Reliance on third parties

Risks related to Galapagos’ reliance on third parties

Galapagos may not be successful in maintaining development and commercialization collaborations, and any partner may not devote sufficient resources to the development or commercialization of Galapagos’ product candidates.

The collaboration arrangements that Galapagos has established, and any collaboration arrangements that it may enter into in the future may not ultimately be successful, which could have a negative impact on its business, results of operations, financial condition and growth prospects. It is possible that a partner may not devote sufficient resources to the development or commercialization of Galapagos’ product candidate or may otherwise fail in development or commercialization efforts, in which event the development and commercialization of such product candidate could be delayed or terminated and Galapagos’ business could be substantially harmed.

Galapagos relies on third party suppliers for which a reliable supply of materials is required in order to avoid delays in the drug discovery and development process. Most goods and services are provided by several different suppliers, which mitigates the risk of loss of key suppliers. Expanding the suppliers’ network can be time consuming as all source suppliers are subject to rigorous ethical and quality control standards. The suppliers should perform as contractually required or expected.

Galapagos relies on third parties to conduct its pre-clinical studies and clinical trials.

Galapagos has relied upon and plans to continue to rely upon contract research organizations ("CROs") to monitor and manage data for its pre-clinical and clinical programs. Galapagos and its CROs also rely upon clinical sites and investigators for the performance of its clinical trials in accordance with the applicable protocols and applicable legal, regulatory and scientific standards. If CROs do not successfully carry out their contractual duties or obligations or meet quality standards, regulatory requirements or expected, Galapagos’ clinical trials may be extended, delayed or terminated and Galapagos may not be able to obtain regulatory approval for or successfully commercialize its product candidates.

Galapagos relies on clinical data and results obtained by third parties that could ultimately prove to be inaccurate or unreliable.

As part of its strategy to mitigate development risk, Galapagos seeks to develop product candidates with validated mechanisms of action and it utilizes biomarkers to assess potential clinical efficacy early in the development process. This strategy necessarily relies upon clinical data and other results obtained by third parties. If the third-party data and results Galapagos relies upon prove to be inaccurate, unreliable or not applicable to its product candidates, Galapagos could make inaccurate assumptions and conclusions about its product candidates and its research and development efforts could be materially adversely affected.