Bristol-Myers Squibb (NYSE:BMY) said today that it landed an exclusive licensing agreement for PsiOxus Therapeutics‘ ‘armed’ oncolytic virus, NG-348, for the treatment of solid tumors.

According to the agreement, Bristol-Myers will pay PsiOxus $50 million upfront and will assume responsibility for global clinical development and commercialization. PsiOxus will be eligible for $886 million in development, regulatory and sales-based milestones. New York-based Bristol-Myers will be responsible for funding the preclinical development of NG-348.

Oncolytic virus therapy makes use of modified viruses that replicate only within tumor cells and stimulate an inflammatory response in the tumor microenvironment. UK-based PsiOxus arms the virus with 2 immuno-therapeutic transgenes using its tumor-specific immuno-gene therapy platform (T-SIGn).

“PsiOxus has developed a novel platform of tumor-targeted delivery with oncolytic viruses focused on cancer and shares our passion for helping more patients respond to treatment,” Bristol-Myers’s head of development for oncology Dr. Fouad Namouni said in prepared remarks. “We are excited to bring our deep expertise in immuno-oncology to the continued development of NG-348 and to better understand the potential role of oncolytic viruses in enhancing checkpoint blockade in multiple types of cancer in the tumor microenvironment.”

In June, the 2 companies collaborated to study PsiOxus’ ‘unarmed’ oncolytic adenovirus therapeutic, enadenotucirev.

“NG-348, represents the first of our T-SIGn armed-viruses,” PsiOxus CEO Dr. John Beadle added. “We are thrilled to partner once again with Bristol-Myers Squibb, a leader in immuno-oncology, to drive this program into clinical development with the aim of providing a potential treatment to cancer patients.”