Only five months after Galapagos announced it would split in two, the cell-therapy-focused biotech is already having second thoughts.
Under plans announced in January, the split would have left one company with the Galapagos name and its portfolio of cell therapies. The other, as yet unnamed, entity would “focus on building a pipeline of innovative medicines through transformational transactions,” the biotech explained at the time.
This separation was expected around mid-2025, but, in a surprise announcement this morning, the Belgian biotech said it is going to “re-evaluate” this plan “following regulatory and market developments.”
When contacted by Fierce, Galapagos wouldn't provide any more details about the reasons for the rethink beyond its relation to “general market regulation conditions.”
The pause comes despite Galapagos having already made “significant progress in reorganizing its business towards the separation,” according to the May 13 release. Galapagos’ CEO Paul Stoffels, M.D., recently announced his upcoming retirement, and the company said today that Stoffels will in fact be replaced by Henry Gosebruch effective immediately.
Gosebruch had already been lined up as the CEO of the unnamed split-off entity. In his new role overseeing the undivided company, Gosebruch will now “lead the strategic evaluation process for Galapagos’ current business.”
“We are currently evaluating strategic options regarding our clinical programs and other assets,” Gosebruch said in the May 13 release.
“I look forward to working with Paul in finding a value-maximizing alternative for the cell therapy business including exploring mergers, divestures, and out-licensing,” the new CEO added. “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.”
The original plan to split up the company involved Gilead Sciences—which entered into a 10-year global research and development collaboration with Galapagos back in 2019—agreeing to hand back full development and commercialization rights to Galapagos’ pipeline. Meanwhile, the spinout company would apply to list on the pan-European stock exchange Euronext—where Galapagos is currently listed along with the Nasdaq—with Galapagos’ existing shareholders receiving a slice of the shares.
That unnamed company was due to launch with 2.45 billion euros ($2.53 billion) of Galapagos’ cash, which could be used to “build a pipeline of innovative medicines with robust clinical proof-of-concept in oncology, immunology, and/or virology through strategic business development transactions,” according to the January announcement.
Galapagos itself—which would have been left with about 500 million euros ($516 million) in cash—would have remained focused on both its decentralized cell therapy manufacturing platform for oncology and its pipeline led by the CAR-T candidate GLPG5101.
After the separation, Gilead would have held around 25% of the outstanding shares in both Galapagos and the spinoff company.
The reorganization was also expected to result in about 300 employees—40% of Galapagos’ workforce—losing their jobs, including “meaningful reductions” in staff in the company’s home territory of Belgium as well as the closure of its site in France. Galapagos told Fierce this morning that those layoffs are now “well-advanced.”
The uncertainty around splitting up the business is only the latest in a series of strategic shake-ups at Galapagos in recent years. Other major events have included the pivot to CAR-Ts in 2022 and the resulting halt of its kidney disease and fibrosis programs, as well as at least two other waves of layoffs.