Artificial Intelligence in Small-Molecule Drug Discovery: A Critical Review of Methods, Applications, and Real-World Outcomes.

Artificial intelligence (AI) is emerging as a valuable complementary tool in small-molecule drug discovery, augmenting traditional methodologies rather than replacing them. This review examines the evolution of AI from early rule-based systems to advanced deep learning, generative models, diffusion models, and autonomous agentic AI systems, highlighting their applications in target identification, hit discovery, lead optimization, and safety prediction. We present both successes and failures to provide a balanced perspective. Notable achievements include baricitinib (BenevolentAI/Eli Lilly, an existing drug repurposed through AI-assisted analysis for COVID-19 and rheumatoid arthritis), halicin (MIT, preclinical antibiotic), DSP-1181 (Exscientia, discontinued after Phase I), and ISM001-055/rentosertib (Insilico Medicine, positive Phase IIa results). However, several AI-assisted compounds have also faced challenges in clinical development. DSP-1181 was discontinued after Phase I, despite a favorable safety profile, highlighting that the acceleration of discovery timelines by AI does not guarantee clinical success. Despite progress, challenges such as data quality, model interpretability, regulatory hurdles, and ethical concerns persist. We provide practical insights for integrating AI into drug discovery workflows, emphasizing hybrid human-AI approaches and the emergence of agentic AI systems that can autonomously navigate discovery pipelines. A critical evaluation of current limitations and future opportunities reveals that while AI offers significant potential as a complementary technology, realistic expectations and careful implementation are crucial for delivering innovative therapeutics.