UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of April 2019.
Commission File Number: 001-37384
GALAPAGOS NV
(Translation of registrants name into English)
Generaal De Wittelaan L11 A3
2800 Mechelen, Belgium
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ☒ Form 40-F ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐
Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐
Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrants home country), or under the rules of the home country exchange on which the registrants securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrants security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.
First Quarter 2019 Results
On April 25, 2019, Galapagos NV (the Company) announced its unaudited first quarter results for 2019, which are further described in a Q1 2019 report.
Exhibit |
Description | |
99.1 | Press Release issued on April 25, 2019 | |
99.2 | First Quarter Report 2019 |
The information contained in this Report on Form 6-K, including the exhibits, except for the quotes of Onno van de Stolpe and Bart Filius contained in Exhibit 99.1, is hereby incorporated by reference into the Companys Registration Statements on Forms F-3 (File No. 333-230639) and S-8 (File Nos. 333-204567, 333-208697,333-211834, 333-215783, 333-218160, 333-225263).
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
GALAPAGOS NV (Registrant) | ||||||
Date: April 26, 2019 | /s/ Xavier Maes | |||||
Xavier Maes | ||||||
Company Secretary |
Exhibit 99.1
Galapagos reports on historic first quarter 2019
Key Q1 2019 results:
| Group revenues of 40.9 million |
| Operating loss 53.2 million |
| Net loss of 48.7 million |
| End of first quarter cash and cash equivalents 1.2 billion |
| Competitive safety and efficacy results with filgotinib in FINCH 1 and 3 Phase 3 trials in RA |
| Clinical progress reported in broad and growing inflammation and fibrosis pipeline |
Webcast presentation tomorrow, 26 April 2019, at 14.00 CET/8 AM ET,
+32 2 404 0659, code 1452466, www.glpg.com
Mechelen, Belgium; 25 April 2019, 22.01 CET; regulated information Galapagos NV (Euronext & NASDAQ: GLPG) presents financial results and highlights the key events for the first quarter of 2019.
The first quarter of 2019 was one of the most historic ones in our nearly 20 year existence: our Phase 3 FINCH 1 and 3 results with our lead program, selective JAK1 inhibitor filgotinib, show competitive efficacy and safety potential in rheumatoid arthritis. With over 40 trials running in 2019, including our fully-owned ISABELA and PINTA programs in IPF and Toledo in inflammation, we are looking forward to a particulary busy and interesting rest of the year, said Onno van de Stolpe, CEO of Galapagos.
Bart Filius, COO & CFO, added: While expanding our early stage clinical portfolio and executing clinical trials on the later stage assets, we incurred an operational cash burn1 of €76.3 million in the first quarter. Given the expected growth in development activity this year, we retain our full year 2019 cash burn guidance of €320-340 million. Our current total cash and cash equivalents position is approximately €1.2 billion, maintaining an excellent financial position to deliver the trials and earlier R&D research planned.
Outlook 2019
Following on the positive Phase 3 FINCH trial results, Gilead plans to discuss submissions for approval of filgotinib in RA with regulatory authorities in 2019. They also plan to report topline results for the proof-of-concept trials in Sjögrens syndrome and cutaneous lupus, and launch a Phase 3 trial in psoriatic arthritis.
1 | The operational cash burn (or operational cash flow if this performance measure is positive) is equal to the increase or decrease in our cash and cash equivalents (excluding the effect of exchange rate differences on cash and cash equivalents), minus : |
(i) | the net proceeds, if any, from share capital and share premium increases included in the net cash flows generated / used (-) in financing activities and; |
(ii) | the net proceeds or cash used, if any, in acquisitions or disposals of businesses; and the movement in restricted cash, if any, included in the net cash flows generated / used (-) in investing activities. |
This alternative performance measure is in our view an important metric for a biotech company in the development stage.
1
We will continue recruitment in our proprietary ISABELA and NOVESA trials, and plan to fully recruit our PINTA trial. With collaboration partner Servier, we also aim to finalize recruitment in the ROCCELLA trial. For MOR106, together with our collaboration partners MorphoSys and Novartis, we plan to continue executing the Phase 1 and 2 trials running.
With regard to our earlier and fully proprietary programs, we expect Phase 1 readouts of a number of trials, including for GLPG3312, our first Toledo compound, with a Phase 1 for a second Toledo compound (GLPG3970), scheduled for the second half of the year.
We retain our guidance for an operational cash burn between 320 340 million in 2019.
Key figures Q1 2019 (unaudited)
( millions, except basic & diluted loss per share)
31 Mar 2019 Group total |
31 Mar 2018 Group total |
|||||||
Revenues and other income |
40.9 | 44.8 | ||||||
R&D expenditure |
-83.2 | -69.8 | ||||||
G&A and S&M expenses |
-11.0 | -7.1 | ||||||
Operating loss |
-53.2 | -32.0 | ||||||
Financial result |
4.7 | -5.2 | ||||||
Taxes |
-0.1 | -0.1 | ||||||
Net result for the period |
-48.7 | -37.3 | ||||||
Basic and diluted loss per share () |
-0.89 | -0.73 | ||||||
Cash and cash equivalents |
1,222.9 | 1,108.2 |
First quarter report 2019
Galapagos has published its online financial report for the first quarter ended 31 March 2019, which can be accessed via http://reports.glpg.com/2019/q1/en/
Conference call and webcast presentation
Galapagos will conduct a conference call open to the public tomorrow, 26 April 2019, at 14:00 CET/8 AM ET, which will also be webcast. To participate in the conference call, please call one of the following numbers ten minutes prior to commencement:
Confirmation Code: 1452466
United Kingdom: | +44 330 336 9105 | |
France: | +33 1 76 772 274 | |
Belgium: | +32 2 404 0659 | |
USA: | +1 323 794 2551 | |
Netherlands: | +31 20 721 9251 |
2
A question and answer session will follow the presentation of the results. Go to www.glpg.com to access the live audio webcast. The archived webcast will also be available for replay shortly after the close of the call.
Financial calendar
25 July 2019 | Half year 2019 results (webcast 26 July 2019) | |
24 October 2019 | Third quarter 2019 results (webcast 25 October 2019) | |
20 February 2020 | Full year 2019 results (webcast 21 February 2020) |
About Galapagos
Galapagos (Euronext & NASDAQ: GLPG) discovers and develops small molecule medicines with novel modes of action, three of which show promising patient results and are currently in late-stage development in multiple diseases. Our pipeline comprises Phase 3 through to discovery programs in inflammation, fibrosis, osteoarthritis and other indications. Our ambition is to become a leading global biopharmaceutical company focused on the discovery, development and commercialization of innovative medicines. More information at www.glpg.com.
All the drug candidates mentioned in this press release are investigational; their efficacy and safety have not yet been established.
Contacts
Investors:
Elizabeth Goodwin
VP IR
+1 781 460 1784
Sofie Van Gijsel
Director IR
+32 485 19 14 15
ir@glpg.com
Media:
Carmen Vroonen
Senior Director Communications & Public Affairs
+32 473 82 48 74
Evelyn Fox
Director Communications
+31 6 53 591 999
communications@glpg.com
Forward-looking statements
This release may contain forward-looking statements, including, among other things, statements regarding the guidance from management (including guidance regarding the expected operational cash burn during financial year 2019), financial results, timing and/or results of clinical studies, and interaction with regulators. Galapagos cautions the reader that forward-looking statements are not guarantees of future performance. Forward-looking statements involve known and unknown risks, uncertainties and other factors which might cause the actual results, financial condition and liquidity, performance or achievements of Galapagos, or industry results, to be materially different from any historic or future results, financial conditions and liquidity, performance or achievements expressed or implied by such forward-looking statements. In addition, even if Galapagos results, performance, financial condition and liquidity, and the development of the industry in which it
3
operates are consistent with such forward-looking statements, they may not be predictive of results or developments in future periods. Among the factors that may result in differences are that Galapagos expectations regarding its 2019 operating expenses may be incorrect (including because one or more of its assumptions underlying its expense expectations may not be realized), Galapagos expectations regarding its development programs may be incorrect, the inherent uncertainties associated with competitive developments, clinical study and product development activities and regulatory approval requirements (including that data from Galapagos ongoing clinical research programs may not support registration or further development of its product candidates due to safety, efficacy or other reasons), Galapagos reliance on collaborations with third parties, and estimating the commercial potential of its development programs. A further list and description of these risks, uncertainties and other risks can be found in Galapagos Securities and Exchange Commission (SEC) filings and reports, including in Galapagos most recent annual report on form 20-F filed with the SEC and other filings and reports filed by Galapagos with the SEC. Given these uncertainties, the reader is advised not to place any undue reliance on such forward-looking statements. These forward-looking statements speak only as of the date of publication of this document. Galapagos expressly disclaims any obligation to update any such forward-looking statements in this document to reflect any change in its expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements, unless specifically required by law or regulation.
4
Exhibit 99.2
CONTENTS
- 2 -
Galapagos NV Q1 Report 2019
THE GALAPAGOS GROUP
Letter from the management
Dear shareholders,
The first quarter of 2019 was one of the most historic ones in our nearly 20 year existence: our Phase 3 FINCH 1 and 3 results with our lead program, selective JAK1 inhibitor filgotinib, show competitive efficacy and safety potential in rheumatoid arthritis (RA). In particular, the safety data from the FINCH program, demonstrated in more than 3,000 patients during six months of treatment, supported the long-term safety data seen with filgotinib in the DARWIN 3 study, as reported at week 156. The large body of filgotinib results to date points to its promising risk/ benefit profile, and we expect our collaboration partner Gilead to discuss submissions for approval in RA with regulatory authorities in the coming months.
And this is only the beginning: we believe that the efficacy and safety results of filgotinib in RA have potential read-throughs to the overall filgotinib development program, currently ongoing in more than 10 different inflammatory conditions. In 2019, we anticipate that Gilead will report topline results with filgotinib in Sjögrens syndrome and cutaneous lupus, and initiate a Phase 3 trial in psoriatic arthritis.
