Innovation Efficiency Evotec Company Overview

Transcription

1 Innovation Efficiency Evotec Company Overview Evotec AG, 31 st Annual J.P. Morgan Healthcare Conference, January 2013

2 Forward-looking statements Information set forth in this presentation contains forward-looking statements, which involve a number of risks and uncertainties. The forwardlooking statements contained herein represent the judgement of Evotec as of the date of this presentation. Such forward-looking statements are neither promises nor guarantees, but are subject to a variety of risks and uncertainties, many of which are beyond our control, and which could cause actual results to differ materially from those contemplated in these forwardlooking statements. We expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any such statements to reflect any change in our expectations or any change in events, conditions or circumstances on which any such statement is based. 1

3 Agenda Evotec at a glance Innovation Efficiency Action Plan 2016 Financial strategy & Outlook 2

4 Best-in-class drug discovery offering Evotec overview and value proposition 1) Profitable, fast growing quality and innovation leader in drug discovery for Pharma and biotech Systematic, unbiased and comprehensive service infrastructures to reduce costs and accelerate time in R&D Rich partnered product pipeline including advanced clinical and preclinical assets and unpartnered first-inclass targets in kidney disease and CNS Strong strategic position with more than 600 scientists, unique track record after >15 years history, >100 lead series, >30 pre-clinical candidates, >20 clinical compounds and strong cash position 3 1) Founded in 1993, Publicly listed on TecDAX (Germany), > 70% free float, >600 employees, Headquarter in Hamburg, Germany

5 A global company with a complete offering Evotec worldwide operations Hamburg, Germany Manfred Eigen 1) Campus San Francisco, US ~30 employees Compound Procurement Compound QC and storage Abingdon, UK ~215 employees Medicinal chemistry ADMET Structural biology ~200 employees Screening HTS,NMR in vitro & in vivo biology Munich, Germany ~30 employees Phosphoproteomics Chemical proteomics Göttingen, Germany ~50 employees Metabolics Regenerative Medicine Thane, India ~130 employees Library synthesis & mgmt. Development chemistry Sales representation (Boston, Tokyo) Operations & sales representation 4 1) Manfred Eigen (*1927), German biophysical chemist and one of the worldwide leading pioneers in biotechnology. In 1967, he won the Nobel Prize in Chemistry for his work on a special measuring method of fast chemical reactions, which, until then, were considered to be immeasurable. He initiated the foundation of Evotec AG.

6 Agenda Evotec at a glance Innovation Efficiency Action Plan 2016 Financial strategy & Outlook 5

7 Drug discovery outsourcing is a growth market Key factors underpinning market dynamics Drivers of more flexible models Global Drug Discovery Outsourcing market revenues, in bn $ 1 2 Need for higher R&D capital efficiency and faster and better stop loss decisions Increasing comfort with outsourcing, high quality CRO s and open innovation models ~+10% p.a Ability to adjust speed proportional to portfolio, funding, etc (e) 2014 (e) 2015 (e) 2016 (e) 2017(e) 6 Source: Visiongain; Drug Discovery Outsouring: World Market 2012

8 Addressing the R&D productivity and innovation challenge Evotec s customer and innovation solutions 3 EVT Innovate 2 EVT Integrate Product Development Partnerships and Cure X Initiatives First-in-class discovery and product alliances with academia and Pharma Investments for upfronts, higher milestones and higher royalties 1 EVT Execute Integrated drug discovery alliances on partner targets Best-in-class integrated drug discovery projects Risk-shared performance-based alliances with research fees, milestones & royalties Stand-alone screening, medicinal chemistry, compound management, compound profiling, Highest quality solution tools and processes No risk exposure, lower margin, but long-term repeat business and build up of infrastructure 7

9 Broad stand-alone execution business Comprehensive Drug Discovery Platform EVO Apps Compound Management High Throughput Screening Protein Production Structural Biology Project management & processes deliver significantly faster execution Target Deconvolution Compound Profiling In vitro and in vivo Pharmacology Computational and Medicinal Chemistry Significant cost reduction versus Pharma internal costs accessed on a variable basis 8

