Schrödinger, Inc. (SDGR): Business Model Canvas [Dec-2025 Updated]

You're digging into Schrödinger, Inc. (SDGR) now, trying to see past the stock noise to the actual business engine as of late 2025. Forget the old story; the current model is a sharp pivot: they are aggressively advancing their physics-based computational platform while using major Big Pharma partnerships to fund the clinical pipeline de-risking. Consider this: Q3 software revenue was $40.9 million, they still hold $401 million in cash, and 2025 collaboration guidance sits between $49 million and $52 million. The platform is the cash cow funding the drug bets. See the full canvas below to map out exactly how they balance those $74.0 million quarterly operating costs against those revenue streams. Finance: draft the Q4 cash flow projection based on these revenue assumptions by next Tuesday.

Schrödinger, Inc. (SDGR) - Canvas Business Model: Key Partnerships

You're looking at the structure that powers Schrödinger, Inc.'s drug discovery revenue, which is heavily reliant on these big pharma relationships. Honestly, these partnerships are the bedrock, validating the platform and providing non-dilutive funding streams.

Major multi-target collaborations with Novartis and Bristol Myers Squibb

The collaboration with Novartis is a significant piece of the puzzle, including both drug discovery and software licensing. Schrödinger received the $150 million upfront payment from Novartis in the first quarter of 2025 for this multi-target research collaboration and license agreement. The total potential value, including milestone payments plus royalties, is up to $2.3 billion.

The existing multi-year agreement with Bristol Myers Squibb (BMS) covers small-molecule drugs across oncology, immunology, and neurology. This deal included an initial payment of $55 million to Schrödinger, with potential milestone payments reaching up to $2.7 billion, plus tiered royalties.

Overall, Schrödinger has 15 active programs across its collaborations eligible for milestones or royalties, representing a collective milestone opportunity of $5 billion.

Expanded research agreements with Eli Lilly and Otsuka Pharmaceutical

Schrödinger has continued to deepen its ties with both Eli Lilly and Company (Lilly) and Otsuka Pharmaceutical Co., Ltd. (Otsuka). The agreement with Lilly was expanded to include an undisclosed new target, building upon their existing collaboration. Similarly, the research collaboration with Otsuka was expanded to add another undisclosed target, with the terms consistent with the prior agreement.

Schrödinger is currently engaged with 19 pharmaceutical and material science customers/collaborators since 2018.

Funding and scientific collaboration with the Bill & Melinda Gates Foundation

The predictive toxicology initiative with the Bill & Melinda Gates Foundation (BMGF) is a key scientific collaboration. This initiative is funded by grants totaling $19.5 million, which followed an initial $10 million grant in July 2024 and an additional $9.5 million. Revenue recognized for services provided under this grant was $9 million for the three months ended March 31, 2025.

Seeking strategic partners for clinical-stage assets like SGR-1505

Schrödinger is actively exploring strategic opportunities for its clinical-stage asset, SGR-1505 (MALT1 inhibitor), with the goal of accelerating its clinical development. The company plans to complete dose escalation studies for SGR-1505 and SGR-3515 while pivoting its strategy to focus more on software licensing and preclinical discovery partnerships, rather than advancing internal assets to the IND stage independently.

Co-founding and investing in biotech companies like Ajax Therapeutics

Schrödinger maintains its role as a co-founder and continuing investor in Ajax Therapeutics. Ajax completed an oversubscribed $95 million Series C financing in 2024, with Schrödinger participating. This partnership recently expanded to include a new Janus kinase (JAK) target, building on their initial 2019 collaboration.

Here's a quick look at the structure of the expanded Ajax Therapeutics deal:

The lead candidate from the original Ajax collaboration, AJ1-11095, is in Phase 1 clinical trials for myelofibrosis treatment.

Schrödinger, Inc. (SDGR) - Canvas Business Model: Key Activities

You're looking at the core engine of Schrödinger, Inc. (SDGR) as of late 2025. This isn't just about selling software; it's about continuously validating the platform through high-stakes drug discovery work. Here's a breakdown of the main things the company is actively doing to generate revenue and advance its technology.

Continuous R&D to advance the core computational platform

Schrödinger, Inc. is constantly refining the physics-based computational platform that underpins everything. This activity is reflected directly in the spending, though management has been actively trimming costs. For the third quarter of 2025, Research and Development (R&D) expenses were reported at $42.8 million, which was a 16% decrease compared to the $51 million spent in Q3 2024. Honestly, this YoY drop is partly due to a strategic shift of certain expenses, like those for predictive toxicology, into the Cost of Goods Sold (COGS) from internal R&D. Still, the core development continues, evidenced by the release of the 2025-4 software update in the third quarter.

