On August 9, 2018 Perrigo Company plc (NYSE; TASE: PRGO) reported financial results for the second quarter ended June 30, 2018 (Press release, Perrigo Company, AUG 9, 2018, View Source [SID1234528664]).

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Additional first half of the year reported results: Reported CHC Americas net sales increased 0.9%. Reported operating margin in the CHC International segment was 2.6%. Reported operating margin in the RX segment was 28.1%.

Perrigo President and CEO, Uwe Roehrhoff commented, "For the first half of calendar year 2018, adjusted EPS performance met our operating goals, driven by the strength of our durable consumer businesses. During the same period, the RX business performed below our expectations and experienced weakness due primarily to a shortfall in new product launches coupled with challenging market dynamics, which is expected to carry forward into the second half of the year. This has resulted in changes to our 2018 operating plan, which are reflected in our updated guidance. I am extremely disappointed in this development and want to reinforce that my primary focus is to create value for shareholders."

Mr. Roehrhoff continued, "Our consumer businesses delivered durable results for the first half of the year. CHC Americas net sales grew approximately 1% on a constant currency basis, while our market-leading OTC and infant nutrition businesses grew approximately 2.5% combined, versus prior year. Adjusted operating margin in the CHC International segment improved to 16.1% for the first half of year, or a 190 basis point improvement compared to the prior year. First half net sales in the RX segment were lower than the prior year by 8% due to challenging market dynamics. Despite the delay in key new product launches in the RX segment, its adjusted operating margin for the first half of 2018 was approximately 40%. Finally, we utilized our strong balance sheet to repurchase approximately $265 million dollars of shares in the first half of 2018."

Refer to Tables I – VI at the end of this press release for a reconciliation of non-GAAP measures to the current year and prior year periods and additional non-GAAP information. The Company’s reported results are included in the attached Condensed Consolidated Statements of Operations, Balance Sheets and Statements of Cash Flows.

Second Quarter Results

Reported net sales for the second quarter of calendar year 2018 were approximately $1.2 billion, which included new product sales of $42 million and the absence of sales from discontinued products of $17 million. Net sales decreased 4.0% compared to the prior year excluding the year-over-year effect of: 1) $7 million in net sales from the exited Russian and unprofitable distribution businesses in 2017 in the CHC International segment, 2) net sales from the divested Israel API business of $16 million and 3) favorable foreign currency movements of $19 million.

Reported net income was $36 million, or $0.26 per diluted share, versus net loss of $70 million, or $0.49 per diluted share, in the prior year. Excluding charges as outlined in Table I, second quarter 2018 adjusted net income was $169 million, or $1.22 per diluted share, versus adjusted net income of $175 million, or $1.22 per diluted share, for the same period last year.

Segment Results

Second quarter reported net sales decreased 1.2% on a constant currency basis due primarily to lower net sales in the animal health business compared to the prior year. Strong net sales in the cough/cold/allergy/sinus category and infant formula business, coupled with new product sales of $15 million, were partially offset by lower net sales in the smoking cessation category and discontinued products of $4 million.

CHC Americas second quarter reported gross profit margin was 32.7%. Adjusted gross profit margin was 34.5%, 120 basis points lower than the prior year due primarily to lower net sales the animal health business and higher input costs.

Reported second quarter operating margin was 9.6%. Second quarter adjusted operating margin was 20.4%, 60 basis points lower than the prior year as gross margin flow through was offset by proactive cost management efforts.

Reported net sales increased 1.2% compared to the second quarter of 2017. Excluding $7 million in net sales from the exited Russian and unprofitable distribution businesses in 2017, and favorable foreign currency movements of $20 million, net sales decreased 2.2% due primarily to lower sales in the anti-parasite, lifestyle and analgesics categories in addition to discontinued products of $8 million. Partially offsetting these effects were new product sales of $19 million and higher net sales in the diagnostics business.

Second quarter reported gross margin was 47.5%. Adjusted gross margin increased 160 basis points over the previous year to 53.3%, driven by improved product mix, new product launches and the continued benefit of insourcing initiatives.

Reported operating margin was 1.5%. Adjusted operating margin expanded 60 basis points to 15.2% due to higher gross margin contribution, partially offset by higher growth investments in the quarter compared to the prior year.

