Galapagos Q1 Earnings Call Highlights

07 May 2026, 16:59 by Renee Jackson · The Cerbat Gem

Galapagos (NASDAQ:GLPG) executives used the company’s first-quarter 2026 earnings call to highlight what Chief Executive Officer Henry Gosebruch described as a “real transformation,” including portfolio changes, management and board updates, and an upcoming corporate rebrand to Lakefront Biotherapeutics.

Gosebruch, marking his one-year anniversary as CEO, said the company has “repositioned our portfolio, added an exciting set of new pipeline programs,” and is “changing our name to Lakefront Biotherapeutics.” He added that the management team has been built around “disciplined decision-making, careful capital allocation, reshaping our pipeline through business development, and focused execution.”

Leadership and governance changes

Gosebruch said Galapagos has refreshed both leadership and board composition to match its new strategic direction. He noted that former board chair Jérôme Contamine retired following the 2026 AGM/EGM and said he was “extraordinarily grateful” for Contamine’s service. Gosebruch said Gino Santini has become the new board chair, pointing to Santini’s 27-year career at Eli Lilly, including as Senior Vice President of Corporate Strategy and Business Development.

Ouro Medicines portfolio deal with Gilead and pipeline focus

A central theme of the call was a recently announced binding agreement with Gilead related to the portfolio created by Ouro Medicines. Gosebruch characterized the transaction as the result of a “structured process” that included early relationship building, confidential reviews, negotiations, and “ultimately successful agreement on a partnership with Gilead.”

According to Gosebruch, the transaction centers on Ouro’s lead program, gamgertamig, a BCMA/CD3 T-cell engager being developed for autoimmune diseases. He said the program is currently in Phase 1b dose-ranging studies and is expected to enter registrational studies “as early as 2027.” Gosebruch said he believes gamgertamig has “multi-billion-dollar revenue potential,” and described it as a potential “first and best-in-class T-cell engager” based on clinical data reviewed to date.

Gosebruch said the company has seen “compelling data from over 60 patients treated with gamgertamig across five distinct autoimmune indications,” highlighting:

“Rapid induction of durable complete responses”
“Minimal cytokine release syndrome with the current schedule of administration”
Consistency of findings across studies and disease indications

He said additional data will be shared “over the coming months” through publications and presentations at medical meetings. He also noted Fast Track and Orphan Drug Designation in the U.S. for immune thrombocytopenia (ITP) and autoimmune hemolytic anemia (AHA), which he said supports an accelerated development path.

Beyond gamgertamig, Gosebruch said the partnership includes “three exciting preclinical programs” that the company intends to progress “with urgency,” though he did not provide details on the call.

Clinical strategy: dose-ranging, CRS mitigation, and infection risk

In the Q&A, RBC Capital Markets analyst Brian Abrahams asked what dose-ranging data would need to show to support registrational studies, including depth and durability of B-cell depletion and reductions in cytokine release syndrome (CRS). Gosebruch said Galapagos had conducted thorough diligence on gamgertamig and other T-cell engagers, and reiterated that the company has seen “very rapid onset, very deep depletion and very good durability” in the clinical experience reviewed.

Chief Clinical Advisor Eric Hedrick said the “optimal profile” for late-stage development would combine “profound B-cell depletion” with a dose and duration schedule that “minimizes CRS risk.” He said the company believes modifications to dose and duration can reduce CRS risk, and also stressed the importance of achieving B-cell depletion that is “deep but relatively short” in order to minimize infection risk and reduce the need for supplemental intravenous immunoglobulin.

Asked by Raymond James’ Yang Hong about infection risk for BCMA T-cell engagers and how it may compare with CD19 T-cell engagers in autoimmune disease, Hedrick said infectious risk is linked to the duration of B-cell and plasma cell depletion. He added that with the current dose and schedule, the company is “comfortable” it is approaching a period of B-cell depletion where infection risk “should be manageable,” and said dose-ranging work is intended to optimize that period.

TD Cowen analyst Phil Nadeau also asked about differentiation versus other BCMA/CD3 assets. Hedrick pointed to two molecular attributes he said were attractive: “detuning of the CD3 binding arm,” which the company believes can help reduce CRS risk alongside dosing strategy, and a “very potent” BCMA binding arm, which he said aligns with the deep B-cell depletion and disease responses seen so far.

