The first generic versions of Takeda's big-selling Actos franchise have been launched in the US, exposing a market valued at around $3bn a year to cut-price competition for the diabetes drug.
On August 17, diabetes treatment Actos (pioglitazone hydrochloride) and line extension Actoplus Met (pioglitazone and metformin) lost patent protection, and are expected to face heavy sales erosion from the outset. Actos sales were $2.7bn in the year to June 30, while Actoplus Met added another $413m on top.
Mylan, Ranbaxy and Teva are the first to market with generic Actos and have six months' exclusivity in the marketplace under the terms of an agreement signed with Takeda in 2010.
Mylan and Teva have also launched generics of Actoplus Met, although Ranbaxy was forced to give up rights to the combination product under the terms of a consent decree with the US Food and Drug Administration (FDA) over manufacturing problems at plants in the US and India and falsification of data.
Meanwhile, rival drugmaker Watson was also party to the exclusivity agreement, but was denied access to the market for technical reasons and is suing the FDA to try to get its own generic onto the market.
The seismic impact on Takeda cannot be overstated, as Actos accounted for around 14 per cent of its global turnover in the first quarter of the fiscal year ending 2013, and more than 50 per cent of its US revenues.
The brand had already seen its global revenues slashed by 40 per cent to $704m compared to the year-earlier quarter after patent expiries outside the US and concerns about safety, including the potential risk of heart failure and bladder cancer with the drug.
Added to that, Takeda is also facing declining sales of another of its top products as a result of generic competition, such as antihypertensive Blopress (candesartan cilexetil) which had first-quarter sales of $140m, a fall of 19 per cent.
The company has tried to offset the decline with the acquisition of Nycomed last year for €9.6bn ($11.8bn); expansion into emerging markets; and the creation of an oncology partnership with Amgen designed to deliver a new crop of pipeline drugs.
The latter collaboration suffered a setback earlier this month, however, when a candidate drug for pancreatic cancer, ganitumab, failed a phase III trial.