Reported net sales in the second quarter were $209 million compared to $240 million last year. New product sales of $8 million were more than offset by lower net sales of existing products of $35 million, due primarily to price erosion. Discontinued products were $5 million.

Reported gross margin was 45.3%. Adjusted gross margin was 55.1%, 370 basis points lower than the same quarter last year, due to strong product mix in 2017.

Reported operating margin was 27.3%. Adjusted operating margin was 39.4% compared to 46.5% in the prior year, due primarily to gross margin flow through and higher R&D investments as a percentage of net sales.

Guidance

The Company now expects calendar year 2018 reported operating income to be in the range of $548 million to $578 million, reported effective tax rate to be approximately 25.0%, and reported diluted EPS to be in the range of $2.11 to $2.31.

Primarily due to revised expectations for the RX segment and unfavorable foreign currency translation of $65 million, the Company now expects calendar year 2018 net sales to be in the range of $4.8 billion to $4.9 billion. The Company further expects adjusted operating income in the range of $960 million to $990 million, an adjusted effective tax rate of approximately 20.0% and an adjusted diluted EPS range of $4.75 to $4.95.

Conference Call

The Company will host a conference call at 8:30 a.m. EDT (5:30 a.m. PDT), August 9, 2018. The conference call will be available live via webcast to interested parties in the investor relations section of the Perrigo website at View Source or by phone at 877-870-4263, International 412-317-0790, and reference ID #2297446. A taped replay of the call will be available beginning at approximately 12:00 p.m. (EDT) Thursday, August 9, until midnight August 24, 2018. To listen to the replay, dial 877-344-7529, International 412-317-0088, and use access code 10122783.

On August 9, 2018 Apricus Biosciences, Inc. (Nasdaq:APRI), a biopharmaceutical company historically focused on seeking to advance innovative medicines in urology and rheumatology, reported financial results for the second quarter and first half of 2018 and provided a corporate update on its near-term priorities (Press release, Apricus Biosciences, AUG 9, 2018, View Source;p=RssLanding&cat=news&id=2363184 [SID1234528648]).

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On July 30, 2018, the Company announced the signing of a definitive agreement to merge with Seelos Therapeutics, Inc., a privately-held biotechnology company, in an all-stock transaction. The merged company will focus on the development and commercialization of central nervous system (CNS) therapeutics with known mechanisms of action in areas with a highly unmet medical need. Upon completion of the proposed merger, the name of the merged company will be Seelos Therapeutics, Inc., and the company is expected to begin trading on the Nasdaq Capital Market under the ticker symbol "SEEL." Upon closing of the transaction, Apricus shareholders of record are expected to own approximately 14% of the combined company based on an estimated $90 million valuation at closing, subject to certain adjustments set forth in the merger agreement. In addition, Apricus shareholders of record at closing will receive a Contingent Value Right (CVR) which will provide such holders 90% of any proceeds above $500,000 obtained by Seelos for the U.S. Vitaros rights.

"Throughout the second quarter of this year, we have been focused on a comprehensive review of strategic alternatives conducted through a structured process. On July 30, 2018 we announced that the Apricus Board of Directors has concluded that the proposed merger with Seelos was in the best interest of our shareholders, as it will provide an opportunity to create value from a diversified pipeline of late-stage clinical assets in areas of high unmet need," said Richard Pascoe, Chief Executive Officer. "We will continue to work with Seelos management in the coming months to complete the merger in the fourth quarter of 2018."

Second Quarter and 1H 2018 Financial Results

Net loss during the quarter ended June 30, 2018 was $2.3 million, or loss per share of $0.10, compared to a net loss of $1.5 million, or loss per share of $0.13, during the second quarter of 2017. Net loss during the first half of 2018 was $4.5 million, or loss per share of $0.23, compared to net income of $6.6 million, or earnings per share of $0.69, during the first half of 2017. Net income during the first half of 2017 was primarily due to the $11.8 million gain recorded upon the sale of our ex-U.S. Vitaros rights and assets to Ferring.

