Letter from the CEO and Chairman

As I reflect on my first year as the CEO and Chairman of the Board of Directors of Galapagos, we can be proud of what we have achieved in a very short time to embrace and execute on a new R&D strategy for accelerated growth and a sustainable future for our patients, our people, and our shareholders.

2022 was characterized by major transformation and change but our purpose remains unchanged: transforming patient outcomes through life-changing science and innovation for more years of life and quality of life.

By year-end, we implemented a therapeutic area focused R&D model in immunology and oncology, and we added new drug modalities to include CAR-T cell therapy and biological capabilities. We aim to rebuild our portfolio with transformational medicines, by accelerated innovation and shorter drug development timelines.

Through the acquisitions of CellPoint and AboundBio, we gained access to a breakthrough, point-of-care CAR-T manufacturing platform, a clinical-stage CAR-T oncology pipeline and research capabilities for novel, differentiated CAR-T constructs, that together have the potential to deliver life-saving medicines to more patients, faster and more efficiently. Through the two acquisitions, we also onboarded an excellent team of cell therapy scientists and oncology experts.

We brought forward our CD19 CAR-T candidates manufactured at point-of-care in two Phase 1/2 studies in patients with relapsed/refractory non-Hodgkin lymphoma and chronic lymphocytic leukemia. We reported encouraging initial safety and efficacy Phase 1/2 results for both CAR-T candidates, which we believe demonstrate that through the decentralized delivery model, a 7-day vein-to-vein, leukapheresis to infusion time, is feasible. In addition, using non-frozen cells with a short culture time seems to result in a promising safety and efficacy profile of the CAR-T therapy.

Over the next years, we aim to further broaden our CAR-T oncology portfolio and bring additional differentiated CAR-T candidates into the clinic and to market, while further advancing the ongoing Phase 1/2 studies in hemato-oncology, for which Phase 1 topline results are expected around mid-2023.

In addition, we remain fully committed to immunology, an area where there is still significant unmet patient need and for which we have built deep scientific know-how and expertise since our founding. With our programs targeting multiple modes-of-action and drug modalities, we have a differentiated portfolio of preclinical to commercial assets.

We are very proud that our first marketed medicine, Jyseleca®, an orally administered JAK1 preferential inhibitor, continued to deliver solid in-market performance with a growing European base and €87.6 million in net sales for the year 2022, reaching 18,000 patients with rheumatoid arthritis and ulcerative colitis across Europe.

Although the topline results from the Phase 3 DIVERSITY trial of filgotinib in Crohn’s disease were not supportive to submit a Marketing Authorization Application in Europe as the induction cohorts did not meet the co-primary endpoints, we were encouraged by the confirmed safety profile and the efficacy results observed in the maintenance study and will thoroughly review the full data to further help our understanding of this disease and to support future research efforts.

We plan to further invest in our Jyseleca® franchise and later this year, we aim to start a Phase 3 study in axial spondyloarthritis, a type of arthritis that typically begins between the age of 20 and 40, and that causes pain and swelling in the spine and the joints that connect the bottom of the spine to the pelvis.

Over the past year, we also made progress with GLPG3667, our selective TYK2 kinase inhibitor, and we aim to start a Phase 2 study in dermatomyositis in the first half of 2023 and in systemic lupus erythematosus in the second half of 2023.

Finally, to accelerate time-to-patients, we have expanded our drug modality capabilities in immunology, and recently announced that we aim to start clinical development with a CD19 CAR-T candidate in refractory systemic lupus erythematosus in 2023.

2022 was characterized by major transformation and change but our purpose remains unchanged: transforming patient outcomes through life-changing science and innovation for more years of life and quality of life.

Beyond our renewed portfolio focus, our strategic transformation also includes formalizing our Environmental, Social and Governance (ESG) ambitions. Over the course of 2022, we completed a new materiality analysis, which allows us to further focus our Sustainability ambitions in those areas that we believe are most material and where we can make the greatest impact.

With the new strategic direction, a new Executive Committee composition was implemented with the retirement of Dr. Walid Abi-Saab and André Hoekema, and the appointments of Valeria Cnossen, General Counsel, also responsible for Compliance & Ethics, the Corporate Secretary Office and Intellectual Property, and Annelies Missotten, Chief Human Resources Officer. In addition, our Board of Directors approved an updated Corporate Governance Charter, which refers, amongst other updates, to the establishment of the Management Committee supporting the Executive Committee. As a result, our senior leadership team has been further strengthened with key hires and internal promotions in Research, Development, Business Development and Commercial. We continue to endeavor to attract experienced top talent across the organization to execute on our strategy and accelerate innovation and time-to-patients in our strategic focus areas of immunology and oncology. 

During 2022, we focused on optimizing our organizational set-up and cost base. Financially, we ended 2022 with a strong balance sheet of €4.1 billion in cash and current financial investments, which provides us with the necessary means to look for additional external innovation to accelerate our R&D portfolio while progressing our internal programs. We are confident that with our renewed focus to bring transformational medicines to more patients, faster, we are well-positioned to deliver significant long-term value for our shareholders.

Taking Galapagos on course for the future and embracing a new strategic direction was challenging and hard work for all the teams. I would like to thank all our employees for their commitment during the past year and for their relentless efforts to pioneer for patients. I want to sincerely thank our shareholders for their trust and continued commitment to stay with us on our journey.

We look forward with great optimism to a sustainable future as we continue to innovate for patients to give them what matters the most: more time with family and friends. More joy. Longer, healthier, better-quality lives.

Respectfully,

Dr. Paul Stoffels¹
CEO and Chairman of the Board of Directors