10 Broad scope of solid fee-for service with long term perspective EVT Execute Examples for strategic collaborations Field Partner Scope Upside Compound management NIH 10 years US$ 70 m, solid margins Screens for multiple disease areas Top Pharma & biotech ~ 25 in 2012 Similar scope in 2013, solid margins Huntington Disease CHDI < 3 years US$ 41 m over period, solid margin, technology development Counter screening Top Pharma Ongoing Solid margins Protein production Top Pharma Ongoing Solid margins Integrated programs Genentech Renewable 2013 Solid margins 9

11 Strong growth with highest quality outsourcing services EVT Execute strategy Expand offering for even more complete customer solutions (e.g. Cell Culture Services 1) ) 2 Expand footprint with services even closer to our customers (e.g. US East Coast) 3 Further improve service levels, gross margins and profitability lean initiatives 10 1) Recently acquired company based in Hamburg

12 Disease biology the processor for integrated drug discovery alliances Core competence alliance model Core disease biology know-how Metabolics Respiratory Diseases Regenerative Medicine Best-in-class systematic, unbiased and comprehensive infrastructures Immunology & Inflammation Oncology CNS & Pain 11

13 Fast Decision business model aligns incentives Milestone-driven performance-based business model Examples of integrated alliances Milestones and royalties create significant long-term upside Illustrative % % Fixcost Pharma EVT Base MS 1 MS 2 MS 3 MS 4 Clinical Start MS 5 MS 6 MS 7 Total Royal- Outsourcing- ties cost 12

14 Large scope pharmaceutical portfolio with significant upsides EVT Innovate and EVT Integrate early assets Indication Partner Status Next milestone Commercials Endometriosis Bayer Pre-clinical Pre-clinical candidate Upfront 12 m; total value up to approx. 580 m; royalties Undisclosed Novartis Pre-clinical Phase II completion Upfront payment, research funding milestone payments and royalties Various Boehringer Ingelheim Pre-clinical Pre- and clinical candidate Milestone payment, royalties Type 2 Diabetes Insulin Sensitizer Boehringer Ingelheim Research Pre-clinical candidate Up to 237 m milestones, significant royalties CureBeta Type 1 and 2 Diabetes Janssen Pharmaceuticals Research Pre-clinical candidate Upfront $ 8 m; research payment; up to $ 300 m milestones per product; significant royalties Type 1 and 2 Diabetes EVT770 MedImmune/ AstraZenca Research Clinical candidate Up to 254 m milestones, significant royalties 13

15 Building an even stronger portfolio of opportunities EVT Integrate strategy Further expansion of portfolio with new strategic multi-target alliances 2 Increase amount of milestone achievements in ongoing alliances 3 Expand customer reach to even more biotech and mid-sized Pharma customers 14

16 Pharma product development portfolio without financial risk EVT Innovate clinical development assets Indication Partner Status Next milestone Commercials Diabetes 1) TEVA/ Andromeda 2 nd Phase III recruitment closed Final Phase III data Approx. 40 m milestones, royalties; potential market approx. 500 m Alzheimer s Disease 2) Roche Start Phase II Completion of Phase II Phase III start Approx. $ 820 m milestones, royalties; potential market $ 3-5 bn Treatment resistant depression 3) Janssen Pharmaceuticals Phase I/II Confirmation of preclinical study / Phase II start Approx. $ 160 m milestones, royalties; potential market $ 2 bn Insomnia 4) Jingxin Phase II Phase IIb start Milestones, royalties Inflammation 5) Conba Phase I/II Phase II start Approx. 60 m milestones, royalties Acromegaly, Diabetic Retinopathy, others Aspireo Phase I Partnering Advisory fees, royalties 15 1) DiaPep277 is being developed by Andromeda Biotech Ltd and has been partnered with TEVA Pharmaceuticals Industries Ltd 2) EVT302 (Mao-B ); 3)EVT101/103 series; 4) Chinese rights only; (EVT201) 5) EVT401 (P2X7)

