Wall Street Trader schreef op 24 december 2020 15:41:
Gilead gaining access to the Galapagos discovery engine was the key to the transaction.Gilead and Galapagos entered a collaboration granting Gilead options for ex-EU rights for anything coming from Galapagos' pipeline for the next 10 years in exchange for $3.95b upfront, $1.1b equity investment plus future milestones.
While the collaboration implies close scientific collaboration between the company, Galapagos retains complete independence in the selection of target and disease area and development till phase 3. All compounds not picked up by Gilead would revert to Galapagos in full with no ties.
Onno van de Stolpe and team have carefully built Galapagos over two decades, focused intently on a “science first” mindset and with a passion for standing up world class biotechnology in Europe. As a result of these values and drivers, the pipeline is enthusiastically pursuing difficult targets in white spaces, building, morphing and leveraging their carefully built in-house discovery and chemistry. Gilead’s “option to buy” further validates this thesis: commit to pipeline and science, leave the people alone, support infrastructure build-up in Europe and elsewhere. Why? Because building an organization is exceptionally hard, destroying it disarmingly easy.
The build-up across TOLEDO with the potential replication of the entire janus kinase inhibitor space with a new target/pathway, are testament to the people, the mindset and the ambition.
Gilead’s cash now provides Galapagos freedom to operate.In the long run IPF and TOLEDO will be the next catalysts and potential blockbusters for the company and stock price.Furthermore Gilead could pay $325M for the ex-EU rights to GLPG1690 upon successful Phase 3 and FDA approval while sharing global development costs and $150M for all other pipeline programs upon decision to opt-in post Phase 2.
All commercial economics for filgotinib in Europe will transfer to Galapagos from 1st January 2022 subject to the payment of tiered royalties of 8% to 15% of net EU sales to Gilead starting in 2024. Gilead has agreed to pay Galapagos €160m (€110m in 2021 and €50m in 2022), subject to adjustments for any higher-than-budgeted development costs.
Whether the Gilead/Galapagos deal proves inspirational in the future will depend on how many of Galapagos’s drug candidates actually succeed.