BioWorld International Correspondent
Evotec AG is selling to PerkinElmer Inc. the remaining elements of its tools and technologies business, Evotec Technologies GmbH, for €23 million (US$30.6 million).
In July, the Hamburg, Germany-based firm sold off part of this business - a single molecule detection business and associated intellectual property - to Tokyo-based Olympus Corp. for around €7.5 million.
Now Wellesley, Mass.-based PerkinElmer is obtaining Evotec's technologies for confocal imaging, cell handling and ultra-high-throughput screening, as well as image capture and cellular analysis software.
"That basically concludes the big steps in transforming the company. While quite a lot of things remain to be done in terms of building the pipeline, we think that we have found in PerkinElmer an excellent partner," Evotec president and CEO Joern Aldag told a conference call audience.
"They have a complete product offering, and they intend to build and forward expand the area of cell imaging and will create here in Hamburg the center of excellence for this part of their product offering." The company also has a global sales and distribution infrastructure, which Evotec Technologies lacked, he added.
Aldag said the cash injection will allow Evotec to expand its pipeline of drugs for central nervous system indications.
Evotec's remaining activities include its research services and its drug development businesses, which logged revenues of €47.7 million and €2.9 million, respectively, for the first three quarters of the year. The company posted an overall net loss for the period of €16.1 million, or €0.25 per share.
The tools and technologies business posted total sales of €17 million in 2005, and Evotec had guided sales of between €16 million and €18 million for 2006. Some analysts had forecast sales as high as €19 million, however, including Stefan Schr der, analyst at SES Research GmbH in Hamburg.
The purchase price, Schr der said, represents "an enterprise value to sales ratio of about 1.6, so this is rather at the lower end [of expectations], I would say, but is still acceptable. "It's more important to get cash in, in order to develop the whole drug pipeline."
Evotec's share price was unaffected by the news, reflecting, Schr der said, a neutral response by the market, which had been expecting Evotec to dispose of its tools and technologies business. Late last week and early this week, the shares were changing hands at around €3.05, a level that, he said, undervalues the stock.
Schr der has a price target of €4.20. He said he expects the company will be able to replicate in the clinical sphere the success it has achieved in preclinical discovery and development projects for large partners, such as Ingelheim, Germany-based Boehringer Ingelheim GmbH and Osaka, Japan-based Takeda Pharmaceutical Co. Ltd.
"I'm very optimistic, I must say," he said.
Evotec has two compounds in clinical trials at present. EVT.201 is undergoing a Phase II trial in insomnia. EVT.101 is undergoing a Phase I study and will be developed for Alzheimer's disease and neuropathic pain. The company plans to move a third compound, EVT.302, into a Phase I trial in Alzheimer's disease next year. The latter is a follow-up to EVT.301, development of which was halted earlier this year following apparent toxicity problems in a Phase I study.