Takeda's selloff spree continues with $562M deal with Germany's Cheplapharm

Takeda HQ
Takeda has agreed to sell certain products in Europe and Canada to Germany's Cheplapharm for $562 million. (Takeda)

With last month’s $2.3 billion Japanese consumer health sale to Blackstone Group, Takeda has arguably achieved its $10 billion divestment goal. But the Japanese pharma is showing no sign of stopping with the selloffs anytime soon.

Tuesday, Takeda said it had penned a deal to offload some noncore prescription drugs sold mainly in Europe and Canada to Germany’s Cheplapharm for $562 million.

No employees are expected to hop over to Cheplapharm in connection with the transaction, according to Takeda.

The portfolio on the chopping block brought in sales of about $260 million during the fiscal year ended in March, and it includes products in the cardiometabolic and anti-inflammatory spaces, as well as calcium.

Once again, the drugs changing hands fall outside of the company’s five key focus areas of gastroenterology, rare diseases, oncology, plasma-derived therapies and neuroscience. Takeda will use the cash to reduce the mountain of debt it incurred with its $59 billion Shire buyout and help lower its net debt/adjusted EBITDA ratio to the target of 2x, which it's aiming to hit between fiscal year 2021 and 2023.

RELATED: Takeda to offload Japan consumer health unit to Blackstone for $2.3B

To reach that goal, Takeda has laid out a strategy to jettison about $10 billion worth of noncore assets. With the Japanese consumer health unit deal announced a few days ago, Takeda has already met that benchmark, reaching about $10.2 billion.

But the largest deal under that plan, the divestment of eye drug Xiidra to Novartis—potentially worth $5.3 billion, including milestone payments—might not be as lucrative as it once seemed. Takeda's chances of netting certain sales-based milestones took a hit after Novartis pulled an application in Europe amid pushback from drug reviewers at the European Medicines Agency.

Meanwhile, the Cheplapharm pact comes after Takeda agreed in April to transfer about 110 over-the-counter and prescription drugs in the same region, as well as two manufacturing sites, to Danish company Orifarm for up to $670 million.

Other deals Takeda has signed this year include a $278 million accord with Celltrion in the Asia-Pacific region and a sale of certain Latin American assets to Hypera Pharma for $825 million.

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