Shareholders
Major shareholders of Galapagos NV
Based on transparency notifications received by Galapagos NV under Belgian law and the statements of acquisition of beneficial ownership filed with the U.S. Securities and Exchange Commission under U.S. securities law, the shareholders owning 5% or more of Galapagos NV’s shares on December 31, 2024 and on an undiluted basis were Gilead Therapeutics A1 Unlimited Company (16,707,477 shares or 25.35%), Van Herk Investments B.V. (4,635,672 shares or 7.03%), and EcoR1 Capital LLC (7,094,049 shares or 10.77%).
Major shareholders on December 31, 2024
At the end of 2024, our CEO owned 1,125,000 subscription rights. The other members of our Executive Committee held an aggregate of 2,600 shares and 491,500 subscription rights. The members of our Board of Directors (excluding our CEO) held an aggregate of 10,274 shares and 7,500 subscription rights. Each subscription right entitles its holder to subscribe to one share of Galapagos NV.
Subject to the approval of Galapagos’ shareholders and certain other conditions, Gilead has the right under the terms of the share subscription agreement to have two designees appointed to our Board of Directors. The Board members Mr. Andrew Dickinson and Dr. Linda Higgins are representatives of Gilead.
Agreements between Galapagos NV shareholders
On the date of this report, we had no knowledge of the existence of any shareholders’ agreements between its shareholders.
Agreements with major Galapagos NV shareholders
On July 14, 2019, we and Gilead Sciences, Inc. and its affiliated companies (hereinafter “Gilead”) announced that we entered into a 10-year global research and development collaboration. In the context of the transaction, Gilead also made an equity investment in Galapagos. We also amended and restated the license agreement for filgotinib that we originally entered into with Gilead on December 16, 2015. On August 23, 2019, the closing of the transaction took place and we received an upfront payment of €3,569.8 million ($3.95 billion) and a €960.1 million ($1.1 billion) equity investment from Gilead.
On December 15, 2020 and on October 30, 2023, we and Gilead announced that we agreed to amend our existing arrangement for the commercialization and development of filgotinib again. On January 31, 2024, we successfully transferred the Jyseleca® business to Alfasigma. As part of the transaction, the amended Filgotinib Agreement between Galapagos and Gilead was assigned to Alfasigma.
On January 8, 2025, we announced an intended separation into two publicly traded entities, in which we would spin out a newly to be formed company (hereinafter “SpinCo”), which would focus on building a pipeline of innovative medicines through transformational transactions. We, Galapagos, would continue to advance our global cell therapy leadership in addressing high unmet medical needs in oncology. In the framework of the separation, we and Gilead have agreed to amend the existing arrangements between us, as further described below.
Terms of the equity investment
As part of the research and development collaboration, Gilead entered into a share subscription agreement with us. On August 23, 2019, Gilead subscribed to 6,828,985 new Galapagos shares at a price of €140.59 per share, which included an issuance premium.
Subject to the approval of Galapagos’ Shareholders’ Meeting and certain other conditions, Gilead has the right under the terms of the share subscription agreement to have two designees appointed to our Board of Directors. The Board members Mr. Andrew Dickinson and Dr. Linda Higgins are representatives of Gilead.
On October 22, 2019, our Extraordinary Shareholders’ Meeting approved the issuance of a warrant to Gilead, known as Warrant A, that confers the right to subscribe for a number of new shares sufficient to bring the number of shares owned by Gilead and its affiliates to 25.1% of the issued and outstanding shares of the Company. Warrant A expires one year after the issue date and the exercise price per share is €140.59. On November 6, 2019, Gilead exercised Warrant A and increased its ownership in Galapagos to 25.10% of the then outstanding shares.