Executing collaborative drug discovery programs for partners

This is where the platform's predictive power translates directly into near-term revenue through upfront payments, milestones, and royalties. The Drug Discovery segment is showing significant acceleration. In Q3 2025, drug discovery revenue hit $13.5 million, a massive jump from just $3.4 million in Q3 2024, representing a 295% surge year-over-year. This growth is being fueled by ongoing collaborations, including extensions with partners like Ajax, Lilly, and Otsuka. For the full year 2025, the company increased its guidance for this revenue stream to a range of $49 million to $52 million.

Licensing and supporting enterprise-scale software deployment

The software business remains the foundation, focused on enterprise-scale deployment for life sciences and materials science customers. Software revenue for Q3 2025 was $40.9 million, marking a solid 28% year-over-year growth. However, you should note the guidance adjustment: the full-year 2025 software revenue growth expectation was lowered to 8% to 13%, down from the prior 10% to 15% range, which management attributed to the timing of certain pharma scale-up opportunities. A key indicator of future revenue is deferred revenue, which grew substantially to $174.7 million as of September 30, 2025, up from $47 million in Q3 2024. Here are the key financial metrics for the core segments:

Advancing proprietary clinical programs (e.g., SGR-1505, SGR-3515) to partnership-ready stages

Schrödinger, Inc. has made a definitive strategic pivot here: they explicitly stated they do not intend to advance discovery programs into the clinic independently beyond planned studies. This shift is expected to generate savings of approximately $70 million. The focus is now on completing Phase 1 dose-escalation studies to make the assets partnership-ready. You should track these two assets closely:

• SGR-1505 (MALT1 inhibitor): Showed a 22% Overall Response Rate (ORR) among 45 patients with B-cell malignancies in data presented in June 2025.
• SGR-3515 (Wee1/Myt1 co-inhibitor): Initial human data is expected in the fourth quarter of 2025.

On a related note, the company discontinued the SGR-2921 (CDC7 inhibitor) program after it was linked to two patient deaths.

Integrating physics-based modeling with AI/ML for predictive toxicology

This is a key area where R&D costs are being reclassified, but development is clearly progressing. The company is accelerating development of its predictive toxicology solution, with a beta currently ongoing. This beta test involves approximately 50 representative kinases. It's worth noting that the software gross margin in Q2 2025 was 68%, down from 80% in Q2 2024, with management citing the costs associated with this predictive toxicology initiative as a primary factor. The goal is for this technology to eventually contribute significantly to the software segment.

Finance: draft 13-week cash view by Friday.

Schrödinger, Inc. (SDGR) - Canvas Business Model: Key Resources

You're looking at the core assets Schrödinger, Inc. (SDGR) relies on to run its business as of late 2025. These aren't just line items; they are the engines driving both the software revenue and the pipeline value.

Proprietary physics-based and machine learning computational platform

The platform itself is the foundation. It's built on over 30 years of research and development investment, which is a serious moat in this space. This technology is what powers the software licenses and the drug discovery engine. The platform's utility is reflected in the financial performance, where the software segment is the consistent revenue driver.

Here's a quick look at the software segment performance as of the third quarter of 2025:

The platform's capability to generate upfront payments is also clear, with Drug Discovery Revenue hitting $13.5 million in Q3 2025, a huge jump from $3.4 million in Q3 2024.

Highly specialized scientific and engineering talent

Talent is critical for maintaining and advancing the computational platform and for running the drug discovery programs. As of early 2025, Schrödinger employed approximately 900 employees across 15 global locations. The company has been actively managing its cost structure, evidenced by operating expenses decreasing to $74.0 million in Q3 2025, down from $86.2 million in Q3 2024, partly due to lower employee-related expenses.

Strong balance sheet with approximately $401 million in cash (Q3 2025)

Financial stability is a key resource, especially when advancing clinical assets. As of September 30, 2025, Schrödinger held $401.0 million in cash, cash equivalents, restricted cash, and marketable securities. This is a healthy position, up from $367.5 million at the end of 2024. Furthermore, the company reported a net cash inflow from operating activities of $29.99 million for the nine months ending September 30, 2025, a significant reversal from the cash outflow of $126.26 million in the same period of 2024.

