Galapagos announces strategy to accelerate innovation and reports strong third quarter 2022 results

Galapagos NV (Euronext & NASDAQ: GLPG) today announced its strategy for accelerated growth and value creation, its financial results for the first nine months of 2022, and the outlook for the remainder of 2022. The results are further detailed in the Q3 2022 financial report available on the financial reports section of the website.

Forward, Faster strategy to accelerate innovation

“Guided by our purpose to bring transformational medicines to patients around the world to help them live longer and healthier lives, we today announce our Forward, Faster strategy to accelerate growth and value creation by reshaping the way we innovate and operate. This strategy provides a clear path forward based on three key pillars. First, we will shift from novel target-based discovery to patient-centric medical need research and development with a focus on our key therapeutic areas of immunology and oncology. Second, we will build on our current capabilities and derisk R&D through multiple drug modalities, including CAR-T, and by focusing on best-in-disease validated targets in our strategic therapeutic areas with shorter time-to-patient potential. Third, we will increase our business development efforts to complement our pipeline and continue to work with our collaboration partner Gilead to bring more medicines to patients worldwide,” said Dr. Paul Stoffels¹, CEO and Chairman of the Board of Directors of Galapagos.

“Our new fit-for-purpose organizational structure and operating model will focus on accelerating our pipeline in immunology and oncology, supported by externally sourced opportunities, and we will discontinue our activities in fibrosis and kidney disease².

As a result of our new strategic direction, we intend to reduce our workforce by approximately 200 positions across our sites in Europe to create room to reinvest in new capabilities and programs in our oncology franchise. This is a difficult but necessary decision, and we will follow all applicable processes with respect for our people.”

Third quarter financial performance
“Jyseleca continues to perform very well with a growing European base and a solid €60.5 million in net sales as of 30 September. As a result, we further increase our 2022 net sales guidance to €80-€90 million from our initial guidance of €65-€75 million. We ended the third quarter of the year with a strong balance sheet of €4.4 billion in cash and current financial investments, which provides us with the necessary means to invest in immunology and oncology and execute on smart business development. We reiterate our cash burnⁱ guidance of €480-€520 million for the full year 2022,” added Bart Filius, President, COO and CFO of Galapagos.

Q3 2022 operational review and recent events 
Jyseleca commercial & regulatory progress 

• Strong adoption across Europe with reimbursement for rheumatoid arthritis (RA) in 15 countries and for ulcerative colitis (UC) in 10 countries 
• Marketing Authorization Application (MAA) submitted for the treatment of UC to Swissmedic, the regulatory authority in Switzerland 
• Article 20 pharmacovigilance procedure ongoing by the European Medicines Agency (EMA)
  
  

Pipeline update 

• Preparations advanced to start Phase 2 of GLPG3667 (TYK2 inhibitor) in dermatomyositis, with the aim to recruit the first patients around year-end  
   

Corporate update 

• Received various transparency notifications from FMR LLC, indicating that its shareholding in Galapagos changed, without crossing below the 5% threshold, to 5.65% of the current outstanding Galapagos shares 
• Raised €6.7 million year-to-date through the exercise of subscription rights 

Post-period events 

• On 27 October 2022, the Pharmacovigilance Risk Assessment Committee (PRAC) of the European Medicines Agency (EMA) concluded the safety review (Article 20 procedure) of all JAK inhibitors approved in the EU for the treatment of inflammatory diseases. On 28 October 2022, the PRAC recommended the harmonization of all labels and concluded that JAK inhibitors should remain indicated for the treatment of patients with RA who have responded inadequately to or who cannot tolerate disease modifying anti-rheumatic drugs (DMARDs) therapy, and for patients with UC who have responded inadequately to or who cannot tolerate conventional therapy or biologics. The PRAC also recommended to update all product labels to include a precautionary approach for use of JAK inhibitors in patients with identified risk factors only if no suitable treatment alternative is available (Section 4.4 - Warning and Precautions). The PRAC recommendations will now be considered by the Committee for Medicinal Products for Human Use (CHMP) for an opinion  
• Abstract accepted for poster presentation at the Annual Society of Hematology (ASH) conference taking place 10-13 December 2022 on the initial data from the ATALANTA-1 Phase 1/2 study in recurring/refractory Non-Hodgkin Lymphoma (rrNHL) evaluating the feasibility, safety and efficacy of the CD19 CAR-T candidate manufactured at point-of-care  
• New post hoc analyses from SELECTION Phase 3 data set with filgotinib in UC patients presented at the United European Gastroenterology (UEG) Week 
• Received positive CHMP opinion for Jyseleca European label update based on testicular function safety data from MANTA/RAy studies