Evotec SE — Investor Presentation 2015

Nov 18, 2015

Leading Innovation Efficiency – Evotec Company Overview

Evotec AG, Company presentation, Jefferies 2015 Global Healthcare Conference, 18 November 2015, London

Forward-looking statements

Information set forth in this presentation contains forward-looking statements, which involve a number of risks and uncertainties. The forward-looking statements contained herein represent the judgement of Evotec as of the date of this presentation. Such forward-looking statements are neither promises nor guarantees, but are subject to a variety of risks and uncertainties, many of which are beyond our control, and which could cause actual results to differ materially from those contemplated in these forward-looking statements. We expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any such statements to reflect any change in our expectations or any change in events, conditions or circumstances on which any such statement is based.

Agenda

Evotec at a glance

EVT Execute

EVT Innovate

Financials & Outlook

Leadership in drug discovery

Our mission

Based on the highest quality drug discovery science, and through innovative collaborations, we are building a partnered product pipeline.

Leading the macro trend of R&D productivity

Market dynamics in drug discovery

Our "Sweet spot"

Pre-clinical development candidate "PDC"

Business model meets partners' needs

EVT Execute & EVT Innovate

Our offering close to Pharma, biotech and academia

Evotec's global footprint – Approx. 1,000 employees

Agenda

Evotec at a glance

EVT Execute

EVT Innovate

Financials & Outlook

Broad stand-alone innovation services

EVT Execute – Comprehensive drug discovery platforms

• No. 1 in drug discovery
• High-quality service business
• The strategic outsourcing partner of choice

Very well balanced portfolio

EVT Execute – Selected customer and revenue metrics

Strong partner base accessing integrated drug discovery value chain

EVT Execute – Representative partners

Agenda

Evotec at a glance

EVT Execute

EVT Innovate

Financials & Outlook

Five fields of core expertise

Overview

Despite several set-backs, fast growing portfolio of > 70 product opportunities

Partnership portfolio

	Molecule	Therapuetic Area/Indication	Partner	Discovery	Pre-clinical	Phase I	Phase II	Phase III
Clinical	EVT3021)	CNS - Alzheimer's disease
	EVT201	CNS - Insomnia
	Somatoprim	Acromegaly
	EVT100	CNS - Depression
	EVT401	Immunology & Inflammation
	ND2)	Oncology
	ND2)	Oncology
	ND2)	CNS - Pain
	ND2)	Oncology
	Various	Women's health - Endometriosis
	EVT770	Metabolic - Diabetes (type 2/1)
Pre-clinical	ND2)	CNS - Pain
	ND2)	Immunology & Inflammation
	Various	Oncology
	Various	Immunology & Inflammation
	Various	Metabolic - Diabetes (type 2/1)
	Various	Metabolic - Diabetes (type 2/1)
	Various	Nephrology
	Various	Metabolic - Diabetes
	Various	CNS - Alzheimer's
Discovery	Various	Oncology - Immunotherapy
	Various	Immunology & Inflammation - Tissue fibrosis
	Various	CNS – Multiple Sclerosis	NEU2
	Various	Metabolic - Diabetes	>5 further programmes
	Various	CNS	>5 further programmes
	Various	Oncology	>10 further programmes
	Various	CNS - Pain & Inflammation	>5 further programmes

Restoring beta cell function

Sanofi & Evotec in Diabetes – Since 2015

Mission

Development of beta cell replacement therapy and drug discovery based on functional human beta cells derived from stem cells

Background

• Fast growing insulin market already exceeds >\$ 22 bn in 2014
• Diabetes is driven by loss in beta cell function
• Human beta cells offer only disease-modifying product opportunity

Agreement with Sanofi

• Upfront fee of € 3 m
• Potential pre-clinical, clinical, regulatory and commercial milestones exceeding € 300 m
• Significant royalties upon commercialisation
• Integrated collaboration, resources involving more than 15 scientists at Evotec and Sanofi

