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2020-08-06

Galapagos reports solid H1 2020 progress

  • First half-year 2020 financial results:
    • Group revenues and other income of €224.6 million
    • Operating loss of €130.8 million
    • Net loss of €165.6 million
    • Cash and current financial investments on 30 June 2020 of €5.6 billion
  • Positive CHMP opinion for filgotinib in rheumatoid arthritis (RA)
  • Positive SELECTION Phase 3 results for filgotinib in ulcerative colitis (UC)
  • Commercial readiness for potential European approval of filgotinib in RA in Q3
  • On track to report topline results from three patient trials later this year

Webcast presentation tomorrow, 7 August 2020, at 14.00 CET / 8 AM ET, www.glpg.com, +32 2 404 0659, code 8997710

Mechelen, Belgium; 6 August 2020, 22.01 CET; regulated information – Galapagos NV (Euronext & NASDAQ: GLPG) announces its unaudited H1 results and key events, which are further detailed in its H1 2020 report available on the Galapagos website, www.glpg.com.

“During the past six months, we made substantial progress despite the global pandemic. We ended the period with important achievements, including a positive opinion from the European Medicines Agency’s Committee for Medicinal Products for Human Use (CHMPi) for our investigational rheumatoid arthritis (RA) drug filgotinib and positive topline data for the SELECTION Phase 3 program in ulcerative colitis (UC). We added two preclinical candidates to our early stage pipeline and completed preparation for a number of new clinical trials, building further on our innovative pipeline for future growth,” said Onno van de Stolpe, CEO of Galapagos.

Bart Filius, COO and CFO added, “We ended the first half of 2020 with a strong cash balance, positioning us well to further grow our pipeline and deliver on operational excellence for the anticipated commercial launch of filgotinib. We maintain our 2020 operational cash burn guidance of €400-€430 million.”

Key figures first half-year report 2020 (unaudited)
(€ millions, except basic & diluted loss per share)

  30 June 2020 group total 30 June 2019 group total
Revenues and other income 224.6 108.5
R&D expenditure (265.9) (177.6)
S&Mii expenses (26.9) (5.6)
G&Aiii expenses (62.6) (22.9)
Operating loss (130.8) (97.6)
Fair value re-measurement of warrants (21.1) -
Net other financial result (13.0) 1.8
Taxes (0.7) (0.1)
Net result for the period (165.6) (95.9)
Basic and diluted loss per share (€) (2.55) (1.76)
     
Current financial investments and cash and cash equivalents 5,566.5 1,147.9

Revenues and other income

Revenues and other income for the first half-year of 2020 increased to €224.6 million compared to €108.5 million in the first half-year of 2019. The impact of the Gilead collaboration on our revenues is €187.7 million and consists of (i) the access and option rights to our drug discovery platform (€112.7 million), and (ii) the filgotinib revenue recognition (€75.0 million).

As a result of the upfront payment received from Gilead in the third quarter of 2019, our deferred income on 30 June 2020 includes €2.1 billion allocated to our drug discovery platform that will be recognized linearly over 10 years, and €0.7 billion allocated to filgotinib (2015 filgotinib contract and recent revised collaboration combined) that will be recognized over a period of 4 to 5 years.  

Results

We realized a net loss of €165.6 million for the first half-year of 2020, compared to a net loss of €95.9 million for the first half-year of 2019.

We reported an operating loss amounting to €130.8 million for the first half-year of 2020, compared to an operating loss of €97.6 million for the first half-year of 2019.

Our R&D expenditure in the first half-year of 2020 amounted to €265.9 million, compared to €177.6 million for the first half-year of 2019. This planned increase was mainly due to an increase in subcontracting costs primarily related to our filgotinib program, our Toledo program and other clinical programs. Furthermore, personnel costs increased explained by a planned headcount increase following the growth in our R&D investments, and increased cost of the subscription right plans. This factor, and the increased cost of the commercial launch of filgotinib in Europe, contributed to the increase in our S&M and G&A expenses, which were respectively €26.9 million and €62.6 million in the first half-year of 2020, compared to respectively €5.6 million and €22.9 million in the first half-year of 2019.

We reported a non-cash fair value loss from the re-measurement of initial warrant B issued to Gilead, amounting to €21.1 million, as result of the increased implied volatility of the Galapagos share price.

Net other financial loss in the first half-year of 2020 amounted to €13.0 million, compared to net other financial income of €1.8 million for the first half-year of 2019, which was primarily attributable to a negative change in (fair) value of current financial investments of €12.5 million.

Cash position

Current financial investments and c...

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