Good day and welcome to Galapagos Webcast Conference Call. At this time, I would like to turn the conference over to Elizabeth Goodwin. Please go ahead ma'am.

Thank you and welcome all to the audio webcast of Galapagos' half year 2016 results. I'm Elizabeth Goodwin, Investor Relations. I'll be hosting the event today. This webcast is accessible via the Galapagos website homepage and will be available for replay later on today. Now, if you would like to have your questions included in our Q&A session, we request that you call into the telephone number given in today's press release, and I'll give it to you right now that's +32 for Belgium, 2 (404) 0659. There are other numbers included in the press release, if you want to dial a local number and the code for the conference is 4067587. I would like to remind everyone that we will be making forward-looking statements during today's audio conference. These forward-looking statements include remarks concerning future developments of the company and possible changes in the industry and competitive environment. Because these forward-looking statements involve risks and uncertainties, Galapagos' actual results may differ materially from the results expressed or implied in these statements. Today's speaker will be Bart Filius, Chief Financial Officer. He will take you through Galapagos' operational and financial highlights for the first half of 2016 and give you some outlook for the remainder of the year. You will see a PowerPoint presentation on screen during this talk. We estimate that the talk will take about 15 minutes and this will be followed by a Q&A session. I would now like to hand over to Bart to start the presentation.

Yes, thank you, Elizabeth, and good afternoon everyone or good morning if you're calling in from the United States. Thanks for joining for this webcast where we will be discussing our first half year results and the operational highlights of first half 2016. Let me start off with a couple of slides on the operational highlights first, because it's been an extremely productive first half of the year. First of all regarding everything along filgotinib we handed over the program to our partner Gilead after the closing of the transaction in January and we were happy to report a successful outcome of the regulatory discussions regarding the filgotinib Phase 3 program in rheumatoid arthritis earlier on in May. The start of which is imminence. Actually, the first patient screens have been done and we expect that first dosing should take place shortly. Also regarding filgotinib, we've been announcing the FITZROY results, the 20-weeks results, which showed continued response and confirmed dose for the safety profile that we've seen in all the trials with filgotinib so far. Then with regard to cystic fibrosis, we've announced in April the alliance expansion with our partner AbbVie. That collaboration has been increased in financial terms. We've increased the amount of milestones that AbbVie will be paying us as part of the contract with $250 million, all related to activities in Phases I and II. We've also started with our potentiator 1837 the Phase II trail SAPHIRA, which is on-track, and actually, we are as we announced during our R&D Day increasing the number of patient operating, including in this trial and we expect to readout by the end of the year the result thereof. And we've also started Phase I trial with another potentiator GLPG2451. And we've announced at our R&D Day in June…

Thank you very much, Bart. That does conclude the presentation portion of the audio conference call. I would now like to ask Maria, our operator, to connect us to any callers with questions for Bart. Go ahead.

Thank you. [Operator Instructions]. We will now take our first question and that comes from Phil Nadeau from Cowen & Company. Please go ahead. Your line is open.

Good morning. Thanks for taking my questions. I actually have a couple on the upcoming news flow. You pointed out that the Servier results will be out by the end of the year and I guess two questions there first on the dose escalation design what's your understanding of how long the patients will be at steady state levels after the last dose increase? And then second I'm curious to hear your latest thoughts on the comparison between 1837 and in the second generation I think it's 2451. We continue to hear speculation that this drug interaction of 1837 kind of what's your latest thinking on that? Which dose is your favorite potentiator? Thank you.

Good, thanks Phil. It's first of all in the dose escalation Interferon that's a different dose escalation by the way between Interferon 1 and Interferon 2 both highly totally is four weeks and patients will be on the highest dose in the last two weeks of that period. On the second point what's the favorite potentiator, I obviously I cannot answer it today we are obviously very interested to see both the results on 1837 and the results on 2451 and we will make the right choices and by the time we are ready for that, which obviously is not today but more towards the end of the year, early next year to be able to conclude.

Great, thanks and just one last question on the design in the current Phase III, I think on your R&D Day you were suggesting that current Phase III could stand Q3 now looks like Q4, is there any significance to that or is this simply a large company like you are taking a bit longer to get the design right? Thank you.

Yes I don't see there is significant to it I wouldn't even call it the Gilead making either, it's I think it's a logistical slippage. It's true that we were hoping still to achieve it by the end of Q3 now it looks like it's going to be Q4, so we want to be fully transparent there but it's there is no significance to that in terms of underlying topics.

We will now take our next question from Matthew Harrison from Morgan Stanley. Please go ahead. Your line is now open.

Thanks. This is Vikram on for Matthew. So just two questions from our side. First would you be able to share your thoughts about what CF data you expect to be able to present at NACFC this year. And second question could you may be comment on how you may consider designing the Phase II combination studies to satisfy kind of the FDA's desire to see the impact of each separate component drugs separately but would you look at double the combinations for, for that purpose even if you aren't pursuing them commercially?

Okay. Thanks for those two questions. NACFC may be first not sure yet that NACFC might be just step early for us to show the SAPHIRA results. So the timeline there is I'm not 100% sure on exactly whether we're going to be able to make NACFC there. We obviously want to make sure that we get the trial and the outcomes right more than making sure that we meet exactly that particular deadline. So no promises there yet. In terms of Phase II design for a combination again that is a bit too early to give you far more view on yet. Let's first make sure that we get our Phase I's right and that we can start a Phase I in healthy volunteers. Then in 2017 obviously that's still our key target is to have a triple combination in patients how we then will develop that further we will get through that, we will decide on that when we get there.

