Evotec, Sanofi Enter Talks for $300-Plus Million R&D Outsourcing Pact

Evotec AG, a drug-discovery company headquartered in Hamburg, Germany, has entered into exclusive negotiations with Sanofi for a strategic alliance focused on drug discovery and preclinical activities. The collaboration involves a minimum guaranteed commitment from Sanofi to Evotec of EUR 250 million ($310 million) over the next five years involving a co-development agreement with associated upfront, development, regulatory, and sales milestones as well as royalties and a plan for Evotec taking over a Sanofi research site in Toulouse, France. The deal is expected to be signed in the first half of 2015, subject to finalization of definitive agreements and completion of the appropriate social process.

Under the agreement, Evotec will expand its drug-discovery staff of approximately 650 scientists by integrating a scientific and technological facility with more than 200 scientists from the Sanofi research site in Toulouse, France. Evotec will integrate the Toulouse capacities, which is a small-molecule discovery site, into its global drug-discovery platform. The expanded capabilities will cover early-stage discovery and preclinical process from screening to medicinal chemistry. From this new facility, Evotec will perform collaborative research with its pharmaceutical, biotechnology, and academic partners as well as its own internal oncology research. Evotec will assume management of Sanofi’s global screening compound library as well as provide a broad range of drug-discovery services for Sanofi for the period of the contracts.

In addition, under the agreement, both partners will collaborate on selected preclinical development projects with a focus on oncology and potential Cure X/Target X initiatives. Under the agreement, Evotec will typically accelerate drug-discovery projects to the point of preclinical development candidates from which point Sanofi may take over the development and commercialization. Evotec will license from Sanofi a portfolio of projects, including five well-advanced preclinical projects in oncology that will be progressed jointly to the investigational new drug (IND) application stage by Sanofi and Evotec before potential partnering. In addition, Evotec will continue to expand its Cure X/Target X business model to include research support through French and European academia. Sanofi will fund this initiative through a commitment to Evotec’s scouting strategy over the period of the agreements. Sanofi could provide support to individual projects that will be progressed through this academic bridge program.

In addition, Sanofi and Evotec plan to combine their libraries to make them available for screening to Evotec’s partners. The Sanofi library, established on its Toulouse site with over 1 million compounds, will expand Evotec’s own corporate library of more than 400,000 compounds. Evotec will screen the libraries against collaborators’ and partners’ targets under pre-agreed terms from which Sanofi will receive a contribution if a product is developed from a library hit.

Source: Evotec

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