- German drug discovery company Evotec announced Wednesday that it agreed to acquire contract research organization Cyprotex for €62 million ($67.7 million).
- The deal is the latest in a string of recent acquisitions for Evotec. The company bought another CRO, Euprotec Ltd., in May 2014 for $2.3 million upfront. Two months earlier, it snagged Bionamics GmbH, an asset management business focused on pre-clinical innovations, for an undisclosed sum. It also inked a strategic partnership with Sanofi valued at $273 million last year.
- The transaction will transfer ownership of Cyprotex's 26.1 million shares to Evotec and wipeout the target's debts. As of June 30, Evotec had $63 million in cash and cash equivalents, according to its 2016 half-year financial report.
Evotec continued a recent trend of gobbling up CRO peers with its latest deal. While the company did not explain how the acquisition would affect drug discovery operations, it did say the deal falls in a "sweet spot," with regard to producing pre-clinical development candidates, in an October 26 investor presentation.
Based in the U.K., Cyprotex researches how drugs operate once inside an organism. The company specializes in ADME-tox analysis, meaning it investigates the absorption, distribution, metabolizing, excretion and toxicity of treatments in the body.
Evotec's growth strategy through 2020 includes "company formations to accelerate drug discovery and product development." Cyprotex helps that strategy, adding leadership in a niche field, technology platform advances and a strengthened client base, the company reported in the presentation.
"This perfectly augments Evotec's drive for innovation efficiency in drug discovery by enabling its partners to make early informed decisions on a molecule's suitability for further development," the company said in an October 26 statement.
"The proven technology platform of Cyprotex and its expert and dedicated employees will be a strong addition to our best-in-class drug discovery platform and resources," Evotec's Chief Operating Officer Mario Polywka said in the statement. "We also expect that both organisations will leverage their extensive partner networks to identify further commercial synergies."
Cyprotex has 136 employees and four locations throughout the U.K. and U.S. It brought in around $10.6 million in revenue, according to Evotec's October 26 presentation.
Evotec stock is traded on the Frankfurt Stock Exchange. Shares were up 2.35% to $5.62 in Thursday morning trading. The company has a current market cap of about $743 million.