For all periods presented, financial statement activity related to our ex-U.S. Vitaros business has been presented as discontinued operations. As of June 30, 2018, the Company’s cash totaled $6.8 million, compared to $6.3 million as of December 31, 2017.

On August 9, 2018 Agenus Inc. (NASDAQ: AGEN), an immuno-oncology (I-O) company with a pipeline of immune checkpoint antibodies, cancer vaccines and adoptive cell therapies1, reported financial results for the second quarter of 2018 (Press release, Agenus, AUG 9, 2018, View Source [SID1234528647]).

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"Innovation and speed are core to our strategy. We have delivered eight new discoveries over the past 2 years. This year alone, 3 INDs from our discovery engines have been filed and 3 additional INDs will be filed by year end; they include our NexGen CTLA-4 and our first-in-class bispecifics. We have delivered on our partnership commitments with Merck and Incyte with 2 programs in the clinic this year and a third expected before the end of the year, each triggering a cash milestone," said Garo H. Armen, Ph.D., Chairman and CEO of Agenus. "In addition, our proprietary CTLA-4 and PD-1 programs are advancing in three trials designed to take advantage of accelerated pathways for a BLA filing as early as 2020. Our partnership discussions have advanced towards potential closure. With these developments, we expect to deliver value to our shareholders and partners."

Key clinical and business updates

Operational Achievements:
New discoveries advance to clinic
Three INDs filed and 3 more to be filed by the end of 2018, including Next-Gen CTLA-4 and two first-in-class bispecifics
Lead CTLA-4 (AGEN1884) & PD-1 (AGEN2034) trials advance towards BLA as early as 2020
ASCO reported data show 31-42% benefit
New data in 2018 anticipated to show expanded benefit
Three trials ongoing designed to leverage accelerated pathways
Payment milestones triggered in partnerships with Incyte, Merck
LAG-3 (INCAGN02385) in the clinic
TIM-3 (INCAGN02390) expected to enter clinic in 2018
Undisclosed target with Merck entered clinic
Sales of GSK’s Shingrix, containing QS-21 Stimulon, have exceeded projections
Manufacturing Speed and Innovation:
Completed clinical & pivotal grade material for AGEN1884 & AGEN2034 3-5x faster than industry standards
First-in-class bispecific, AGEN1223, manufactured at scale in <2 months; setting industry records
AgenTus Cell Therapy Business:
Lead identified for IND filing; private financing and plans for IPO underway
Second Quarter 2018 Financial Results

Cash and cash equivalents were $43.2 million and $60.2 million at June 30, 2018 and December 31, 2017 respectively.

For the second quarter ended June 30, 2018, we reported a net loss of $25.2 million, or $0.24 per share, compared to a net loss for same period in 2017 of $31.7 million, or $0.32 per share. We recognized revenue during the current quarter of $16 million which includes milestone achievements and non-cash royalties earned.

For the six months ended June 30, 2018, we reported a net loss of $79.5 million or $0.76 per share compared to a net loss for the same period in 2017 of $48.8 million or $0.51 per share. The increased net loss reflects reduced revenue due to an accelerated milestone received during 2017 from Incyte and the loss on early extinguishment of debt.

Conference Call, Webcast and Prepared Statement Information

Agenus executives will host a conference call on Thursday, August 9, 2018 at 8:30 a.m. Eastern Time. To access the live call, dial (844) 492-3727 (domestic) and (412) 317-5118 (international). Ask to be joined into the Agenus call. The call will also be webcast and will be accessible from the Company’s website at View Source or via the following link: View Source A replay will be available on the Company’s website approximately two hours after the call and will remain available for 90 days.

On August 9, 2018 Magenta Therapeutics (NASDAQ: MGTA), a clinical-stage biotechnology company developing novel medicines to bring the curative power of bone marrow transplant to more patients, reported financial results and business highlights for the second quarter ended June 30, 2018 (Press release, Magenta Therapeutics, AUG 9, 2018, View Source [SID1234528624]).

