After presenting a strong set of financials, Galapagos has disclosed that Merck & Co is pulling out of its alliances with the Belgium-based biotech.
The pacts were signed in 2008 and 2009, and covered metabolic, cardiovascular and inflammatory disease. However, a strategic change in Merck’s early discovery programmes "has required us to make some challenging decisions,” said Kathleen Metters, head of the US giant's External Discovery and Preclinical Sciences unit. She added, however, that “we look forward to investigating alternate opportunities to collaborate with Galapagos in the future".
Merck will make a payment of 12 million euros to Galapagos for work completed in 2010, so the latter have received a total of 20.9 million euros in upfront and milestone payments derived from the alliances. The Mechelen-headquartered group has regained worldwide rights to the targets discovered and assays developed from the collaboration and chief executive Onno van de Stolpe said that "owning these valuable assets...can form the basis for future alliances".
Galapagos also presented preliminary results for last year, saying it expects to report a profit and revenues of 137 million euros. The company, which ended the year with 40.4 million euros in cash, is forecasting turnover of at least 150 million euros for 2011.