|Teva CEO Erez Vigodman|
The independent company being created by a joint venture between Israel's Teva Pharmaceutical Industries ($TEVA) and Japan's Takeda Pharmaceutical became a bit more clear this week when the two pharma giants released additional details on their plans.
The companies said the products being shifted to the new company will include Blopress for hypertension, Takepron for peptic ulcers, and Basen for Type 2 diabetes. Sales revenue generated by those drugs totaled ¥125 billion ($1.03 billion) in fiscal 2014, which was 7% of Takeda's total global revenue, according to a statement released by the two firms. The two also said the drug Leuplin will remain a part of Takeda in its oncology unit.
The companies said in the statement that Takeda's overall revenue is expected to decline by ¥50 billion yen as a result of the deal.
Teva and Takeda said the new company, which will be majority owned by Teva, will be made up of Teva Takeda Pharma and Teva Takeda Yakuhin. The companies said the deal should be "EPS and cash flow accretive" in fiscal 2016 and that long-term growth in its generic business will also be positive.
Takeda's hiving off of some of its no-growth drugs into the new company is an effort to focus on more financially rewarding new drugs, but the market for off-patent drugs and generics in Japan is expected to remain strong for the new company, because the country, like others in Asia, is trying to cut its national healthcare spending and rely more on such medicines.
- here's the release