Hello, and welcome to our daily round-up of key stories from pharma and beyond.
Deal done, Takeda looks to marketing and R&D savings of $1.4bn
Takeda’s chief executive Christophe Weber has set out his vision for turning the merged Takeda and Shire into a world-class pharma company – but first must come cuts.
The markets have been highly sceptical about the £46bn ($62bn) takeover of Shire, its share price having fallen 20% during its protracted pursuit of the rare disease specialist firm.
However yesterday Takeda’s shares rallied, and were helped by its plans to make $1.4bn in savings, with around $689m of this from cuts to sales and marketing divisions, plus around $560m in cuts to R&D costs.
The bulk of these savings will undoubtedly come from job losses, with thousands shed from the 30,000 Takeda employees and 23,000 Shire staffers – the latter being already being product of a rolling programme of M&A in recent years.
Takeda will be headquartered in Japan, with Shire’s base in Cambridge, Mass set to be its other main hub. Shire’s European hub in Switzerland is likely to take a hit, therefore, and its corporate headquarters in Ireland will also no longer be required.
The combined company will focus on four cores areas: GI, neuroscience, oncology, rare diseases, plus the two additional franchises of plasma-based products and vaccines.
Takeda says the $30bn bridging loan it has taken out to finance the deal won’t hit its dividend policy, and states it can realise all the synergies within three years.
However the company still won’t be an out-and-out leader in any therapy area, and will need to make the most of its planned $1bn overall increase in R&D spending to grow in the long term.
“We have the ability to create a truly R&D driven leader which will be able to compete with the best-of-the-best, which will be headquartered in Japan and have a very balanced geographical footprint and scale in all countries,” said Weber.
He tried to soften the coming blow of redundancies, saying: “We know that we need the expertise of the Shire employees – it’s not an acquisition that is about cost cutting, it’s a win-win.”
Brexit: UK Parliament to get vote on remaining in single market
The UK government has been hit by a shock defeat in Parliament, with MPs now gaining the opportunity to vote on keeping the country in the European Economic Area (EEA).
This flies in the face of the Brexit policies of Prime Minister Theresa May and Labour leader Jeremy Corbyn – but would undoubtedly be welcomed by business.
82 Labour peers in the Lords defied their party line to allow a Commons vote on staying in the EEA – what would amount to the softest of Brexits.
The move will be opposed by Brexiteers, including Foreign Secretary Boris Johnson, who has been vocally opposing Prime Minister Theresa May’s plans for a bespoke ‘customs partnership’ model to address border and trade issues.
The outcome is of huge importance to the UK pharmaceutical industry, which would very much favour the UK remaining an EEA member. In addition to the issue of cross border trade and customs, EEA membership would also allow the UK to remain aligned with the European Medicines Agency, a ‘must have’ for the sector.
Read more here: Theresa May forced to give MPs single market vote after shock defeat
Looking to distance itself from toxic past, Valeant to rebrand as Bausch Health
Valeant’s years of buccaneering mergers and acquisitions, suspect business practices and allegations of fraud have left it saddled with debt and a pariah-like status in the industry.
Joseph Papa was appointed as CEO in May 2016 to clear up the mess left by his predecessors, and has worked to cut $5bn from what was a debt of $30bn.
Now Papa is now looking to make a clean break from the past with a name change for the firm, which will become Bausch Health Companies in July.
Read more here
J&J’s novel depression treatment closer to filing
Johnson & Johnson could have on its hands the first new drug in decades for patients with treatment-resistant major depression.
Two Phase III clinical studies of its esketamine nasal spray in patients with treatment-resistant depression, combined with a newly initiated oral antidepressant, produced a clinically meaningful rapid reduction of depressive symptoms as compared to placebo.
“With about 30% of patients with major depression failing to respond to currently available antidepressants1, treatment-resistant depression represents a major public health need,” said Husseini K. Manji, MD, Global Head, Neuroscience Therapeutic Area, Janssen Research & Development.
While the trial data wasn’t entirely clear cut, the high unmet need in the area is likely to persuade the FDA to approve the treatment. Esketamine received Breakthrough Therapy Designations from the FDA in 2013 for treatment-resistant depression and in 2016 for major depressive disorder with imminent risk for suicide.
Data from other Phase III studies will be presented later this year, with its first filing expected in the coming months.