Galapagos inks two 'major' contracts

By Emilie Reymond

- Last updated on GMT

Related tags Biofocus dpi Drug discovery Galapagos

Galapagos' recent acquisitions seem to be paying off as the Belgian
biotech firm has announced its contract services unit BioFocus DPI
has inked two new deals with Japan-based Ono Pharmaceutical.

Galapagos said the contracts build on an existing relationship between Ono and BioFocus DPI that started three years ago. Under the first agreement, Galapagos' service division will conduct high-throughput screening for the Japanese drug maker's discovery programme, using selected compounds from its SoftFocus and other synthetic small molecule collections. Meanwhile, in the second collaboration, BioFocus DPI will apply medical and computational chemistry and ADME (Absorption, Distribution, Metabolism and Excretion) profiling expertise - gained through the acquisition of Inpharmatica for $19.1m ($14.1m) last December - in multiple medicinal chemistry projects for the Osaka-based firm. While Onno van de Stolpe, Galapagos' CEO, told that these two deals with Ono represent "major contracts"​ for the company, he couldn't disclose any financial details. "The new contracts, which will last over a year, show the benefits of combining expertise from our recently acquired companies Discovery Partners International, BioFocus as well as Inpharmatica, realising the synergy in bringing these activities together,"​ said van de Stolpe in an interview. This is the second time this year that Galapagos has signed a deal in which a combination of services is included. Last February, the firm signed a €2m drug discovery contract with the University of Bristol that combines Inpharmatica's Admensa and BioFocus DPI's medicinal chemistry expertise. With this number of deals signed in such a short period of time, it seems that the acquisition strategy the company has been adopting in recent months is paying off. Prior to the Inpharmatica purchase, Galapagos bought the drug discovery operations of Discovery Partners International (DPI) last year for $6.4m (€4.8m) - a move that cemented its BioFocus division as one of the top three global providers of drug discovery services. According van de Stolpe, the combination of the three recently acquired companies and the resulting broader service offering is what made a major deal such as the one with Ono possible. "We can now offer services from target identification through to clinical candidates, something that BioFocus couldn't provide as a stand-alone unit,"​ he said. And the profitable BioFocus DPI service division was the stronger performer in the company's annual results announced last March, generating $31m of the total revenue for 2006 - a 38 per cent growth spurt. The company also announced at that time a one year extension of one of its current service contracts with Eli Lilly, said to be worth over €1m. Under the deal, Galapagos is helping the drug giant to discover new compounds that target nuclear hormone receptors (NHRs), a class of ligand activated proteins that function as on-off switches for transcription within the cell nucleus when bound to specific DNA sequences. Van de Stolpe said BioFocus DPI currently has several more deals in the pipeline and he expects the unit to continue to grow above the 15 per cent market rates in 2007, although growth as strong as last year is unrealistic.

Related topics Preclinical Research Preclinical

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