On October 22, 2019, Gilead was also issued another warrant, known as the initial Warrant B, that confers the right to subscribe for a number of new shares sufficient to bring the number of shares owned by Gilead and its affiliates to 29.9% of the issued and outstanding shares of the Company. Pursuant to this warrant, the exercise price per share will be the greater of (i) 120% multiplied by the arithmetic mean of the 30-day daily volume weighted average trading price of the Galapagos shares as traded on Euronext Brussels and Euronext Amsterdam, preceding the date of the exercise notice with respect to such exercise, and (ii) €140.59. The initial Warrant B expired on August 23, 2024. It was agreed between us and Gilead that, between 57 and 59 months from August 23, 2019, subject to and upon approval by the Company’s Shareholders’ Meeting, we would issue a warrant with substantially similar terms, including exercise price, to the initial Warrant B. On April 30, 2024, the Extraordinary Shareholders’ Meeting approved the issuance of this warrant to Gilead. This subsequent Warrant B will expire five years after the date that the warrant is issued.
Gilead is subject to certain standstill restrictions until 10 years following the closing, which occurred on August 23, 2019. Among other things, during this time Gilead and its affiliates and any party acting in concert with them may not, without our consent, acquire voting securities of Galapagos exceeding more than 29.9% of the then issued and outstanding voting securities, and Gilead may not propose a business combination with or acquisition of Galapagos. The standstill restrictions are subject to certain exceptions as provided in the share subscription agreement.
Pursuant to the terms of the share subscription agreement, Gilead also agreed to certain lock-up provisions. They shall not, and shall cause their affiliates not to, without our prior consent, dispose of any equity securities of Galapagos prior to the second anniversary of the closing (August 23, 2019). During the period beginning on the date that is two years following the closing until the date that is five years following the closing, Gilead and its affiliates shall not, without our prior consent, dispose of any equity securities of Galapagos if after such disposal they would own less than 20.1% of the then issued and outstanding voting securities of Galapagos. The lock-up restrictions are subject to certain exceptions as provided in the share subscription agreement and may terminate upon certain events.
In April 2021, we and Gilead agreed to amend the share subscription agreement to extend the full lock-up of all of Gilead’s securities of Galapagos for a period of five years until August 22, 2024. In 2022, Gilead and Galapagos agreed to amend the share subscription agreement for conformity with the change from a two-tier to a one-tier governance system by Galapagos.
In January 2025, we and Gilead agreed to amend the share subscription agreement in the framework of the intended separation that is further described below under “Intended separation”, whereby the share subscription agreement, as amended, will be assigned to the newly formed SpinCo as of the effective date of the separation.
At the time of separation, Gilead will hold approximately 25% of the outstanding shares in both Galapagos and SpinCo. A lock-up will apply to the shares of Gilead in Galapagos until the earlier of the following dates (i) the termination of the separation agreement, (ii) the date that is six months after the completion of a qualifying equity financing by Galapagos, or (iii) March 31, 2027. A lock-up will also apply to the shares of Gilead in SpinCo until six months following the separation. Each lock-up is subject to certain customary exceptions and early termination provisions.
Gilead will be subject to standstill restrictions in relation to both Galapagos and SpinCo. The standstill restrictions in relation to Galapagos will apply as of the effective time of the separation and terminate on August 22, 2029. During this time Gilead and its affiliates and any party acting in concert with them may not, among other things, acquire voting securities of Galapagos exceeding more than 29.9% of the then issued and outstanding voting securities without our consent, and Gilead may not propose a business combination with or acquisition of Galapagos. Similar standstill provisions will apply to Gilead in relation to SpinCo, which will apply as of the effective time of the separation and terminate two years thereafter. Both standstills are subject to certain exceptions as provided in the separation agreement.
SpinCo will have a Board of Directors consisting of a majority of Independent Non-Executive Directors. Gilead will be entitled to nominate two Directors of SpinCo, and will no longer have the right to have designees appointed to our Board of Directors, and the two Gilead Directors currently serving on the Board of Directors will step down upon the separation.
The outstanding warrant held by Gilead that was issued on April 30, 2024 will be adjusted at the occasion of the separation, and split into a warrant for Galapagos shares and a warrant for SpinCo shares.
Terms of the global research and development collaboration
Under the option, license and collaboration agreement, we would fund and lead all discovery and development autonomously until the end of Phase 2. After the completion of a qualifying Phase 2 study (or, in certain circumstances, the first Phase 3 study), Gilead would have the option to acquire an exclusive commercial license to the compound in all countries outside of Europe. If an option were exercised, Gilead and we would co-develop the compound and share costs equally. Gilead would maintain option rights to our programs through the 10-year term of the collaboration.
