Cowen
QUICK TAKE: COMPANY UPDATE
October 27, 2020
Price: $128.02 (10/27/2020 )
Price Target: NA
OUTPERFORM (1)
TOLEDO COMPOUNDS INHIBIT SALTINDUCIBLE KINASES, BROAD CLINICAL PROGRAM ONGOING
Phil Nadeau, Ph.D.
THE COWEN INSIGHT
For the first time today GLPG disclosed that its Toledo compounds are inhibitors of saltinducible
kinases (SIKs). Preclinical data demonstrate that SIK inhibitors increase antiinflammatory
cytokines and decrease pro-inflammatory, suggesting utility across a range
of inflammatory diseases. 5 parallel POC studies are underway or planned, with initial data
anticipated by Mid:21. Remain Outperform.
Our Take: A Key Question Answered, 2021 Data Will Further Define Toledo's Promise.
Since Galapagos first began discussing its Toledo program at its 2018 R&D day investors
have been keen to know the target and learn about the preclinical data that has so excited
GLPG. Today's unveil of the target as salt-inducible kinases (SIK) and discussion of the
preclinical results was notable and interesting.
We find it intriguing that the inhibition of SIKs has the ability to reduce the transcription of
pro-inflammatory cytokines such as TNFa, IL-12 and IL-1ß while simultaneously enhancing
the transcription of anti-inflammatory cytokines such as IL-10. This suggests a dual
mechanism. Moreover, the activity of SIK inhibitors across a range of cell types such as
MCs, DCs, T cells and B cells implies potential activity in a range of inflammatory conditions.
Further encouraging was the robust activity in preclinical models of inflammatory diseases
such as inflammatory bowel disease, psoriasis, psoriatic arthritis, rheumatoid arthritis,
and systemic lupus as well as fibrotic diseases like graft vs host disease, IPF, and systemic
sclerosis.
That being said, as promising as the preclinical data appear to be, investors have learned to
be cautious when extrapolating results from model systems to human clinical trials. This is
particularly the case for a novel mechanism such as the inhibition of salt-inducible kinases.
SIKs are widely expressed in the body and are thought to be involved in basic cellular
processes such as lipid metabolism and gluconeogenesis. There is also some suggestion
that SIKs can regulate tumor suppressors and have a role in tumorigenesis. In light of their
ubiquitous expression and basic functions, clearly much remains to be learned about the
efficacy and safety of using SIK inhibitors to treat inflammatory diseases. In some respects
this morning's presentation raised as many questions as it answered.
Clinical proof of concept data will be necessary to further define Toledo's promise. GLPG
is currently conducting 3 proof of concept trials for lead candidate GLPG3970 in psoriasis,
ulcerative colitis, and rheumatoid arthritis, with add'l studies in SLE and Sjogren's planned.
With initial data from the first anticipated in Mid:21, the potential of GLPG3970 and GLPG's
SIK inhibitors more generally should begin to come into better focus next year.
The News: Today, at an R&D roundtable, Galapagos disclosed that the Toledo program is a
series of salt-inducible kinase (SIK) inhibitors. Recall that at Galapagos’ 2018 R&D day, the
company unveiled pre-clinical efforts toward a novel target for inflammation code-named
"Toledo". The target and mechanism were not disclosed until today.
The lead candidate in the Toledo program is GLPG3970, a selective SIK2/3 inhibitor.
Galapagos has completed Ph. I healthy volunteer studies of Toledo compounds GLPG3312
and GLPG3970. Management had previously decided to prioritize GLPG3970 over
GLPG3312. GLPG3312 was designed to have exposure only in the GI tract for the treatment
of IBD. GLPG believes that selective targeting was achieved. However, the downside is that
without systemic exposure, GLPG was not able to measure changes in plasma biomarkers.
GLPG3970, on the other hand, distributes to a range of tissues and has sufficient exposure
to produce meaningful changes in biomarkers. These signals of target engagement gave
GLPG more confidence in '3970's profile and so GLPG selected it for further development.
Galapagos has also nominated for clinical development GLPG4605 (a SIK2/3 inhibitor) and
GLPG4399 (a SIK3 inhibitor). Phase I data from GLPG4399 are anticipated in 2021.
Galapagos disclosed preclinical data showing disease activity of GLPG3970 on three
separate IBD models. Further, results indicated GLPG3970 induced macrophages
polarization by decreasing pro-inflammatory M1 macrophages and increasing
immunosuppressive M2 macrophages. In vivo studies also demonstrated an increase in proinflammatory cytokines and a decreased in anti-inflammatory cytokines. Taken together,
these data support the proposed dual mechanism of action of GLPG3970 and SIK inhibition
generally. Management reported the compound has also shown activity in models of
psoriasis, arthritis, lupus, and fibrosis.
Data on the Phase I single ascending and multiple-ascending dose study of ‘3970 in healthy
volunteers showed the compound to be well tolerated with a PK profile supportive of once
daily dosing. Ex-vivo analysis on participants’ whole-blood plasma confirmed the preclinical
findings supporting the dual mechanism of action.
Galapagos is conducting a broad proof of concept program for GLPG-3970 to validate
its activity in a wide range of inflammatory and fibrotic indications including psoriasis,
ulcerative colitis, rheumatoid arthritis, lupus (SLE) and Sjogren's. Management provided
detail on three studies:
CALOSOMA study: This Phase 1b trial is a double-blind, placebo-controlled study evaluating
the safety, tolerability of GLPG3970 single and multiple ascending doses in up to 52 adults
with moderate/severe psoriasis.
SEA TURTLE study: Phase 2 trial in patients with moderate to severe UC. The double-blind,
placebo-controlled trial will evaluate the efficacy, safety, tolerability of GLPG3970 in up to
30 patients. The primary endpoint is the change from baseline in total Mayo Clinical Score
(MCS).
LADYBUG study: This Phase 2 trial is a double-blind, placebo-controlled study evaluating
the efficacy, safety, tolerability of GLPG3970 in up to 25 participants with severely active
RA and an inadequate response to methotrexate. The primary endpoint is change from
baseline of DAS28 CRP at week 6.
In all trials, GLPG3970 will be administrated orally once daily for 6 weeks. GLPG is also
planning studies in SLE and Sjogren's which are expected to start late this year or early
next.
Initial top-line data from the proof-of-concept trials is anticipated around Mid-21. For
indications which look promising, the next step will be to conduct larger and longer Phase
IIb dose-ranging studies before advancing to Phase III confirmatory studies. GLPG expects
to "Fast Track" psoriatic arthritis with the Ph. II dose ranging study to begin next year after
the Phase Ib CALOSOMA trial. Gilead has an option to opt-in after Phase II.