Galapagos inflates IPO again as AbbVie, J&J jockey for position

Galapagos (AMS:GLPG) has ratcheted up its IPO expectations for the second time in a week. The latest maximum offering is just shy of $290 million (€258 million), one-fifth of which is expected to come from potential suitors AbbVie ($ABBV) and Johnson & Johnson ($JNJ).

Galapagos CEO Onno van de Stolpe

AbbVie put in an order for a $30 million stake in the IPO last week. Two days later, Galapagos filed another amendment to its F-1/A revealing J&J's interest in taking a $25 million cut of the offering. Galapagos followed up with a further amendment to its F-1 on Monday, in which it once again increased the amount it hopes to raise when it lists on Nasdaq. Mechelen, Belgium-based Galapagos has now set the maximum amount to be raised at $288 million, almost double the target listed in its initial IPO filing last month.

The latest jump is attributable to an increase in the number of shares being offered by Galapagos, which is now making 6 million available, 28% more than it initially planned to list. Most of the newly added shares are being set aside for investors in Europe and other countries outside of the U.S. and Canada. One-third of all the shares being listed are now earmarked for investors based outside of North America, up from one-fifth at the start of the IPO process. AbbVie and J&J are set to hoover up a sizeable slice of the total number of shares offered.

Both drugmakers are considered potential buyers of Galapagos, mainly because the biotech could alleviate concerns about the long-term viability of their respective rheumatoid arthritis franchises. A Humira-shaped hole looms on the horizon for AbbVie's finances, while J&J is preparing for the loss of patent protection on its own rheumatoid arthritis blockbuster, Remicade. Both drugmakers already have their talons into Galapagos. AbbVie has a $200 million opt-in option on Galapagos' experimental rheumatoid arthritis drug, while J&J owns a 7.6% stake in the company going into the IPO. 

- read the F-1/A

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