Abbott Laboratories and Belgium's Galapagos have joined forces to develop the latter's mid-stage rheumatoid arthritis drug.

The treatment in question is GLPG0634, a Janus kinase (JAK)-1 inhibitor  that Galapagos is developing for the treatment of RA and other autoimmune diseases. In previously-reported results from a four-week Phase IIa study, GLPG0634 demonstrated "efficacy measures among the best reported in RA", the partners note.

Cashwise, Abbott will make an initial upfront payment of $150 million and upon successful completion of the RA Phase II studies, the US major will license the programme for a one-time fee of $200 million. Galapagos is also eligible to receive milestones potentially amounting to $1.00 billion, plus tiered double-digit royalties.

John Leonard, senior vice president of global R&D at Abbott, said that "the addition of this novel, oral compound offers patients the potential for advanced treatment options and an improved patient experience". Galapagos chief executive Onno van de Stolpe noted that a number of firms were interested in GLPG0634 but "we view Abbott to be the best partner possible to deliver a complete clinical programme and a powerful market introduction".

He went on to say that with GLPG0634, "we have proven that we can deliver from target to clinical proof-of-concept, and we aim to do the same on many novel target programs in our pipeline. This collaboration is transformational for Galapagos".

Investors certainly agree and at 10.10am (UK time), the Mechelen-based group's shares were up 19% to 12.95 euros.