• Total Revenue: EUR 276 million, including EUR 35 million from Jyseleca supply revenues and EUR 241 million in collaboration revenues.
• Research and Development Expenses: EUR 335 million, a 39% increase year-over-year.
• G&A and Sales and Marketing Expenses: EUR 134 million, flat year-over-year.
• Net Profit: EUR 74 million, driven by fair value adjustments, currency exchange, interest income, and a gain from the sale of the Jyseleca business.
• Cash Position: Approximately EUR 3.3 billion at the end of 2024.
• Cash Burn: EUR 374 million for 2024; excluding business development, EUR 293 million, within the guidance range of EUR 280 million to EUR 320 million.
• Capitalization Post-Separation: Galapagos with approximately EUR 500 million in cash; SpinCo with approximately EUR 2.45 billion.

• Warning! GuruFocus has detected 5 Warning Signs with GLPG.

Release Date: February 13, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Galapagos NV (NASDAQ:GLPG) received FDA's IND clearance to begin clinical studies in the US for their CD19 CAR-T program, GLPG5101.
• The company reported strong clinical data from the ATLANTA study, showing high overall and complete response rates in various lymphoma indications.
• Galapagos NV (NASDAQ:GLPG) is well-capitalized with approximately EUR3.3 billion in cash, providing a solid financial foundation for future developments.
• The company is advancing its leadership in cell therapy with a decentralized manufacturing platform, aiming for a seven-day vein-to-vein time.
• Galapagos NV (NASDAQ:GLPG) plans to separate into two publicly traded entities, allowing for focused strategies and resource allocation in cell therapy and other innovative medicines.

Negative Points

• Research and development expenses increased by 39% year-over-year, driven by expansion in oncology CAR-T, impacting overall profitability.
• The company is discontinuing future small molecule research, which may limit diversification in their pipeline.
• There is a delay in the US patient recruitment for the ATLANTA 1 study, which could impact timelines for clinical development.
• Galapagos NV (NASDAQ:GLPG) is deprioritizing its second CD19 CAR-T candidate, GLPG5201, which may limit options in their CAR-T portfolio.
• The separation into two entities requires significant restructuring and realignment, which could pose operational challenges.

Q & A Highlights

Q: Can you elaborate on why Galapagos is deprioritizing the 5201 CAR-T program in favor of 5101? A: Paulus Stoffels, CEO, explained that both 5101 and 5201 showed excellent efficacy and safety. However, focusing on 5101 simplifies the process and accelerates the pipeline, as running two CD19 programs would complicate the decentralized manufacturing network. By prioritizing 5101, they can accelerate the two indications most likely to reach the market.

Q: Are there any differences in manufacturing processes between 5101 and 5201? A: Jeevan Shetty, Head of Oncology Clinical Development, stated that the manufacturing fundamentals are the same for both programs, focusing on fresh cells and a seven-day vein-to-vein time. The decision to prioritize 5101 was based on compelling data and the complexity of managing two programs.

Q: What is the status of the separation transaction, and what are the current challenges? A: Thad Huston, CFO, mentioned that the separation involves several steps, including hiring a management team and legal processes. Valeria Cnossen, General Counsel, added that the listing on Nasdaq and Euronext is subject to regulatory reviews and shareholder approval, expected around midyear.

Q: What are the plans for the US-based manufacturing footprint for 5101? A: Jeevan Shetty explained that they are expanding their decentralized manufacturing network with regional sites in high-density areas across the US. The aim is to cover major hospitals and ensure readiness for pivotal studies by 2026.

Q: Can you provide an update on the ATLANTA 1 study in the US? A: Jeevan Shetty stated that patient recruitment is ongoing in Europe, and they are working towards enrolling the first US patient soon. The delay is due to procedural and operational components, but they are confident in starting imminently.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.