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"Magenta has made important progress this year toward realizing our long-term vision of broadening the curative potential of bone marrow transplant to more patients and building a fully integrated biotechnology company. The first half of 2018 has been particularly productive for us with the advancement of MGTA-456 into a Phase 2 study and the completion of our Series C financing and initial public offering," said Jason Gardner, D.Phil., chief executive officer, president and co-founder, Magenta Therapeutics. "We are in a strong financial position to continue advancing our programs, and we plan to share data updates from several programs before the end of the year, including preliminary clinical data from our Phase 2 study of MGTA-456 in patients with inherited metabolic disorders."

Recent Business Highlights:

Transplanted First Patient in Phase 2 Study of MGTA-456: Magenta announced in April 2018 that the first patient was treated in a Phase 2 study of MGTA-456 in inherited metabolic disorders. MGTA-456 is a first-in-class allogeneic stem cell therapy consisting of a single umbilical cord blood unit expanded with an aryl hydrocarbon receptor (AHR) antagonist then administered to a patient through a bone marrow transplant.

Strengthened Board of Directors and Scientific Advisory Board: In April 2018, Magenta announced the addition of Amy Ronneberg, President of Be The Match BioTherapies, to its Board of Directors. Megan Sykes, M.D., Professor of Medicine and Professor of Microbiology & Immunology and Surgical Sciences at Columbia University Medical Center, joined Magenta’s Scientific Advisory Board in April 2018, and Bruce Blazar, M.D., Regents Professor of Pediatrics in the Division of Blood and Marrow Transplantation at the University of Minnesota, joined Magenta’s Scientific Advisory Board in June 2018.

Raised $52 Million in Series C Financing: In April 2018, Magenta completed a Series C financing, raising $52 million. The oversubscribed Series C financing was led by Casdin Capital, with participation from new investors EcoR1 Capital, Eventide Asset Management, Watermill Asset Management and additional long-term institutional investors. Existing investors Be the Match BioTherapies and Access Industries also participated.

Successfully Completed Initial Public Offering: In June 2018, Magenta successfully completed an initial public offering of 6,666,667 common shares at $15.00 per share, raising net proceeds of $90 million.

Financial Results:

Cash Position: Cash and cash equivalents as of June 30, 2018, were $173.4 million compared to $51.4 million on December 31, 2017. The increase is primarily driven by proceeds from the $52 million Series C preferred stock financing completed in April 2018, and net proceeds of $90 million from Magenta’s IPO completed in June 2018. Magenta anticipates that its cash and cash equivalents will be sufficient to fund operations and capital expenditures through at least the first quarter of 2020 on the Company’s current business plan.

Research and Development Expenses: Research and development (R&D) expenses were $9.7 million in the second quarter of 2018, compared to $13.8 million for the same period in 2017. The decrease was largely due to the prior year cost of in-licensing technology related to the rights to MGTA-456, partially offset by increased R&D personnel costs associated with the growth of the Company, the advancement of the MGTA-456 Phase 2 clinical trial and continued progression of the Company’s pipeline.

General and Administrative Expenses: General and administrative (G&A) expenses were $4.3 million for the second quarter of 2018, compared to $1.9 million for the same period in 2017. The increase was largely due to increased G&A personnel costs associated with the growth of the Company and professional fees related to supporting operations as a public company.

Net Loss: Net loss was $13.7 million for the second quarter of 2018, compared to net loss of $15.7 million for the same period in 2017.

On August 9, 2018 Evotec AG (Frankfurt Stock Exchange: EVT, TecDAX, ISIN: DE0005664809) reported financial results and corporate updates for the first half of 2018 (Press release, Evotec, AUG 9, 2018, View Source;announcements/press-releases/p/evotec-ag-reports-first-half-year-2018-results-and-corporate-updates-5709 [SID1234528620]).

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STRONG FINANCIAL PERFORMANCE FROM BOTH SEGMENTS
Group revenues: 67% increase to € 173.8 m (H1 2017: € 104.3 m);
EVT Execute revenues up 61% to € 163.3 m (H1 2017: € 101.3 m);
EVT Innovate revenues up 52% to € 32.0 m (H1 2017: € 21.1 m)
Adjusted Group EBITDA up 47% to € 38.6 m (H1 2017: € 26.2 m);
Adjusted EBITDA for EVT Execute of € 36.3 m (H1 2017: € 28.6 m);
Adjusted EBITDA for EVT Innovate of € 2.3 m (H1 2017: € (2.4) m)
Group R&D expenses up 17% to € 10.0 m (H1 2017: € 8.5 m)
Very strong performance in Q2 2018 due to Aptuit contribution, milestone achievements and signing of new partnerships
Acquisition loan from 2017 repaid by 50% (partially after period-end) mainly from operational cash flows
Strong liquidity position of € 109.8 m