On how Galapagos will prioritize indications for pivotal development, Chief Strategy Officer Dan Grossman said the initial indication choices were designed to generate a “very rapid and very clear signal” of clinical potency, particularly in “benign hematologic indications.” He described gamgertamig as “the vanguard” of T-cell engager therapy in autoimmune disease and said the company intends to pursue breadth across diseases and therapeutic areas where deep B-cell depletion has a strong mechanistic rationale and where standard of care remains inadequate. Gosebruch added that the company believes the observed impact means relatively small patient numbers may be needed in early studies, which he suggested could make development “very capital efficient.”

Financial results and updated 2026 outlook

Chief Financial Officer Aaron Cox reported first-quarter 2026 total net revenues of EUR 6.5 million, compared with EUR 75 million in the prior-year period. He attributed the decline mainly to the first quarter of 2025 including EUR 57.6 million related to revenue recognition under the legacy Option, License and Collaboration Agreement (OLCA) with Gilead, adding that the remaining deferred income balance tied to the OLCA was “fully released at year-end 2025.”

Cox said first-quarter 2026 revenue was primarily driven by:

EUR 4.9 million in supply revenues from Jyseleca inventory sales to Alfasigma
EUR 1.6 million in collaboration revenues reflecting royalties from Gilead

On expenses, Cox said operating costs continued to decline. Research and development expenses fell to EUR 31 million, which he said reflected lower severance and the absence of restructuring-related charges that affected the prior-year quarter. Operating loss improved to EUR 63.7 million versus EUR 158.7 million a year earlier, when the company recorded EUR 111 million in restructuring costs.

Below operating income, Cox reported net financial income of EUR 77.7 million, driven mainly by positive fair value adjustments and favorable unrealized currency exchange gains on U.S. dollar-denominated cash and investments totaling EUR 64.3 million. The company posted a net profit of EUR 14.5 million for the quarter, compared with a net loss of EUR 153.4 million in the first quarter of 2025.

Financial investments and cash and cash equivalents were EUR 2,982.2 million at March 31, 2026, compared with EUR 3,297 million at March 31, 2025. Cox said the quarter-end cash balance “meaningfully benefited” from currency movement, with the U.S. dollar to euro exchange rate shifting from 1.175 at year-end 2025 to approximately 1.15 at quarter-end.

Cox also emphasized strategic implications of the Ouro/Gilead arrangement, including what he described as “a partial waiver and modification” of the legacy OLCA, which he said improves financial flexibility. Under revised terms and subject to closing, Cox said $500 million would be “unlocked for broader use beyond the Ouro Medicines investment,” enabling Galapagos to pursue opportunities independently of Gilead. He added that up to $150 million of that amount may be used for return of capital to shareholders, subject to limitations. Cox noted shareholders recently approved a share repurchase, and said the company would provide an update after the Ouro transaction closes.

For 2026 guidance, Cox said the company expects the Ouro transaction to close in the second quarter and anticipates EUR 60 million to EUR 75 million in Ouro-related cash expenditures (operating costs and transaction expenses) during 2026, in addition to an upfront payment of approximately EUR 713 million. That implies total Ouro-related cash expenditures of EUR 775 million to EUR 790 million for 2026. The company continues to expect one-time cash costs of EUR 125 million to EUR 175 million related to winding down cell therapy activities.

Including Ouro-related spending and the cell therapy wind-down, Cox said Galapagos expects to end 2026 with EUR 1.975 billion to EUR 2.05 billion in cash and cash equivalents. He said the company “remains robustly funded,” adding that after the transaction and estimated R&D spending on gamgertamig through first approval, the company expects to retain a majority of its current cash for additional strategic transactions and other capital allocation priorities.

In closing remarks, Gosebruch reiterated the impending name change and said that as of May 8, the company expects to be listed as LKFT on Euronext and Nasdaq. He said the company looks forward to closing the Ouro transaction in the second quarter and “welcoming the team from Ouro” to Galapagos.

During Q&A, KBC Securities’ Matthias Geens asked about strategic options for the Galapagos 36,667 program. Gosebruch said the company is analyzing “a broad range of options,” that the process is “quite well advanced,” and that a decision is expected in the “not too distant future,” but he declined to comment further.

About Galapagos (NASDAQ:GLPG)

Galapagos NV (NASDAQ:GLPG) is a clinical-stage biotechnology company headquartered in Mechelen, Belgium, focused on the discovery and development of novel small-molecule therapies. Established in 1999 through the merger of Tibotec and Progenix, Galapagos has built a research platform targeting chronic inflammatory diseases, fibrosis and oncology. The company’s discovery engine integrates human genetics, translational biology and medicinal chemistry to identify and optimize drug candidates with unique modes of action.

The company’s pipeline encompasses multiple programs across various stages of development.