Evotec Se · XETR:EVT
Evotec — 17th German Corporate Conference 2018
39 slides from Evotec's conference presentation, Jan 15, 2018
Slide 1: Evotec – Leading external innovation
Evotec – Leading external innovation Evotec AG, Company Presentation, 17th German Corporate Conference, Frankfurt am Main, 15 January 2018
Slide 2: Forward-looking statement
Forward-looking statement Information set forth in this presentation contains forward-looking statements, which involve a number of risks and uncertainties. The forward-looking statements contained herein represent the judgement of Evotec as of the date of this presentation. Such forward-looking sta
Slide 3: Agenda
Agenda Overview EVT Execute EVT Innovate Financials & Outlook PAGE 2
Slide 4: Leading external innovation to accelerate new drugs – Evotec at a glance
Leading external innovation to accelerate new drugs Evotec at a glance Evotec delivers a fast growing & profitable drug discovery and development business to Pharma, biotech and foundations Evotec and its partners are progressing a pipeline of > 80 co-owned first-in-class projects in major indic
Slide 5: The macro trend in R&D productivity is just starting
The macro trend in R&D productivity is just starting Market dynamics in external innovation Key growth drivers Macro trend in R&D outsourcing Market overview – Revenues, in € bn Capital efficiency 5–10% ~33 p.a. ~30 Switch from fixed costs to 28 variable business models 25 22 20 17 Capital elasticit
Slide 6: R&D holds great potential for further outsourcing
R&D holds great potential for further outsourcing R&D outsourcing market by stage in € bn ~30-36 ~85-90 ~10 ∑ ~ €130 bn 100% 90% 80% 5 Not 55 (~50%) outsourced 70% ~7 (~60%) 60% ~25 (~70%) 50% (~90%) 40% 30% 5 35 Outsourced 20% ~3 (~50%) (~40%) 10% (~30%) ~3 (10%) 0% 0% 10% 20% 30% 40% 50% 60% 70% 8
Slide 7: "One stop partner" for external innovation
“One stop partner” for external innovation Evotec’s integrated offering and core competences along the value chain Pre- Hit- Lead Target ID/ clinical identi- optimi- IND Phase I Phase II Phase III Approval Market validation Tox fication sation testing Evotec offers end-to-end platform solutions incl
Slide 8: Global presence in centres of excellence
Global presence in centres of excellence Evotec’s global footprint Hamburg (HQ), Abingdon/ Toulouse Verona (Italy), Princeton, Göttingen, Alderley Park (UK) (France) Basel (CH) Watertown, Munich (Germany) Branford (USA) ~500 employees ~600 employees ~350 employees ~600 employees ~90 employees Hit
Slide 9: Highly skilled and experienced workforce
Highly skilled and experienced workforce Human Resources >2,300 >2,000 865 1,000 606 2014 2015 2016 2017 2018(e) Highly skilled workforce > 2,100 employees in Europe & USA > 80% of employees have at least one academic qualification Approx. 2/3 Biologists; 1/3 Chemists 6.2 years of average ex
Slide 10: Leading external innovation – Long term strategy "Co-own to win for all"
Leading external innovation Long term strategy “Co-own to win for all” 2022 2018 2012 2009 Business segmentation Service & innovation partner in drug Investments and M&A to build discovery and development for large Restructuring highest quality service platform Pharma, biotech and foundation
Slide 11: ONE stop-shop for external innovation
ONE stop-shop for external innovation The Business model – EVT Execute & EVT Innovate PAGE 10
Slide 12: Agenda
Agenda Overview EVT Execute EVT Innovate Financials & Outlook PAGE 11
Slide 13: No 1 in quality and R&D efficiency – EVT Execute
No 1 in quality and R&D efficiency EVT Execute – Comprehensive integrated service offering PAGE 12
Slide 14: Integrated and systematic working on all modalities
Integrated and systematic working on all modalities M&A/Capabilities upgrade along the value chain since 2010 Biological validation Technological validation Disease relevance & production High-end Target ID/ Compound Assay Screening & Lead Pre-clinical CMC1) manu- validation management development P