For all programs resulting from the collaboration (other than GLPG1972 and GLPG1690), Gilead would make a $150 million opt-in payment per program and would owe no subsequent milestones. We would receive tiered royalties ranging from 20 – 24% on net sales of all our products licensed by Gilead in countries outside of Europe as part of the agreement. For GLPG1972, Gilead declined to exercise its option under the collaboration agreement in November 2020. In February 2021, the development of GLPG1690 (ziritaxestat) was discontinued.
In January 2025, we agreed with Gilead in the framework of this intended separation, that we will assign the option, license and collaboration agreement to the newly formed SpinCo as of the effective date of the separation. As of the separation, we will be released from the collaboration and will have full global development and commercialization rights to our pipeline, which will no longer be subject to Gilead’s opt-in rights under the option, license and collaboration agreement, subject to payment of single digit royalties to Gilead on net sales of certain products. The applicable royalty rates will be subject to customary step-downs and adjustments, such as reductions where there is no patent protection, no regulatory exclusivity, or in the presence of generic competition. The royalty term will continue until the later of the expiration of the last Galapagos patent covering the product, the expiration of regulatory exclusivity, or twenty years after the separation date.
In the framework of this intended separation, Gilead has furthermore agreed to waive its rights under the option, license and collaboration agreement with respect to all of Galapagos' and its affiliates' small molecule research and development activities and programs. This waiver allows us to wind down, license, divest, partner, or take other similar actions in respect of the small molecule programs without Gilead's consent or veto. Gilead will not receive any royalties, proceeds, payments, or other consideration arising from these actions.
Revised filgotinib collaboration
Under the terms of the new arrangement agreed in December 2020, we assumed all development, manufacturing, commercialization and certain other rights for filgotinib in Europe. Gilead retains commercial rights and remains the marketing authorization holder for filgotinib outside of Europe, including in Japan, where filgotinib is co-marketed with Eisai. The transfer was subject to applicable local legal, regulatory and consultation requirements. Most activities transferred to us by December 31, 2021 and we completed the transition during 2022.
The new arrangement was formalized in (1) the Transition and Amendment Agreement of April 3, 2021 pursuant to which Gilead transitioned the exploitation of filgotinib in Europe to us by the end of 2021, (2) the DIVERSITY Letter Agreement of September 6, 2021 pursuant to which we and Gilead agreed to transfer the sponsorship of and operational and financial responsibility for the ongoing DIVERSITY study and its long-term extension study (LTE) study from Gilead to us, and (3) the Second Amended and Restated License and Collaboration Agreement of December 24, 2021, amending and restating the existing collaboration agreement, which went into effect as of January 1, 2022.
In March 2022, we and Gilead agreed to transfer the sponsorship of and the operational responsibility for the MANTA study, a safety study in men with moderately to severely active UC and CD to assess semen parameters while taking filgotinib, and its long-term extension, from Gilead to us.
Since January 1, 2021, we bear the future development costs for certain studies, in lieu of the equal cost split contemplated by the previous agreement. These studies include the DARWIN3, FINCH4, FILOSOPHY, and Phase 4 studies and registries in RA, MANTA and MANTA-Ray, the PENGUIN1 and 2 and EQUATOR2 studies in PsA, the SEALION1 and 2 studies in AS, the HUMBOLDT study in uveitis in addition to other clinical and non-clinical expenses supporting these studies and support for any investigator sponsored trials in non-IBD conditions and non-clinical costs on all current trials. The existing 50/50 global development cost sharing arrangement continued for the following studies: SELECTION and its long-term extension study (LTE) in UC, DIVERSITY and its LTE, DIVERGENCE 1 and 2 and their LTEs and support for Phase 4 studies and registries in Crohn’s disease, pediatric studies and their LTEs in RA, UC and CD, and support for investigator sponsored trials in IBD. In September 2021, we and Gilead agreed to transfer the sponsorship of the DIVERSITY study and its LTE study from Gilead to us. The transfer was intended to be completed by June 30, 2022 and was completed by March 2023. From April 1, 2022, we are solely responsible for all development costs for the DIVERSITY study and its LTE study. In March 2022, we and Gilead agreed to transfer the sponsorship of the MANTA study and its LTE from Gilead to us, which transfer was largely completed by December 31, 2022.
