EU Taxonomy 2025 Statement
The European Commission’s action plan on financing sustainable growth led to the creation of an EU classification system for sustainable activities, also known as the EU taxonomy. The EU Taxonomy introduces a classification system for environmentally sustainable activities, and an activity is deemed environmentally sustainable if it meets all of the following overarching criteria:
substantially contributing to at least one of the six environmental objectives of the EU Taxonomy Regulation: (i) climate change mitigation;(ii) climate change adaptation;(iii) sustainable use and protection of water and marine resources;(iv) transition to a circular economy, (v) pollution prevention and control; and (vi) protection and restoration of biodiversity and ecosystems;
not significantly harming any of these environmental objectives;
complying with minimum safeguards.
As indicated in the Delegated Regulation of (EU) 2021/2178, non-financial undertakings shall disclose the proportion of Taxonomy-eligible and aligned economic activities in their total turnover, capital expenditure (CapEx) and operational expenditure (OpEx).
Our approach
Changes from previous reporting period
We have closely followed the development of the Omnibus Delegated Act, which streamlines the EU Taxonomy Regulation and came into force on 28 January 2026. The Act applies retrospectively from 1 January 2026, and accordingly, we have updated our EU Taxonomy reporting approach to align with the amended rules.
Key updates introduced this year include the use of the revised EU Taxonomy reporting templates, the omission of dedicated templates for performance and exposures related to fossil gas and nuclear activities, and the application of the new materiality threshold, which allows entities to omit the assessment of activities that are not financially material. The methodology applied for the eligibility and alignment assessments and the calculation of the related KPIs has remained largely unchanged compared to the previous year, apart from an adjustment to the approach for calculating the OpEx KPI. Further details are provided in the Accounting Policy section.
Materiality
The amended Delegated Act allows non-financial undertakings to omit assessing whether some of their economic activities are taxonomy-eligible or taxonomy-aligned where the cumulative value of those economic activities is below 10%. In line with this provision, we have assessed materiality separately for each KPI by identifying economic activities and their corresponding values of the KPI. Those activities that cumulatively fall below the 10% threshold have been classified as non-material and excluded from further eligibility and alignment assessment.
Non-material activities were identified under CapEx and OpEx. For CapEx they included investments in software and databases (NACE 62.01 Computer programming activities) and leased, right-of-use vehicles (77.11 Renting and leasing of cars and light motor vehicles). These activities cumulatively represent approximately 4% of the total CapEx.
Under OpEx, non-material activities consisted of expenses related to maintenance of property, plant and equipment (NACE 81.1 Combined facilities support activities) and short-term leases of heat pumps (NACE 77.3 Renting and leasing of other machinery, equipment and tangible goods), accounting for approximately 0.5%. These non-material activities are not part of Galapagos’ core business operations but relate to supporting functions and therefore account for only a minor proportion of the KPIs.
Eligibility
Following a thorough review of the EU Taxonomy legal framework, beginning with an assessment of our core activities and NACE codes against the activities identified under the EU Taxonomy, we do not consider our core business activities of discovering and developing innovative medicines to be in scope of the Delegated Acts. As a result, no eligibility has been reported for turnover.
For CapEx, we have identified activity 7.3. Installation, maintenance and repair of energy efficiency equipment as eligible. This relates to expenses for installation of heating, ventilation and air-conditioning (HVAC) in Galapagos-owned building in the Netherlands.
Most of our OpEx under EU Taxonomy definition consists of R&D expenses associated with developing medicinal products, which is currently not covered by the EU Taxonomy and deemed not eligible.
Alignment
Alignment assessment has been conducted for the eligible activity 7.3. Installation, maintenance and repair of energy efficiency equipment. The assessment covers the Substantial Contribution, Do No Significant Harm (DNSH), and Minimum Safeguards criteria.
The substantial contribution criteria are met as the heating, ventilation and air-conditioning (HVAC) systems use highly efficient technologies. The DNSH criteria for activity 7.3 require compliance with the generic criteria for DNSH to climate change adaptation and pollution prevention and control. The criteria are met as Galapagos has screened physical climate risks for the relevant location and the activity does not lead to the manufacturing, placing on the market or use of substances specified in the criteria.
In line with our sustainability commitments, we comply with the minimum safeguards. We take a holistic approach to ensure that achieving environmental objectives does not compromise human rights, fair competition, or compliance with anti-bribery, anti-corruption, and taxation laws. We have a Code of Conduct covering human rights, fair competition, and corruption and bribery, as well as an Anti-Bribery and an Anti-Corruption Policy and Global Tax Policy in place and we have not violated any of the minimum safeguards.
Accounting policy
For the determination of turnover, CapEx and OpEx, we use the reported data in the 2025 consolidated financial statements included in this report:
Turnover comprises the net turnover derived from products or services. Turnover covers all continuing activities of Galapagos as of December 31, 2025 and the denominator can be reconciled with the 2025 IFRS total net revenues of €1.1 billion as disclosed in note 7, which comprise collaboration revenues and supply revenues. The numerator is 0 as activities related to R&D of medicinal products are currently not covered in EU Taxonomy.
CapEx consists of additions to tangible and intangible assets during the financial year 2025 considered before depreciation, amortization and any re-measurements recognized by Galapagos pursuant to IAS 38. The denominator (total CapEx) can be reconciled with the sum of the lines “Additions” disclosed in notes 14 and 15 (total €15.2 million) of the consolidated financial statements. Most of the CapEx is associated with installation of machinery and lab equipment, and property, plant and equipment (covering fully owned and right-of-use assets). The numerator consists of expenses related to installation of heating, ventilation and air-conditioning (HVAC) systems in Galapagos-owned building.
OpEx, according to the EU Taxonomy, covers direct non-capitalized costs of research and development, building renovation measures, short-term leases, maintenance and repair and any other direct expenditure relating to the day-to-day servicing of assets of property, plant and equipment by Galapagos or third-parties that are necessary to ensure the continued and effective functioning of such assets. Following further assessment of the regulation, we have reviewed our process for reporting OpEx under the EU Taxonomy and have strictly included R&D costs, maintenance expenses and short-term leases in the denominator, which results in a more stringent approach compared with prior year. R&D expenditure amounts to €459.4 million, as disclosed in note 8, with maintenance and short-term lease expenses amounting to €4 million, resulting in a total of €461.7 million (€335 million in the previous year, restated for comparability). The numerator is 0 as activities related to R&D of medicinal products are currently not covered in EU Taxonomy.
Based on our assessment and the available data, we report 0% Taxonomy eligible and aligned turnover. We report 0.6% Taxonomy eligible and aligned CapEx, and 0% Taxonomy eligible and aligned OpEx (as presented in the EU Taxonomy 2025 Tables).
Please refer to the EU Taxonomy 2025 tables for the disclosure on KPIs of non-financial undertakings as required by Commission Delegated regulation (EU) 2026/73. The eligibility figures reflect the fact that our core activities remain outside the scope of the economic activities for which Technical Screening Criteria (TSC) have been established under the Delegated Acts.