CRO Evotec sees spin-out firm as strategic opportunity
In March, German contract research organisation (CRO) Evotec announced it was spinning-out a company – Topas Therapeutics – which will focus on nanoparticle-based autoimmune therapies following the neuro portfolio it acquired from Bionamics in March 2014.
The creation of this standalone drugmaker will present an opportunity for Evotec to build on its strategic partnership strategy, management said during a conference call discussing Q1 2016 results on Tuesday.
With Topas planning to commence its first clinical trial next year, Evotec CEO Werner Lanthaler said the CRO had a “very nice… strategic opportunity” built on a known management team and strategy within Topas.
“Evotec was pivotal to form that strategy and we will just optimise shareholder value in an optimum risk with whatever situation for Evotec shareholders comes out of Topas,” he told stakeholders.
He added there is unlikely to be an exit or pivotal point for Evotec related to the clinical start date, but a pivotal decision point into forming an ongoing partnership should come in 2018-2019, on the back of proof-of-concept data.
For the first quarter, group revenues grew 74% year-on-year to €37.5m ($43m), but the firm suffered an overall loss of €1.2m ($1.3m)
Like other CROs, Evotec has been shifting its business model to form strategic, long-term partnerships with its clients, and has inked such deals with pharma firms including Sanofi, Janssen, Bayer, and most recently UCB.
But the firm is also working with Padlock Therapeutics, developing inhibitors of protein-arginine deiminases (PADs) in a deal that extends to March next year.
However, in March, Bristol-Myers Squibb announced it was buying Padlock in a deal worth up to $600m.
When asked how this will impact Evotec’s business, Lanthaler said BMS’s decision to acquire the firm was due in part to Evotec’s two years of development work with Padlock on its portfolio.
“We're at a stage now where there is still a lot exchange of information between the scientific teams of Evotec, Padlock and BMS,” he said. “There are not at the moment discussions about whether work will move from Evotec elsewhere or slowdown.”
“Again, we would see this as an opportunity and this already happened in a number of meetings where we've been able to showcase what fantastic signs we've done at the Padlock with senior BMS scientists.”