We are also making steady progress with regard to the other programs in our broad and growing pipeline. We opened new centers for the global Phase 3 ISABELA trial with our fully proprietary autotaxin inhibitor GLPG1690 in idiopathic pulmonary fibrosis (IPF). It is noteworthy that recruitment per center is currently above target. This reflects the enthusiasm we hear from investigators on this innovative trial, as GLPG1690 has the potential to address the high unmet medical need for IPF patients world-wide. Recruitment for the Phase 2 NOVESA trial with GLPG1690 in systemic sclerosis (SSc) and for the Phase 2 PINTA trial with GPR84 inhibitor GLPG1205 in IPF is on track. We initiated the GECKO Phase 2 trial with antibody MOR106 for atopic dermatitis acting on novel target IL-17C. We opened an IND for this trial with the FDA in the U.S. |
Furthermore, we note excellent progress in recruitment for the Phase 2b ROCCELLA trial for osteoarthritis with ADAMTS-5 inhibitor GLPG1972, which we develop together with our collaboration partner Servier.
At the same time, we continue to leverage our unique target discovery engine, as we keep pushing forward to discover novel targets and develop new mode of action molecules. This includes our Toledo class of novel targets for inflammation, for which we brought a first compound, GLPG3312, into the clinic in early 2019, with a second one expected to follow in the second half of the year.
Galapagos ended the first quarter of 2019 with a very strong balance sheet. We continue to grow our organization to support this broad pipeline, while we continue to build a commercial organization for potential launch of filgotinib in Europe next year. The Galapagos proprietary late stage development is growing, leading to increased costs for our company. This year we expect to execute over 40 clinical trials. Our financial guidance for operational cash burn1 between 320 and 340 million for full year 2019 remains unchanged.
1 | The operational cash burn (or operational cash flow if this performance measure is positive) is equal to the increase or decrease in our cash and cash equivalents (excluding the effect of exchange rate differences on cash and cash equivalents), minus: |
i. the net proceeds, if any, from share capital and share premium increases included in the net cash flows generated / used () in financing activities
ii. the net proceeds or cash used, if any, in acquisitions or disposals of businesses; and the movement in restricted cash, if any, included in the net cash flows generated / used () in investing activities.
This alternative performance measure is in our view an important metric for a biotech company in the development stage.
- 4 -
Galapagos NV Q1 Report 2019
THE GALAPAGOS GROUP
Operational overview Q1 2019
Inflammation
| Reported positive results with filgotinib in the Phase 3 FINCH 1 and 3 trials in RA, with collaboration partner Gilead |
| Gilead completed recruitment for the SELECTION Phase 3 trial in UC, as well for the Phase 2 trials in Sjögrens disease and cutaneous lupus |
| Initiated a Phase 1 trial with GLPG3312, a first compound from our Toledo class of novel targets for inflammation |
Fibrosis
| Initiated the NOVESA Phase 2 trial with GLPG1690 in SSc |
| Inlicensed compounds from Fibrocor and Evotec for fibrosis |
Corporate & other
| Raised 3.5 million from warrant exercises |
Recent events
| Initiated a Phase 1 trial with GLPG3121, a novel JAK1/TYK2 inhibitor aimed at inflammation |
| Initiated the GECKO Phase 2 trial with MOR106 together with collaboration partners MorphoSys and Novartis |
Q1 2019 financial result
Revenues and other income
Our revenues and other income for the first three months of 2019 amounted to 40.9 million, compared to 44.8 million in the first three months of 2018. Revenues (33.0 million for the first three months of 2019 vs 37.9 million for the first three months of 2018) were lower due to lower over time recognition in revenue of the upfront payments and milestone payments related to the filgotinib program with Gilead, as well as for the CF program as we are transitioning the activities to AbbVie. This was partly compensated by higher reimbursement income mainly from Novartis in the scope of our collaboration for MOR106.
Other income increased (7.9 million for the first three months of 2019 vs 6.9 million for the first three months of 2018), mainly driven by higher income from R&D incentives.
Results
We realized a net loss of 48.7 million for the first three months of 2019, compared to a net loss of 37.3 million for the first three months of 2018.
We reported an operating loss amounting to 53.2 million for the first three months of 2019, compared to an operating loss of 32.0 million for the first three months of 2018.
Our R&D expenditure in the first three months of 2019 amounted to 83.2 million, compared to 69.8 million for the first three months of 2018. This planned increase was mainly due to an increase of 5.5 million in subcontracting costs primarily related to our IPF program and other proprietary programs. Furthermore, personnel costs increased explained by a planned headcount increase and higher costs related to the warrant plans as a result of the increase of the Galapagos share price. These also explained the increase in our G&A and S&M expenses which were 11.0 million in the first three months of 2019, compared to 7.1 million in the first three months of 2018.
- 5 -
Galapagos NV Q1 Report 2019
THE GALAPAGOS GROUP
Net financial income in the first three months of 2019 amounted to 4.7 million, compared to net financial expenses of 5.2 million for the first three months of 2018, which was primarily attributable to 5.0 million of unrealized exchange gain on our cash position in U.S. dollars (5.6 million of unrealized exchange loss on our cash position in U.S. dollars in the first three months of 2018).
Liquid assets position
Cash and cash equivalents totaled 1,222.9 million on 31 March 2019.
A net decrease of 67.9 million in cash and cash equivalents was recorded during the first three months of 2019, compared to a net decrease of 43.0 million during the first three months of 2018. This net decrease was composed of 76.3 million of operational cash burn, offset by (i) 3.5 million of cash proceeds from capital and share premium increase from exercise of warrants in the first three months of 2019 and (ii) 5.0 million of unrealized positive exchange rate differences.
Finally, our balance sheet as at 31 March 2019 held a receivable from the French government (Crédit dImpôt Recherche2), payable in 4 yearly tranches, and a receivable from the Belgian Government for R&D incentives, for a total of 87.7 million.
Outlook 2019
Following on the positive Phase 3 FINCH trial results, Gilead plans to discuss submissions for approval of filgotinib in RA with regulatory authorities in 2019. Also for filgotinib, in the second half of the year, we expect Gilead to report topline results for the proof-of-concept studies in Sjögrens syndrome and cutaneous lupus, and to launch a Phase 3 trial in PsA.
We also plan to fully recruit our Phase 2 PINTA trial for our IPF compound GLPG1205 as well as for our ROCCELLA study in OA, together with collaboration partner Servier. For GLPG1690, we plan to continue recruitment in our ISABELA trials as well as the NOVESA Phase 2 trial in SSc, for which a first patient was dosed in early 2019.
For MOR106, together with our collaboration partners MorphoSys and Novartis, we plan to continue recruiting the Phase 2 trial in AtD with MOR106 in combination with topical corticosteroids (the GECKO trial), for which a first patient was dosed post-period, and to prepare further for the Japanese ethno-bridging study. We will also continue the IGUANA Phase 2 trial in AtD as well as the subcutaneous Phase 1 bridging study with MOR106. Pending positive results, these four studies combined should offer a solid data package for our collaboration partner Novartis to move into Phase 3.
With regard to our earlier and fully proprietary programs, we expect Phase 1 readouts of a number of trials, including for GLPG3312, the first Toledo compound that entered the clinic in early 2019. This molecule is scheduled to be dosed in patients in a first proof-of-concept study in ulcerative colitis before the end of the year. We also plan to initiate a Phase 1 trial with our second generation Toledo compound, GLPG3970, in the second half of the year.
Given the large number of maturing proprietary clinical programs and the expansion of our R&D and commercial team, we retain our guidance for an operational cash burn between 320 and 340 million in 2019.
We thank you again for your support of Galapagos, as we aim to discover and to develop more novel medications, bring successful therapies to the market, and improve patients lives.
Onno van de Stolpe
CEO
2 | Crédit dImpôt Recherche refers to an innovation incentive system underwritten by the French government. |
- 6 -
Galapagos NV Q1 Report 2019
THE GALAPAGOS GROUP
At a glance
Consolidated Key Figures
(thousands of , if not stated otherwise) |
Three months ended 31 March 2019 |
Three months ended 31 March 2018 |
Full year 2018 | |||||||||
Income statement |
||||||||||||
Revenues |
33,047 | 37,907 | 288,836 | |||||||||
Other income |
7,872 | 6,931 | 29,009 | |||||||||
R&D expenditure |
(83,195 | ) | (69,765 | ) | (322,875 | ) | ||||||
S, G&A expenses |
(10,966 | ) | (7,110 | ) | (39,776 | ) | ||||||
Operating expenses |
(94,161 | ) | (76,875 | ) | (362,652 | ) | ||||||
Operating loss |
(53,242 | ) | (32,036 | ) | (44,807 | ) | ||||||
Net financial results |
4,655 | (5,184 | ) | 15,598 | ||||||||
Taxes |
(68 | ) | (62 | ) | (50 | ) | ||||||
Net loss |
(48,656 | ) | (37,283 | ) | (29,259 | ) | ||||||
Balance sheet |
||||||||||||
Cash and cash equivalents |
1,222,901 | 1,108,186 | 1,290,796 | |||||||||
R&D incentives receivables |
87,674 | 80,870 | 84,646 | |||||||||
Assets(1) |
1,400,200 | 1,229,864 | 1,439,496 | |||||||||
Shareholders equity(1) |
1,175,755 | 899,345 | 1,214,249 | |||||||||
Deferred income |
123,822 | 268,654 | 149,801 | |||||||||
Other liabilities(1) |
100,624 | 61,865 | 75,446 | |||||||||
Cash flow |
||||||||||||
Operational cash burn(2) |
(76,344 | ) | (41,354 | ) | (158,384 | ) | ||||||
Cash flow used in operating activities(1) |
(71,698 | ) | (39,804 | ) | (142,466 | ) | ||||||
Cash flow used in investing activities |
(3,398 | ) | (1,531 | ) | (15,914 | ) | ||||||
Cash flow generated in financing activities(1) |
2,233 | 3,905 | 287,876 | |||||||||
Increase / decrease (-) in cash and cash equivalents |
(72,863 | ) | (37,430 | ) | 129,497 | |||||||
Effect of currency exchange rate fluctuation on cash and cash equivalents |
4,968 | (5,595 | ) | 10,089 | ||||||||
Cash and cash equivalents at the end of the period |
1,222,901 | 1,108,186 | 1,290,796 | |||||||||
Financial ratios |
||||||||||||
Number of shares issued at the end of the period |
54,614,791 | 51,234,962 | 54,465,421 | |||||||||
Basic and diluted loss per share (in ) |
(0.89 | ) | (0.73 | ) | (0.56 | ) | ||||||
Share price at the end of the period (in ) |
103.90 | 81.30 | 80.56 | |||||||||
Total group employees at the end of the period (number) |
779 | 634 | 725 |
(1) | Our assets, shareholders equity, other liabilities, cash flow used in operating activities and cash flow generated in financing activities for the period ended 31 March 2019 were influenced by the adoption of the new standard IFRS 16 Leases, on 1 January 2019. We refer to the notes of this condensed consolidated interim financial report for additional information. |
(2) | The operational cash burn (or operational cash flow if this performance measure is positive) is equal to the increase or decrease in our cash and cash equivalents (excluding the effect of exchange rate differences on cash and cash equivalents), minus: |
(i) | the net proceeds, if any, from share capital and share premium increases included in the net cash flows generated / used (-) in financing activities |
(ii) | the net proceeds or cash used, if any, in acquisitions or disposals of businesses; and the movement in restricted cash, if any, included in the net cash flows generated / used (-) in investing activities. |
This alternative performance measure is in our view an important metric for a biotech company in the development stage.
