Business Weekly - Cambridge, UK

The Euro7.5m payment, the fourth in an ongoing series was made by GSK following the arrival of the team at a significant milestone in their collaborative work, which could see Galapagos, BioFocus’ parent company net a total of up to Euro186m.

BioFocus DPI, which offers a full suite of target-to-drug discovery products and services to pharmaceutical and biotech companies, has been working on the collaboration since its inception in 2006.

June of 2006 saw GSK’s Center of Excellence for External Drug Discovery (CEEDD) and Galapagos initiate a program to deliver disease-modifying drugs with clinical Proof of Concept to GSK’s global research and development organisation, which to date, has earned the Belgian pharma Eur15.1m in access fees and milestone payments from GSK.

The agreement’s aim was for Galapagos to expand its portfolio of novel targets in the field of osteoarthritis, conduct compound screening, identify tractable hits, pursue a number of hit-to-lead programs, and develop the resulting leads into candidate selection compounds through to a successful Proof of Concept in clinical research Phase IIa.

GSK has exclusive options to further develop and commercialise these compounds on a worldwide basis, while Galapagos will have the right to further develop and commercialise compounds for which GSK does not exercise its option.

“Achieving these significant milestones according to plan is evidence that we can deliver on our risk/reward sharing alliances with pharma,” said CEO of the parent company, Galapagos, Onno van de Stolpe.

“Furthermore, we have demonstrated that this model is a viable strategy to progress a number of drug discovery programs while retaining the upside.”

In July 2007, GSK made a Euro4.4m equity investment in Galapagos and the alliance was expanded to include up to two selected GSK targets.

The expanded alliance is worth up to Euro186m in milestones for two marketable products to Galapagos, plus up to double-digit royalties on global product sales.

“Galapagos goes from strength to strength in our collaboration, and we are very pleased with today’s excellent results,” said senior VP of GSK, Hugh Cowley.
“We are confident that our alliance will continue to advance GSK’s pipeline in osteoarthritis.”

Galapagos focuses its osteoarthritis research programs on chondrocytes, the main cell types in cartilage. Galapagos has identified a number of novel targets that have been validated in cellular disease models and has progressed these into drug discovery.