Slide 15: Strong organic growth, supported by acquisitions
Strong organic growth, supported by acquisitions EVT Execute – Key performance indicators 9M 2017 Revenues1) Adjusted EBITDA2) Gross margin (in € m) (in € m) (in %) Intersegment revenues 165.1 +1% 32.9 41.3 41.7 +30% 27.4 29.0 126.6 24.8 23.4 23.9 93.4 19.5 61.5 137.7 16.1 13.2 102.7 9.9 73.9 48.3 9
Slide 16: Strong customer base, excellent customer reach
Strong customer base, excellent customer reach EVT Execute – Selected KPIs in % Very good customer mix – Revenues driven by USA & Europe – Revenues by customer segment ytd 20171), 2) Revenues by region ytd 20171), 2) 100% 2% 1% 1% 2% 100% Others (approx. 300) 12% 13% 12% ROW 26% 17% 16% USA 41% 46%
Slide 17: Clear targets, strong outlook for 2018
Clear targets, strong outlook for 2018 EVT Execute – Expected key milestones 2018 New long-term alliances integrating offering of Aptuit New performance-based integrated technology/disease alliances Expansion of foundations and biotech network in USA/Europe Milestones from existing alliances
Slide 18: Agenda
Agenda Overview EVT Execute EVT Innovate Financials & Outlook PAGE 17
Slide 19: Addressing major market needs – EVT Innovate
Addressing major market needs EVT Innovate – Fields of core expertise RESPIRATORY NEURONAL DIABETES & FIBROSIS DISEASES COMPLICATIONS Market potential Market potential Market potential Market potential > € 100 bn > € 500 bn > € 500 bn > € 100 bn ANTI- PAIN ONCOLOGY INFECTIVES Market potential Market
Slide 20: Building a co-owned pipeline
Building a co-owned pipeline EVT Innovate – Initiatives PAGE 19
Slide 21: Milestones are key growth driver
Milestones are key growth driver EVT Innovate – Key performance indicators 9M 2017 Revenues Adjusted EBITDA1) Gross margin (in € m) (in € m) (in %) 53.5 45.6 46.2 33.2 32.0 +84% 17.9 10.6 4.3 9M 2014 9M 2015 9M 2016 9M 2017 (2.4) 9M 2014 9M 2015 9M 2016 9M 2017 (9.5) (10.7) (12.7) 9M 2014 9M 2015 9M
Slide 22: >80 co-owned projects across broad range of therapeutic areas
>80 co-owned projects across broad range of therapeutic areas Co-owned portfolio Co-owned Co-owned Co-owned Value chain Discovery Pre-clinical Clinical > 50 projects > 25 projects > 10 projects Ø € 1-10 m upfront Ø € 150 m mile- Ø Commercials and substantial Ø 8% royalties stones per project r
Slide 23: Fully invested co-owned pipeline
Fully invested co-owned pipeline Partnership portfolio Molecule Therapeutic Area/Indication Partner Discovery Pre-clinical Phase I Phase II EVT201 CNS – Insomnia EVT401 Immunology & Inflammation ND1) Oncology Clinical ND1) Oncology Various Women’s health – Endometriosis Various Women’s health – Endo
Slide 24: First-in-class alliances with significant upside
First-in-class alliances with significant upside Examples First milestone achieved Chronic kidney disease (“CKD”) Immuno-oncology Highly innovative therapeutics in diabetic Small molecule-based cancer complications (e.g. CKD) immunotherapies to complement checkpoint inhibitors (together with APEIRON
Slide 25: iPSC-based patient-focused discovery
iPSC-based patient-focused discovery Strong focus on iPSC1) platform “IPS cells can become a powerful tool to develop new drugs to cure intractable diseases because they can be made from patients’ somatic cells.” Shinya Yamanaka Disease-specific drugs Screening Patient Disease Patient- in a dish spe
Slide 26: Paradigm shifts in neurodegeneration and diabetes
Paradigm shifts in neurodegeneration and diabetes iPSC – Alliances iPSC alliance in neurodegeneration iPSC alliance in diabetes Development of novel therapies for a broad range Development of beta cell replacement therapy and of neurodegenerative diseases drug discovery based on functional human bet
Slide 27: Continued expansion of iPSC projects