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Galapagos NV Q1 Report 2019
THE GALAPAGOS GROUP
Risk factors
We refer to the description of risk factors in the 2018 annual report, pp. 57-66, as supplemented by the description of risk factors in our Annual Report on Form 20-F filed with the U.S. Securities and Exchange Commission, pp. 4-45. In summary, the principal risks and uncertainties faced by us relate to: product development, regulatory approval and commercialization; our financial position and need for additional capital; our reliance on third parties; our competitive position; our intellectual property; our organization, structure and operation (including but not limited to certain risks related to our status as a U.S. publicly listed company following the public offering of shares (in the form of ADSs) and listing on Nasdaq in May 2015) and market risks relating to our shares and ADSs.
We also refer to the description of the groups financial risk management given in the 2018 annual report, pp. 161-163, which remains valid.
- 8 -
Galapagos NV Q1 Report 2019
THE GALAPAGOS GROUP
The Galapagos share
Performance of the Galapagos share on Euronext and Nasdaq
- 9 -
Galapagos NV Q1 Report 2019
THE GALAPAGOS GROUP
Disclaimer and other information
Galapagos NV is a limited liability company organized under the laws of Belgium, having its registered office at Generaal De Wittelaan L11 A3, 2800 Mechelen, Belgium. Throughout this report, the term Galapagos NV refers solely to the non-consolidated Belgian company and references to we, our, the group or Galapagos include Galapagos NV together with its subsidiaries.
This report is published in Dutch and in English. In case of inconsistency between the Dutch and the English versions, the Dutch version shall prevail. Galapagos is responsible for the translation and conformity between the Dutch and English version.
This report is available free of charge and upon request to be addressed to:
Galapagos NV
Investor Relations
Generaal De Wittelaan L11 A3 2800 Mechelen, Belgium
Tel: +32 15 34 29 00
Email: ir@glpg.com
A digital version of this report is available on our website, www.glpg.com.
We will use reasonable efforts to ensure the accuracy of the digital version, but do not assume responsibility if inaccuracies or inconsistencies with the printed document arise as a result of any electronic transmission. Therefore, we consider only the printed version of this report to be legally valid. Other information on our website or on other websites does not form a part of this report.
Listings
Euronext Amsterdam and Brussels: GLPG
Nasdaq: GLPG
Forward-looking statements
This report contains forward-looking statements, all of which involve certain risks and uncertainties. These statements are often, but are not always, made through the use of words or phrases such as believe, anticipate, expect, intend, plan, seek, estimate, may, will, could, stand to, continue, as well as similar expressions. Forward-looking statements contained in this report include, but are not limited to, statements made in the Letter from the management, the information provided in the section captioned Outlook 2019, guidance from management regarding the expected operational use of cash during financial year 2019, statements regarding the expected timing, design and readouts of ongoing and planned clinical trials (i) with filgotinib in rheumatoid arthritis, Crohns disease, ulcerative colitis and other indications, (ii) with GLPG1690 in IPF and SSc and GLPG1205 in IPF, (iii) with GLPG1972 in osteoarthritis, (iv) with MOR106 in atopic dermatitis, and (v) with GLPG3312 and GLPG3121 for inflammation. We caution the reader that forward-looking statements are not guarantees of future performance. Forward-looking statements may involve known and unknown risks, uncertainties and other factors which might cause our actual results, financial condition and liquidity, performance or achievements, or the development of the industry in which we operate, to be materially different from any historic or future results, financial conditions, performance or achievements expressed or implied by such forward-looking statements. In addition, even if our results of operations, financial condition and liquidity, and the development of the industry in which we operate are consistent with such forward-looking statements, they may not be predictive of results or developments in future periods. Among the factors that may result in differences are that our expectations regarding our 2019 revenues and financial results and our 2019 operating
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Galapagos NV Q1 Report 2019
THE GALAPAGOS GROUP
expenses may be incorrect (including because one or more of our assumptions underlying our revenue or expense expectations may not be realized), the inherent uncertainties associated with competitive developments, clinical trial and product development activities and regulatory approval requirements (including that data from our clinical research programs in rheumatoid arthritis, Crohns disease, ulcerative colitis, idiopathic pulmonary fibrosis, systemic sclerosis, osteoarthritis, atopic dermatitis, and other inflammatory indications may not support registration or further development of our product candidates due to safety, efficacy or other reasons), our reliance on collaborations with third parties (including our collaboration partner for filgotinib, Gilead; our collaboration partner for GLPG1972, Servier; and our collaboration partners for MOR106, Novartis and MorphoSys), and estimating the commercial potential of our product candidates. A further list and description of these risks, uncertainties and other risks can be found in our Securities and Exchange Commission filings and reports, including in our most recent Annual Report on Form 20-F filed with the SEC and our other filings and reports. We also refer to the Risk Factors section of this report. Given these uncertainties, the reader is advised not to place any undue reliance on such forward-looking statements. These forward-looking statements speak only as of the date of publication of this document. We expressly disclaim any obligation to update any such forward-looking statements in this document to reflect any change in our expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements, unless specifically required by law or regulation.
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Galapagos NV Q1 Report 2019
FINANCIAL STATEMENTS
Unaudited condensed consolidated interim financial statements for the first three months of 2019
Consolidated statements of income and comprehensive income
(unaudited)
Consolidated income statement
Three months ended 31 March | ||||||||
(thousands of , except per share data) |
2019 | 2018 | ||||||
Revenues |
33,047 | 37,907 | ||||||
Other income |
7,872 | 6,931 | ||||||
|
|
|
|
|||||
Total revenues and other income |
40,919 | 44,838 | ||||||
|
|
|
|
|||||
Research and development expenditure |
(83,195 | ) | (69,765 | ) | ||||
General and administrative expenses |
(9,221 | ) | (6,697 | ) | ||||
Sales and marketing expenses |
(1,746 | ) | (413 | ) | ||||
|
|
|
|
|||||
Total operating expenses |
(94,161 | ) | (76,875 | ) | ||||
|
|
|
|
|||||
Operating loss |
(53,242 | ) | (32,036 | ) | ||||
Financial income |
6,999 | 1,610 | ||||||
Financial expenses |
(2,345 | ) | (6,794 | ) | ||||
|
|
|
|
|||||
Loss before tax |
(48,588 | ) | (37,221 | ) | ||||
|
|
|
|
|||||
Income taxes |
(68 | ) | (62 | ) | ||||
|
|
|
|
|||||
Net loss |
(48,656 | ) | (37,283 | ) | ||||
|
|
|
|
|||||
Net loss attributable to: |
||||||||
Owners of the parent |
(48,656 | ) | (37,283 | ) | ||||
|
|
|
|
|||||
Basic and diluted loss per share |
(0.89 | ) | (0.73 | ) | ||||
|
|
|
|
The accompanying notes form an integral part of these condensed consolidated financial statements.
- 13 -
Galapagos NV Q1 Report 2019
FINANCIAL STATEMENTS
Consolidated statement of comprehensive income / loss (-)
Three months ended 31 March | ||||||||
(thousands of ) |
2019 | 2018 | ||||||
Net loss |
(48,656 | ) | (37,283 | ) | ||||
|
|
|
|
|||||
Items that may be reclassified subsequently to profit or loss: |
||||||||
Translation differences, arisen from translating foreign activities |
267 | (3 | ) | |||||
|
|
|
|
|||||
Other comprehensive income / loss (-), net of income tax |
267 | (3 | ) | |||||
|
|
|
|
|||||
Total comprehensive income / loss (-) attributable to: |
||||||||
Owners of the parent |
(48,389 | ) | (37,286 | ) | ||||
|
|
|
|
The accompanying notes form an integral part of these condensed consolidated financial statements.