Extensive intellectual property protecting algorithms and methods

The proprietary nature of the algorithms is protected by a growing IP portfolio. As of late October 2025, the company had 240 total patent documents, encompassing both applications and grants, with 183 patent families. This IP underpins the value of the software licenses and the defensibility of the drug discovery methods.

Clinical-stage drug candidates (e.g., SGR-1505) for out-licensing

The internal pipeline represents potential future value through partnerships and licensing deals. Schrödinger is advancing three clinical-stage oncology programs.

Key pipeline assets and their status as of late 2025 include:

• SGR-1505 (MALT1 inhibitor): Phase 1 study ongoing; reported a 22% overall response rate as monotherapy. Received FDA Fast Track Designation.
• SGR-2921 (CDC7 inhibitor): Phase 1 study ongoing; initial clinical data expected in the fourth quarter of 2025. Received FDA Fast Track Designation.
• SGR-3515 (Wee1/Myt1 co-inhibitor): Phase 1 study ongoing; initial clinical data expected in the first half of 2026.

The strategic shift is to focus on a discovery-centric R&D model, aiming for long-term value through licensing and collaborations.

Schrödinger, Inc. (SDGR) - Canvas Business Model: Value Propositions

You're looking at the core value Schrödinger, Inc. (SDGR) delivers to its customers, which is fundamentally about making drug discovery faster and more predictable. This value is quantified by their financial performance and strategic focus as of late 2025.

Accelerated molecular discovery using predictive computational modeling

Schrödinger, Inc. emphasizes the industry's increasing demand for its leading computational platform. The software segment, which embodies this value proposition, generated $40.9 million in revenue for the third quarter of 2025, marking a 28% year-over-year growth for that period. Management noted strong customer engagement, which is driving the full-year 2025 software revenue growth guidance to a range of 8% to 13% compared to 2024's $180.4 million in software revenue. The platform's continuous improvement is evidenced by the release of the 2025-4 software update. This core technology is built on nearly 35 years of research and development investment.

Significant reduction in the cost and time of preclinical R&D

The value of time and cost efficiency is reflected in Schrödinger, Inc.'s focus on operational discipline. The company announced expense-reduction measures earlier in 2025 that are expected to result in savings of approximately $70 million. Operating expenses for the third quarter of 2025 decreased to $74.0 million from $86.2 million in the third quarter of 2024, a 14% reduction, aligning with a focus on improving the long-term profitability profile. This efficiency supports the value of accelerating R&D timelines for clients.

A gold standard platform for discovering differentiated molecules

The platform's perceived quality and necessity are supported by the growth in the drug discovery services segment, which saw revenue surge 295% year-over-year in Q3 2025 to reach $13.5 million. The full-year 2025 guidance for drug discovery revenue was increased to a range of $49 million to $52 million. Furthermore, the company maintains a strong balance sheet to support this high-value work, reporting $401 million in cash and marketable securities as of September 30, 2025. The software gross margin for Q3 2025 stood at 73%, with the full-year expectation set between 73% to 75%.

Predictive toxicology solutions to reduce late-stage failure risk

Mitigating late-stage failure risk through early prediction is a key offering. Schrödinger, Inc. is progressing its predictive toxicology initiative, which was launched with support including a $19.5 million grant from the Bill & Melinda Gates Foundation. The company anticipates releasing this predictive toxicology solution to customers in the latter half of 2025. This capability aims to improve drug candidate characteristics by assessing toxicology risks early, which is a common cause of development failures linked to off-target protein interactions.

Hybrid model offering both software tools and drug discovery services

Schrödinger, Inc. operates a hybrid model, clearly segmenting its revenue streams. The following table breaks down the financial contribution from each component in the third quarter of 2025:

The company's deferred revenue, which represents future recognized revenue from contracts, stood at $174.7 million as of September 30, 2025, indicating substantial contracted work across both service and software offerings.

• The company is advancing two key internal clinical programs: SGR-1505 and SGR-3515.
• A major collaboration with Novartis included a $150 million upfront payment.
• The company reported a net loss of $32.8 million for Q3 2025.
• The software revenue growth guidance for 2025 was updated to 8% to 13%.
• The company is focusing on completing Phase 1 dose-escalation studies for its clinical candidates.

Schrödinger, Inc. (SDGR) - Canvas Business Model: Customer Relationships

You're looking at how Schrödinger, Inc. manages its key relationships, which really splits into two very different camps: the deep, multi-year partnerships with Big Pharma and the broader, more transactional software sales to the rest of the research world. It's a balancing act, honestly.

