Date: 2015-12-28
Type of information: Joint-venture agreement
Compound:
Company: Takeda Pharmaceutical (Japan) Teva Pharmaceutical Industries (Israel)
Therapeutic area:
Type agreement: joint-venture
Action mechanism:
Disease:
Details: * On December 28, 2015, Takeda Pharmaceutical Company and Teva Pharmaceutical Industries made the below follow-up announcement regarding the overview of their new business venture in Japan, which was initially disclosed on November 30, 2015. The new business venture, to be established in or after April 2016, will deliver Teva\'s high-quality generic medicines and some of Takeda\'s long listed products to patients and healthcare professionals in Japan, leveraging Takeda\'s corporate brand and unique distribution network in Japan and Teva\'s wide product portfolio and cutting-edge business efficiency. The new business venture, to be owned 51% by Teva and 49% by Takeda, will consist of Teva Takeda Pharma and Teva Takeda Yakuhin. This is a triangular absorption-type company split among Teva Pharma Japan and Taisho Pharm. Ind., as well as Takeda. In this absorption-type company split, Takeda will be the splitting company and Taisho Pharm will be the succeeding company. Takeda\'s long listed products business will be transferred to Taisho Pharm, and Taisho Pharm will allocate shares of Teva Pharma, which will become its parent company, to Takeda as consideration for the company split. The company name of Taisho Pharm, which will succeed Takeda\'s long listed products business and also continue its generics business, will become Teva Takeda Yakuhin and the company name of Teva Pharma, which will continue its generics business, will become Teva Takeda Pharma. Both companies will jointly engage in the new business. * On November 30, 2015, Teva Pharmaceutical Industries and Takeda Pharmaceutical Company announced that the two companies have entered into a definitive agreement to establish an unprecedented partnership in Japan. The strategic move between Takeda, an R&D driven pharmaceutical company which has a long history as a leading company in Japan, and Teva, among the top ten pharmaceutical companies in the world and the global leader in generics, will form a new business venture to meet the wide-ranging needs of patients and growing importance of generics in Japan. Subject to standard regulatory approvals, the business venture is expected to start operating in the second calendar quarter of 2016, and will offer patients and the healthcare system the portfolio of Teva’s high-quality generic medicines and Takeda’s long listed products. Teva will have a 51% stake in the new company and Takeda will have 49%. The business venture will operate as an independent company with its own Board of Directors, Chief Executive Officer, and Executive Leadership team. Further details of the agreement have not been disclosed. Given that the deal will not become effective until the second calendar quarter of 2016, there is no expected material financial impact for both Teva and Takeda in 2015.
The major long listed products of Takeda to be transferred to the new business venture in FY2016 are Blopress®, Takepron® and Basen®. Total sales of the products to be transferred in FY2016 were 125 billion yen in FY2014, which was 7% of Takeda\'s global revenue. As a result of the transaction, Takeda’s FY2016 revenue is estimated to decrease by approximately 50 billion yen, based upon current assumptions. Leuplin® remains at Takeda, as a product of Takeda Oncology.
The new business venture of Teva Takeda Pharma and Teva Takeda Yakuhin, to be established in or after April 2016, will deliver Teva\'s high-quality generic medicines and Takeda\'s long listed products to patients and healthcare professionals in Japan. Its aim is to become a leading off-patent product (including generic medicines and long listed products) company in Japan, leveraging Takeda\'s corporate brand and the unique distribution network that has been built through Takeda\'s longstanding business in Japan, and Teva\'s wide product portfolio and cutting-edge business efficiency.
This strategic move between Takeda, an R&D driven pharmaceutical company which has a long history as a leading company in Japan, and Teva, which is among the top ten pharmaceutical companies in the world and a global leader in generics, will form the new companies to meet the wide-ranging needs of patients and correspond to the growing importance of generics in Japan, by delivering Takeda\'s transferred long listed products and Teva\'s generic medicines. The Japanese generics market is one of the fastest growing in the world, and is expected to continue its high growth driven by social requirements such as increased patient need for the stable supply of affordable high quality medicines, and the Japanese government\'s initiatives to control healthcare expenditure. Takeda’s leading brand reputation and strong distribution presence in Japan combined with Teva’s global expertise in supply chain, operational networks, commercial deployment, and R&D and scientific insight, brings forward a new, collaborative business model in line with government objectives that will ultimately serve millions of patients. Moreover, Takeda will further strengthen its initiatives to lead innovation in medicine through providing innovative new drugs.
Financial terms: Takeda anticipates that the transaction will be both EPS and cash flow accretive in FY2016 and over the long-term, due to growth of the generic business and the addition of products from Takeda and Teva to the new business venture. The new business venture will be instantly accretive to Teva\'s non GAAP EPS in 2016 and beyond. Some additional details about the financial impact of the transaction are outlined in Takeda\'s TSE Filing, and all will be incorporated into Takeda\'s FY2016 forecast which will be communicated in May 2016.
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