GSK, Galapagos Enter Osteoarthritis Drug Pact

GlaxoSmithKline and Galapagos created a worldwide, multi-year, multi-program drug discovery and development alliance in the field of osteoarthritis. GSK, through its Center of Excellence for External Drug Discovery (CEEDD), will collaborate with Galapagos to deliver disease-modifying drugs with clinical Proof of Concept to GSK’s global R&D organization. This alliance builds upon Galapagos’ internal target and drug discovery program in osteoarthritis.

Galapagos will 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 Proof of Concept in clinical research Phase IIA. GSK will have exclusive options to further develop and commercialize these compounds on a worldwide basis. Galapagos will have the right to further develop and commercialize compounds for which GSK does not exercise its option. Galapagos will contract a substantial part of the activities to its service division, BioFocus. The overall strategy will be to identify genes that stimulate anabolic repair processes (chondrogenesis) and inhibit catabolic (breakdown) activity in affected joints.

Under the terms of the agreement, Galapagos will receive an upfront technology access fee of $5.2 million from GSK. Upon successful completion of all program criteria, Galapagos stands to receive as much as $83.7 million in success-based milestones. In addition, Galapagos will receive as much as double-digit royalties on commercial sales of alliance products. Further to the agreement, on the realization of a defined future milestone, GSK will make an equity investment of up to $3.9 million in Galapagos.

Maxine Gowen, Ph.D., senior vice president and head of GSK’s CEEDD stated, “We are very pleased to be able to announce the alliance with Galapagos. As there are no therapies available that prevent or block the progression of osteoarthritis, the potential unmet need is substantial. Through this combination of GSK’s understanding of medical needs and Galapagos’ innovation in drug discovery, we aim to bring new medicines to patients.”

“The alliance announced today fits very well into our strategy to provide turn-key drug discovery services to the biopharmaceutical industry,” said Onno van de Stolpe, chief executive officer of Galapagos. “With this first broad alliance, we have started to realize the strategic synergies of combining BioFocus’ drug discovery capabilities with Galapagos’s target discovery engine. The alliance with GSK in osteoarthritis also serves as a strong validation of Galapagos’s internal drug discovery program in bone and joint diseases.”