Risks Related to Product Development and Regulatory Approval
Operating procedures, monitoring, and prioritizing product candidates
We operate adequate standard operating procedures to secure the integrity and protection of our R&D activities and results, and the optimum allocation of our R&D budgets. The progress of the most important R&D programs is monitored by our Executive Committee. The Science and Development Committee, in place until October 31, 2025, provided input and advice to the Board of Directors on matters relating to our R&D strategy. The programs are discussed with the Board of Directors at least once per quarter.
Nevertheless, we must, and have in the past, as we did during the financial year 2025, prioritize the development of certain product candidates by, at times, discontinuing other product candidates and research activities, like the small molecules research activities and the wind-down of our cell therapy activities; these decisions may prove to have been wrong and may adversely affect our business.
Strongly dependent on the success of clinical product candidates and the discovery portfolio
We expect to generate minimal to no revenue until such time that we are able to obtain regulatory approval of and commercialize our existing or future product candidates, other than earn-out payments from Alfasigma in connection with the transfer of the Jyseleca® business.
Following the wind-down of our cell therapy activities and until such time, if ever, as we are able to acquire, partner or license or develop additional product candidates, our only product candidate in development will be GLPG3667. As a result, we will be substantially dependent on the success of GLPG3667, and our results of operations and financial condition will be increasingly vulnerable to adverse developments in the clinical development and, if approved, commercialization of GLPG3667. Further, for reasons unrelated to its clinical development, we may determine to discontinue the development of GLPG3667 at any time, which could leave us without any viable product candidates. We are evaluating all strategic options for GLPG3667, including exploring a potential partnership and business development opportunities to accelerate development of GLPG3667 in DM, as well as in parallel assessing the funding and capability requirements for us to run our own Phase 3 program for GLPG3667 in DM. We cannot give any assurance that any current and future (including acquired) product candidate will successfully complete clinical trials, or receive regulatory approval, which is necessary before it can be commercialized.
Unpredictable commercial viability of the product candidates
Our business and future success is substantially dependent on our ability to develop successfully, obtain regulatory approval for, and then successfully commercialize our product candidates. We are not permitted to market or promote any of our product candidates before we receive regulatory approval from the FDA, the EMA, the MHRA, the MHLW or any other comparable regulatory authority, and we may never receive such regulatory approval for any of our product candidates. We cannot give any assurances that our clinical trials for our product candidates will be completed in a timely manner, or at all. If any of our current and future (including acquired) product candidates are not approved and commercialized in certain jurisdictions, we will not be able to generate any product revenues for that product candidate.
Lengthy, time-consuming regulatory processes
The regulatory approval processes of the FDA, the EMA, the MHRA, the MHLW and any other comparable regulatory authority are lengthy, time-consuming and inherently unpredictable, and if we are ultimately unable to obtain regulatory approval for our current and future (including acquired) product candidates, our business, including its financial condition, will be substantially harmed.
Expensive clinical development process with uncertain outcome
Clinical testing is expensive and can take many years to complete, and its outcome is inherently uncertain. Results of earlier studies and trials as well as data from any interim analysis of ongoing clinical trials may not be predictive of future trial results, and failure can occur at any time during the clinical trial process. If we experience delays in the completion of, or termination of, any clinical trial of our current and future (including acquired) product candidates, the commercial prospects of our product candidates will be harmed, and our ability to generate product revenues from any of these product candidates will be delayed. If any of our product candidates are found to be unsafe or have a lack of efficacy, we will not be able to obtain or maintain regulatory approval for it and our business would be materially harmed.
Conducting multinational clinical trials exposes us to additional risks. The FDA requires that clinical trials are well- designed and conducted and performed by qualified investigators in accordance with ethical principles, such as institutional review board or ethics committee approval and informed consent procedures. The trial population must also adequately represent the U.S. population and the data must be applicable to the U.S. population and U.S. medical practice in ways that the FDA deems clinically meaningful.