- 14 -
Galapagos NV Q1 Report 2019
FINANCIAL STATEMENTS
Consolidated statements of financial position
(unaudited)
31 March | 31 December | |||||||
(thousands of ) |
2019 | 2018 | ||||||
Intangible assets |
6,497 | 3,632 | ||||||
Property, plant and equipment |
49,542 | 23,137 | ||||||
Deferred tax assets |
2,511 | 2,514 | ||||||
Non-current R&D incentives receivables |
76,029 | 73,443 | ||||||
Other non-current assets |
6,377 | 7,919 | ||||||
|
|
|
|
|||||
Non-current assets |
140,956 | 110,645 | ||||||
|
|
|
|
|||||
Trade and other receivables |
15,347 | 18,609 | ||||||
Current R&D incentives receivables |
11,645 | 11,203 | ||||||
Cash and cash equivalents |
1,222,901 | 1,290,796 | ||||||
Other current assets |
9,351 | 8,244 | ||||||
|
|
|
|
|||||
Current assets |
1,259,244 | 1,328,851 | ||||||
|
|
|
|
|||||
Total assets |
1,400,200 | 1,439,496 | ||||||
|
|
|
|
|||||
Equity and liabilities |
||||||||
Share capital |
237,348 | 236,540 | ||||||
Share premium account |
1,280,452 | 1,277,780 | ||||||
Other reserves |
(735 | ) | (735 | ) | ||||
Translation differences |
(1,290 | ) | (1,557 | ) | ||||
Accumulated losses |
(340,020 | ) | (297,779 | ) | ||||
|
|
|
|
|||||
Total equity |
1,175,755 | 1,214,249 | ||||||
|
|
|
|
|||||
Retirement benefit liabilities |
3,851 | 3,764 | ||||||
Non-current lease liabilities |
20,409 | | ||||||
Other non-current liabilities |
736 | 1,578 | ||||||
|
|
|
|
|||||
Non-current liabilities |
24,996 | 5,342 | ||||||
|
|
|
|
|||||
Current lease liabilities |
4,580 | | ||||||
Trade and other liabilities |
69,880 | 68,928 | ||||||
Current tax payable |
1,168 | 1,175 | ||||||
Current deferred income |
123,822 | 149,801 | ||||||
|
|
|
|
|||||
Current liabilities |
199,450 | 219,905 | ||||||
|
|
|
|
|||||
Total liabilities |
224,445 | 225,247 | ||||||
|
|
|
|
|||||
Total equity and liabilities |
1,400,200 | 1,439,496 | ||||||
|
|
|
|
The accompanying notes form an integral part of these condensed consolidated financial statements.
- 15 -
Galapagos NV Q1 Report 2019
FINANCIAL STATEMENTS
Consolidated cash flow statements
(unaudited)
Three months ended 31 March | ||||||||
(thousands of ) |
2019 | 2018 | ||||||
Net loss of the period |
(48,656 | ) | (37,283 | ) | ||||
|
|
|
|
|||||
Adjustment for non-cash transactions |
5,524 | 11,057 | ||||||
Adjustment for items to disclose separately under operating cash flow |
(1,517 | ) | (530 | ) | ||||
Adjustment for items to disclose under investing and financing cash flows |
(3 | ) | | |||||
Change in working capital other than deferred income |
(2,294 | ) | 20,482 | |||||
Decrease in deferred income |
(25,979 | ) | (34,458 | ) | ||||
|
|
|
|
|||||
Cash used in operations |
(72,925 | ) | (40,732 | ) | ||||
|
|
|
|
|||||
Interest paid |
(327 | ) | (500 | ) | ||||
Interest received |
1,565 | 1,428 | ||||||
Corporate taxes paid |
(11 | ) | | |||||
|
|
|
|
|||||
Net cash flows used in operating activities |
(71,698 | ) | (39,804 | ) | ||||
|
|
|
|
|||||
Purchase of property, plant and equipment |
(2,103 | ) | (1,192 | ) | ||||
Purchase of intangible fixed assets |
(1,201 | ) | (340 | ) | ||||
Proceeds from disposal of property, plant and equipment |
1 | 1 | ||||||
Acquisition of financial assets held at fair value through profit or loss |
(177 | ) | | |||||
Proceeds from sale of financial assets held at fair value through profit or loss |
82 | | ||||||
|
|
|
|
|||||
Net cash flows used in investing activities |
(3,398 | ) | (1,531 | ) | ||||
|
|
|
|
|||||
Payment of lease liabilities |
(1,248 | ) | (19 | ) | ||||
Proceeds from capital and share premium increases from exercise of warrants |
3,481 | 3,924 | ||||||
|
|
|
|
|||||
Net cash flows generated in financing activities |
2,233 | 3,905 | ||||||
|
|
|
|
|||||
Decrease in cash and cash equivalents |
(72,863 | ) | (37,430 | ) | ||||
|
|
|
|
|||||
Cash and cash equivalents at beginning of the period |
1,290,796 | 1,151,211 | ||||||
|
|
|
|
|||||
Decrease in cash and cash equivalents |
(72,863 | ) | (37,430 | ) | ||||
|
|
|
|
|||||
Effect of exchange rate differences on cash and cash equivalents |
4,968 | (5,595 | ) | |||||
|
|
|
|
|||||
Cash and cash equivalents at end of the period |
1,222,901 | 1,108,186 | ||||||
|
|
|
|
The accompanying notes form an integral part of these condensed consolidated financial statements.
- 16 -
Galapagos NV Q1 Report 2019
FINANCIAL STATEMENTS
Consolidated statements of changes in equity
(unaudited)
(thousands of ) |
Share capital |
Share premium account |
Translation differences |
Other reserves |
Accumul. losses |
Total | ||||||||||||||||||
On 1 January 2018 |
233,414 | 993,025 | (1,754 | ) | (1,260 | ) | (211,441 | ) | 1,011,983 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Change in accounting policy (modified retrospective application IFRS 15) |
(83,220 | ) | (83,220 | ) | ||||||||||||||||||||
Change in accounting policy (modified retrospective application IFRS 9) |
619 | (619 | ) | | ||||||||||||||||||||
Restated total equity at 1 January 2018 |
233,414 | 993,025 | (1,754 | ) | (641 | ) | (295,279 | ) | 928,766 | |||||||||||||||
Net loss |
(37,283 | ) | (37,283 | ) | ||||||||||||||||||||
Other comprehensive loss |
(3 | ) | (3 | ) | ||||||||||||||||||||
Total comprehensive loss |
| | (3 | ) | | (37,283 | ) | (37,286 | ) | |||||||||||||||
Share-based compensation |
3,943 | 3,943 | ||||||||||||||||||||||
Exercise of warrants |
1,613 | 2,311 | 3,924 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
On 31 March 2018 |
235,027 | 995,336 | (1,757 | ) | (641 | ) | (328,620 | ) | 899,345 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
On 1 January 2019 |
236,540 | 1,277,780 | (1,557 | ) | (735 | ) | (297,779 | ) | 1,214,249 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Change in accounting policy (modified retrospective application IFRS 16) |
416 | 416 | ||||||||||||||||||||||
Restated total equity at 1 January 2019 |
236,540 | 1,277,780 | (1,557 | ) | (735 | ) | (297,363 | ) | 1,214,665 | |||||||||||||||
Net loss |
(48,656 | ) | (48,656 | ) | ||||||||||||||||||||
Other comprehensive income |
267 | 267 | ||||||||||||||||||||||
Total comprehensive income / loss (-) |
| | 267 | | (48,656 | ) | (48,389 | ) | ||||||||||||||||
Share-based compensation |
6,000 | 6,000 | ||||||||||||||||||||||
Exercise of warrants |
808 | 2,673 | 3,481 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
On 31 March 2019 |
237,348 | 1,280,452 | (1,290 | ) | (735 | ) | (340,020 | ) | 1,175,755 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
The accompanying notes form an integral part of these condensed consolidated financial statements.
- 17 -
Galapagos NV Q1 Report 2019
FINANCIAL STATEMENTS
Notes to the unaudited consolidated interim financial statements for the first three months of 2019
Basis of preparation
These condensed consolidated interim financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the European Union and as issued by the IASB. The condensed consolidated interim financial statements do not contain all information required for an annual report and should therefore be read in conjunction with Galapagos annual report 2018.
Significant accounting policies
There were no significant changes in accounting policies applied by us in these condensed consolidated interim financial statements compared to those used in the most recent annual consolidated financial statements of 31 December 2018, except for the adoption of new standards and interpretations described below.
| IFRS 16 Leases (applicable for annual periods beginning on or after 1 January 2019) |
The nature and the effect of these changes were taken into consideration, and the above amendments affected the condensed consolidated interim financial statements as follows:
We adopted IFRS 16 on 1 January 2019, in accordance with the transitional provisions of IFRS 16, using the modified retrospective approach. Consequently, the cumulative effect of adopting IFRS 16 was recognized as an adjustment to the opening balance of retained earnings as at 1 January 2019, with no restatement of the comparative figures.
On adoption of IFRS 16, we recognized lease liabilities in relation to leases which had previously been classified as operating leases under IAS 17. These liabilities were measured at the present value of the remaining lease payments and discounted using our incremental borrowing rate as of 1 January 2019. Our weighted average incremental borrowing rate applied to the lease liabilities on 1 January 2019 was 1.55%.
The differences between our total operating lease commitments as reported in note 25 of our consolidated financial statements of 31 December 2018 and the total lease liabilities recognized in our statement of financial position as at 1 January 2019 are summarized below.
(thousands of ) |
||||
Operating lease commitments disclosed as at 31 December 2018 |
27,704 | |||
|
|
|||
Less: discounting effect using the lessees incremental borrowing rate at the date of initial application |
(1,223 | ) | ||
Less: other |
(569 | ) | ||
|
|
|||
Lease liability recognized as at 1 January 2019 |
25,912 | |||
|
|
|||
Of which are: |
||||
current lease liabilities |
4,516 | |||
non-current lease liabilities |
21,396 |
- 18 -
Galapagos NV Q1 Report 2019
FINANCIAL STATEMENTS
The change in accounting policy affected the statement of financial position as at 1 January 2019 as follows:
(thousands of ) |
1 January 2019 |
|||
Property, plant and equipment (right-of-use assets) |
26,406 | |||
Other current assets (prepaid expenses) |
(494 | ) | ||
|
|
|||
Effect on total assets |
25,912 | |||
|
|
|||
Accumulated losses |
416 | |||
Lease liabilities (current and non-current) |
25,912 | |||
Deferred income |
(416 | ) | ||
|
|
|||
Effect on total equity and liabilities |
25,912 | |||
|
|
We applied the following practical expedients, as permitted by IFRS 16, on transition date:
| Reliance on the previous definition of a lease (as provided by IAS 17) for all contracts that existed on the date of initial application; |
| The use of a single discount rate to a portfolio of leases with reasonably similar characteristics; |
| Reliance on previous assessments on whether leases are onerous instead of performing an impairment review; |
| The accounting for operating leases with a remaining lease term of less than 12 months as at 1 January 2019 as short-term leases. |
Other new standards and interpretations applicable for the annual period beginning on 1 January 2019 did not have any impact on our condensed consolidated interim financial statements.
