Galapagos is planning to wind down its cell therapy business, completing a whiplash change that saw the biotech go from focusing on the modality to ditching it in six months.
Belgium-based Galapagos began looking into strategic alternatives for its cell therapy business in May. In early October, the biotech said it had received “a limited number of non-binding offers” to buy the business, mostly from financial investors. Galapagos set itself a Nov. 5 deadline for disclosing its decision on the future of the business.
Tuesday, Galapagos CEO Henry Gosebruch said in a statement that “no viable proposals were received with terms or financing that would reasonably support the business’ future.” The lack of suitable offers shut down attempts to divest the unit.
Galapagos decided against investing its own cash in the business after assessing what the unit will need and the “evolving market dynamics,” Gosebruch said. The factors led the company to decide its cash is better spent on other opportunities.
Lacking internal or external investment, Galapagos has opted to wind down its cell therapy business. The action is subject to talks with groups representing workers in Belgium and the Netherlands. Galapagos said it will continue to operate the business during the talks, adding that it would consider “any viable proposal to acquire all or part of the cell therapy business” during the wind-down process.
Unless a white knight emerges to rescue the business, Galapagos will start a wind-down process that will affect around 365 employees in Europe, the U.S. and China. The company plans to close two facilities in the U.S., plus one site each in the Netherlands, Switzerland and China, as part of the process.
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Galapagos plans to retain a presence at its headquarters in Belgium. Working out of the site, the biotech will pursue “transformational business development” deals to build a pipeline of drug candidates. Galapagos had 3.1 billion euros ($3.6 billion) in cash and investments at the end of June, but the wind-down could eat into that figure.
The company expects to rack up cell therapy operating costs of up to 125 million euros from the fourth quarter of 2025 through 2026. Galapagos has earmarked a further 150 million to 200 million euros for one-time restructuring costs next year.
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The decision to wind down the cell therapy business marks another lurch on the roller coaster ride Galapagos has been on since unveiling plans to split in two in January. Under that plan, Galapagos would have set up a new company that would inherit its partnership with Gilead Sciences and almost 2.5 billion euros to build a new pipeline.
Galapagos announced in April that Paul Stoffels, the executive who oversaw the separation plan, would retire as CEO, but the split appeared to be on track at that stage. Days after news of his retirement, Stoffels told (PDF) investors “we are transforming Galapagos into a focused cell therapy company.” Less than three weeks later, the biotech said it was exploring strategic alternatives for the cell therapy unit.
Galapagos’ latest pivot comes at a difficult time for the larger cell therapy field. Just this month, pharma giants Novo Nordisk and Takeda announced separate decisions to abandon further efforts in the modality. The companies planned nearly 250 layoffs and 137 layoffs, respectively, as a result of their moves.