Further, the FDA may consider an on-site inspection to be necessary in which case they must be able to validate the data through such an inspection or other appropriate means. In addition, while these clinical trials are subject to the applicable local laws, acceptance of the data by the FDA will be dependent upon its determination that the trials were conducted consistent with all applicable U.S. laws and regulations. Similarly, any data submitted to foreign regulatory authorities may not adhere to their standards and requirements for clinical trials and data from trials conducted outside of such jurisdiction may not be accepted.
Patient enrollment influence
The rates at which we complete our scientific studies and clinical trials depend on many factors, including, but not limited to, patient enrollment. Patient enrollment is a significant factor in the timing of clinical trials and is affected by many factors including competing clinical trials, clinicians’ and patients’ perceptions as to the potential advantages of the drug being studied in relation to other available therapies and the relatively limited number of patients. Any of these occurrences may harm our clinical trials and by extension, our business, financial condition and prospects.
Product candidates may cause undesirable side effects or serious adverse events
Our current and future (including acquired) product candidates may cause undesirable or unacceptable side effects or have other properties that could delay, may result in clinical holds or prevent their regulatory approval, limit the commercial profile of an approved label, or result in significant negative consequences following marketing approval, if any. Undesirable side effects caused by our product candidates could cause us or regulatory authorities to interrupt, delay or halt clinical trials and could result in a more restrictive label or the delay or denial of regulatory approval by the FDA, the EMA, the MHRA, the MHLW or any other comparable regulatory authority. The drug-related side effects could affect patient recruitment or the ability of enrolled patients to complete the trial or result in potential product liability claims. Any of these occurrences may harm our business, financial condition and prospects significantly and may adversely impact the viability of our other product candidates or preclinical programs.
Over the last years, we have focused on the development of CAR-T product candidates. Patients receiving T cell-based immunotherapies may experience serious adverse events, including neurotoxicity and cytokine release syndrome. Serious adverse events or undesirable side effects associated with our CAR-T product candidates could significantly harm our business, financial condition and prospects.
If we are not able to obtain orphan product exclusivity, or maintain such status for future product candidates for which we seek this status, or if our competitors are able to obtain orphan product exclusivity before we do, we may not be able to obtain approval for our competing products for a significant period of time. Even if we are able to obtain orphan designation, we may not be the first to obtain marketing approval for such indication due to the uncertainties associated with developing pharmaceutical products. Orphan drug designation neither shortens the development time or regulatory review time of a drug nor gives the drug any advantage in the regulatory review or approval process.
Extensive ongoing regulatory requirements
If the FDA, EMA, or any other comparable regulatory authority approves any of our current and future (including acquired) product candidates, the manufacturing processes, distribution, adverse event reporting, storage, advertising, and recordkeeping for the product will be subject to extensive and ongoing regulatory requirements. These requirements include submissions of safety and other post-marketing information and reports, registration requirements and continued compliance with current good manufacturing practices, or cGMPs, and good clinical practices, or GCPs, for any clinical trials that we conduct post-approval. Failure to comply with the aforementioned practices may harm our clinical trials or regulatory process and by extension, our business, financial condition and prospects. For example, the FDA stated in its January 2024 final guidance document titled “Considerations for the Development of Chimeric Antigen Receptor (CAR) T Cell Products” that subjects in clinical trials treated with CAR-T cells containing an integrated transgene should be monitored for 15 years after treatment.
Before we can begin to commercially manufacture our current and future (including acquired) product candidates for human therapeutics, the FDA must review for the applicable manufacturing process and facilities as part of its review of our marketing application. This will likely require the manufacturing facilities to pass a pre-approval inspection by the FDA. A manufacturing authorization must also be obtained from the appropriate EU regulatory authorities or other comparable regulatory authorities.
We must establish and maintain a pharmacovigilance system, including a qualified person responsible for oversight, submit safety reports to the regulators and comply with the good pharmacovigilance practice guidelines adopted by the relevant regulatory authorities. Failure to comply with these guidelines may harm our clinical trials or regulatory process and by extension, our business.