We have not early adopted any other standard, interpretation, or amendment that has been issued but is not yet effective.
Change in accounting policies with effect from 1 January 2019 as a result of the adoption of IFRS 16:
Whereas until the end of 2018, we made a distinction between finance leases (presented on the balance sheet) and operating leases (off-balance sheet commitments), we recognized as from 1 January 2019 right-of-use assets on the balance sheet and corresponding lease liabilities (measured on a present value basis). These liabilities reflect the expected lease payments to be made in the future, estimated at the commencement date of the leases. After initial recognition, these lease liabilities are measured at amortized cost.
The right-of-use assets (mainly comprising the initial lease liability) are measured at cost and depreciated over their useful life on a straight-line basis. The right-of-use assets are presented in the statement of financial position under the caption Property, plant and equipment and the lease liabilities are presented as current and non-current lease liabilities.
Each lease payment is allocated between the lease liability and financial expenses.
Management judgments and estimates
Preparing interim financial statements in compliance with IFRS requires management to make judgments and estimates and to use assumptions that may significantly influence the reported amounts of assets and liabilities, the notes on contingent assets and liabilities on the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results may differ from these estimates. We refer to our annual report 2018, except for the judgments and estimates as a result of the application of IFRS 16.
- 19 -
Galapagos NV Q1 Report 2019
FINANCIAL STATEMENTS
Details of the unaudited condensed consolidated interim results
Revenues and other income
Revenues
The following table summarizes our revenues for the three months ended 31 March 2019 and 2018.
Three months ended 31 March | ||||||||
(thousands of ) |
2019 | 2018 | ||||||
Recognition of non-refundable upfront payments and license fees |
20,231 | 25,824 | ||||||
|
|
|
|
|||||
Gilead collaboration agreement for filgotinib |
19,787 | 23,874 | ||||||
AbbVie collaboration agreement for CF |
444 | 1,950 | ||||||
|
|
|
|
|||||
Milestone payments |
5,302 | 8,809 | ||||||
|
|
|
|
|||||
Gilead collaboration agreement for filgotinib |
4,834 | 4,891 | ||||||
AbbVie collaboration agreement for CF |
468 | 3,918 | ||||||
|
|
|
|
|||||
Reimbursement income |
5,136 | 192 | ||||||
|
|
|
|
|||||
Novartis collaboration agreement for MOR106 |
4,680 | | ||||||
AbbVie collaboration agreement for CF |
456 | 192 | ||||||
|
|
|
|
|||||
Other revenues |
2,378 | 3,081 | ||||||
|
|
|
|
|||||
Fee-for-services revenues |
2,312 | 3,019 | ||||||
Other |
66 | 63 | ||||||
|
|
|
|
|||||
Total revenues |
33,047 | 37,907 | ||||||
|
|
|
|
Revenues (33.0 million for the first three months of 2019 vs 37.9 million for the first three months of 2018) were lower due to lower over time recognition in revenue of the upfront payments and milestone payments related to the filgotinib program with Gilead, as well as for the CF program as we are transitioning the activities to AbbVie. This was partly compensated by higher reimbursement income mainly from Novartis in the scope of our collaboration for MOR106.
For the first three months of 2019, 24.6 million of deferred income related to the Gilead collaboration agreement was recognized in revenue in function of costs incurred, applying the percentage of completion method. This consisted of the over time revenue recognition of (i) 17.3 million related to the upfront license fee, (ii) 2.5 million related to the deferred income triggered by the accounting treatment of the share subscription agreement under IAS 39 Financial Instruments: recognition and measurement, at the time of signing of the agreement in 2015, and (iii) 4.8 million related to milestone payments. The outstanding balance of deferred income from the Gilead collaboration agreement at the end of March 2019 amounted to 121.2 million all reported as current deferred income, as we expect to reach, at the end of 2019, the predetermined level of development study costs further described hereafter.
In December 2015, we entered into a license and collaboration agreement to co-develop filgotinib with Gilead in rheumatoid arthritis, Crohns disease, ulcerative colitis and other indications. We are responsible for funding 20% of the associated global development costs of the program. We have retained certain mechanisms to give us cost protection as filgotinib advances in clinical development. We can defer our portion of the global co-development study costs if they exceed a predetermined level, which we expect to reach at the end of 2019, and this deferment would be credited against future milestones, royalties or profit sharing at our option. If there are no future amounts to be paid by Gilead, we will not be obligated to make any payments to Gilead for such deferment.
- 20 -
Galapagos NV Q1 Report 2019
FINANCIAL STATEMENTS
For the first three months of 2019, 0.9 million of deferred income related to the AbbVie collaboration agreement was recognized in revenue in function of costs incurred, applying the percentage of completion method. This consisted of the over time revenue recognition of (i) 0.4 million related to the upfront license fees, and (ii) 0.5 million related to milestone payments. The outstanding balance deferred income from the AbbVie collaboration agreement at the end of March 2019 amounted to 2.3 million, all reported as current deferred income.
For the first three months of 2019, 4.7 million of reimbursement income was recognized as revenue related to our R&D activities in the scope of our collaboration agreement with Novartis and MorphoSys for MOR106.
Other revenues
Other revenues amounting to 2.4 million mainly consisted of service revenues from our fee-for-service business for 2.3 million.
Other income
The following table summarizes our other income for the three months ended 31 March 2019 and 2018.
Three months ended 31 March | ||||||||
(thousands of ) |
2019 | 2018 | ||||||
Grant income |
351 | 549 | ||||||
Other income |
7,520 | 6,382 | ||||||
|
|
|
|
|||||
Total other income |
7,872 | 6,931 | ||||||
|
|
|
|
Total other income increased to 7.9 million in the first three months of 2019 compared to 6.9 million in the first three months of 2018, mainly driven by higher income from R&D incentives.
Results
We realized a net loss of 48.7 million for the first three months of 2019, compared to a net loss of 37.3 million in the first three months of 2018.
We reported an operating loss amounting to 53.2 million for the first three months of 2019, compared to an operating loss of 32.0 million for the first three months of 2018.
Our R&D expenditure in the first three months of 2019 amounted to 83.2 million, compared to 69.8 million in the first three months of 2018. This planned increase was mainly due to an increase of 5.5 million in subcontracting costs primarily related to our IPF program and other proprietary programs. Furthermore, personnel costs increased explained by a planned headcount increase and higher costs related to warrant plans as a result of the increase of the Galapagos share price.
- 21 -
Galapagos NV Q1 Report 2019
FINANCIAL STATEMENTS
The table below summarizes our R&D expenditure for the three months ended 31 March 2019 and 2018, broken down by program.
Three months ended 31 March | ||||||||
(thousands of ) |
2019 | 2018 | ||||||
Filgotinib program (partnered) |
(14,400 | ) | (15,265 | ) | ||||
CF program (partnered) |
(1,343 | ) | (11,761 | ) | ||||
IPF program on GLPG1690 (proprietary) |
(20,013 | ) | (8,960 | ) | ||||
OA program on GLPG1972 (partnered) |
(3,861 | ) | (2,233 | ) | ||||
AtD program on MOR106 (partnered) |
(5,490 | ) | (4,494 | ) | ||||
Other |
(38,088 | ) | (27,051 | ) | ||||
|
|
|
|
|||||
Total R&D expenditure |
(83,195 | ) | (69,765 | ) | ||||
|
|
|
|
Our G&A and S&M expenses were 11.0 million in the first three months of 2019, compared to 7.1 million in the first three months of 2018. This increase mainly resulted from higher personnel costs due to a planned headcount increase as well as higher costs for warrant plans as a result of the increase of the Galapagos share price.
Net financial income in the first three months of 2019 amounted to 4.7 million compared to net financial expenses of 5.2 million in the first three months of 2018, and was primarily attributable to 5.0 million of unrealized exchange gain on our cash position in U.S. dollars (5.6 million of unrealized exchange loss on our cash position in U.S. dollars in the first three months of 2018).
Segment information
We have two reportable segments: R&D and our fee-for-service business Fidelta, located in Croatia.
Segment information for the three months ended 31 March 2019 | ||||||||||||||||
(thousands of ) |
R&D | Fee-for-services | Inter-segment elimination |
Group | ||||||||||||
External revenue |
30,735 | 2,312 | 33,047 | |||||||||||||
Internal revenue |
1,481 | (1,481 | ) | | ||||||||||||
Other income |
7,865 | 7 | 7,872 | |||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Revenues & other income |
38,600 | 3,800 | (1,481 | ) | 40,919 | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Segment result |
(46,967 | ) | (276 | ) | (47,242 | ) | ||||||||||
|
|
|
|
|
|
|||||||||||
Unallocated expenses(1) |
(6,000 | ) | ||||||||||||||
|
|
|||||||||||||||
Operating loss |
(53,242 | ) | ||||||||||||||
|
|
|||||||||||||||
Financial (expenses)/income |
4,655 | |||||||||||||||
|
|
|||||||||||||||
Result before tax |
(48,588 | ) | ||||||||||||||
|
|
|||||||||||||||
Income taxes |
(68 | ) | ||||||||||||||
|
|
|||||||||||||||
Net loss |
(48,656 | ) | ||||||||||||||
|
|
(1) | Unallocated expenses consist of expenses for warrant plans under IFRS 2 Share based payments. |
- 22 -
Galapagos NV Q1 Report 2019
FINANCIAL STATEMENTS
Segment information for the three months ended 31 March 2018 | ||||||||||||||||
(thousands of ) |
R&D | Fee-for-services | Inter-segment elimination |
Group | ||||||||||||
External revenue |
34,888 | 3,019 | 37,907 | |||||||||||||
Internal revenue |
2,175 | (2,175 | ) | | ||||||||||||
Other income |
6,931 | 6,931 | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Revenues & other income |
41,819 | 5,194 | (2,175 | ) | 44,838 | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Segment result |
(29,424 | ) | 1,330 | (28,093 | ) | |||||||||||
|
|
|
|
|
|
|||||||||||
Unallocated expenses(1) |
(3,943 | ) | ||||||||||||||
|
|
|||||||||||||||
Operating loss |
(32,036 | ) | ||||||||||||||
|
|
|||||||||||||||
Financial (expenses)/income |
(5,184 | ) | ||||||||||||||
|
|
|||||||||||||||
Result before tax |
(37,221 | ) | ||||||||||||||
|
|
|||||||||||||||
Income taxes |
(62 | ) | ||||||||||||||
|
|
|||||||||||||||
Net loss |
(37,283 | ) | ||||||||||||||
|
|
(1) | Unallocated expenses consist of expenses for warrant plans under IFRS 2 Share based payments. |
The basis of accounting for any transactions between reportable segments is consistent with the valuation rules and with transactions with third parties.
