly 95% of the top 20 publicly traded biopharma companies globally. Beyond its collaborations with over 200 pharmaceutical firms, Tempus is utilized in more than half of U.S. academic medical centers and collaborates with over 7,000 physicians.
The alliance between SoftBank and Tempus AI, bolstered by Tempus's market leadership and its ongoing strategic partnerships with tech giants, solidifies its position as a key player among companies driving the future of AI-powered healthcare services. This collaboration represents a pivotal moment in the global healthcare industry, setting the stage for transformative advancements in personalized medicine and patient care.
