Gilead Sciences Inc plans to invest a further $5.1 billion into the Belgian-Dutch biotech firm Galapagos NV. This investment, after nearly four years ago, when the companies partnered to develop a drug that targets inflammatory diseases, will come in the form of an upfront payment of $3.95 billion and a further $1.1 billion equity investment.
Gilead’s Chief Executive Officer, Daniel O’Day said: “Gilead gains exclusive access to all current and future compounds in Galapagos’ rich pipeline while Galapagos is able to expand its research activities and build commercial infrastructure.”
The US-based GSI will pay $158.43 per newly acquired share, which will increase its stake in Galapagos from 12.3% to 22%. Galapagos said that it would seek shareholder approval which will, if approved, allow Gilead to increase their ownership to 29.9%. Their agreement includes a ten-year standstill clause which prevents the US firm from buying any more of Galapagos’ shares during that period.
Filgotinib, an experimental drug for rheumatoid arthritis and inflammatory bowel diseases, will be submitted by Gilead to the U.S. Food and Drug Administration this year. The original 80-20 cost split for the development of filgotinib outlined in the original agreement will now be replaced with an equal 50-50 one.
Galapagos intends to use the proceedings generated from filgotinib sales to speed up their RnD programs significantly.
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