High-touch, long-term strategic collaborations with Big Pharma

These collaborations are the bedrock for validating the platform and generating lumpy, high-value Drug Discovery revenue. They aren't just selling software; they are co-piloting drug discovery programs. For instance, the multi-target research collaboration and license agreement with Novartis included a $150 million upfront payment and is eligible for up to $2.3 billion in milestone payments plus royalties.

The relationship with BMS is similar, involving a $55 million upfront payment and up to $2.7 billion in milestones. The Lilly partnership targets up to $425 million in milestones. Even the Sanofi deal covers up to 10 drug discovery programs with $120 million in potential milestones.

The platform's success is validated by the fact that it has facilitated the entry of 15 molecules into clinical trials through these Big Pharma collaborations. The cumulative milestone opportunity across all partnered programs is estimated to be around $5 billion, and around 15 programs are eligible for royalties. Remember, an early collaboration with Agios resulted in two FDA-approved medications, Idhifa® and Tibsovo®.

Here's a quick look at the financial structure of these key relationships:

Dedicated account management for enterprise software licensing

For the core software business, which is the more predictable revenue stream, you see a focus on deepening relationships within existing large accounts. Software revenue for the third quarter of 2025 hit $40.9 million, marking a 28% year-over-year growth. The company updated its full-year 2025 guidance for software revenue growth to a range of 8% to 13%.

The stickiness of the enterprise offering is clear when you look at the high-value customers. The number of software customers with an Annual Contract Value (ACV) greater than $5 million doubled from 4 in 2023 to 8 in 2024. Plus, they achieved a 100% software customer retention rate for customers with an ACV of at least $500,000 in 2024. This high-value engagement is also reflected in the deferred revenue, which grew to $174.7 million as of September 30, 2025, up from $47 million in Q3 2024, showing a lot of future committed revenue.

The software gross margin remains strong, projected to be between 73% to 75% for the full year 2025.

Self-service and technical support for smaller academic/industrial users

While the Big Pharma deals get the headlines, the platform is licensed by academic institutions and smaller industrial companies globally. These users likely rely more on scalable, self-service onboarding for the software platform, supplemented by technical support channels. The company has approximately 1,752 software customers worldwide as of the end of 2024.

• Support scales based on contract size.
• Academic licenses often use the platform for basic research.
• The focus is on driving increased customer adoption of the computational technology.

Seeking co-development and out-licensing relationships for clinical assets

Schrödinger, Inc. has made a strategic pivot to focus on a discovery-focused therapeutics R&D model, meaning they are actively looking to partner or out-license their internally generated clinical assets rather than fund them all the way through to commercialization independently.

Key actions in this area include:

• Actively seeking a strategic partner for the mid-stage development of SGR-1505.
• Planning to complete Phase 1 dose-escalation studies for SGR-1505 and SGR-3515, then exploring strategic opportunities for further development through partnerships.
• Advancing a program (ACCG-2671) with Structure, where Schrödinger holds an equity stake and is eligible for milestones and low single-digit royalties.
• The company intends to pursue additional proprietary drug discovery programs through co-development or out-licensing to optimize their potential.

They are definitely shifting the risk/reward profile of the therapeutics portfolio toward licensing upside. Finance: draft 13-week cash view by Friday.

Schrödinger, Inc. (SDGR) - Canvas Business Model: Channels

You're looking at how Schrödinger, Inc. gets its value proposition-the computational platform-into the hands of its customers, which is a mix of direct sales, deep partnerships, and digital delivery. Honestly, the numbers show a clear focus on high-value enterprise contracts and strategic collaborations.

Direct Enterprise Sales Team for Large Pharmaceutical Contracts

The direct sales channel targets large pharmaceutical and life sciences companies, which is where the bulk of the software revenue comes from. This team focuses on securing large, multi-year agreements, often involving both on-premise and hosted solutions. The stickiness of these relationships is quite high; for instance, the customer retention rate among those with an Annual Contract Value (ACV) of at least $500,000 was 100% as of the end of 2024. The number of these top-tier customers grew to 61 at the end of 2024. Furthermore, the very top tier, those with an ACV of at least $5 million, doubled from 4 to 8 customers by the close of 2024.

The success in this channel is reflected in the software revenue performance. For the third quarter of 2025, software revenue hit $40.9 million, marking a 28% year-over-year growth. For the full year 2025, management updated guidance for software revenue growth to be between 8% and 13%.

