Halozyme Therapeutics, Inc. (NASDAQ: HALO) announced it has withdrawn its non-binding proposal to acquire Evotec SE (NASDAQ: EVO) at €11.00 per share in cash, representing a fully diluted equity value of €2.0 billion. Despite expressing strong interest in the merger, Halozyme cited Evotec’s unwillingness to engage in discussions as the reason for withdrawing its bid.
Halozyme’s Vision for the Merger
Halozyme President and CEO Helen Torley emphasized the strategic potential of the proposed acquisition, stating, “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.”
The company envisioned a partnership that would leverage the strengths of both organizations, building a comprehensive pharma services platform with significant global impact. However, Evotec’s lack of openness to collaboration ultimately stalled Halozyme’s efforts.
Efforts to Engage Evotec
Halozyme detailed the extensive efforts it undertook to initiate discussions with Evotec, including:
- Early Engagement: Informal discussions with a member of Evotec’s Supervisory Board to gauge interest in a potential business combination.
- Formal Requests: Direct outreach to Evotec’s Chairwoman of the Supervisory Board to discuss Halozyme’s vision and the mutual benefits of the proposed merger.
- Proposal Submission: After repeated attempts to engage informally were declined, Halozyme submitted a formal proposal to Evotec’s CEO, demonstrating its commitment to the transaction.
Despite these efforts, Evotec remained firm in its stance to remain independent. A company spokesperson publicly reiterated this position, further indicating no interest in pursuing the merger.
Looking Ahead: Halozyme’s Independent Strategy
With the withdrawal of the Evotec proposal, Halozyme reaffirmed its commitment to its standalone growth strategy. Helen Torley expressed confidence in the company’s future, highlighting its robust pipeline and financial trajectory.
Key Achievements and Outlook:
- Halozyme remains on track to achieve 10 approved products utilizing its ENHANZE® drug delivery technology by 2025.
- The company expects to generate $1 billion in royalty revenue by 2027, driven by its expanding portfolio and strong partnerships.
- Halozyme recently raised its 2024 guidance, projecting revenue of $970–$1,020 million and adjusted EBITDA of $595–$625 million, reflecting double-digit growth.
Torley stated, “We will continue advancing our mission to improve the patient treatment experience and deliver tremendous value for all stakeholders. Our momentum heading into 2025 underscores the strength of our strategy and operational execution.”
Industry Implications
Halozyme’s decision to withdraw its bid for Evotec underscores the challenges companies face when attempting mergers and acquisitions in the highly specialized biotech sector. While consolidation can unlock synergies and drive innovation, it requires alignment between leadership teams and a shared vision for the future.
As Halozyme shifts its focus back to its existing business strategy, Evotec’s steadfast commitment to independence highlights the diverse paths companies can take in navigating growth and value creation in the pharmaceutical industry.
This announcement marks a pivotal moment for both companies, each poised to pursue their respective goals independently.