EVT EXECUTE
Clinical Phase I and Phase II starts in Bayer alliance and strong progress within ongoing alliances (e.g. Forge, Dermira, C4X, Blackthorn, Abivax)
New and extended drug discovery and development agreements (e.g. Katexco)
Continued strong performance of high-throughput ADME-tox testing (Cyprotex, an Evotec company)
Aptuit integration according to plan:
Positive development of business and good uptake of INDiGO solution to accelerate drug candidate delivery (e.g. Carna Biosciences, Petra Pharma); expansion of INDiGO capacity initiated

EVT INNOVATE
Takeover of Sanofi’s infectious disease unit effective 01 July 2018, creating largest global footprint in infectious disease capabilities plus a broad project pipeline – Evotec at the same time receives an upfront payment of € 60 m (after period-end) and R&D cost coverage for the first five years
New long-term partnership with Celgene in oncology with upfront payment of $ 65 m
Important milestone achievements (e.g. iPSC diabetes alliance with Sanofi, iPSC neurodegeneration alliance with Celgene)
Continued focus on expansion of iPSC platform and patient-centric approaches to drug discovery
Academic BRIDGE model continues momentum (e.g. expansion of funded projects under LAB150 and LAB282; LAB591 as first US BRIDGE established)

CORPORATE
Conversion into European Company (SE) initiated

GUIDANCE UPDATE H2 2018
Guidance on Group revenues – Growth of >30% confirmed
Guidance on adjusted Group EBITDA – Growth of approx. 30% confirmed
Guidance on R&D expenses increased – R&D expenses for 2018 will increase to € 35-45 m (from € 20-30 m) due to investments in newly started anti-infectives initiatives; there will be no impact on adjusted Group EBITDA since the costs for the first five years will be covered by Sanofi

1. STRONG FINANCIAL PERFORMANCE FROM BOTH SEGMENTS

Evotec’s Group revenues for the first half of 2018 grew to € 173.8 m, a significant increase of 67% compared to the same period of the previous year (H1 2017: € 104.3 m). This increase is due to a strong performance in the base business, a positive Aptuit contribution (€ 53.6 m) as well as increased milestone achievements in existing alliances. The total revenues from milestones, upfronts and licences for the first half of 2018 amounted to € 15.5 m and increased by 17% over the same period of the previous year (H1 2017: € 13.3 m). In the first six months of 2018, the gross margin amounted to 28.9% (H1 2017: 35.7%). This margin change compared to 2017 reflects a new business mix with different margin expectations following the acquisition of Aptuit, higher amortisation of intangible assets and adverse FX effects. Gross margin excluding total amortisation amounted to 32.5%. The second quarter of 2018 recorded a very strong financial performance. Group revenues increased by 78% to € 94.8 m (Q2 2017: € 53.4 m), following the Aptuit contribution, strong milestone achievements and the signing of new partnerships (e.g. Celgene partnership in oncology). The significant milestone achievements were also reflected in the gross margin of Q2 2018 of 33.6% (Q2 2017: 34.1%). Q2 2018 gross margin excluding total amortisation amounted to 36.7% (Q2 2017: 37.1%). The adjusted Group EBITDA increased from € 12.8 m in the second quarter of 2017 to € 24.6 m in the second quarter of 2018.

R&D expenses for the first half of 2018 increased by 17% to € 10.0 m (H1 2017: € 8.5 m) reflecting continued development of predominantly initiatives in the fields of CNS and metabolic diseases as well as a focus on academic BRIDGE initiatives. SG&A expenses for the first half of 2018 increased as expected by 72% to € 27.1 m (H1 2017: € 15.8 m). Q2 2018 SG&A expenses remained on a similar level as in Q4 2017 and Q1 2018, which were the first full quarters following the Aptuit acquisition. SG&A expenses in the first six months of 2018 were mainly impacted by the addition of Aptuit as well as an increase in headcount in response to overall Company growth.