Direct Engagement via R&D and Business Development Teams for Collaborations

Direct engagement through R&D and business development teams drives the Drug Discovery segment, which is characterized by large, upfront payments and milestone potential. These teams broker the multi-target collaborations that are critical for the high growth seen in this segment. Drug discovery revenue for Q3 2025 surged to $13.5 million, a massive 295% increase compared to Q3 2024, largely due to recognizing revenue from upfront payments associated with advancing these ongoing collaborations. The full-year 2025 drug discovery revenue guidance was increased to a range of $49 million to $52 million.

Key examples of this channel's impact include the Novartis collaboration, which brought in a $150 million upfront payment in January 2025. Another major deal with Bristol Myers Squibb involves a $55 million upfront payment plus milestones and royalties. The Sanofi partnership involves up to 120 million USD in milestone payments alone.

Here's a quick look at the collaboration pipeline metrics:

• Established drug discovery collaborations since 2018: 19 (as of Q1 2025).
• Total cash received from upfront payments in early 2025 from new/expanded deals: Over $150 million.
• Number of ongoing programs eligible for royalties at year-end 2024: 13.

Online Platform and Technical Support for Software Distribution

The core software is distributed via the online platform, increasingly through hosted contracts, which suggests a move toward more predictable, recurring revenue streams. Technical support is integral to maintaining the high retention rates in the enterprise segment. The company reported having approximately 1,752 software customers worldwide as of December 31, 2024. The platform continues to be enhanced, with the 2025-4 software update released and the predictive toxicology solution in beta testing, which currently includes approximately 50 representative kinases.

The shift to hosted solutions is notable, as it impacts revenue recognition timing, though it bolsters the deferred revenue balance, which stood at $174.7 million as of September 30, 2025, up significantly from $47 million in Q3 2024.

Scientific and Industry Conferences

Conferences serve as a key channel for visibility, lead generation, and maintaining relationships with the scientific community and investors. Schrödinger, Inc. was scheduled to present at the Jefferies London Healthcare Conference on November 6, 2025. These events are where the company showcases platform advancements, like the new capabilities in protein degrader modeling and crystal structure prediction, directly to decision-makers.

To be fair, looking at the revenue mix across these channels gives you a clearer picture of the current business focus:

Finance: review the Q4 2025 bookings pipeline against the lower end of the 8% software growth guidance by next Tuesday.

Schrödinger, Inc. (SDGR) - Canvas Business Model: Customer Segments

You're looking at the core groups Schrödinger, Inc. serves with its computational platform, which is a mix of big pharma deals and broader software licensing. Honestly, the customer base is segmented by the scale of their R&D budget and their need for high-fidelity molecular modeling.

The financial performance in late 2025 clearly shows the impact of these segments. For the third quarter ended September 30, 2025, Schrödinger reported total revenue of $54.3 million, with software revenue at $40.9 million and drug discovery revenue at $13.5 million. The trailing twelve-month (TTM) revenue as of September 30, 2025, stood at $257 million.

Schrödinger, Inc. has been growing its high-value customer base. The number of customers with an Annual Contract Value (ACV) greater than $5 million increased from 4 in 2023 to 8 in 2024.

Here's a breakdown of the key customer segments and how they interact with Schrödinger, Inc.

The focus on Big Pharma is evident in the large, upfront payments recognized in revenue. For instance, Q1 2025 total revenue of $59.6 million included higher recognition from collaborations, particularly with Novartis. Drug discovery revenue, which is heavily tied to these collaborations, was projected to be between $49 million to $52 million for the full year 2025.

You see the breadth of the customer base by looking at the total count. As of December 31, 2024, Schrödinger had approximately 1,752 active customers worldwide (defined as having an ACV greater than $1,000).

The company is actively looking to deepen relationships within these segments, planning to increase platform adoption among existing pharma customers and targeting increased ACV from customers in the $1 million to $5 million range.

• Software gross margin remained stable at 73% for Q3 2025.
• The company has over 50 off-targets structurally enabled in its predictive toxicology solutions as of Q1 2025.
• Schrödinger, Inc. had ~800 employees worldwide as of August 2025.

Schrödinger, Inc. (SDGR) - Canvas Business Model: Cost Structure

You're looking at the cost base for Schrödinger, Inc. as of the third quarter of 2025, which shows a clear focus on managing expenses while still investing in the platform.

High R&D expenses for platform and drug development remain a significant cost driver, though they have been actively managed. For the third quarter of 2025, total operating expenses were reported at $74.0 million. This figure represented a 14% decrease compared to the third quarter of 2024's $86.2 million operating expenses. This reduction aligns with a strategic shift and earlier expense-reduction measures that are expected to yield approximately $70 million in savings overall.

