EVOequity

BRIDGEs & Operational venturing – use ventures as an acceleration vehicle

BRIDGEs re-define the paradigm of academic acceleration – Opportunity to invest

An increasing number of academic institutions are filling the translational gap between what typical academic projects produce and what companies or VC firms want to see in order to commercialise a drug discovery project. The pace of biomedical innovation in academia is accelerating. Academia is a major source of drug approvals, for example, 15 to 20% of approved drugs originate from academia and every year around 30 to 40% of the drugs approved by the FDA were actually discovered in European academic labs.

We have positioned ourselves as the leading company for the accelerated translation of these academic assets by generating Biomedical Research, Innovation & Development Generation Efficiency, in short BRIDGE, a funding mechanism that brings in external funds for the validation of academic assets on our leading multimodality drug discovery platform. BRIDGEs also aim to further develop these assets towards value inflection points, which enable formation of academic spin-off companies or partnering with pharmaceutical companies. To date, Evotec has created five BRIDGEs and a first spin-off from the University of Oxford named Dark Blue Therapeutics evolved out of this initiative.

EVOequity – Source for co-owned pipeline

With the creation of Evotec’s first spin-off ‘Topas Therapeutics’ in 2016, the foundation was laid for the EVOequity strategy. Since then, the portfolio of equity holdings grew steadily, with five new additions in 2020 alone. With twenty equity investments today and ample opportunities for further investments over the years to come, EVOequity has the potential to become an important pillar of Evotec’s value proposition and the third business segment alongside EVT Execute and EVT Innovate. To date, Evotec has invested more than € 70 m into its EVOequity strategy and this is expected to accelerate in the upcoming years.

A growing portfolio of co-owned opportunities with operational synergies

Although the external valuation of Evotec’s equity holdings today is marginal, there is significant upside potential, particularly once a successful exit from one of the portfolio companies is realised which is expected over the next couple of years. Likewise partnering events, clinical successes and positive commercial developments will drive the valuation of individual portfolio companies.

Hence, the vision of EVOequity is to contribute as a ‘true operational VC’ to Evotec’s long-term value generation