Tempus AI Strikes $200M Deal With AstraZeneca, Pathos To Build World's Largest Oncology Model

Tempus AI Inc. (NASDAQ:TEM) during the first quarter secured a multi-million dollar deal to build “the world’s largest foundation model for oncology.”

What Happened: During its first-quarter earnings call on Tuesday, Tempus shed light on its new $200 million, three-year data and modeling license agreement with AstraZeneca PLC (NASDAQ:AZN) and Pathos AI, aimed at developing a foundational model to support diagnostics and drug discovery in oncology.

“And this is big for a few reasons,” said Tempus CEO Eric Lefkofsky. This deal brings the company's total remaining contract value to $1 billion and provides access to more than 300 petabytes of rich multimodal data linked to outcomes. Most importantly, Lefkofsky added, a substantial portion of the computing costs will be covered by AstraZeneca and Pathos AI.

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Lefkofsky says that the model is expected to be completed within 9 to 12 months, following which, each party will get a copy, “AZ [AstraZeneca] and Pathos to advance their drug discovery efforts and Tempus to advance its diagnostic and data products,” he says.

Lefkofsky also emphasized that the agreement is non-exclusive, allowing Tempus to license its data and collaborate on model development with other partners in the future. “We can essentially license data and build models with others, and we hope to do so,” he said, underscoring the broader strategic value of the deal.

Why It Matters: Tempus shares have been popular among retail investors ever since Former House Speaker Nancy Pelosi disclosed her position in the company, early this year.

There has also been a big surge in institutional holdings in recent months, with the likes of JPMorgan Chase & Co. (NYSE:JPM), BlackRock Inc. (NYSE:BLK), and Cathie Wood’s Ark Invest all scooping up its shares.

The company reported $255.76 million in revenue during the first quarter, up 75.4% YoY, and ahead of consensus estimates at $248.13 million. It posted a loss of $0.24 per share, beating analyst estimates forecasting a loss of $0.27 per share.

Price Action: Tempus shares were down 3.48% on Tuesday, and it is currently down another 1.72% after hours.

The stock has a favorable price trend in the short, medium, and long term according to Benzinga’s Edge Stock Rankings. For more insights, sign up for Benzinga Edge.

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