By Joshua Kirby

Sanofi SA and Exscientia PLC are to partner on drug development in oncology and immunology in a deal that could see the latter receive up to $5.3 billion, the two pharmaceutical companies said Friday.

Paris-listed Sanofi and U.K.-based Exscientia will collaborate to identify and select target projects, using Exscientia's artificial-intelligence-driven personalized medicine platform.

Under the research, collaboration and licensing agreement, the two companies will develop up to 15 novel small-molecule candidates in oncology and immunology, they said in a joint release.

Sanofi will pay Exscientia an upfront cash payment of $100 million, while future payments could reach some $5.2 billion, relating to commercial, clinical and regulatory milestones, the companies said.

If Sanofi commercializes a therapeutic treatment from the collaboration, Exscientia will also be eligible to receive tiered royalties on product sales ranging from a rate of high single digits to mid-teens, and an option for clinical co-investment to increase the royalty rate up to 21% on net sales of cofunded products, the companies said.

Write to Joshua Kirby at joshua.kirby@wsj.com; @joshualeokirby

(END) Dow Jones Newswires

01-07-22 0136ET