Liquid assets position
Cash and cash equivalents totaled 1,222.9 million on 31 March 2019.
A net decrease of 67.9 million in cash and cash equivalents was recorded during the first three months of 2019, compared to a net decrease of 43.0 million during the first three months of 2018. This net decrease was composed of 76.3 million of operational cash burn, offset by (i) 3.5 million of cash proceeds from capital and share premium increase from exercise of warrants in the first three months of 2019 and (ii) 5.0 million of unrealized positive exchange rate differences.
Cash and cash equivalents amounted to 1,222.9 million at the end of March 2019 and comprised cash and cash at banks, short term bank deposits and money market funds that are readily convertible to cash and are subject to an insignificant risk of changes in value. Our cash management strategy may allow short term deposits with an original maturity exceeding three months while monitoring all liquidity aspects. Cash and cash equivalents comprised 649.8 million of term deposits with an original maturity longer than three months but which are available upon one month notice period. Cash at banks were mainly composed of savings accounts and current accounts. We maintain our bank deposits in highly rated financial institutions to reduce credit risk. Cash invested in highly liquid money market funds represented 199.1 million and aim at meeting short-term cash commitments, while reducing the counterparty risk of investment.
31 March | 31 December | |||||||
(thousands of ) |
2019 | 2018 | ||||||
Cash at banks |
373,965 | 358,016 | ||||||
Term deposits |
649,822 | 733,537 | ||||||
Money market funds |
199,114 | 199,243 | ||||||
|
|
|
|
|||||
Total cash and cash equivalents |
1,222,901 | 1,290,796 | ||||||
|
|
|
|
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Galapagos NV Q1 Report 2019
FINANCIAL STATEMENTS
On 31 March 2019, our cash and cash equivalents included $298.8 million held in U.S. dollars which could generate foreign exchange gains or losses in our financial results in accordance with the fluctuation of the EUR/U.S. dollar exchange rate as our functional currency is EUR.
Finally, our balance sheet held R&D incentives receivables from the French government (Crédit dImpôt Recherche), to be received in four yearly tranches, and R&D incentives receivables from the Belgian Government, for a total of 87.7 million as at 31 March 2019.
Capital increase
On 31 March 2019, Galapagos NVs share capital was represented by 54,614,791 shares. All shares were issued, fully paid up and of the same class. The below table summarizes our capital increases for the quarter ended 31 March 2019.
(thousands of , except share data) |
Number of shares |
Share capital | Share premium |
Share capital and share premium |
Average exercise price warrants |
Closing share price on date of capital increase |
||||||||||||||||||
On 1 January 2019 |
54,465,421 | 236,540 | 1,277,780 | 1,514,320 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||
20 March 2019: exercise of warrants |
149,370 | 808 | 2,673 | 3,481 | 23.30 | 90.32 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
On 31 March 2019 |
54,614,791 | 237,348 | 1,280,452 | 1,517,801 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
Note to the cash flow statement
Three months ended 31 March | ||||||||
(thousands of ) |
2019 | 2018 | ||||||
Adjustment for non-cash transactions |
||||||||
Depreciation and amortization |
2,758 | 1,197 | ||||||
Share-based compensation |
6,000 | 3,943 | ||||||
Increase in retirement benefit obligations and provisions |
87 | 78 | ||||||
Unrealised exchange gains (-) /losses and non-cash other financial expenses |
(4,777 | ) | 5,716 | |||||
Fair value adjustment financial assets held at fair value through profit or loss |
1,455 | 123 | ||||||
|
|
|
|
|||||
Total adjustment for non-cash transactions |
5,524 | 11,057 | ||||||
|
|
|
|
|||||
Adjustment for items to disclose separately under operating cash flow |
||||||||
Interest expense |
237 | 208 | ||||||
Interest income |
(1,822 | ) | (800 | ) | ||||
Tax expense |
68 | 62 | ||||||
|
|
|
|
|||||
Total adjustment for items to disclose separately under operating cash flow |
(1,517 | ) | (530 | ) | ||||
|
|
|
|
|||||
Adjustment for items to disclose under investing and financing cash flows |
||||||||
Gain on sale of assets |
(3 | ) | | |||||
Total adjustment for items to disclose under investing and financing cash flows |
(3 | ) | | |||||
Change in working capital other than deferred income |
||||||||
Decrease / increase (-) in inventories |
2 | (14 | ) | |||||
Decrease / increase (-) in receivables |
(1,239 | ) | 12,928 | |||||
Increase / decrease (-) in payables |
(1,057 | ) | 7,568 | |||||
|
|
|
|
|||||
Total change in working capital other than deferred income |
(2,294 | ) | 20,482 | |||||
|
|
|
|
- 24 -
Galapagos NV Q1 Report 2019
FINANCIAL STATEMENTS
Contingencies and commitments
Contractual obligations and commitments
We entered into lease agreements for offices, laboratories and cars. As a consequence of the adoption of IFRS 16 Leases, on 1 January 2019, lease obligations in the scope of the new standard are presented as lease liabilities in the statements of financial position and no longer disclosed separately as off-balance sheet commitments.
We also have certain purchase commitments principally with CRO subcontractors and certain collaboration partners.
On 31 March 2019 we had outstanding obligations for purchase commitments, which become due as follows:
(thousands of ) |
Total | Less than 1 year |
1 - 3 years | 3 - 5 years | More than 5 years |
|||||||||||||||
Purchase commitments |
229,290 | 137,148 | 77,139 | 13,377 | 1,625 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
In addition to the table above, we have a contractual cost sharing obligation related to our collaboration agreement with Gilead for filgotinib. The contractual cost sharing commitment amounted to 62.7 million at 31 March 2019 for which we have direct purchase commitments of 20.7 million at 31 March 2019 reflected in the table above.
Contingent liabilities and assets
We refer to our annual report 2018 for a description of our contingent liabilities and assets as no material change is to be disclosed for the first three months of 2019.
Events after the end of the reporting period
On 10 April 2019, the board of directors of Galapagos approved Warrant Plan 2019, a warrant plan intended mainly for the employees of the company and its subsidiaries, and also for directors and an independent consultant of the company, and Warrant Plan 2019 RMV, a warrant plan intended for the employees of its French subsidiary, Galapagos SASU, within the framework of the authorized capital. Under these warrant plans, 2,070,000 warrants were created, subject to acceptances, and offered to the beneficiaries of the plans. The offer of warrants to directors remains subject to approval of the annual shareholders meeting of 30 April 2019. The warrants have an exercise term of eight years as of the date of the offer and have an exercise price of 95.11 (the average closing price of the share on Euronext Amsterdam and Brussels during the thirty days preceding the date of the offer). In principle, the warrants are not transferable and cannot be exercised prior to 1 January 2023. Each warrant gives the right to subscribe to one new Galapagos share.
Approval of interim financial statements
The interim financial statements were approved by the board of directors on 23 April 2019.
