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Takeda signs strategic-level outsourcing deal with PRA

R&D deal adds to cutbacks strategy with predicted annual savings of $175m

TakedaJapanese drugmakers are known for generally keeping their R&D in-house, but Takeda continues to buck that trend with a major outsourcing deal with PRA.

Japan's largest drugmaker has just signed a deal that will see PRA take over responsibility for a block of Takeda's pre- and post-marketing clinical trials - along with regulatory, pharmacovigilance and other operational support - with 300 of the Japanese company's R&D staff set to transfer to the contract research organisation (CRO).

Several western drugmakers have gone down the route of signing strategic-level deals with CROs, replacing the previous model of transaction-based relationships, but this still remains relatively uncommon in the Japanese pharma industry.

Takeda has prior experience of the approach however, as it signed high-level deals with Covance and Quintiles in 2011, although the new deal with PRA takes that to a new level and is described by the CRO's chief executive Colin Shannon as "the first of its kind in the CRO industry".

Takeda has been transformed under the leadership of its first western chief executive - Christophe Weber - and the deal with PRA comes amid a major restructuring of its operations that have already seen it divest a series of assets as it refocuses on a stripped down R&D pipeline.

The R&D overhaul has seen the company concentrate its efforts in Japan and the US, jettison projects outside central nervous system (CNS), cancer, gastrointestinal diseases and vaccines, shut down R&D operations in the UK and bundle its older generic drugs into a joint venture with Teva.

The cutbacks - predicted to cost around $725m - are expected to eventually yield annual savings of around $175m and come after years of declining operating profit margins at the company. Takeda said tapping into PRA's expertise would "improve operating efficiencies, drive globalization and reduce fixed infrastructure costs".

Recently-appointed R&D chief Andrew Plump told investors in June that Takeda needed to transform its R&D and rebuild its pipeline "to a level of innovation that will be necessary to be effective for patients and for Takeda in the future."

Financial terms of the deal have not been disclosed, but the two companies did say that Takeda employees supporting drug development and marketed products will be "given the opportunity to transition to PRA in the US and Europe”.

Discussion regarding Japan employees is ongoing between Takeda and PRA, according to Takeda.

Article by
Phil Taylor

14th September 2016

From: Sales

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