Okay. That's helpful, thanks. So a very quick follow-on, could you quickly remind us on the timing for the second generation corrector tox studies and kind of when you might expect them to be clinic ready is there any more specific guidance you could give beyond what you have already provided?

Our anticipation is that we should be ready to get into healthy volunteers with our second generation corrector by the end of the year allowing us to go into the triple in first part of 2017 in healthy volunteers.

We will now take our next question from Peter Welford from Jefferies. Please go ahead. Your line is now open.

Hi thanks for taking my questions, I have got two financial and one on the cystic fibrosis program. So, Bart, firstly on the CF, so you mentioned of the 2451 Phase I data are now expected in the early part of 2017. So if you can perhaps give us a bit of color as to the reasons of the delay given this is just a study in healthy volunteers and also that will -- how that impacts your thinking with regards to the next study for 2222 that's the correct given I think you were planning to do a trial perhaps with 2451 and should we now think that perhaps may be instead with 1837 given 2222 has already completed Phase I, so it's ready for further combo study perhaps already. Then the two financial ones is perhaps it is more appropriate and firstly with regards to the cash burn outlook, you mentioned that the cash burn in the first half is €48.4 million and used that a reference, but I think the €48.4 million also excludes if my math is right the $20 million of AbbVie milestone income that you got during the first half. So when we look at your full year guidance that for should be also in our minds be excluding in addition to the Gilead also any incremental AbbVie milestone to receive during the second half of the year. And then secondly just on the -- you mentioned filgotinib milestones that could come in the future during this year, if those milestones do come presumably on trials start or anything similar. Are those milestones also going to be deferred over the four to five year period or will you recognize milestones recognized this year in full? Thank you.

Okay. Thanks for those questions, Peter. So first of all on the delay in 2451 it's true, it was planned to be the end of the year now it's early next year. Again that is not a meaningful changes more logistical and the size of the trial that we are actually executing, so don't read too much into that whether it has an impact on the combination with 2222, we haven't actually made up our mind in full yet as to whether or not we are going to do a combination there with 2222 and 2451, so that's but it's for sure something that we will not do at this year when Phase I is still ongoing with 2451. Then on the financial question first of all the AbbVie milestones are they are, they are not into the €48 million, actually they are so the €48 million is in next cash burn including the income from AbbVie, so that's also the way to look at that going forward. The only thing which is excluded from the guidance of €100 million to €120 million is the filgotinib milestone that could potentially occur later this year. And then on that last point to your question was do we defer this as well over the next four to five years the answer is no. Our accounting policy there will be recognize milestones as they are received unlike the license income which we indeed defer over the next periods. Hope those answer the questions Peter?

We will now take our next question from Anastasia Karpova from Kempen. Please go ahead. Your line is now open.

Good afternoon and I have three questions on CF program. Can you specify already which populations are you planning to include in the Phase II triple combo trials, looking at across two heterogeneous or homogenous on the population. Secondly, do you expect to include U.S. sites in your Phase II trial for the combination? And finally does a small delay with the second potentiator result in a delay with initiation of the Phase II with triple combo because it initially was planned by the middle of 2017 but I got a perception that it's slightly shifted now. Thank you.

All right, noting the questions while you speak Anastasia. Thanks for those on the population for Phase II, exactly in which sequence we will do it, I cannot tell you today but definitely ultimately we would be interested to test out the combination both in homozygous and heterozygous. Second question will this early trial already be in the U.S. I would think that probably the early trial not in U.S. but ultimately it will obviously be a trial which will be in the U.S. And your third question was whether the delay in 2451 delayed the Phase II. We maintain our guidance that we should be able to get the triple combination in patients by the middle of next year. And as a remainder at 2737 our second corrector it is the last in line in terms of start of Phase I and so far that seems to be on the critical path. I can know your question also whether in which class it's obviously in the FITZROY bill population can be testing that.

And just quickly the follow-up, could you spending positive results of SAPHIRA trial, would you consider evaluating one of the potentiators alone in class limitations let's say in the next two years not eventually but in the near-term?

Yes I think and we said that before, I think where our obvious target is the triple combination for Class 2 patients but we don't rule out that we those who go after Class 3 but we do anticipate that we would need to show or at least have hope for a significantly at least at par or better than Kalydeco results should be able to do that.

[Operator Instructions]. We will now take our next question from Michaël Vlemmix from KBC Securities. Please go ahead. Your line is now open. Michaël Vlemmix: I have one question left it's quite a general broad one. The idea is to make the filgotinib JAK inhibitors first line chronic therapy for RA now the positioning of potential benefits versus the current TNF are clear but can you may be elaborate a bit why you believe that JAK inhibitors will come before the IL-6 inhibitors? Thank you.

Yes thanks Michael. Obviously we are little cuppy as out before we are actually starting to the commercial strategy but I do believe that in oral drug it has a meaningful benefit over the biologics both the TNF and the IL-6. So let's first see what the clinical outcomes are with the Phase III trial but I do think there is really a place for JAKs and if you look at the results that maybe shown with our filgotinib, I think that's also clear both in terms of efficacy and safety for the JAKs to go before the biologics and as such go before TNFs as well as the IL-6 category.

[Operator Instructions]. There are no further questions in the queue at this time.