Glossary of terms

Glossary of terms

ACR

American College of Rheumatology

ACR20

American College of Rheumatology 20% response rate signifies a 20% or greater improvement in the number of swollen and tender joints as well as a 20% or greater improvement in three out of five other disease-activity measures

ADR

American Depositary Receipt; Galapagos has a Level 1 ADR with ticker symbol GLPYY and CUSIP number 36315X101, which is traded over the counter on the Pink Sheets. One ADR is equivalent to one ordinary share in Galapagos NV

Attrition rate

The historical success rate for drug discovery and development, based on publicly known development paths. Statistically seen, investment in at least 12 target-based programs is required to ensure that at least one of these will reach a Phase 3 study. Most new drug R&D programs are discontinued before reaching Phase 3 because they are not successful enough to be approved

BID dosing

Twice daily dosing

Bioavailability

Assessment of the amount of (candidate) drug that reaches a body’s systemic circulation after administration

Biomarker

Substance used as an indicator of a biological state, particularly to monitor a biological response to a candidate drug

Black & Scholes model

A mathematical description of financial markets and derivative investment instruments that is widely used in the pricing of European options and warrants

Candidate drug

Substance that has satisfied the requirements of pre-clinical testing and has been selected for clinical testing for the treatment of a certain disorder in humans

CIR

Credit Impot Recherche, or research credit. Under the CIR, the French government refunds up to 30% of the annual investment in French R&D operations, over a period of three years. Galapagos benefits from the CIR through its operations in Romainville, just outside Paris

Clinical Proof of Concept (PoC)

Point in the drug development process where the candidate drug shows efficacy in a therapeutic setting

Colitis ulcerosa/ulcerative colitis (UC)

see IBD

Compound

A chemical substance, often a small molecule with drug-like properties

Contract research organization

Organization which provides drug discovery and development services

COPD

Chronic obstructive pulmonary disease; chronic lung disease characterized by difficulty breathing and persistent coughing; includes the diseases commonly referred to as chronic bronchitis and emphysema

Corrector drug

Drug that restores the protein forming the ion channel opening in cystic fibrosis patients. In most CF patients, a potentiator and corrector drug are needed in combination to restore the genetic defect causing CF

Crohn’s (CD)

see IBD

CRP

C-reactive protein is a protein found in the blood, the levels of which rise in response to inflammation

Cystic fibrosis (CF)

A life-threatening genetic disease that affects approximately 80,000 people worldwide. Although the disease affects the entire body, difficulty breathing is the most serious symptom as a result of frequent lung infections

DAS28

DAS28 is an RA Disease Activity Score based on C-reactive protein, tender and swollen joint counts of 28 defined joints and physician’s global health assessment

Development

Process of bringing a new drug to the market. At Galapagos, this is the department which performs pre-clinical and clinical development research, clinical batch scale-up, and regulatory filings of Galapagos’ drug candidates

Discovery

Process by which new medicines are discovered and/or designed. At Galapagos, this is the department that oversees target and drug discovery research through to nomination of pre-clinical candidates

Disease-modifying

Addresses the cause of disease and modifying the disease progression, not just the symptoms of the disease

Dose-range finding study

Phase 2 clinical study exploring the trade-offs between efficacy and safety among various doses of treatment in patients. Results are used to determine doses for later studies

Downstream milestones

The downstream milestones are for successes at key decision making points in the alliance, i.e. selection of a pre-clinical candidate, start of a clinical research study, regulatory filings and approvals, and achievement of commercial sales goals

Drug development

Process of bringing a new drug to the market; includes both pre-clinical development and human clinical trials

Drug discovery

Process by which a (potential) therapeutic is either discovered or designed

Efficacy

Effectiveness for intended use

EMA

European Medicines Agency

FDA

The U.S. Food and Drug Administration is an agency responsible for protecting and promoting public health

Fee-for-service

Payment system where the service provider is paid a specific amount for each procedure or service performed

