- Evotec SE and Sandoz AG signed a non-binding term sheet on a planned sale of Just – Evotec Biologics EU in Toulouse to Sandoz
- Under the proposed deal Evotec would transfer biosimilar manufacturing capabilities to enable Sandoz to produce biosimilar medicines using Just – Evotec Biologics’ advanced continuous manufacturing technology
- The deal terms include the purchase price of the site for around US$ 300 m in cash, and in addition will include further technology related consideration, future development revenues, milestones and product royalties
- Planned transaction marks major milestone in Evotec’s strategy to create asset-lighter business model leveraging high-margin offerings, with Just – Evotec Biologics remaining core business for Evotec
- Transaction is expected to immediately improve Evotec’s short-, mid-, and long-term revenue mix, profit margins, and capital efficiency
Evotec SE (Frankfurt Stock Exchange: EVT, MDAX/TecDAX, Prime Standard, ISIN: DE0005664809, WKN 566480; NASDAQ: EVO) today announced the signing of a non-binding agreement with Sandoz AG (SIX: SDZ / OTCQX: SDZNY) regarding the potential sale of Just – Evotec Biologics EU, which owns the J.POD biologics manufacturing facility in Toulouse, France, and to grant access to its proprietary platform for integrated development and advanced continuous manufacturing of biologics via a technology license. The site has been customised and dedicated entirely to Sandoz since July 2024, and the transaction is a natural progression in an already successful partnership. Closing of the planned transaction remains subject to completion of the relevant information and consultation processes with employees and their representatives, final contractual agreements and to meeting regulatory requirements, expected in the fourth quarter. Further deal terms will be disclosed after successful signing of the contracts.
Execution on strategy to create an asset-lighter business model for Just – Evotec Biologics
The agreement marks a milestone in Evotec’s new strategy to drive sustainable and profitable growth. A key pillar of this strategy is the transition to an asset-lighter and capital-efficient model that can better leverage its technology & IP and scale its service offerings.
Under the proposed terms of the transaction, Sandoz would assume full ownership of the Just – Evotec Biologics Toulouse site, while Evotec would retain short-, mid-, and long-term economic upside through revenue, milestones and royalty optionality. The planned deal terms include the purchase price of the site for around US$ 300 m in cash, and in addition would include further technology related consideration, future development revenues, milestones and product royalties.
The planned deal would immediately improve Evotec’s revenue mix, profit margins, and capital efficiency. Additionally, the agreement is testament for Evotec’s ability to leverage its technology advantage to shape a new segment in a fast-growing market.
Continuation of strategic collaboration
The planned transfer of Just – Evotec Biologics’ biosimilars manufacturing facility, a dedicated single-customer site, including proprietary platform for integrated development and advanced continuous manufacturing, is the natural next step in the multi-year strategic partnership between Evotec and Sandoz. It follows the agreement in July 2024 to grant Sandoz long-term commercial supply access to the facility.
Dr Christian Wojczewski, Chief Executive Officer of Evotec, said:
“We are excited about the evolution of our strategic partnership. Today’s agreement marks a significant milestone in Evotec’s new strategy to refocus on its core strengths and deliver sustainable profitable growth. By leveraging Just – Evotec Biologics’ capabilities as a scalable technology provider while moving to a more capital efficient model, we are well positioned to shape a new segment in the biologics manufacturing market and expand the scope of our partner base.”
Dr Linda Zuckerman, EVP and Global Head of Just – Evotec Biologics, said:
“We are thrilled to see our technology and vision further validated through this transaction. Just – Evotec Biologics and Sandoz are united in our missions to broaden global access to life-changing biotherapeutics. Our perfusion-based continuous manufacturing platform plays a pivotal role in achieving this mission, unlocking greater efficiency, scalability, and agility.”