World-leading effort in Endometriosis

Bayer & Evotec in Endometriosis – Since 2012

Mission

• Goal of developing three clinical candidates for the treatment of endometriosis within five years
• Both parties contribute innovative drug targets and high quality technology infrastructures

Background

• Endometriosis affects approx. 200 million women worldwide, 10% of women of reproductive age
• There is no known cure for endometriosis

Agreement with Bayer

• € 12 m upfront payment
• Up to € 580 m in potential milestone payments based on the achievement of pre-clinical, clinical and sales milestones, up to double-digit royalties
• Integrated collaboration involving more than 30 scientists at Evotec
• Strategic five-year multi-target collaboration

Identify and develop novel therapies in AD

J&J Innovation & Evotec in Alzheimer's disease (AD) – Since 2013

Mission

Explore genes dysregulated in Alzheimer's disease patients to identify new targets for drug discovery and development

Background

• Approximately 7.7 million new cases of dementia are diagnosed each year. \$ 612 bn were spent on the treatment of dementia in 2014
• AD costs equal about 1% of the world's GDP

Agreement with J&J Innovation

• \$ 10 m in FTE-based research costs
• Pre-clinical, clinical, regulatory and commercial payments up to approximately \$ 125 m to \$ 145 m per programme
• Significant royalties on future sales of any products that may result from the alliance
• Integrated three-year collaboration, resources involving more than 20 scientists at Evotec and J&J Innovation

Novel mechanisms in tissue fibrosis

Evotec & Pfizer in Fibrosis – Since 2015

Mission

Evotec and Pfizer develop novel mechanisms as targeted anti-fibrotics in multi-organ fibrosis

Background

• Tissue fibrosis is a huge unmet medical need Total market value up to \$ 100 bn
• Four major indications: liver, kidney, cardiac, lung fibrosis

Agreement with Pfizer

• Undisclosed upfront payment
• Potential milestone payments based on the achievement of specific development and sales milestones (undisclosed)
• Integrated collaboration involving more than 10 scientists between Evotec
• Strategic four-year collaboration

Small molecule-based cancer immunotherapies

Sanofi & Evotec in Immuno-oncology – Since 2015

Mission

Development of small molecule-based cancer immunotherapies for next-generation immunooncological therapies to complement current offerings of checkpoint inhibitors

Background

• Based on partnership between Apeiron and Evotec initiated in 2012/13
• Immuno-oncology will become a new pillar of cancer therapy – Market potential estimated to be \$ 35 bn in 2023

Agreement with Sanofi

• Significant pre-clinical, clinical and regulatory milestones exceeding € 200 m
• Significant royalties upon commercialisation
• Integrated collaboration involving more than 20 scientists between Evotec, Sanofi and Apeiron
• Multi-year research payments for Evotec and Apeiron

Translating first-in-class science to Pharma

EVT Innovate

• Carefully selected discovery stage projects in indications of high unmet medical need
• Advancing and partnering projects at tangible value inflection points
• Fuelling Evotec's pre-clinical and clinical opportunities

More than 10 unpartnered EVT Innovate projects

Cure X/Target X projects "The Bridge"

2011	2012	2013	2014	2015
CureBeta (Harvard Stem Cell Institute)	CureNephron (Harvard, BWH, USC, AstraZeneca) TargetASIC (BMBF/undisclosed Pharma partner) Somatoprim (Cortendo) TargetPicV (Haplogen) TargetFibrosis (Pfizer)	TargetImmuniT (Apeiron/Sanofi) TargetDBR (Yale) TargetMB (Second Genome) TargetPGB (Harvard) TargetKDM (Dana-Farber, Belfer) TargetIDX (Debiopharm) CureMN (Harvard) TargetEEM (Harvard) TargetAD (NBB/J&J)	TargetBCD (Sanofi) TargetDR (Internal) TargetATD (Internal) TargetFX (Internal) TargetKX (undisclosed) TargetCytokine (DRFZ/BMBF) Fraunhofer Initiative	TargetASN (Internal) TargetFRX (Internal) TargetNTR (Internal) ….