All commercial economics on filgotinib in Europe transferred to us as of January 1, 2022, subject to payment of tiered royalties of 8 to 15 percent of net sales in Europe to Gilead, starting in 2024. In connection with the amendments to the existing arrangement for the commercialization and development of filgotinib, Gilead agreed to irrevocably pay us €160 million, subject to certain adjustments for higher than budgeted development costs. Gilead paid €35 million in January 2021, an additional €75 million in April 2021 and €50 million in 2022. Furthermore, Gilead made a one-time payment of $15 million to us in 2022 in consideration for us assuming responsibility for the DIVERSITY study. In addition, we will no longer be eligible to receive any future milestone payments relating to filgotinib in Europe. However, we will remain eligible to receive tiered royalty percentages ranging from 20% to 30% on Gilead’s global net sales of filgotinib outside of Europe and future development and regulatory milestone-based payments of up to $275 million and sales-based milestone payments of up to $600 million.
On March 28, 2022 filgotinib was approved by the Japanese Ministry of Health, Labour and Welfare for UC, for which we received a $20.0 million (€18.2 million) regulatory milestone payment from Gilead in May 2022.
In March 2022, we and Gilead agreed to further amend the collaboration by adding the following countries to the Galapagos territory: Andorra, San Marino, Monaco, and Vatican City.
In October 2023, we and Gilead agreed to further amend the collaboration. We and Gilead agreed to terminate the existing 50/50 global development cost sharing arrangement, with us bearing the costs going forward, and to terminate Galapagos’ obligation to pay tiered royalties to Gilead on net sales of Jyseleca® in Europe, in addition to other amendments. Effective January 31, 2024, following the closing of the transaction between Galapagos and Alfasigma S.p.A. to transfer the Jyseleca® business to Alfasigma, we assigned our rights and obligations under the filgotinib collaboration to Alfasigma, except for our right to receive royalties from Gilead on net sales in the Gilead Territory under a separate agreement between Gilead and Galapagos entered into in October 2023.
Intended separation
On January 7, 2025, we and Gilead entered into a separation agreement to restructure our existing relationship. Under this agreement, we intend to transfer, by way of a partial demerger to be effected in accordance with the relevant provisions of the Belgian Companies Code, a portion of our current cash balance (along with certain other assets and liabilities) into a new entity, SpinCo. Our existing shareholders will receive shares in SpinCo in the same proportion as their shareholdings in Galapagos as of a record date to be established. SpinCo will focus on identifying and investing in innovative medicines with robust demonstrated proof-of-concept in oncology, immunology, and/or virology through strategic business development transactions. Completion of the separation is contingent upon the approval of the partial demerger by an Extraordinary Shareholders’ Meeting of Galapagos, as well as certain other customary conditions. The separation is expected to occur by mid-2025.
As further described above under “Terms of the global research and development collaboration”, the option, license and collaboration agreement, as amended, will be assigned to SpinCo in the framework of this intended separation. Gilead has furthermore agreed to waive its rights under the option, license and collaboration agreement with respect to all of Galapagos' and its affiliates' small molecule research and development activities and programs.
We intend to apply for listing on the regulated market of Euronext Amsterdam and Brussels, and Nasdaq (through American Depositary Shares (ADSs)).
Gilead has agreed to lock-up provisions and standstill restrictions in respect of both Galapagos and SpinCo, as described above under “Terms of the equity investment”.
We will provide transitional services to SpinCo on a cost plus basis during a reasonable period after the separation to facilitate SpinCo's operations and allow it to operate on a stand-alone basis as soon as possible.
As part of the separation, we also agreed with Gilead that SpinCo will provide us with a financing backstop facility to support our operations post-separation.