Halozyme has withdrawn its offer to buy biopharmaceutical services firm Evotec for €2 billion, a move that comes after repeated requests to meet with the company to discuss a deal were all turned down.
Halozyme, a company with a platform technology for delivering biologic drugs, revealed its acquisition offer earlier in November. But the San Diego-based company said Friday that the months prior to publicly announcing a bid were spent conducting diligence on its proposal, including informal discussions with one member of Evotec’s supervisory board. That’s as far as any merger discussions went.
According to Halozyme, requests to meet with Iris Löw-Friedrich, chairwoman of Evotec’s supervisory board, were not accepted. That left a formal proposal to the company’s CEO as the only way to convey its interest. Still, Evotec, a Hamburg, Germany-based company whose offerings include drug discovery technologies and manufacturing capabilities, showed no interest.
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“We continue to believe that a combination of Halozyme and Evotec would create a leading, differentiated, global pharma services company, benefitting shareholders, patients and employees,” Halozyme President and CEO Helen Torley said in a prepared statement. “However, to date, Evotec has been unwilling to engage with us to explore a potential combination and a company spokesperson has publicly commented that its goal is to remain an independent company. As a result, we are withdrawing our proposal to acquire Evotec for €11.00 per share in cash.”
Halozyme does not make or sell any drugs. Its Enhanze technology enables subcutaneous injectable dosing of large molecule biologic drugs, which typically must be given as infusions. Revenue comes in the form of royalty payments from the companies that employ Enhanze in their products. Halozyme’s big pharmaceutical customers include Roche, Eli Lilly, and AbbVie. The company expects the total number of products employing Enhanze will reach 10 next year. Halozyme also forecasts its royalty revenue will reach $1 billion in 2027.
In an investor presentation posted last week, Halozyme said a business combination with Evotec would create a company with a more diversified range of service offerings with operations in both the U.S. and Europe. Halozyme also views its Enhanze drug delivery technology as complementary to Evotec’s biologics manufacturing platform.
While Evotec has a diversified business, it has also been trying to put that business in better order. The company has spent much of this year working through a corporate restructuring. Evotec made clear it intends to stay on that course — alone.
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“The Management Board and Supervisory Board continue to have strong conviction in the Company’s standalone strategy, which is expected to accelerate growth, strengthen the long-term profitability of the Company and deliver significant value to shareholders,” Evotec said in a brief statement released Friday.
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