Germany-headquartered Bayer (ETR: BAYN) has announced a significant modification to its 2020 drug discovery collaboration with US biotechnology firm Recursion Pharmaceuticals (NASDAQ: RXRX). The partnership, which was initially focused on fibrosis, will now shift its attention to precision oncology. This strategic move will see the initiation of up to seven cancer programs by leveraging Bayer’s expertise and compound library alongside Recursion’s artificial intelligence (AI)-driven drug discovery methodology and a proprietary dataset encompassing over 5 trillion biological and chemical relationships from 50 different human cell types.
Updated Agreement and Financial Terms
Under the revised terms of the agreement, Recursion stands to receive up to USD 1.5 billion in milestone payments plus additional sales royalties. This financial arrangement underscores the potential impact of the collaboration on the development of new cancer treatments. Bayer, in turn, gains the option to license successful candidates emerging from the joint research efforts.
Historical Investment and Industry Interest
In 2020, Bayer made a substantial investment of USD 50 million into Recursion through a Series D financing round, demonstrating its commitment to the partnership. According to the public data, the chip giant NVIDIA (NASDAQ: NVDA) also invested USD 50 million into Recursion earlier this year, highlighting the broader industry interest in Recursion’s AI-driven drug discovery capabilities.- Flcube.com
