Galapagos have suffered a setback with partner Roche ending a partnership with the Belgian biotech which focused on fibrosis.

What is described as "a strategic change in therapy area at Roche" has resulted in the conclusion of the alliance. The firms signed a pact looking at chromic obstructive pulmonary disease in December 2009 which was broadened to fibrosis a year later.

The Swiss major is paying 5.75 million euros to Galapagos for work completed in 2012, which means that the Mechelen-headquartered company has banked a total of 16 million euros in upfront and milestone payments from the collaboration. The latter regains the worldwide rights to all fibrosis assays and targets discovered in the alliance.

Chief executive Onno van de Stolpe said "we regret that Roche ended the alliance due to a strategic change, but the good news is that all assets have returned to Galapagos". He added that "our plan is to find another partner to continue the search for compounds against these debilitating diseases".

Net loss but record revenues

The setback came as Galapagos unveiled its financials for 2012 which revealed a net loss of 5.7 million euros, despite the company having forecast a profit in August. Still, the loss was considerably reduced from the 30.1 million euros posted in 2011.

However, Galapagos recorded record revenues for 2012 of 153 million euros, a rise of 36%. Growth was boosted by 37.2 million euros banked as part of the $150 million upfront payment received from AbbVie related to their collaboration on GLPG0634, a Janus kinase (JAK)-1 inhibitor for the treatment of rheumatoid arthritis and other autoimmune diseases.

Investors are perturbed however and Galapagos shares fell 5.6% to 19.25 euros.