Bristol Myers Squibb will pay $55m upfront to American life sciences company Schrödinger to access its drug discovery platform.

The deal will focus on five small molecules across a number of disease areas, with initial targets including HIF-2a for kidney cancer and SOS1- and KRAS-driven cancers.

In addition to the upfront payment, BMS will potentially pay-out up to $2.7bn in milestone payments dependent on preclinical, development, regulatory and sale-based successes.

Schrödinger will also be eligible to receive royalties on net sales of each product subsequently commercialised by BMS.

“We are delighted to be working with Bristol Myers Squibb, a proven leader in oncology and immunology development, to identify and advance novel therapeutics for patients worldwide,” said Karen Akinsanya, executive vice President, chief biomedical scientist and head of discovery R&D at Schrödinger.

“We see tremendous potential in bringing together our drug discovery expertise with Bristol Myers Squibb's depth of experience in development and commercialisation,” she added.

Schrödinger’s physics-based software platform is the focus of the deal – this technology enables discovery of high-quality, novel molecules for drug development and materials applications ‘more rapidly’ and at a lower cost compared to traditional methods, according to the company.

Following the deal, Schrödinger has agreed to grant BMS exclusive worldwide rights to develop and commercialise the development candidates generated by the collaboration.

“This collaboration is an example of our continued commitment to developing potential clinical candidates that could lead to new therapies in these important disease areas,” said Rupert Vessey, executive vice president, research & early development, BMS.

“Our teams share the goal of transforming how new medicines are discovered and developed and may ultimately benefit patients,” he added.