Israeli drugmaker Teva and Japan's Takeda have undergone separate, yearslong cutback sprees, looking to slice away a range of underperforming assets. Now, the two drugmakers will take a scalpel to their joint venture in Japan as they continue to hunt for savings.
Teva and Takeda's Japanese venture will offload most of its generics portfolio and a manufacturing site to Nichi-Iko Pharmaceutical as the partners "shift focus" to a smaller core of specialty drugs and targeted generics, Teva said Thursday.
The strategic shift follows an "in-depth review of market opportunities" five years after the joint venture's launch, Teva said. The partners plan to close the sale by early 2021.
Teva didn't specify how much of the venture's portfolio would be sold off but did say the partners would retain around 20 small-molecule generic drugs and "several" pipeline assets. The two companies will also market a range of specialty drugs and authorized generics.
The joint venture downsizing comes months after Teva wrapped up a multiyear restructuring that closed down facilities around the globe and cut around 13,000 jobs.
By December, Teva had not only sliced away those employees. It had also either shut down, sold or earmarked for disposal 23 manufacturing sites and shuttered 40 offices and laboratories.
That $3 billion scale-back plan was the centerpiece of Teva's new strategy under CEO Kåre Schultz, enticed away from Lundbeck in November 2017 to help steer the ship after years of disastrous financial leadership.
Meanwhile, Takeda has also been shedding assets in recent years, selling off whole swaths of commercial medicines to hit its goal of cutting annual operating costs and retiring debt it took on to buy Shire in January 2019.
Most recently, Takeda said in June it would sell 18 over-the-counter and prescription drugs marketed in the Asia-Pacific region to South Korea’s Celltrion for $278 million.
The portfolio generated sales of about $140 million in the fiscal year ended in March 2019, mainly driven by DPP-4 diabetes drug Nesina and hypertension med Edarbi, Takeda said at the time.
Previously, Takeda sold noncore assets in the Russia-CIS region to Germany’s Stada and in the Middle East and Africa region to Swiss firm Acino. It also penned deals to offload products in Latin America to Hypera Pharma and in Europe to Orifarm Group. Plus, it handed Shire’s eye drug Xiidra to Novartis in exchange for up to $5.3 billion.
The money raised goes toward Takeda's $10 billion selloff goal, aimed at reducing the debt load from the $59 billion Shire takeover. Takeda was said to be working on selling its own consumer health unit in Japan, Nikkei Asia Review reported in April, which the drugmaker had pegged at a value of $3.72 billion.