FIH

First-in-human clinical trial, usually conducted in healthy volunteers with the aim to assess the safety, tolerability and bioavailability of the candidate drug

filgotinib

Also known as GLPG0634. Small molecule selective JAK1 inhibitor which showed excellent efficacy and safety in rheumatoid arthritis patients in Phase 2 trials in November 2011 and November 2012, partnered with AbbVie in 2012. Currently in a Phase 2b study in rheumatoid arthritis and Phase 2 study in Crohn’s disease

FSMA

The Belgian market authority: Financial Services and Markets Authority, or Autoriteit voor Financiële Diensten en Markten

FTE

Full-time equivalent; a way to measure a worker’s involvement in a project. For example, an FTE of 1.0 means that the equivalent work of one full-time worker was used on the project

GLPG0634

Also known as filgotinib. Small molecule selective JAK1 inhibitor which showed excellent efficacy and safety in rheumatoid arthritis patients in Phase 2 trials in November 2011 and November 2012, partnered with AbbVie in 2012. Currently in a Phase 2b study in rheumatoid arthritis and Phase 2 study in Crohn’s disease

GLPG0778

Second candidate drug from Galapagos’ arthritis alliance with GlaxoSmithKline, inlicensed by GSK in 2012. This program is now called GSK2586184

GLPG0974

Galapagos candidate drug targeting GPR43, which plays a key role in Inflammatory Bowel Disease: did not show efficacy in a Phase 2 Proof of Concept study in ulcerative colitis patients

GLPG1205

Novel mode of action medicine in inflammatory bowel disease, fully owned by Galapagos, currently in a Phase 2 Proof-of-Concept study in ulcerative colitis

GLPG1492

A novel mode of action antibiotic currently in pre-clinical candidate stage, is fully proprietary to Galapagos

GLPG1690

A novel drug targeting autotaxin, with potential applications in idiopathic pulmonary fibrosis. Fully proprietary to Galapagos. Currently in preparations for the start of a Phase 2 Proof of concept study in IPF

GLPG1790

A novel drug targeting the ephrin tyrosine kinase receptor, with potential applications in triple-negative breast cancer, melanoma, prostate and other cancer types. Currently in pre-clinical candidate stage

GLPG1837

A potentiator drug which entered Phase 1 in December 2014. Galapagos and AbbVie are planning to combine GLPG1837 with GLPG2222 and another corrector drug to treat the largest mutation of CF

GLPG1972

A novel mode of action drug currently in pre-clinical candidate stage, is part of the osteoarthritis alliance with Servier. GLPG1972 is expected to enter Phase 1 before end 2015

GLPG2222

A corrector drug currently in pre-clinical candidate stage, which is expected to enter Phase 1 before end 2015. Galapagos and AbbVie are planning to combine GLPG1837 with GLPG2222 and another corrector drug to treat the largest mutation of CF

IBD

Inflammatory Bowel Disease. This is a general term for autoimmune disease affecting the bowel, including Crohn’s disease and ulcerative colitis. Crohn’s disease affects the small intestine primarily, while ulcerative colitis affects the large intestine. Both diseases involve inflammation of the intestinal wall, leading to pain, bleeding, and ultimately in some cases removal of bowel tissue

IPF

Idiopathic pulmonary fibrosis. A chronic and ultimately fatal disease characterized by a progressive decline in lung function. Pulmonary fibrosis involves scarring of lung tissue and is the cause of shortness of breath. Fibrosis is usually associated with a poor prognosis. The term “idiopathic” is used because the cause of pulmonary fibrosis is still unknown.

Infectious diseases

Diseases that are caused by pathogenic micro-organisms such as bacteria, viruses, parasites or fungi

Inflammatory diseases

A large, unrelated group of disorders associated with abnormalities in inflammation

In-/out-licensing

Receiving/granting permission from/to another company or institution to use a brand name, patent, or other proprietary right, in exchange for a fee and/or royalty

Intellectual property

Creations of the mind that have commercial value and are protected by patents, trademarks or copyrights

Intersegment

Occurring between the different operations of a company

Investigational New Drug (IND) application

United States Federal law requires a pharmaceutical company to obtain an exemption to ship an experimental drug across state lines, usually to clinical investigators, before a marketing application for the drug has been approved. The IND is the means by which the sponsor technically obtains this exemption

