Galapagos Abandons Spinout Plan, Shifts Strategy Amid Leadership Change

Belgian biotech company Galapagos has announced a dramatic shift in its corporate strategy, abandoning previously announced plans for a spinout and changing its leadership structure. This move comes as the latest development in the company's 25-year history, during which it has yet to secure approval for a therapy.

Strategic Reversal and Leadership Changes

Galapagos has decided to reverse course on its January 2023 plans, which included spinning out a portion of the company and appointing a new CEO over the next year. The company cited "regulatory and market developments" as the catalyst for this change in direction.

Paul Stoffels, who joined Galapagos as CEO in 2022 with a promise to turn the company around within five years, will be exiting earlier than expected. Henry Gosebruch, previously appointed as CEO of the proposed spinout company, will now take over as CEO of Galapagos. Jérôme Contamine has replaced Stoffels as chair of the Galapagos board.

Refocused Business Strategy

Instead of proceeding with the spinout, which was to have $2.5 billion in capital for new asset acquisitions, Galapagos will now conduct "transformative business development transactions" internally. The company plans to leverage the resources originally earmarked for the spinout to build a new pipeline through strategic business development initiatives.

Gosebruch stated, "We are currently evaluating strategic options regarding our clinical programs and other assets. I look forward to working with Paul [Stoffels] in finding a value-maximizing alternative for the cell therapy business including exploring mergers, divestures, and out-licensing. In parallel, we will pursue transformative business development opportunities in order to build an innovative pipeline with the potential to deliver differentiated medicines for patients."

Cell Therapy Asset Divestment

A key aspect of Galapagos' new strategy involves exploring the potential sale of its cell therapy assets, which Stoffels had acquired through a series of acquisitions over the past three years. Stoffels will remain involved with the company in an advisory capacity, focusing specifically on finding a new home for these assets.

Among the cell therapy assets under consideration for divestment are the lead program GLPG5101 and the company's decentralized cell therapy manufacturing platform. The GLPG5101 program encompasses several B cell blood cancers, including mantle cell lymphoma and chronic lymphocytic leukemia, with the most advanced being a Phase II clinical trial for follicular lymphoma or marginal zone lymphoma.