Business

Bristol-Myers pays $300 million for Cambridge biotech

Drug giant Bristol-Myers Squibb Co. has agreed to pay $300 million to buy a two-year-old Boston biotech that’s developing treatments for cancers and other diseases.

Under the deal unveiled Thursday afternoon, Bristol-Myers also will make contingent payments — known in the industry as “biobucks” — of up to $1.01 billion for each of two of IFM’s experimental immunotherapies. That money would be paid out only if they eventually succeed in clinical trials, win regulatory approvals, and meet sales targets once they’re on the market.

The pipeline of IFM Therapeutics — which is backed by Atlas Venture, Abingworth, and Novartis AG — includes drugs that use two different approaches to stimulate disease-fighting immune responses in patients with a wide range of tumors and inflammatory disorders.

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The company’s compounds will strengthen the cancer and immunology research programs of New York-based Bristol-Myers. Like other Big Pharma companies, Bristol-Myers has been stepping up its acquisition of smaller biotechs that demonstrate promising science, as a way to supplement its own programs.

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The takeover, approved by both companies’ boards, is expected to close in the third quarter.

Some additional research programs at IFM Therapeutics that weren’t purchased by Bristol-Myers will be carried forward by a new business — called IFM Therapeutics LLC — formed by the biotech’s current investors. Bristol-Myers negotiated a right of first refusal to potentially buy one of that entity’s programs in the future.

Robert Weisman can be reached at robert.weisman@globe.com.

Correction: An earlier version of this story contained incorrect information on the headquarters of IFM Therapeutics, the name of a financial backer, and how much the company could receive in contingent payments.