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Galapagos NV Q1 Report 2019
OTHER INFORMATION
Glossary of terms
100 points clinical response
Percentage of patients achieving a 100-point decrease in CDAI score during a clinical trial in CD patients
ACR
American College of Rheumatology
ACR20 (ACR 20/50/70)
American College of Rheumatology 20% response rate signifies a 20% or greater improvement in the number of swollen and tender joints as well as a 20% or greater improvement in three out of five other disease-activity measures. ACR50 and ACR70 reflect the same, for 50% and 70% response rates, respectively
ADAMTS-5
ADAMTS-5 is a key enzyme involved in cartilage breakdown (Larkin 2015)
ADS
American Depositary Share; Galapagos has a Level 3 ADS listed on Nasdaq with ticker symbol GLPG and CUSIP number 36315X101. One ADS is equivalent to one ordinary share in Galapagos NV
AFM
Dutch Authority for the Financial Markets
Anemia
Condition in which the patient has an inadequate number of red blood cells to carry oxygen to the bodys tissues
Ankylosing spondylitis (AS)
AS is a systemic, chronic, and progressive spondyoloarthropathy primarily affecting the spine and sacroiliac joints, and progressing into severe inflammation that fuses the spine, leading to permanent painful stiffness of the back
(Anti-)TNF
Tumor necrosis factor. An anti-TNF drug acts by modulation of TNF
ASDAS
Ankylosing Spondylitis Disease Activity Score, a composite score of symptoms such as back pain, duration of morning stiffness, and peripheral pain and swelling. We measured ASDAS scores in the TORTUGA trial with filgotinib in AS
Atherogenic index
Total cholesterol over HDL ratio. Improvement of the atherogenic index may be a forecast of cardiovascular health
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Galapagos NV Q1 Report 2019
OTHER INFORMATION
Atopic dermatitis (AtD)
Also known as atopic eczema, atopic dermatitis is a common pruritis inflammatory condition affecting the skin, which most frequently starts in childhood
Attrition rate
The historical success rate for drug discovery and development, based on publicly known development paths. Statistically seen, investment in at least 12 target-based programs is required to ensure that at least one of these will reach a Phase 3 study. Most new drug R&D programs are discontinued before reaching Phase 3 because they are not successful enough to be approved
Autotaxin (ATX)
An enzyme important for generating the signaling molecule lypophosphatidic acid (LPA). GLPG1690 targets autotaxin for IPF and SSc
BID dosing
Twice-daily dosing (bis in die)
Bioavailability
Assessment of the amount of product candidate that reaches a bodys systemic circulation after (oral) administration
Biomarker
Substance used as an indicator of a biological process, particularly to determine whether a product candidate has a biological effect
Black & Scholes model
A mathematical description of financial markets and derivative investment instruments that is widely used in the pricing of European options and warrants
Bleomycin model
A preclinical model involving use of bleomycin (a cancer medication) to induce IPF symptoms
CDAI
Crohns Disease Activity Index, evaluating patients on eight different factors, each of which has a pre-defined weight as a way to quantify the impact of CD
CDAI remission
In the FITZROY trial, the percentage of patients with CD who showed a reduction of CDAI score to <150
CIR
Crédit dImpôt Recherche, or research credit. Under the CIR, the French government refunds up to 30% of the annual investment in French R&D operations, over a period of three years. Galapagos benefits from the CIR through its operations in Romainville, just outside Paris
Clinical proof-of-concept (PoC)
Point in the drug development process where the product candidate first shows efficacy in a therapeutic setting
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Galapagos NV Q1 Report 2019
OTHER INFORMATION
Compound
A chemical substance, often a small molecule with drug-like properties
Contract research organization
Organization which provides drug discovery and development services
Crohns disease (CD)
An IBD involving inflammation of the small and large intestines, leading to pain, bleeding, and ultimately in some cases surgical removal of parts of the bowel
CRP
C-reactive protein is a protein found in the blood, the levels of which rise in response to inflammation
Cutaneous lupus
Cutaneous lupus is a heterogeneous autoimmune skin disease that can present itself as an organ-specific disease (e.g., in the skin only) or as a systemic disease involving multiple organs
Cytokine
A category of small proteins which play important roles in signaling in processes in the body
Dactylitis
Dactylitis is inflammation of a digit (either finger or toe) and is derived from the Greek word dactylos meaning finger. The affected fingers and/or toes swell up into a sausage shape and can become painful. Dactylitis was measured in the EQUATOR trial with filgotinib in psoriatic arthritis
DARWIN
Phase 2 program for filgotinib in RA. Completed and reported in 2015 (except for the currently still ongoing DARWIN 3 study). DARWIN 1 explored three doses, in twice-daily and once-daily administration, for up to 24 weeks in RA patients with insufficient response to methotrexate (MTX) and who remained on their stable background treatment with MTX. DARWIN 2 explored three once-daily doses for up to 24 weeks in RA patients with insufficient response to methotrexate (MTX) and who washed out of their treatment with MTX. DARWIN 1 and 2 were double-blind, placebo-controlled trials which recruited approximately 900 patients globally. DARWIN 3 is a long term extension trial currently ongoing; all patients are on 200 mg filgotinib, except for U.S. males who are on 100 mg
DAS28 (CRP)
DAS28 is an RA Disease Activity Score based on a calculation that uses tender and swollen joint counts of 28 defined joints, the physicians global health assessment and a serum marker for inflammation, such as C-reactive protein. DAS28 (CRP) includes the C-reactive protein score calculation: scores range from 2.0 to 10.0, with scores below 2.6 being considered remission
Development
All activities required to bring a new drug to the market. This includes preclinical and clinical development research, chemical and pharmaceutical development and regulatory filings of product candidates
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Galapagos NV Q1 Report 2019
OTHER INFORMATION
Discovery
Process by which new medicines are discovered and/or designed. At Galapagos, this is the department that oversees target and drug discovery research through to nomination of preclinical candidates
Disease-modifying
Addresses the disease itself, modifying the disease progression, not just the symptoms of the disease
DIVERSITY
Phase 3 program evaluating filgotinib in CD
DLCO
DLCO (diffusion capacity of the lung for carbon monoxide) is the extent to which oxygen passes from the air sacs of the lungs into the blood. This is measured in IPF patients
Dose-range finding study
Phase 2 clinical study exploring the balance between efficacy and safety among various doses of treatment in patients. Results are used to determine doses for later studies
Double-blind
Term to characterize a clinical trial in which neither the physician nor the patient knows if the patient is taking placebo or the treatment being evaluated
Efficacy
Effectiveness for intended use
EMA
European Medicines Agency, in charge of European market authorization of new medications
Endoscopy
A non-surgical procedure involving use of an endoscope to examine a persons digestive tract
Enthesitis
Inflammation of the tendons or ligaments; this is one of the key symptoms of psoriatic arthritis and was also measured in the EQUATOR trial with filgotinib
EQUATOR
A Phase 2 trial with filgotinib in psoriatic arthritis patients
Esbriet
An approved drug (pirfenidone) for IPF, marketed by Roche
FDA
The U.S. Food and Drug Administration is an agency responsible for protecting and promoting public health and in charge of American market approval of new medications
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Galapagos NV Q1 Report 2019
OTHER INFORMATION
Fee-for-service
Payment system where the service provider is paid a specific amount for each procedure or service performed
FEV
Forced expiratory volume measures how much air a person can exhale during a forced breath. The amount of air exhaled may be measured during the first (FEV1), second (FEV2), and/or third seconds (FEV3) of the forced breath
Fibrotic score
The Ashcroft fibrotic score involves measuring pulmonary fibrosis through examination of histopathology tissue
FIH
First-in-human clinical trial, usually conducted in healthy volunteers with the aim to assess the safety, tolerability and pharmacokinetics of the product candidate
Filgotinib
Formerly known as GLPG0634. Small molecule selective JAK1 inhibitor which showed activity and favorable tolerability in RA, PsA, AS and CD patients in Phase 2 trials. Filgotinib is partnered with Gilead. Galapagos and Gilead are running Phase 3 trials with filgotinib in RA, CD, and UC and Phase 2 trials with filgotinib in additional indications. Filgotinib is an investigational drug and its efficacy and safety have not been established
FINCH
Phase 3 program evaluating filgotinib in RA
Fistulizing CD
Fistulae are inflammatory tracts that most often occur between the distal colon and the perianal region. Fistulae are one of the most severe sequelae of luminal CD and the lifetime risk of occurrence is close to 50% of those with active CD
FITZROY
A double-blind, placebo controlled Phase 2 trial with filgotinib in 177 CD patients for up to 20 weeks. Full results were published in The Lancet in 2016
FLORA
A double-blind, placebo-controlled exploratory Phase 2a trial with GLPG1690 in up to 24 IPF patients; topline results were reported in August 2017
FRI
Functional respiratory imaging is a technology which enhances 3D visualization and quantification of a patients airway and lung geometry
FSMA
The Belgian market authority: Financial Services and Markets Authority, or Autoriteit voor Financiële Diensten en Markten
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Galapagos NV Q1 Report 2019
OTHER INFORMATION
FTE
Full-time equivalent; a way to measure an employees involvement in a project. For example, an FTE of 1.0 means that the equivalent work of one full-time worker was used on the project
FVC
Forced vital capacity is the amount of air which can be forcibly exhaled from the lungs after taking the deepest breath possible. FVC is used to help determine both the presence and severity of lung diseases such as IPF
GECKO
A Phase 2 trial evaluating a subcutaneaous formulation of MOR106 in combination with topical corticosteroids. This Phase 2 trial was initiated early 2019
GLPG0555
A preclinical candidate with undisclosed mode of action directed toward inflammation
GLPG0634
Molecule number currently known as filgotinib
GLPG1205
A GPR84 inhibitor fully proprietary to us. We initiated the PINTA patient trial with GLPG1205 in IPF
GLPG1690
A novel drug targeting autotaxin, with potential application in IPF & SSc. Fully proprietary to Galapagos. Topline results from the Phase 2a FLORA trial were reported in August 2017. The ISABELA Phase 3 program was initiated in 2018 and the NOVESA Phase 2 trial in SSc was initiated in early 2019
GLPG1972/S201086
GLPG1972/S201086, also referred to as GLPG1972, is a novel mode-of-action product candidate that is part of the OA collaboration with Servier. Galapagos and Servier are recruiting the ROCCELLA global Phase 2b trial with GLPG1972/S201086
GLPG2534
A preclinical candidate with undisclosed mode of action. GLPG2534 is expected to enter Phase 1 trials in 2019
GLPG2737
A preclinical candidate with undisclosed novel mode of action. This compound is part of the CF collaboration with AbbVie but Galapagos regained rights outside of CF
GLPG3121
A compound currently in Phase 1 with a novel mode of action directed towards inflammation. GLPG3121 is a JAK1/TYK2 inhibitor
GLPG3312
A compound currently in Phase 1 with an undisclosed mode of action directed towards inflammation (IBD). GLPG3312 is a Toledo compound and the first one to enter Phase 1
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Galapagos NV Q1 Report 2019
OTHER INFORMATION
GLPG3667
A preclinical candidate with undisclosed mode of action directed toward inflammation. GLPG3667 is expected to enter Phase 1 trials in 2019
GLPG3970