JAK

Janus kinases (JAK) are critical components of signaling mechanisms utilized by a number of cytokines and growth factors, including those that are elevated in rheumatoid arthritis

Milestone

Major achievement in a project or program; in Galapagos’ alliances, this is usually associated with a payment

MTX

Methotrexate

Molecule collections

Chemical libraries, usually consisting of drug-like small molecules that are designed to interact with to specific target classes. These collections can be screened against a target to generate initial “hits” in a drug discovery program

MOR106

A novel mode of action antibody currently in pre-clinical candidate stage, is part of the alliance with MorphoSys. MOR106 is expected to enter Phase 1 in 2016

MRSA

Methicillin-resistant Staphylococcus aureus is a strain of Staphylococcus aureus that is resistant to methicillin. It causes a potentially life-threatening infection that occurs most frequently among patients in hospitals

NDA

New Drug Application

Oral dosing

Administration of medicine by the mouth, either as a solution or solid (capsule, pill) form

Osteoarthritis

The most common form of arthritis, usually occurring after middle age, marked by chronic breakdown of cartilage in the joints leading to pain, stiffness, and swelling

OTC

“Over the Counter” which means trading directly between two parties. In the U.S., over the counter trading in stocks is carried out via market makers who use quotation services such as the OTC Bulletin Board (OTCBB) and the Pink Sheets. The US over-the-counter market is monitored by the FINRA. Galapagos’ Level 1 ADR is traded over the counter under ticker symbol GLPYY on the Pink Sheets in the US, www.pinksheets.com

Outsourcing

Contracting work to a third party

Pharmacokinetics (PK)

Study of what a body does to a drug; the fate of a substance delivered to a body

Phase 1

First stage of clinical testing of a potential new treatment designed to assess the safety and tolerability of a drug, usually performed in a small number of healthy human volunteers

Phase 2

Second stage of clinical testing, usually performed in 20-300 patients, in order to determine efficacy, tolerability and the most effective dose to use

Phase 3

Large clinical trials, usually conducted in 300-3000 patients to gain a definitive understanding of the efficacy and tolerability of the candidate treatment by comparing it to the “gold standard” treatment; serves as the principal basis for regulatory approval

Placebo-controlled

A clinical study can only show statistical significance when the effect of a candidate drug is measured against that of a placebo, a substance having no pharmacological effect but administered as a control in testing experimentally or clinically the efficacy of a biologically active preparation

Potentiator drug

Drug that restores the ion channel opening in cystic fibrosis patients. In most CF patients, a potentiator and corrector drug are needed in combination to restore the genetic defect causing CF

Pre-clinical

Stage of drug research development, undertaken prior to the administration of the drug to humans. Consists of in vitro and in vivo screening, pharmaco-kinetics, toxicology, and chemical upscaling

Pre-clinical candidate (PCC)

A potential drug that meets chemical and biological criteria to begin the development process

Psoriasis

Psoriasis is an immune-mediated disease that affects the skin. It is caused by the immune system being mistakenly triggered, resulting in overproduction of new skin cells

Rheumatoid arthritis (RA)

A chronic, systemic inflammatory disease that causes joint inflammation, and usually leads to cartilage destruction, bone erosion and disability

R&D operations

Research and development operations; unit responsible for discovery and developing new candidate drugs for internal pipeline or as part of risk/reward sharing alliances with partners

Screening

Method usually applied at the beginning of a drug discovery campaign, where a target is tested in a biochemical assay against a series of small molecules or antibodies to obtain an initial set of “hits” that show activity against the target. These hits are then further tested or optimized

Service operations

Business unit primarily focused on delivering products and conducting fee-for-service work for clients. Galapagos’ service operations included the BioFocus and Argenta business units, which were both sold in April 2014 to Charles River Laboratories

Target

Protein that has been shown to be involved in a disease process and forms the basis of therapeutic intervention or drug discovery

Target discovery

Identification and validation of proteins that have been shown to play a role in a disease process

Technology access fee

License payment made in return for access to specific technology (e.g. compound or virus collections)

TNF

Tumor necrosis factor

Ussing Chamber

Ussing chamber is a scientific tool used to measure the current as an indicator of ion transport taking place across an epithelium