Co-own & Share products
Video: A short introduction to EVOroyalty
Co-owned pipeline – Evolution from discovery into clinical-stage projects
Through co-owned partnerships, risk, cost and IP are shared within strategic R&D alliances with pharma and biotech as well as academic drug discovery centres. The aim of these partnerships is to develop R&D projects faster and more efficiently based on knowledge sharing. This ensures a quicker ROI and access to a far larger and more comprehensive knowledge base than has ever been possible before.
Since the inception of Action Plan 2012, Evotec has followed the principle of sharing risk and co-owning. Moving forward, Evotec will continue this model with its partners within Action Plan 2025 and stick to its long-term strategy of co-owning assets, but typically will not sponsor clinical trials.
Over the last decade, Evotec’s co-owned pipeline rose from approx. 10 to 150+, which is a result of the Company’s unique business strategy. Building a co-owned pipeline takes time, and the last few years can be almost seen as a seeding phase for the first wave of clinical candidates for the portfolio. The next 12–24 months are likely to show an increased number of clinical projects for multiple, key therapeutic areas.
Logic for co-ownership model
- Flow of milestones and royalties-based revenues to secure and accelerate profitability
- Development attrition will typically be handed over /shared with partner – protects Evotec’s P&L, in case a project needs to be stopped
- Evotec builds its own, unique space: performing high-quality research activities to build an early-staged pipeline while at the same time fuelling a clinical pipeline through partnerships
In recent years, Evotec has laid a strong foundation for a continued and strong growth of its co-owned pipeline. Early-stage programmes will continuously flow into the pipeline through own R&D, partnerships, EVOequity and BRIDGEs, but it is Evotec’s clear vision and goal to significantly broaden the clinical pipeline and have the first approved drugs in its portfolio.
Different sources for co-ownership that CONTINUOUSLY FILL THE PIPELINE
Three entry doors open the paths to the largest co-owned pipeline that has ever been built in this industry.
- Platforms (EVT Innovate & EVT Execute)
e.g. High-value integrated drug discovery & development; Data-driven precision medicine
- Indication-driven target pipelines
e.g. P2X3, B1, A2a, …
- BRIDGEs, operational ventures Equity/ royalty ownership in companies via operational VC investment
e.g. LAB282, Exscientia, Topas, Breakpoint, …
With very focused R&D investments we have generated a meaningful revenue line for EVT Innovate. These R&D payments and milestones have resulted in an EBITDA line fluctuating around the zero line – this does not take into account future products on the market delivering royalty-based income. At the same time, the number of potential co-owned product opportunities is increasing substantially and continues to grow.
The pipeline of more than 150 co-owned assets already holds the potential of a massive pool of milestones today and a clear EBITDA hockey stick effect will follow with the first royalties and larger later stage milestones coming in.
Increase visibility of the co-owned pipeline (EVT Innovate, EVT Execute, BRIDGEs, equity)
- Become perceived as “The innovation hub for pipeline development within the healthcare R&D industry”
- High quality development leads to lower attrition rates compared to industry (to be proven)
Strategy & Funding
- Build ONE strategy to ensure seamless integration of Innovate, BRIDGEs and Equity
- Provide appropriate funding levels to enable additional growth beyond current “growth as normal”