Schrodinger (SDGR)

Type: Public computational chemistry platform + drug asset company — NASDAQ: SDGR

Schrodinger built the most rigorous physics-based drug design software stack: free energy perturbation (FEP+) for binding affinity, Glide for docking, WaterMap for water displacement, LigPrep for ligand preparation. The Schrodinger Suite is used by most top-10 pharma companies and is the gold standard for structure-based drug design.

Business model split: ~60% software licensing (SaaS) + ~40% internal drug pipeline (Schrodinger discovered its own drug candidates using its platform). This dual model was the original techbio archetype — build the platform, prove it on your own drugs, sell both.

Platform differentiation: Unlike pure ML models, Schrodinger's FEP+ combines quantum mechanics / molecular mechanics with ML to give physically rigorous binding free energy calculations. This makes it more reliable for novel scaffolds outside ML model training distributions.

2026 context: SDGR trades well below 2021 peak. The company's internal pipeline is an asset with several programs in Phase 1/2. The platform's moat is challenged by the rise of open-weight protein models (which don't use physics) but remains defensible for high-precision binding affinity calculations where ML models struggle.

Key metric

FEP+ is FDA-accepted as supporting evidence in IND and NDA filings when predictions are validated — a remarkable moat for a computational tool.

Sources

• Schrodinger SEC filings (SDGR)
• biomednexus.com 2026 AI drug companies