Galapagos adds Sareum services to BioFocus portfolio
The acquisition positions BioFocus DPI in “a rapidly growing segment of the drug discovery market,” according to Galapagos.
The deal adds structural biology to BioFocus DPI’s preclinical drug discovery capabilities, so the unit now offers a full suite of lead optimisation services covering structural biology, biological screening, medicinal chemistry and ADME.
For Sareum the deal comes in the nick of time. Back in June, the company shares were suspended after it said it needed to make a “strategic transaction within a short timescale” or be unable to continue operations. With the services unit now sold, the question is what will happen to the firm’s pipeline of cancer drugs.
CEO Tim Mitchell confirmed in an interview that the company “no longer has a service business” and said that the funds raised would be used to develop its drug discovery projects. He would not be drawn further on Sareum’s plans and said that additional statements would be made in the coming weeks.
Structure-based drug discovery makes use of techniques such as X-ray crystallography, NMR spectroscopy and computational chemistry to work out the three-dimensional conformation of a drug target, and then design drug molecules that fit into that 3D structure.
While still an emerging field, the approach has already been used in a number of approved drugs, including Merck & Co’s glaucoma drug Trusopt (dorzolomide), first launched in 1994, Novartis’ cancer drug Glivec/Gleevec (imatinib) and Roche’s HIV entry inhibitor Fuzeon (enfuvirtide).
Galapagos has paid €695,000 (£553,000) in cash for Sareum's drug discovery services business, which focuses on the use of X-ray crystallography to discover chemical fragments for recombination into lead compounds as well as to explore the binding behaviour of different compound families to a target protein.
It has acquired all of Sareum's ongoing services contracts relating to structure-based drug discovery. At the end of December Sareum had contracts in place with Genentech and Lundbeck, but it is understood that one of these is no longer in place.
The deal includes a platform known as the Crystal Bank, which is a set of protein target structures known to be of therapeutic relevance, and BioFocus DPI also gets access to Sareum’s fragment screening library and the specialised equipment needed to perform structure-based drug discovery.
“This technology fits very well and will be incorporated within BioFocus DPI's capabilities in screening and medicinal chemistry, and will complement its services offering,” said Galapagos in a statement.
Five Sareum employees will join BioFocus DPI facility in Saffron Walden, UK, to help with the smooth handover of the business.
UCB deal
Meanwhile, Belgian drugmaker UCB has signed a contract for the provision of chemistry services in the UK from BioFocus DPI, with a total contract value that could exceed €4m.
UCB will transfer a team of chemists to BioFocus DPI from UCB’s recently closed Cambridge, UK, research site and BioFocus DPI will continue the chemistry work for the program that was running at the Belgian firm. Under the contract, UCB will provide biology support for the programme.
That deal added additional shine to Galapagos’ bright set of first-half figures, released a little earlier, which saw revenues increase to €33.6m, a 30 per cent advance, with a 44 per cent narrowing of net losses to €9.4m. Income at the firm's R&D division more than doubled to €14.2m, with €23.7m earned by its BioFocus DPI unit, a 10 per cent rise over the first half of 2007.
Galapagos said the structure based offering would contribute “marginally” to BioFocus DPI revenue target for 2008. Sareum made revenues of around £1m (€1.25m) in the latter half of 2007.
The Belgian firm reiterated its full year guidance of revenues between €75-€80m and a year-end cash position of around €25m.
