Log in
Forgot password ?
Become a member for free
Sign up
Sign up
Dynamic quotes 

MarketScreener Homepage  >  Equities  >  Nyse  >  AbbVie    ABBV


News SummaryMost relevantAll newsOfficial PublicationsSector newsAnalyst Recommendations

Gilead invests $5 billion to deepen ties with biotech Galapagos

share with twitter share with LinkedIn share with facebook
share via e-mail
07/15/2019 | 04:37pm EDT
A Gilead Sciences, Inc. logo is seen outside the company headquarters in Foster City, California

(Reuters) - U.S. antiviral drugmaker Gilead Sciences will invest $5.1 billion in a major expansion of its partnership with Belgo-Dutch biotech Galapagos, news that lifted Galapagos's shares more than 18% to an all-time high on Monday.

The move will bring Gilead's new chief executive Daniel O'Day growth opportunities in Galapagos's specialist areas including fibrosis and arthritis, and give Galapagos deep funds to develop and commercialize its drugs.

The two companies are going after inflammatory conditions, one of the most lucrative areas in the pharmaceuticals industry.

AbbVie Humira, used to treat rheumatoid arthritis and spondylitis, racked up nearly $20 billion in sales in 2018, while Amgen and Pfizer Enbrel still brings in $7 billion annually after 20 years on the market.

As part of the deal, Gilead will spend $1.1 billion to lift its Galapagos stake to 22% from 12.3%. The rest of the investment will be used to develop and commercialize its treatments for a 10-year period, the companies said.

"We chose to partner with Galapagos because of its pioneering target and drug discovery platform, proven scientific capabilities and outstanding team," O'Day said in a statement.

Galapagos, which has more than 500 scientists, is part of a thriving biotech scene centered around Belgium, fueled by tax breaks and other incentives, with companies spun out of universities now listed on the local stock exchange.

The deal follows a spate of biotech mergers last year including the acquisition of fellow Belgian biotech Ablynx by French drugmaker Sanofi for 3.9 billion euros ($4.4 billion) after a bidding war with Novo Nordisk.

Galapagos's most advanced drug in development is filgotinib, an experimental compound being advanced for rheumatoid arthritis and inflammatory bowel disease that Gilead intends to submit to the U.S. Food and Drug Administration this year.

The two companies first partnered four years ago to develop a drug targeting inflammatory diseases, with Gilead paying more than $2 billion for the development of filgotinib, as well as an equity stake in the European firm.

Gilead is paying a 10% premium to Friday's closing price for the increased stake in Galapagos, but has a 10-year standstill agreement preventing it from raising its stake above 29.9%.

"We see a logical rationale for the deal and believe that over time the closer relationship should help both companies," RBC analyst Brian Abrahams wrote in a note, reiterating his "buy" recommendation on Gilead stock.

Shares in Galapagos rose 18.8% to 152.20 euros.

Galapagos said it would also seek shareholder approval to allow Gilead to further increase its ownership to up to 29.9%.

The companies will share future development costs for filgotinib equally, replacing the 80-20 cost split provided by the original agreement, they said, with Galapagos gaining a broader role in the treatment's commercialization in Europe.

Gilead will get access to Galapagos's drug pipeline outside of Europe.

Gilead will nominate two people to Galapagos' board.

Barclays, Centerview Partners and Lazard acted as financial advisers to Gilead while Moelis & Co and Morgan Stanley advised Galapagos.

(Reporting by Ismail Shakil in Bengaluru; Additional reporting by Shubham Kalia, Phil Blenkinsop in Brussels and John Miller in Zurich; Writing by Georgina Prodhan in London; Editing by David Evans)

Stocks mentioned in the article
ChangeLast1st jan.
ABBVIE 2.30% 64.43 Delayed Quote.-30.11%
AMGEN 2.36% 204.02 Delayed Quote.2.38%
GALAPAGOS 1.61% 154.85 Delayed Quote.92.22%
GILEAD SCIENCES 0.43% 63.14 Delayed Quote.0.94%
NOVO NORDISK AS 1.34% 347.5 Delayed Quote.16.65%
PFIZER 0.49% 34.65 Delayed Quote.-21.01%
SANOFI 1.55% 75.99 Real-time Quote.0.44%
share with twitter share with LinkedIn share with facebook
share via e-mail
Latest news on ABBVIE
08/16Health Care Up as Risk Appetite Buoys Biotech -- Health Care Roundup
08/16ABBVIE : Gets FDA OK for Rheumatoid Arthritis Drug Rinvoq
08/16ALLERGAN : Form 8.3 - Allergan Plc
08/14ABBVIE : Form 8.3 - Allergan Plc
08/14ALEMBIC : Pharmaceuticals receives USFDA Approval for Fenofibrate Tablets USP, 4..
08/13ALLERGAN : Form 8.3 -Allergan Plc
08/09ABBVIE : Form 8.3 -
08/08ABBVIE : Form 8.3 -Allergan Plc
08/08ABBVIE : Form 8.3 -AbbVie Inc
08/06ABBVIE : Form 8.3 -
More news
Financials (USD)
Sales 2019 33 077 M
EBIT 2019 15 682 M
Net income 2019 9 260 M
Debt 2019 29 942 M
Yield 2019 6,65%
P/E ratio 2019 10,1x
P/E ratio 2020 7,84x
EV / Sales2019 3,79x
EV / Sales2020 3,50x
Capitalization 95 259 M
Duration : Period :
AbbVie Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends ABBVIE
Short TermMid-TermLong Term
Income Statement Evolution
Mean consensus OUTPERFORM
Number of Analysts 13
Average target price 85,58  $
Last Close Price 64,43  $
Spread / Highest target 78,5%
Spread / Average Target 32,8%
Spread / Lowest Target 7,09%
EPS Revisions
Richard A. Gonzalez Chairman & Chief Executive Officer
Michael E. Severino Vice Chairman & President
Azita Saleki-Gerhardt Senior Vice President-Operations
Robert A. Michael Chief Financial Officer & Senior Vice President
Carlos Alban Vice Chairman & Chief Commercial Officer
Sector and Competitors
1st jan.Capitalization (M$)
ABBVIE-30.11%93 115
JOHNSON & JOHNSON1.15%344 517
ROCHE HOLDING LTD.12.24%235 575
ROCHE HOLDING13.20%235 575
MERCK AND COMPANY11.32%213 689
NOVARTIS17.81%202 958