In the first six months of 2018, Evotec recorded impairments of intangible assets of € 4.2 m in total (H1 2017: € 0.0 m). The EVT770 programme was fully impaired (€ 4.0 m) as the project was put on hold. At the same time, correlated earn-out accruals of € 2.3 m were relieved under other operating income, which is a counter-effect to the impairment. The developed assets within the Panion joint venture were fully impaired (€ 0.2 m) as it was decided to discontinue the one programme.

Evotec’s adjusted Group EBITDA in the first six months of 2018 significantly increased by 47% to € 38.6 m (H1 2017: € 26.2 m). Evotec’s operating result for the first half of 2018 amounted to € 21.7 m (H1 2017: € 18.4 m). The net result in the first half of 2018 increased to € 17.9 m (H1 2017: € 10.3 m).

Liquidity, which includes cash and cash equivalents (€ 91.3 m) and investments (€ 18.5 m) amounted to € 109.8 m at the end of June 2018 (31 December 2017: € 91.2 m). On 31 July 2018, Evotec announced the repayment of 50% of the € 140 m debt facility, which was taken to fund the acquisition of Aptuit in 2017. This repayment was enabled mainly through the strong cash inflow from Evotec’s operational activities in the first half of 2018; in addition, part of the loan has been refinanced at highly attractive terms.

In the first half of 2018, revenues from the EVT Execute segment amounted to € 163.3 m, an increase of 61% compared to the same period of the previous year (H1 2017: € 101.3 m). This increase is primarily attributable to the strong performance in the base business and the Aptuit contribution for the first six months of 2018. Included in this amount are € 21.5 m of intersegment revenues (H1 2017: € 18.0 m). The EVT Execute segment recorded costs of revenue of € 126.8 m in the first six months of 2018 (H1 2017: € 71.6 m), resulting in a gross margin of 22.4% (H1 2017: 29.3%). The drivers behind this change in gross margin are the same drivers, which affected the Group gross margin. In the first six months of 2018, the EVT Execute segment recorded a significant upswing of its adjusted EBITDA of 27% to € 36.3 m against the prior-year period (H1 2017: € 28.6 m).

The EVT Innovate segment generated revenues in the amount of € 32.0 m (H1 2017: € 21.1 m), consisting entirely of third-party revenues. This 52% increase in EVT Innovate revenues primarily resulted from milestone achievements in key alliances in the first half of 2018. The EVT Innovate segment reported costs of revenue of € 15.9 m (H1 2017: € 11.4 m), resulting in a gross margin of 50.4% compared to 46.1% in the prior-year period. R&D expenses for the EVT Innovate increased from € 10.4 m in the first six months of 2017 to € 12.0 m in the first six months of 2018. The EVT Innovate segment reported a positive adjusted EBITDA of € 2.3 m (H1 2017: € (2.4) m) mainly due to milestone achievements. All key projects to achieve significant milestones in 2018 are on track.

2. EVT EXECUTE & EVT INNOVATE
EVT EXECUTE
In the first half of 2018, the EVT Execute segment continued its strong operational performance of the previous quarters. The Aptuit integration into the Evotec Group is proceeding according to plan. Evotec’s INDiGO offering, which was part of the strategic rationale behind the Aptuit acquisition, was launched in March 2018 and has started to attract very good interest from the industry, resulting in new INDiGO deals being signed with Carna Biosciences and Petra Pharma, among others. INDiGO is an integrated and highly efficient process to IND submission. In addition, Aptuit’s stand-alone development services and integrated CMC continued to deliver and sign new programmes. The expansion of the Active Pharmaceutical Ingredient ("API") capacity volume in Oxford and Verona will be completed in the second half of 2018, affording significant important scale to maximise on INDiGO opportunities. The Cyprotex business (acquired in December 2016) has continued its excellent performance of the previous quarters.