Agenda

Evotec at a glance

EVT Execute

EVT Innovate

Financials & Outlook

Sharp revenue and profitability increase in EVT Execute

Condensed income statement on segments for the first nine months 2015

in € m			Inter
	EVT Execute	EVT Innovate	segment elimination	Not allocated	Evotec Group
Revenues	93.4	14.3	(19.5)	–	88.2
Gross margin	23.4%	53.5%	16.9%	–	29.7%
 R&D expenses	(0.2)	(16.6)	3.3	–	(13.5)
 SG&A expenses	(14.3)	(4.7)	–	–	(19.0)
 Amortisation of intangible assets	(1.9)	(0.3)	–	–	(2.2)
 Impairment of intangible assets	–	(0.1)	–	–	(0.1)
 Income from bargain purchase	–	–	–	18.5	18.5
 Other op. income (expenses), net	1.8	0.6	–	–	2.4
Operating income (loss)	7.2	(13.4)	–	18.5	12.3
EBITDA1)	16.1	(12.7)	–	–	3.4

• Strong adjusted EBITDA of € 16.1 m in EVT Execute
• Increased investments in Cure X/Target X initiatives and oncology projects in Toulouse in in-line with strategy
• Milestones expected for end of 2015

¹⁾ Adjusted for changes in contingent considerations; Group EBITDA was adjusted for changes in contingent consideration as well as for one-time effects with regards to the bargain purchase resulting from the acquisition of Evotec (France) SAS in 2015

Key figures illustrate clear long-term growth strategy

Performance overview EVT Execute & EVT Innovate

Accelerated path to growth and sustainability

Key metrics

• 1) 1) Adjusted for changes in contingent considerations
• 2) 2) Cash and cash equivalents and investments

3) 3) Effective on 01 April 2015, Evotec acquired Sanofi's scientific operations in Toulouse, France; 2015 number including the employees from this transaction

Strong team and shareholders for innovation

Management & shareholder structure

Number of shares: 132.5 m Listing: Frankfurt TecDAX, OTCBB 52 week high/low: € 4.30/€ 2.97

Management Board

• Werner Lanthaler (CEO) Long-time experience in Pharma & biotech
• Mario Polywka (COO) 18 years Evotec experience
• Cord Dohrmann (CSO) Outstanding background in metabolics
• Colin Bond (CFO) Big industry multi-national background

Supervisory Board

• Wolfgang Plischke Ex-Bayer
• Bernd Hirsch Symrise AG
• Claus Braestrup Ex-Lundbeck
• Paul Herrling Ex-Novartis
• Iris Löw-Friedrich UCB
• Elaine Sullivan Carrick Therapeutics

Strong outlook for Q4 2015 – Guidance confirmed1) - Strong initial outlook into 2016

Guidance 2015

1	Double digit top line growth	 Approx. 45% growth excluding milestones, upfronts and licences
2	Profitable	 Positive adjusted EBITDA2) 100 m3)  Liquidity is expected to be well in excess of €
3	Accelerated investments	 Increased R&D investments of approx. € 15–20 m in strategic Cure X and Target X initiatives to accelerate long-term clinical pipeline building  Continued capacity and capability building with up to € 10 m

PAGE 27 1) As a result of the Sanofi collaboration, Evotec raised its revenue guidance that was published in Evotec's Annual Report 2014 two times, firstly on 24 March 2015 and secondly on 12 May 2015. On 15 September 2015, Evotec raised its revenue guidance due to a strong business performance and a positive outlook for the remainder of the year. All elements of the financial guidance 2015 as of 12 May 2015 are confirmed.

2) Before contingent considerations and excluding impairments on other intangible and tangible assets and goodwill as well as the total non-operating result

3) Excluding any potential cash outflow for M&A or similar transactions

Your contact:

Dr Werner Lanthaler Chief Executive Officer

+49.(0).40.560 81-242 +49.(0).40.560 81-333 Fax werner.lanthaler@evotec.com