Joseph Hedden

Joseph Hedden from Rx Securities inquired about metrics for the kidney disease franchise within the DP&D segment and asked for details on the types of new customers being added to the Just Evotec Biologics business.

Answer

Chief Scientific Officer Cord Dohrmann highlighted the strategic value of the kidney disease platform in securing top-tier pharma partnerships, noting the most advanced program is in Phase 1, but did not provide specific revenue metrics. CEO Christian Wojczewski described the new Just customers as ranging from small to large companies, with a significant portion of H1 growth coming from three large pharma companies for earlier-stage work.

Joseph Hedden from Rx Securities asked for the basis of management's confidence in a second-half recovery for the Shared R&D segment, inquiring about underlying metrics and the dependency on BMS work packages versus a broader market rebound. He also requested details on the phasing of ramp-up costs for the Just-Evotec facility in Toulouse.

Answer

CEO Christian Wojczewski reiterated that the market remains soft and a potential H2 recovery is at the top end of expectations, noting that new business is arriving in smaller, more conservative chunks. He explained that the BMS collaboration's revenue profile naturally fluctuates with scientific progress but is expected to grow mid-term. Executive Paul Hitchin added that the Toulouse ramp-up costs, which began in Q4 2024, will continue through 2025 as planned, and the strong Q1 for Just-Evotec was partly due to the phasing of work packages.

Joseph Hedden questioned the basis for confidence in a second-half recovery for Shared R&D and the role of BMS work packages in that outlook. He also asked about the cost phasing for the Just-Evotec Biologics' Toulouse facility ramp-up for the remainder of the year.

Answer

CEO Christian Wojczewski reiterated that the market outlook hasn't changed since April, with business coming in smaller increments. He explained that the BMS collaboration's revenue profile varies quarterly based on scientific progress but is expected to grow long-term. CFO Paul Hitchin added that while Just-Evotec's Q1 was strong due to timing, ramp-up costs for Toulouse will continue through 2025 as planned.

Asked for the basis of confidence in a second-half recovery for Shared R&D and the role of BMS work packages in that outlook. Also inquired about the phasing of ramp-up costs for the Just-Evotec facility in Toulouse.

Answer

The company's outlook for a potential H2 recovery remains unchanged, noting the market is soft but stable, with business coming in smaller pieces. The BMS collaboration profile varies but is expected to grow long-term. For Just-Evotec, Q1 was strong due to work package phasing, and ramp-up costs for the new facility will continue through the year as planned.

Joseph Hedden asked for more detail on the Just - Evotec Biologics quarter, specifically the contribution from Sandoz. He also inquired about the status of the former Bayer alliances in endometriosis and PQS, and the reasoning for exiting the gene therapy business.

Answer

CBO Matthias Evers described Q1 for Just as exceptionally strong and confirmed Sandoz is a significant partner but did not provide a breakdown. CSO Cord Dohrmann stated that the Bayer Women's Health collaborations were discontinued, while partnerships in kidney disease and a new one in cardiology are ongoing. COO Craig Johnstone explained the gene therapy exit was due to the high R&D investment required to remain competitive and operational complexity.

Asked if Q2 was an exceptional quarter for Just-Evotec Biologics due to the Sandoz deal, what to expect for the rest of the year, and how revenues from major collaborations like BMS are accounted for.

Answer

Q2 was an exceptional quarter due to the Sandoz upfront payment and should not be seen as a recurring event. The focus is now on operational delivery, with significant revenue growth from Just-Evotec expected once J.PODs are fully operational. Revenues from major collaborations like BMS are indeed recognized within the Innovate segment.