Gilead On Board, But Still No Easy Sailing for Galapagos with Phase IIa Failure

26/01/2016 - 2 minutes

Galapagos (Belgium) and Gilead (US) announced today the closing and entry into force of their global license and collaboration agreement on filgotinib, just as results are released for a phase II trial against Ulcerative colitis.

Galapagos_septemer_stocks_nasdaq_filgotinib_abbvie_gilead_dealUnder the terms of the agreement, the closing of this transaction triggers an upfront license fee payment of $300M by Gilead to Galapagos. In addition, Gilead has made a $425M (€392M) equity investment in Galapagos by subscribing for new shares at a price of €58 per share, including issuance premium.

This equates to 14.75% of Galapagos, which is a relatively huge proportion of ownership for such a Biotech. Perhaps Gilead is thinking of acquiring Galapagos further down the line – in a year or two? We speculate.

However, Galapagos have also just released phase IIa trials for another candidate (GLPG1205) in Ulcerative Colitis. Whilst good safety and tolerability profiles for this small-molecule candidate were found, unfortunately the drug failed to meet is primary endpoint in tackling this disease.

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