Context: Conformation generation, also known as molecular unfolding (MU), is a crucial step in structure-based drug design, remaining a challenging combinatorial optimization problem. Quantum annealing (QA) has shown great potential for solving certain combinatorial optimization problems over traditional classical methods such as simulated annealing (SA). However, a recent study showed that a 2000-qubit QA hardware was still unable to outperform SA for the MU problem. Here, we propose the use of quantum-inspired algorithm to solve the MU problem, in order to go beyond traditional SA. We introduce a highly compact phase encoding method which can exponentially reduce the representation space, compared with the previous one-hot encoding method. For benchmarking, we tested this new approach on the public QM9 dataset generated by density functional theory (DFT). The root-mean-square deviation between the conformation determined by our approach and DFT is negligible (less than about 0.5Å), which underpins the validity of our approach. Furthermore, the median time-to-target metric can be reduced by a factor of five compared to SA. Additionally, we demonstrate a simulation experiment by MindQuantum using quantum approximate optimization algorithm (QAOA) to reach optimal results. These results indicate that quantum-inspired algorithms can be applied to solve practical problems even before quantum hardware becomes mature., Methods: The objective function of MU is defined as the sum of all internal distances between atoms in the molecule, which is a high-order unconstrained binary optimization (HUBO) problem. The degree of freedom of variables is discretized and encoded with binary variables by the phase encoding method. We employ the quantum-inspired simulated bifurcation algorithm for optimization. The public QM9 dataset is generated by DFT. The simulation experiment of quantum computation is implemented by MindQuantum using QAOA., (© 2024. The Author(s), under exclusive licence to Springer-Verlag GmbH Germany, part of Springer Nature.)