Evotec ups 2015 forecast for second time in two months citing Big Pharma deals

Evotec AG has raised its revenue expectations twice in as many months, predicting that contracts with Big Pharma customers will drive growth.

The German contractor revised its forecast last night, predicting that revenue for 2015 would be up 45% on the €73.4m ($83m) it generated last year.

Evotec said the revision reflected “strong business performance” in its EVT execute alliances business – which handles its deals with Sanofi, Bayer, Roche and Novartis – and accelerated growth its drug discovery-focused innovate division.

Company spokeswoman Gabriele Hansen told us the "EVT Execute segment continued its strong performance in 2015" but added that new alliances with companies such as Spero, Padlock and C4X Discovery also played a part in the revised guidance.

She also said that: "The screening pipeline grew substantially with screens initiated and established collaborations with Active Biotech or CHDI were extended."

The revised forecast comes a week after Evotec announced it had been selected by US drugmaker Pfizer to help it discover and develop treatments for fibrosis, which is a hard to treat conditions characterised by the inappropriate build-up of connective tissue.

The Pfizer deal – which is being run by Evotec’s innovate division – will generate an upfront as well as development milestones and royalties on any treatments that are developed and sold as a result of the partnership.

Hansen said the agreement with Pfizer had been factored into the revision, but that it would not have a significant impact.

She added that Evotec would not be making any specific investments to service the Pfizer agreement but added that "we regard this deal as a return on our future investment into fibrosis."

Pharma driver

The revised forecast is the second Evotec has issued in as many months.

In August the firm predicted that revenues would be 35% higher than the 2014 total, citing its deal with French drugmaker Sanofi as a likely driver.

In yesterday’s revision, Evotec also reiterated that it expects its R&D costs to increase more than 30% this year.

The firm said it “will continue to invest in its technology platforms and capacities in order to drive its long-term growth strategy” adding that it will spend up to €10 to increase capacity and upgrade its technological capabilities.