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Dec 22, 2006

Galapagos Purchases ProSkelia for Over $35M

  • Galapagos acquired ProSkelia, a French subsidiary of ProStrakan engaged in drug discovery and development for bone diseases. Its operations will be integrated with Galapagos’ drug discovery division.

    The assets that Galapagos will acquire include ProSkelia’s R&D operations, a product portfolio of three preclinical products aimed at osteoporosis and bone metastasis, and one preclinical product for cachexia for which ProStrakan will have the right of first refusal should Galapagos decide to partner or out-license it.

    The transaction also includes an exclusive option and license for oestradiol glucoside (E2G), a product that has successfully completed a Phase IIa clinical study for the treatment of menopausal symptoms.

    With the acquisition, ProSkelia’s ongoing R&D partnerships with Amgen, Genentech, and Novartis will be transferred to Galapagos. Galapagos will receive all annual revenues from these partnerships and will be eligible for 25% of the downstream milestones and royalties from these partnerships.

    The acquisition price of ProSkelia is Euro12.5 million in newly issued Galapagos shares. This price is partially offset by estimated cash tax-refunds of Euro9 million over the coming four years. In addition, ProStrakan will be eligible for earn-out payments, capped at Euro14.5 million, from future income that Galapagos will derive from the acquired programs.

    For the license on E2G, ProStrakan will receive Euro5 million plus a fixed amount of the licensing revenues received by Galapagos, as well as royalties. These payments are conditional on the successful completion of Phase IIb trials and partnering of the product.

     



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