A preclinical candidate with a undisclosed mode of action directed toward inflammation. GLPG3970, which is part of the Toledo target family, is expected to enter Phase 1 trials in 2019
HDL
High-density lipoprotein. HDL scavenges and reduces low-density lipoprotein (LDL) which contributes to heart disease at high levels. High levels of HDL reduce the risk for heart disease, while low levels of HDL increase the risk of heart disease
Hemoglobin
A protein inside red blood cells that carries oxygen from the lungs to tissues and organs in the body and carries carbon dioxide back to the lungs
Histopathology
Microscopic examination of tissues for manifestations of a disease
IBD
Inflammatory Bowel Disease. This is a general term for an autoimmune disease affecting the bowel, including CD and UC. CD affects the small and large intestine, while UC affects the large intestine. Both diseases involve inflammation of the intestinal wall, leading to pain, bleeding, and ultimately, in some cases, surgical removal of part of the bowel
IGUANA
Phase 2 trial together with our partners MophoSys and Novartis, investigating MOR106 in AtD patients
IL-17C
IL-17C has been shown to be distinct from other members of the IL-17 family of cytokines. IL-17C has been shown to be an important mediator in inflammatory skin diseases, and is the target of MOR106
In-/out-licensing
Receiving/granting permission from/to another company or institution to use a brand name, patent, or other proprietary right, in exchange for a fee and/or royalty
In vitro
Studies performed with cells outside their natural context, for example in a laboratory
Inflammatory diseases
A large, unrelated group of disorders associated with abnormalities in inflammation
Inspiratory capacity
Total lung capacity or the amount of gas contained in the lung at the end of a maximal inhalation
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Galapagos NV Q1 Report 2019
OTHER INFORMATION
Intellectual property
Creations of the mind that have commercial value and are protected or protectable, including by patents, trademarks or copyrights
Intersegment
Occurring between the different operations of a company
Investigational New Drug (IND) Application
United States Federal law requires a pharmaceutical company to obtain an exemption to ship an experimental drug across state lines, usually to clinical investigators, before a marketing application for the drug has been approved. The IND is the means by which the sponsor obtains this exemption, allowing them to perform clinical studies
IPF
Idiopathic pulmonary fibrosis. A chronic and ultimately fatal disease characterized by a progressive decline in lung function. Pulmonary fibrosis involves scarring of lung tissue and is the cause of shortness of breath. Fibrosis is usually associated with a poor prognosis. The term idiopathic is used because the cause of pulmonary fibrosis is still unknown
ISABELA
Phase 3 clinical program investigating GLPG1690 in IPF patients. The ISABELA Phase 3 program consists of two identically designed trials, ISABELA 1 and ISABELA 2, and will enroll a total of 1,500 IPF patients combined
JAK
Janus kinases (JAK) are critical components of signaling mechanisms utilized by a number of cytokines and growth factors, including those that are elevated in RA. Filgotinib is a selective JAK1 inhibitor
LDL
Low-density lipoprotein. LDL contributes to heart disease at high levels
Liver enzymes
Inflamed or injured liver cells secrete higher than normal amounts of certain chemicals, including liver enzymes, into the bloodstream
LPA
Lysophosphatidic acid (LPA) is a signaling molecule involved in fibrosis
Lymphocyte
Type of white blood cell that is part of the immune system
MANTA
A Phase 2 trial with filgotinib to evaluate male testicular safety in patients with UC
Milestone
Major achievement in a project or program; in our alliances, this is usually associated with a payment
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Galapagos NV Q1 Report 2019
OTHER INFORMATION
Molecule collections
Chemical libraries, usually consisting of drug-like small molecules that are designed to interact with specific target classes. These collections can be screened against a target to generate initial hits in a drug discovery program
MOR106
A novel mode-of-action antibody product candidate currently in a Phase 2 trial in AtD patients. MOR106 acts on IL-17C, a novel antibody target discovered by Galapagos. MOR106 is part of the alliance with MorphoSys and Novartis
MTX
Methotrexate; a first-line therapy for inflammatory diseases
NDA
New Drug Application
Neutrophil
Type of immune system cell which is one of the first cell types to travel to the site of an infection in the body. Neutrophils are another type of white blood cell which fight infection by ingesting and killing microorganisms
NK cells
Natural killer cells, type of white blood cell with granules of enzymes which can attack tumors or viruses
NOVESA
A Phase 2 trial to evaluate GLPG1690 in systemic sclerosis (SSc)
Ofev
An approved drug (nintedanib) for IPF, marketed by Boehringer Ingelheim
Oral dosing
Administration of medicine by the mouth, either as a solution or solid (capsule, pill) form
Organoids
Miniature organ produced from cells from a donor; organoids have all the phenotypic characteristics of the patient donor, making them useful tools for in vitro drug research
Osteoarthritis (OA)
The most common form of arthritis, usually occurring after middle age, marked by chronic breakdown of cartilage in the joints leading to pain, stiffness, and swelling
Outsourcing
Contracting work to a third party
Pharmacokinetics (PK)
Study of what a body does to a drug; the fate of a substance delivered to a body. This includes absorption, distribution to the tissues, metabolism and excretion. These processes determine the blood concentration of the drug and its metabolite(s) as a function of time from dosing
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Galapagos NV Q1 Report 2019
OTHER INFORMATION
Phase 1
First stage of clinical testing of an investigational drug designed to assess the safety and tolerability, pharmacokinetics of a drug, usually performed in a small number of healthy human volunteers
Phase 2
Second stage of clinical testing, usually performed in no more than several hundred patients, in order to determine efficacy, tolerability and the dose to use
Phase 3
Large clinical trials, usually conducted in several hundred to several thousand patients to gain a definitive understanding of the efficacy and tolerability of the candidate treatment; serves as the principal basis for regulatory approval
PINTA
Phase 2 trial with GPR84 inhibitor GLPG1205 in IPF patients
Placebo-controlled
A substance having no pharmacological effect but administered as a control in testing a biologically active preparation
Preclinical
Stage of drug research development, undertaken prior to the administration of the drug to humans. Consists of in vitro and in vivo screening, pharmacokinetics, toxicology, and chemical upscaling
Preclinical candidate (PCC)
A new molecule and potential drug that meets chemical and biological criteria to begin the development process
Product candidate
Substance that has satisfied the requirements of early preclinical testing and has been selected for development, starting with formal preclinical safety evaluation followed by clinical testing for the treatment of a certain disorder in humans
Proof-of-concept study
Phase 2 patient study in which activity as well as safety in patients is evaluated, usually for a new mechanism of action
Pruritis
Extreme itching, as observed in AtD patients
Psoriatic arthritis (PsA)
Psoriatic arthritis or PsA is an inflammatory form of arthritis, affecting up to 30% of psoriasis patients. Psoriatic arthritis can cause swelling, stiffness and pain in and around the joints, and cause nail changes and overall fatigue
QD dosing
Once-daily dosing (qd from the Latin quaque die)
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Galapagos NV Q1 Report 2019
OTHER INFORMATION
R&D operations
Research and development operations; unit responsible for discovery and developing new product candidates for internal pipeline or as part of risk/reward sharing alliances with partners
Rheumatoid arthritis (RA)
A chronic, systemic inflammatory disease that causes joint inflammation, and usually leads to cartilage destruction, bone erosion and disability
ROCCELLA
Global Phase 2b trial, together with our collaboration partner Servier, evaluating GLPG1972/S201086 (GLPG1972) in osteoarthritis (OA)
Screening
Method usually applied at the beginning of a drug discovery campaign, where a target is tested in a biochemical assay against a series of small molecules or antibodies to obtain an initial set of hits that show activity against the target. These hits are then further tested or optimized
SELECTION
Phase 3 program evaluating filgotinib in UC patients
Service operations
Business unit primarily focused on delivering products and conducting fee-for-service work for clients. Our service operations included the BioFocus and Argenta business units, which were both sold in April 2014 to Charles River Laboratories
SES-CD scores
Simple endoscopic score for CD, involving review of five pre-defined bowel segments, assigning values from 0 (unaffected) to 3 (highly affected)
Sjögrens syndrome
Sjögrens Syndrome is a systemic inflammatory disease which can be felt throughout the body, often resulting in chronic dryness of the eyes and mouth
Small bowel CD (SBCD)
CD causes chronic inflammation and erosion of the intestines. It can affect different regions of gastrointestinal tract including the stomach and small and large intestines. While isolated SBCD is an uncommon presentation of CD, involvement of some portion of the small bowel, particularly the ileum, is common
Spondylitis
About 20% of patients with psoriatic arthritis will develop spinal involvement, which is called psoriatic spondylitis. Inflammation of the spine can lead to complete fusion, as in AS, or affect only certain areas such as the lower back or neck. We measured spondylitis in the EQUATOR trial with filgotinib in psoriatic arthritis
Systemic sclerosis (SSc)
Systemic sclerosis (SSc) or scleroderma is an autoimmune disease. One of the most visible manifestations is hardening of the skin. In diffuse cutaneous SSc, which has one of the highest mortality rates among rheumatic diseases, fibrosis occurs in multiple organs, such as the lung
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Galapagos NV Q1 Report 2019
OTHER INFORMATION
Target
Proteïn that has been shown to play a role in a disease process and that forms the basis of a therapeutic intervention or discovery of a medicine
Target discovery
Identification and validation of proteins that have been shown to play a role in a disease process
Technology access fee
License payment made in return for access to specific technology (e.g. compound or virus collections)
Tendinitis
Tendinitis is inflammation or irritation of a tendon, the thick fibrous cords that attach muscle to bone. The condition causes pain and tenderness just outside a joint. We measured tendinitis in the EQUATOR trial with filgotinib in psoriatic arthritis
Toledo
Toledo is a code name for a target family with a novel, undisclosed mode of action. GLPG3312 is the first of the Toledo compounds for which a Phase 1-trial has been initiated early 2019
TORTUGA
Phase 2 trial with filgotinib in patients with ankylosing spondylitis. In 2018, we and Gilead reported that TORTUGA met its primary endpoint
Ulcerative colitis (UC)
UC is an IBD causing chronic inflammation of the lining of the colon and rectum (unlike CD with inflammation throughout the gastrointestinal tract)
Uveitis
Uveitis is the term that refers to inflammation inside the eye. This inflammation can be caused by infection, autoimmune reaction, or by conditions confined primarily to the eye
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Galapagos NV Q1 Report 2019
OTHER INFORMATION
Contact
Elizabeth Goodwin | Sofie Van Gijsel | Carmen Vroonen | ||
Vice President Investor Relations | Director Investor Relations | Senior Director Corporate | ||
Galapagos NV | Galapagos NV | Communications | ||
230 Third Ave | Generaal De Wittelaan L11 A3 | Galapagos NV | ||
Waltham, MA 02451, | 2800 Mechelen, Belgium | Generaal De Wittelaan L11 A3 | ||
United States | Tel. +32 485 19 14 15 | 2800 Mechelen, Belgium | ||
Tel. +1 781 522 0002 | Email: ir@glpg.com | Tel. +32 15 34 28 24 | ||
Mob. +1 781 460 1784 | Email: | |||
Email: ir@glpg.com | communications@glpg.com |
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Galapagos NV Q1 Report 2019