Significant employee-related expenses for specialized scientists and engineers are embedded within the operating expense categories, particularly Research & Development (R&D). The decline in operating expenses across the board was primarily attributed to lower employee-related costs. The company also announced a decision not to move forward with certain internal programs, which is expected to save an additional $40 million.

The breakdown of operating expenses for Q3 2025 shows where the spending is concentrated:

The R&D decrease was partly due to a shift of predictive toxicology expenses into the cost of revenue line item.

Costs of revenue for software, including cloud computing and infrastructure, are reflected in the software gross margin. For Q3 2025, the software gross margin was 73%. Cost of revenues for software generally includes personnel-related expenses for employees directly involved in software delivery, royalties for third-party licensed technology used in the software, and allocated overhead like facilities and IT support. The shift of certain predictive toxicology expenses from R&D into software cost of goods sold impacts this area.

Regarding clinical trial costs for proprietary drug candidates, Schrödinger has made a strategic pivot. The company explicitly stated, 'Beyond our planned clinical investments to complete the Phase 1 dose-escalation studies for SGR-1505 and SGR-3515, we do not intend to advance discovery programs into the clinic independently.' This signals a reduction in direct, independent clinical trial spending in favor of a discovery-focused therapeutics R&D model centered on collaborations and licensing.

Sales and marketing expenses to drive software adoption were $9.5 million in the third quarter of 2025. This represented an 8% decrease compared to the third quarter of 2024. The overall software revenue growth of 28% in Q3 2025 to $40.9 million suggests that the marketing spend is supporting continued customer engagement.

Finance: draft 13-week cash view by Friday.

Schrödinger, Inc. (SDGR) - Canvas Business Model: Revenue Streams

You're looking at how Schrödinger, Inc. actually brings in the cash to fund its platform development and drug discovery efforts as of late 2025. It's a dual engine: steady software income and the lumpy, but potentially massive, returns from drug discovery partnerships. Honestly, the mix is what makes their story interesting right now.

The core, reliable money comes from their computational platform licensing. For the third quarter of 2025, the software revenue hit $40.9 million, which was a solid 28% year-over-year growth. That tells you the industry is still heavily investing in their computational tools. This recurring revenue stream is the foundation.

The other side, Drug Discovery Revenue, is more variable, often tied to when big partners pay up. For the full year 2025, Schrödinger updated its guidance for this segment to be between $49 million to $52 million. To give you context on how that revenue is recognized, the Q3 2025 Drug Discovery Revenue specifically came in at $13.5 million, a huge jump from just $3.4 million in Q3 2024, largely because of upfront payments being recognized.

Here's a quick look at the key components making up the revenue picture based on recent figures:

The upfront payments are significant cash infusions when new, large-scale collaborations kick off. These aren't recurring, but they certainly boost the balance sheet. You definitely saw this impact in Q1 2025 when the Novartis deal closed.

The revenue streams from collaborations can be broken down like this:

• Software Revenue from subscription licenses.
• Drug Discovery Revenue from collaborations, which includes upfront payments.

When you look at the big partnership deals, the upfront cash is a major component. For example:

• The research collaboration and license agreement with Novartis included an upfront payment of $150 million, which Schrödinger expected to receive in the first quarter of 2025.
• The collaboration agreement with Bristol-Myers Squibb Company (BMS) included an upfront payment of $55.0 million.

Then you have the potential upside, which is what analysts really watch for long-term value creation. These are milestone payments and royalties tied to the success of the partnered drug programs as they advance through development and commercialization. The total potential value across some of these deals is staggering, though it's all contingent on clinical success, which is never a sure thing.

Here are some of the milestone and royalty potentials mentioned in recent agreements:

• Novartis collaboration: Eligible for up to $2.3 billion in milestone payments plus royalties.
• BMS partnership: Up to $2.7 billion in milestone payments along with royalties.
• Lilly partnership: Up to $425 million in milestone payments.
• Sanofi partnership: Up to $120 million in milestone payments.
• Total potential milestones across some partnerships are around $5 billion.

Finally, the potential future royalties on net sales of partnered products represent the long-term, passive income stream if any of these joint efforts result in a commercialized drug. This is the ultimate payoff for the discovery work Schrödinger helps facilitate.

Finance: draft the Q4 2025 revenue forecast based on the updated 2025 guidance by next Tuesday.