Galapagos at the start of the year had planned to split into two businesses, with one resulting entity focused on cell therapies. The biotech nixed these plans a few months later, instead choosing to put up for sale multiple cell therapy assets.
Galapagos has shuttered its cell therapy operations amid a broader strategic review.
In a press announcement on Tuesday, CEO Henry Gosebruch revealed that the company had undertaken a “thorough” process of searching for potential buyers for its cell therapy unit. “Ultimately no viable proposals were received,” he added, with none of the offers providing financial terms that would “reasonably support the business’ future.”
Galapagos has therefore decided to wind down its cell therapy business in order to reallocate money “to other areas of unmet need,” Gosebruch said, though he did not identify what these areas are. The cell therapy exit will also allow Galapagos to “pursue transformative business development opportunities,” according to the CEO, who again did not provide specifics regarding the matter.
Cell therapy represents seven of the ten indications the company is pursuing across its pipeline. Cutting those therapies leaves the company with just three small molecule assets in development, targeting diseases like systemic lupus erythematosus, inflammatory bowel disease and undisclosed autoimmune and inflammatory conditions.
In conjunction with the pullback, around 365 employees across the U.S., Europe and China will lose their jobs. Galapagos will also close down multiple sites across the Netherlands, Switzerland, the U.S. and China. Once implemented, the cell therapy exit will also cost Galapagos €150 million to €200 million ($174 million to $232 million) in one-time expenses, plus €100 million to €125 million ($116 million to $145 million) in operating costs from the fourth quarter of 2025 through 2026.
The company is scheduled to present third-quarter results on Nov. 6, at which point it will provide an updated cash outlook. Shares of the company are down 11% to just over $30 apiece in premarket trading Tuesday.
Tuesday’s news continues what has been a confusing year for Galapagos. In January, the biotech announced plans to split into two entities. The first was to be an unnamed spinout to focus on oncology, immunology and virology, leaning on strategic dealmaking to fill out its pipeline. The second would inherit the Galapagos name to work on cell therapies. These structural changes were to come with a 40% headcount reduction, which affected around 300 employees across Europe.
In May, however, Galapagos changed plans: instead of a spinoff, the biotech conducted a strategic review of its business, exploring the potential sale of several cell therapy assets. Former CEO Paul Stoffels also stepped down from his role and was succeeded by Gosebruch.
Beyond Galapagos, the cell therapy space has seen a couple of high-profile exits in recent weeks. Earlier this month, Novo Nordisk announced that it would no longer invest in the modality and terminate related programs, including one for type 1 diabetes. Takeda made a similar move just a few days earlier.
