GlaxoSmithKline (NYSE:GSK) is strengthening its prospects of developing a new arthritis treatment by licensing two anti-inflammatory compounds from drug partner Galapagos NV (OTC:GLPYY).
Belgium-based Galapagos said GSK has exercised its option on compounds GLPG0778 and GLPG0555, both of which were developed within the partnership. Galapagos now stands to receive from GSK an option fee payment in the single-digit millions of euros. The company is also eligible to receive more than 34 million euros in milestone payments, plus royalties if the compounds are successfully commercialized as new drugs.
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The Galapagos/GSK strategic alliance dates to 2006, when the companies partnered to discover and develop drugs that target osteoarthritis. In 2007 and 2008, the alliance was expanded to include other targets, such as antibacterials and antivirals. The company also has strategic alliances with other large pharmaceutical companies. The rheumatoid arthritis alliance with Janssen Pharmaceuticals is separate from Galapagos’ partnership with GSK.
London-based GSK, which has its U.S. headquarters in Research Triangle Park, North Carolina, now has the right to continue clinical development of GLPG0778 and GLPG0555. Galapagos said that GLPG0778 was identified and optioned within 30 months, beating the five-year goal of advancing from discovery to clinical proof of concept. GLPG0778 and GLPG0555 are the first Galapagos compounds in any of its strategic alliances to be licensed by a large pharmaceutical company.
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