Evotec's Reorganization Deepens: Job Cuts Exceed Initial Estimates

Evotec, the German biopharma contractor, has intensified its restructuring efforts, cutting approximately 600 jobs since March 2024, significantly surpassing its original target of 400 layoffs. This development comes as part of a sweeping reorganization aimed at driving sustainable profitable growth and improving operational efficiency.

Expanded Job Cuts and Financial Performance

The company's half-year report, released this week, reveals that between March 2024 and June 2025, Evotec reduced its workforce by 600 full-time positions. This represents a 50% increase from the initially planned 400 job cuts announced last year. The reorganization, designed to achieve annualized savings of over 40 million euros ($44 million), also includes the termination of certain lease agreements.

Despite these cost-cutting measures, Evotec reported a 5% overall sales decline in the first six months of 2025, generating 371 million euros compared to 391 million euros during the same period in 2024. The company's discovery and preclinical development (D&PD) division was particularly affected, experiencing an 11% revenue drop due to soft market demand.

Strategic Shifts and Asset Optimization

Evotec's CEO, Christian Wojczewski, Ph.D., emphasized that the company's strategic execution is "firmly on track" towards sustainable and profitable growth. As part of this strategy, Evotec has been transitioning to an "asset-lighter" model, focusing on its core areas of expertise.

Key strategic moves include:

1. The sale of its biologics manufacturing facility in Toulouse, France, to biosimilar partner Sandoz, aimed at improving revenue mix, profit margins, and capital efficiency.
2. A 30% reduction in its asset portfolio, including the divestment of a phase 2 candidate, effectively ending the company's involvement in clinical development.
3. Narrowing its focus to the early stages of drug development, specifically "from target ID to IND," as stated by Wojczewski.

Contrasting Divisional Performance

While Evotec's CDMO unit, Just – Evotec Biologics (JEB), reported strong performance with 16% year-over-year revenue growth in the first half of 2025, the D&PD division underperformed expectations. This disparity highlights the challenges faced by different segments of the pharmaceutical services industry in the current market environment.

Despite the extensive restructuring, Evotec maintains a substantial global presence with a workforce of over 5,000 employees worldwide. The company continues to navigate the complex landscape of the pharmaceutical industry, balancing cost-cutting measures with strategic investments in its core capabilities.