17 Novel treatment for T1D met Phase III endpoints Product development alliance with Andromeda/Teva (Phase III) DiaPep277 A therapeutic treatment for newly diagnosed type 1 diabetes Type 1 diabetes results from the body s failure to produce insulin and presently requires life long insulin therapy by subcutaneous injection Today there is no therapy able to slow the destruction of insulin secreting pancreatic beta cells DiaPep277 is targeted to treat newly diagnosed patients with residual insulin secreting cells About DiaPep277 DiaPep277 is a unique peptide of 24 amino acids derived from human heat shock protein 60 (HSP 60) The peptide acts by modulating the immune system, thus preventing the destruction of pancreatic cells that secrete insulin in response to elevated blood glucose levels 16

18 DiaPep277 progressing towards market Product development alliance with Andromeda/Teva Development background All development, regulatory responsibilities and costs have been transferred to Andromeda/Teva 1) Phase I and Phase II studies were successfully conducted Two Phase III studies have to be conducted for registration Orphan drug status in USA granted Teva has a world-wide exclusive license to DiaPep277 Status DiaPep277 met primary endpoint of 1 st Phase III trial (beta cell function) DiaPep277 demonstrated a significant preservation of C-peptide levels, a marker for assessing insulin secretion by pancreatic cells Additional clinical, safety and efficacy analysis ongoing 2 nd Phase III with approx. 500 patients/recruitment closed Expected key milestones for Evotec Next milestone is triggered upon completion and outcome of 2 nd Phase III study Final data of 2 nd Phase III in 2014/2015(e) First sales projected for 2015(e)/ ) DiaPep 277 was owned by DeveloGen (Evotec International GmbH)

19 Novel treatment of Alzheimer s disease Product development alliance with Roche (Phase II) EVT302 an orally active MAO-B inhibitor to slow down progression of Alzheimer s disease (AD) Alzheimer s disease (AD) is the most common form of dementia, most often AD is diagnosed in people over 65 There is no cure for the disease, which worsens as it progresses. AD is predicted to affect 1 in 80 people by RG1577 EVT302 is targeted to slow down the symptoms of AD. This was demonstrated in cognitive tests such as ADAS-cog 1). About RG1577 EVT302 MAO-B is normally present in brain and is responsible for break-down of certain neurotransmitters Activity of MAO-B is linked to production of reactive oxygen species, molecules that can cause neuronal damage Blocking the activity of MAO-B should reduce oxidative stress which is expected to slow progression of AD 18 1) Alzheimer s disease assessment scale cognitive subsection. Current gold standard in AD clinical trial endpoints

20 Phase II POC ongoing Product development alliance with Roche Development background All development, regulatory responsibilities and costs have been transferred to Roche Phase I and Phase II trials have been conducted partially with different therapeutic goals Safety profile is established Development profile can potentially target stand-alone application or combination treatments Licensing agreement No further costs to Evotec Upfront payment of $ 10 m Milestones of $ 820 m Double-digit royalties Status and expected key milestones for Evotec Phase II trial initiated in September 2012 Phase II completion (POC) / Phase III start (2015e) 19

21 Uniquely positioned to meet an huge unmet medical need Product development alliance with Janssen (Phase I/II) TRD & selective antagonists of NMDA receptor NR2B subtypes TRD a high unmet medical need 1) More than 120 m depressed patients in US/EU 1/3 of patients does not respond to first line antidepressant Significant side effects of all existing interventions Significant advantages over non-selective NMDA antagonists (e.g. ketamine and memantine) due to better side effect profile About NMDA receptor NR2B subtypes EVT100 are high affinity, selective antagonists of N-methyl-D-aspartate (NMDA) receptor subtypes containing the NR2B subunit; they bind preferentially to the activated form of the receptor (activity-dependent); they modulate channel activity by inhibiting channel opening probability 20 1) Definition CPMP Guidelines: TRD Consecutive treatment with 2 products of different classes, used for a sufficient length of time at an adequate dose, fail to induce an acceptable effect (Cave pseudo-resistance)

22 Fast next development steps expected Product development alliance with Janssen Development background All development, regulatory responsibilities and costs have been transferred to Janssen Several Phase I trials have been conducted with EVT101 and EVT103 Safety / Tox profile is established for EVT101 and almost complete for EVT103 Licensing agreement No further costs to Evotec Upfront payment of $ 2 m and $ 6 m after confirmation of certain pre-clinical properties of the candidates Clinical & commercial milestones of up to $ 167 m Double-digit royalties Status and expected key milestones for Evotec Confirmation of pre-clinical study of EVT103 and Phase II trial start in 2013 Completion/Phase II 2015(e) 21

