Evotec AG (Frankfurt Stock Exchange: EVT; NASDAQ: EVTC) and Roche (SWX: RO, ROG; OTCQX: RHHBY) announced today that they have entered into an agreement for Phase II clinical development of EVT 101 in patients with treatment-resistant depression. The potential value of this transaction exceeds US$300 million.
Evotec will be responsible for conducting Phase II studies for EVT 101, a compound originally discovered by Roche and developed from discovery stages through clinical studies by Evotec.
Eugene Tierney, Head of CNS at Roche, said: “Our aim is to alleviate the suffering of the many patients with treatment-resistant depression. As many as one in three depressed patients are not adequately treated by currently available medicines. We believe that EVT 101 has the potential to become an effective new therapy for the high unmet need of these patients.”
Evotec will also conduct Phase I safety and tolerability studies for EVT 103, a next generation compound to EVT 101. Roche will fully fund these development programs. In addition, for the option to buy back rights to the entire EVT 100 family of compounds, Roche has agreed to pay Evotec an upfront fee of US$10million.
Dr Klaus Maleck, Chief Financial Officer of Evotec, said: “This product development agreement with Roche is clear evidence of the value Evotec has created with the EVT 100 compound family over the past few years, benefiting patients and, ultimately, shareholders. We are delighted to enter into this partnership with Roche, providing obvious benefits to both parties.”
Terms of the Agreement
This agreement covers possible development of the entire EVT 100 family of compounds, with a total potential deal value exceeding US$300million.
Roche has committed to fund clinical development of EVT 101, as well as EVT 103, the follow-on compound to EVT 101.
If Roche exercises its buy-back option after the completion of the Phase II study, Evotec will receive a US$65million lump-sum payment from Roche in exchange for returning the asset, as well as the entire EVT 100 family to Roche. Evotec would be eligible for further development, sales performance, and scalable double-digit commercial payments.
In the event that Roche decides not to exercise its buy-back option, Evotec will be granted exclusive worldwide rights to the entire EVT 100 family of compounds. Evotec will then get rights to all indications under revised terms from the original contract signed between Evotec and Roche at the end of 2003.