Belgium/German collaboration on novel fibrosis, NASH targets

Germany’s Evotec (EVT: Xetra) and Belgium’s Galapagos (Euronext: GLPG) both saw their shares edge higher after the two biotech firms today announced a global collaboration focused on a novel target for fibrosis and other indications.

The collaboration concerns a small molecule program, currently in pre-clinical development for the treatment of fibrotic diseases of the liver and other organs. The target has been identified and validated using Evotec's proprietary platforms for fibrotic diseases and non-alcoholic steatohepatitis (NASH). Evotec utilized its in-house assay development and drug screening capabilities to identify small molecule modulators against the target, which remains undisclosed.

In exchange for global commercialization rights to Galapagos, Evotec receives an undisclosed upfront payment and is eligible for potential milestone and royalty payments. Galapagos will be responsible for all further development of the program. Furthermore, Galapagos will have access to specific screening formats at Evotec to support the final pre-clinical development.

Big market expectations

Although there are no currently approved NASH specific treatments available, the market for fatty liver disease treatments is set to expand at a compound annual growth rate (CAGR) of 63% across the USA and the five major European markets (5EU; France, Germany, Italy, Spain and the UK) to reach $18.3 billion by 2026, according to data and analytics company GlobalData. An earlier report from the company put NASH product sales at $138.4 million in 2016.