23 Creating first-in-class innovation Janssen / Harvard / Evotec - CureBeta 1 Evotec Best-in-class metabolics discovery infrastructure 15 years experience in beta cell regeneration < Harvard Stem Cell Institute / Howard Hughes Medical Institute Prof. Doug Melton key strategic partner for Evotec Beta cell targets, assays, tools 2 Janssen Perfect discovery and development partner Commited to innovation in diabetes 3 Leader in biologics 22

24 Building a Cure X pipeline Cure X initiatives CureBeta CureNephron Started collaboration with Harvard University in March 2011 Partnered CureBeta with Janssen in July 2012 Significant research payments, milestones, royalties Started collaboration with Harvard University in February 2012 Portfolio of approaches to identify disease modifying mechanisms Highly productive in generating candidate targets & compounds CureNeuron Concept phase for internal projects Exploring potential collaboration opportunities CureHeart Concept phase for internal projects Exploring potential collaboration opportunities 23

25 Open innovation with a commercial outlet Yale Evotec partnership Highly innovative structure of academia biotech partnership Master agreement that covers all indications and is open to all Yale faculty Projects will go through a three step process: Evaluation - Research - Commercialization Evaluation phase Projects will be selected by a Joint Evaluation Committee Highly innovative and significant value creation through joint effort Research phase Initial period up to 2 years governed by Joint Research Committee Both parties contribute to research effort Commercial phase Project licensed to Pharma partner Yale and Evotec will split financial rewards according to relative contributions 24

26 First-in-class innovation with focus in CNS, oncology and metabolics EVT Innovate strategy Define 1-2 more Cure X initiatives 2 Commercialise one Cure X initiative 3 Expand academic innovation network 25

27 Agenda Evotec at a glance Innovation Efficiency Action Plan 2016 Financial strategy & Outlook 26

28 Positive trend of all key metrics and strong revenue and profitability growth expected for 2013 Key metrics for 2012/2013 in m Double-digit revenue growth to approx. 88 m Focused R&D investments for first-in-class innovation Accelerated operating profitability ) approx (e) < (e) Key trends for 2013 Sales Gross margin % R&D expense SG&A ratio Free cash flow CAPEX investments approx. 10m Top-class scientists ~ 10 m approx (e) Strong liquidity despite significant investments 1 Technology 4 India DeveloGen Kinaxo 12 Compound Focus 44 Acquisitions from >60 Cash status end ) Including impairment and restructuring expenses

29 The right team to deliver innovation, growth and industrialisation Management & shareholder structure TVM Capital Roland ~10.0% Oetker/ ROI ~15.0% Management ~1% Number of shares: m Listing: Frankfurt TecDAX, OTCBB 52 week high/low: 3.07 / 1.87 Management Board Werner Lanthaler (CEO) Long-time experience in biotech & Pharma growth organisations Mario Polywka (COO) 18 years Evotec experience Cord Dohrmann (CSO) Outstanding background in metabolics Colin Bond (CFO) Big industry multi-national background Key scientific Advisors Doug Melton Harvard University/HHMI William Jenkins Ex-Novartis Supervisory Board Flemming Ørnskov Shire Hubert Birner TVM Capital Mary Tanner Peter J. Solomon Walter Wenninger Ex-Bayer Roland Oetker ROI Andreas Pinkwart Dean of Leipzig Graduate School of Management 28

30 Strong news flow to come with Action Plan 2016 Outlook and next steps for 2013 ff Key milestones for EVT Execute Double-digit revenue growth Expansion success of existing alliances Significant long-term deals with Pharma, biotech and mid-sized Pharma 2 EVT Integrate At least 1 significant new integrated technology/disease alliance Accelerated pre-clinical/clinical milestones 3 EVT Innovate Strong progress in product development partnerships Expand network of academic alliances 29

31 Your contact: Dr Cord Dohrmann Chief Scientific Officer +49 (0)