Good progress was achieved in Evotec’s existing alliances (e.g. Forge, Dermira, C4X, Blackthorn, Abivax) and new and expanded alliances were also signed (e.g. Katexco). In Evotec’s multi-target alliance with Bayer, further promising small molecules for the treatment of endometriosis advanced into Phase I and for the treatment of chronic cough into Phase II (after period-end). Since the beginning of the collaboration in 2012, six first-in-class/best-in-class non-hormonal pre-clinical candidates have been generated, out of which three programmes have progressed into Phase I/Phase II clinical trials.

EVT INNOVATE
The EVT Innovate segment also had a very strong first half of 2018. Significant progress was recorded across the various different ventures within this segment.

With the closing of the agreement with Sanofi in infectious diseases effective 01 July 2018 triggering an upfront of € 60 m (€ 43 m in cash plus € 17 m cash of the acquired company), Evotec now has the largest global footprint in infectious disease capabilities in the industry and a broad pipeline of drug candidates and discovery projects. Furthermore, Evotec broadened its existing relationship with Celgene with the start of a major long-term strategic agreement with Celgene in oncology resulting in an upfront payment of $ 65 m. This collaboration leverages Evotec’s phenotypic screening capabilities and unique compound libraries as well as associated target deconvolution capabilities.

Evotec’s existing key programmes are also on track, demonstrated by significant milestone achievements in the strategic iPSC alliance with Sanofi in the field of diabetes (TargetBCD) (milestone payment of € 3 m) and in the iPSC-based alliance with Celgene in neurodegeneration (milestone payment of $ 6 m). Evotec continues to place great emphasis on the expansion and development of its iPSC platform and patient-centric approaches to drug discovery.

Evotec’s academic BRIDGE model continues to attract significant interest from academia and industry partners. LAB591, the first US-based BRIDGE, was formed in May in partnership with Fred Hutchinson and Arix Bioscience. Evotec’s existing BRIDGES LAB282 and LAB150 also recorded progress with projects being selected for future activities in the course of the first six months of 2018.

3. CORPORATE
CONVERSION INTO EUROPEAN COMPANY (SE) INITIATED
At the Annual General Meeting held on 20 June 2018 in Hamburg, Evotec’s shareholders voted to support the conversion of Evotec AG into a European Company with a majority of 99.96%. After finalising the mandatory negotiation process regarding the future arrangements for employee involvement, Evotec AG will be transferred into Evotec SE with the registered seat and headquarters remaining in Hamburg, Germany.

4. GUIDANCE UPDATE H2 2018
Following the closing of the agreement to take over Sanofi’s infectious disease unit, the financial guidance 2018 was updated. Evotec now expects R&D expenses to range from € 35-45 m (previously: € 20-30 m). All other elements of the guidance 2018 are confirmed. In particular, the additional R&D efforts are not expected to impact the adjusted EBITDA since these extra R&D expenses will be covered by other operating income recognised in context of this new agreement with Sanofi.

Webcast/Conference Call
The Company is going to hold a conference call to discuss the results as well as to provide an update on its performance. The conference call will be held in English.

Conference call details

Date: Thursday, 09 August 2018

Time: 02.00 pm CEST (01.00 pm BST/08.00 am EDT)

From Germany: +49 69 22 22 29 043

From France: +33 170 750 705

From Italy: +39 023 601 3806

From UK: +44 20 3009 2452

From USA: +1 855 402 7766

Access Code: 37969784#

A simultaneous slide presentation for participants dialling in via phone is available at View Source

Webcast details

To join the audio webcast and to access the presentation slides you will find a link on our homepage www.evotec.com shortly before the event.

A replay of the conference call will be available for 24 hours and can be accessed in Europe by dialling +49 69 22 22 33 985 (Germany) or +44 20 3426 2807 (UK) and in the USA by dialling +1 866 535 8030. The access code is 654573#. The on-demand version of the webcast will be available on our website: View Source

Note: The 2017 and 2018 results are not fully comparable. The difference stems from the acquisition of Aptuit, effective 11 August 2017. The results from Aptuit are only included from 11 August 2017 onwards. The accounting policies used to prepare this interim information are the same as those used to prepare the audited consolidated financial statements for the year ended 31 December 2017, except for the adoption of new standards effective as of 01 January 2018.

From 01 January 2018 onwards, Evotec applies IFRS 15. The comparison period 2017 is adjusted from the first time application of IFRS 15.