Continued expansion of iPSC projects Next opportunities in iPSC drug discovery Myopathies Duchenne’s muscular dystrophy (DMD) Retinal diseases Age-related macular dystrophy Lysosomal storage diseases Pompe, Krabbe, NPC, Batten, … NPC, Batten, … Neurodevelopmental diseases Autism, Fragile X
Slide 28: Patient-focused platforms for nephrology & fibrosis
Patient-focused platforms for nephrology & fibrosis NURTuRE & NEPLEX Systematic access to unique Identification of disease causing patient sample collection mechanisms Better patient stratification Better drug discovery starting points in kidney diseases and fibrosis “Nephron-on-a-chip” – A fu
Slide 29: AI in drug discovery to improve productivity
AI in drug discovery to improve productivity Exscientia & Evotec: Pioneers in Artificial Intelligence (“AI”) Human & Optimal Algorithms to AI systems speed up drug for superior discovery performance Cutting R&D costs, Chemist 2 = 911 AI Design = 878 reducing failure Chemist 8 = 843 Chemist 9 = 8
Slide 30: BRIDGEs over the "Valley of death"
BRIDGEs over the “Valley of death“ The funding gap Basic Applied Technology Development Product Commercialisation Market Entry & Research Research and Demonstration and Market Development Market Volume Public Market Funding Level Pension Plan Project Finance Governments Funding Gap Banks/Credit Line
Slide 31: Upside participation in first-in-class innovation
Upside participation in first-in-class innovation Innovative building & investing Spin-offs outside of Evotec’s main areas of interest for potential broader/later Panion Ltd/ stage applications Fibrocor Tx Participation in financing rounds, built on Evotec’s platforms, via strategic investments
Slide 32: Even more innovation in 2018
Even more innovation in 2018 EVT Innovate – Expected key milestones 2018 New clinical initiations and good progress of clinical pipeline within existing partnerships Expansion of academic BRIDGE network Strong R&D progress within Cure X/Target X platforms Strong expansion of iPSC (induced pl
Slide 33: Agenda
Agenda Overview EVT Execute EVT Innovate Financials & Outlook PAGE 32
Slide 34: Continued strong financial performance expected
Continued strong financial performance expected Financial history 2014-2018 (e) – Selected performance indicators Total Group revenues (in € m) R&D expenses (in € m) 18.3 18.1 164.5 12.7 127.7 89.5 2014 2015 2016 2017(e) 2018(e) 2014 2015 2016 2017(e) 2018(e) Adjusted Group EBITDA (in € m) Gross mar
Slide 35: Financial performance reflects strong business
Financial performance reflects strong business Condensed income statement 9M 2017 – Evotec Group, including Aptuit in € m1) YTD 2017 YTD 2016 % vs. 2016 Revenue increase due Revenues 170.9 120.6 +42% to strong performance in base business, Gross margin 35.1% 38.5% – contributions from acquired bus
Slide 36: Strong positive momentum across both segments
Strong positive momentum across both segments Segment information 9M 2017 – Evotec Group, including Aptuit in € m1) Inter- EVT EVT segment Evotec Revenue growth in EVT Execute Innovate elimination Group Execute due to strong base business and Revenues 165.1 33.2 (27.4) 170.9 contributions from Cyp
Slide 37: Strong team and shareholders for innovation
Strong team and shareholders for innovation Management & shareholder structure ̴ 9% Roland ̴ 5% AGI2) ̴ 5% Goldman Management Board Supervisory Board Oetker/ROI Sachs Werner Lanthaler (CEO) Wolfgang Plischke Long-time experience in Ex-Bayer ̴ 3% DAMI3) pharma & biotech Bernd Hirsch Enno Spil
Slide 38: New guidance in March 2018, strong growth and profitability expected
New guidance in March 2018, Strong growth and profitability expected Guidance 20171) Double- 1 digit top- More than 40% (previously: 15%) Group revenue growth2) line growth Profitable Adjusted Group EBITDA3) expected to improve by more 2 and growing than 50% (previously: significantly) compared
Slide 39: Your contact: Dr Werner Lanthaler
Your contact: Dr Werner Lanthaler Chief Executive Officer +49.(0).40.560 81-242 +49.(0).40.560 81-333 Fax werner.lanthaler@evotec.com