Galapagos NV (ADR) (NASDAQ:GLPG) Will Pocket $250M In Milestones From AbbVie Inc (NYSE:ABBV)

323

The cystic fibrosis deal between AbbVie Inc (NYSE:ABBV) and Galapagos NV (ADR) (NASDAQ:GLPG) that was struck back in 2013 seems is coming to its conclusion and the Belgian biotech will now pocket $250 million (€218 million). The amount is more than the original agreement but contingent on milestones.

The deal resulted from the reallocation in focus from double to a triple collection of cystic fibrosis drugs, a workload that Galapagos currently has to bear. The initial plan was to develop a double combination cystic fibrosis treatment but things have taken a different turn altogether.

Nevertheless, Galapagos has made good on its objective by advancing on GLPG2222, a corrector, and GLPG1837, a potentiator, the pairing combination that was in the initial plan. The company has now been able to convince AbbVie to take up a financial obligation for the advancement of the additional front.

Galapagos must work hard to hit the milestones that are tied to Phase I and II so as to receive the extra $250 million in potential payouts. According to the company’s CEO Onno van de Stolpe, they will have a substantial reduction of financial exposure in the CF program over the next couple of years. Hence, the company must do all it can to get payment from AbbVie.

The testing of the triple combination in humans for the Phase I and II trials by Galapagos is likely to start next year. The company will by then have generated additional information on the individual use of the three lead drugs. It will also have carried out studies of backup compounds.

The race for the best technology is multifaceted looking at the suite of clinical trials being carried out on a daily basis. Nonetheless, this particular suite is racing forward compared to activities at Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX), which is testing a batch of cystic fibrosis drugs with a triple combination therapy in view. Vertex is trying to increase the sales of its current product Orkambi before Galapagos and AbbVie can overshadow the market.

An ad to help with our costs