Evotec AG and Sanofi have entered negotiations for a five-year strategic alliance comprised of three major initiatives focused on improving innovation effectiveness in drug discovery and preclinical development. Sanofi will commit €250 million under the alliance, including an upfront cash payment, and a co-development agreement includes regulatory and sales milestones, as well as royalties. The transaction is expected to be finalized in 1H15.
 
A pipeline-building collaboration will initially focus on oncology, where Evotec will accelerate drug discovery projects to the point of preclinical development candidates, at which point Sanofi may take over development. Evotec will license a portfolio of projects from Sanofi, including five well-advanced preclinical projects in oncology that will jointly be progressed to IND.
 
Also, under a French academic bridge program, Evotec will continue to expand its Cure X/Target X business model to leverage scientific expertise and a portfolio of drug development services to capitalize on the most promising science. Sanofi will fund this initiative and may support individual projects through this program.
 
Furthermore, an outsourcing alliance will include the acquisition of Sanofi’s drug discovery operations in Toulouse to build a European center of excellence for compound management and drug discovery services. To meet capacity needs, Evotec will expand its capabilities by integrating a scientific and technological facility with more than 200 experienced scientists from Sanofi’s Toulouse research site, which is a small molecule discovery site, into its global drug discovery platform that would cover early-stage discovery and preclinical process from screening to medicinal chemistry.
 
Evotec will manage Sanofi’s global screening compound library as well as provide a range of drug discovery services for Sanofi for the period of the contracts.
 
Lastly, an open innovation initiative will offer combined libraries, which will be made available for screening to Evotec’s partners. The Sanofi library, with more than 1,000,000 compounds, will expand Evotec’s library of more than 400,000 compounds, creating a large drug discovery source. Evotec will screen the libraries against collaborators’ targets under pre-agreed terms from which Sanofi will receive a contribution if a product is developed from a library hit.
 
Dr. Werner Lanthaler, chief executive officer of Evotec, said, “We are very proud that Sanofi has chosen Evotec for this significant alliance. This collaboration is a major milestone in the drug discovery space and accelerates Evotec’s strategy to become the leading drug discovery partner to the Pharma and biotech industry as well as academia. We will warmly welcome the Sanofi employees to the Evotec Group and look forward to working with them.”
 
“Open innovation is a key driver of Sanofi’s strategy. We believe Evotec will be an ideal partner, a company that fits our quality expectations and our strategic vision. Our collaboration will secure the future for our employees in Toulouse and importantly accelerate our pipeline productivity,” said Dr. Elias Zerhouni, president Global R&D for Sanofi.