Galapagos NV (Euronext:GLPG) and Sareum Holdings plc (AIM:SAR) announce today that Galapagos has acquired Sareum’s assets in drug discovery services, for a total cash consideration of €695,000 (£553,000). These assets will expand and strengthen Galapagos’ service division, BioFocus DPI, by adding structural biology to its pre-clinical drug discovery capabilities.

The acquisition means that BioFocus DPI now offers a full suite of lead optimization services covering: structural biology, biological screening, medicinal chemistry and ADME.

A key step in drug discovery research is the identification of small molecules that bind to a drug target. In structure-based drug design, the three-dimensional structure of a drug target is used to guide the discovery of such small molecules. Sareum’s X-ray crystallography platform enables the interactions between the small molecules and the target to be studied at the atomic level and so aid the rapid optimization of the molecules into drugs. Sareum’s structure-based approach to lead discovery makes use of X-ray crystallography to identify chemical fragments that bind to the target and which are then optimized into lead compounds. The approach has proven to accelerate drug discovery in many programs, both in its internal R&D and in service contracts with top pharma clients.

Under the agreement, Galapagos has acquired all of Sareum’s ongoing service contracts relating to structure-based drug discovery, the Crystal Bank (a collection of protein targets, available for rapid drug/protein structural analysis), a fragment screening library and the specialized equipment needed to perform structure-based drug discovery. This technology fits very well and will be incorporated within BioFocus DPI’s capabilities in screening and medicinal chemistry, and will complement its services offering. A team of five Sareum employees will join BioFocus DPI (Chesterford Park, Saffron Walden, UK) and continue to operate the platform, securing a smooth transition of the business.

“We are pleased to have acquired Sareum’s structure-based drug discovery assets and welcome their team and their clients to BioFocus DPI,” said Dr Chris Newton, Senior Vice President BioFocus DPI. “The assets and expertise acquired from Sareum strengthen our drug discovery, adding a novel technology that our customers are expressing interest in. We look forward to extending and expanding this business within the BioFocus DPI client base.”

“I am confident that the acquisition of Sareum’s expertise in structure-based drug discovery services will further enhance BioFocus DPI’s leading position in global drug discovery service provision”, added Dr Tim Mitchell, CEO, Sareum Holdings plc. The structure-based offering will contribute marginally to BioFocus DPI’s revenue target for 2008 and Galapagos reiterates its full year guidance of revenues between €75-80 million and a yearend cash of around €25 million.

About structure-based drug discovery

Structure-based drug discovery has been in use within the pharmaceutical industry for over twenty-five years. It plays an important role in drug discovery, design and optimization. The technology relies on knowledge of the three dimensional structure of drug targets. Once the structure is known, potential drugs are designed to ‘lock-in’ to the drug target, facilitating the development of high-quality drug candidates.

About Sareum

Sareum Holdings plc is a structure-based drug discovery business headquartered in Cambridge, UK. The Company was formed in August 2003 to discover new drugs for the treatment of cancer. Sareum’s unique approach aims to halve the time it takes to discover new drug candidates. Sareum’s approach to structure determination utilises its proprietary protein expression platform in order to produce multiple recombinant proteins that accelerate structure determination. Sareum aims to successfully deliver drug candidates for licensing to larger pharmaceutical companies at the pre-clinical or early clinical trials stage. Sareum joined the AIM market of the London Stock Exchange in October 2004 and trades under the symbol SAR. For further information, please visit www.sareum.co.uk

About Galapagos and BioFocus DPI

Galapagos (Euronext Brussels: GLPG; Euronext Amsterdam: GLPGA; OTC: GLPYY) is a drug discovery company with pre-clinical programs in bone and joint diseases and bone metastasis. Its division BioFocus DPI offers a full suite of target-to-drug discovery products and services to pharmaceutical and biotech companies, encompassing target discovery and validation, screening and drug discovery through to delivery of pre-clinical candidates. BioFocus DPI also provides adenoviral reagents for rapid identification and validation of novel drug targets, compound libraries for drug screening as well as ADMET products to select compounds. Galapagos currently employs 500 people and operates facilities in six countries, with global headquarters in Mechelen, Belgium. More information about Galapagos and BioFocus DPI can be found at www.glpg.com and www.biofocusdpi.com.