Natural compounds are a major source of new medicines, as nearly half of drugs brought to market in the last 20 years originated from compounds derived from nature. With their unique organic characteristics, natural compounds from bacterial and fungal sources are especially important for drug development against certain target classes. Under the terms of the agreement, Galapagos stands to receive up to €400,000 in project fees and up to €3m in milestone payments. Galapagos may also receive royalties on sales of commercial products resulting from the collaboration. "We are pleased with this new collaboration in many ways. Not only do we initiate a relationship with LEO Pharma, but we also confirm the interest from the market for our newly-acquired natural compounds collection and technologies by landing this high-value deal within only a few months after closing the DPI transaction," said Onno van de Stolpe, Chief Executive Officer of Galapagos. The deal with LEO Pharma marks Galapagos' first for its natural compound collection, acquired with the drug discovery activities of Discovery Partners International in July 2006. The collection forms part of Galapagos' service division, BioFocus DPI, which offers a full suite of target-to-drug discovery products and services to pharmaceutical and biotech companies. "We at LEO Pharma are delighted to enter into this collaboration with BioFocus DPI and expect that gaining access to their significant repository of natural product subfractions will strengthen our antibiotic drug discovery program," said Dr. Tore Duvold, Vice President for Drug Discovery at LEO Pharma. "We trust this will be the start of a successful and long term arrangement to discover new pharmaceutical natural products." Galapagos acquisition of the drug discovery service operations of Discovery Partners International for $6.4m cemented Galapagos' BioFocus division as a top three provider in drug discovery services worldwide. The acquisition allows Galapagos to further strengthen its presence in the US with as the acquisition includes the assets of all four of DPI's drug discovery services sites, two of which are in San Diego and San Francisco, USA.
