Takeda's Deal Flurry Set To Wane
Executive Summary
Takeda's reorganization and the focusing of its R&D on specialty medicines in three sectors is shifting to the next stage, with products moving through its pipeline; the company has lifted its financial outlook at the six-month stage, but is wary of the emergence of US generic competition to Velcade later this year.
Takeda Pharmaceutical Co. Ltd. has entered into numerous company and academic partnerships over the past year or so as it has strived to rebuild its R&D pipeline, but this level of feverish deal activity may soon be coming to an end.
"We don’t intend to keep this pace up forever," says chief medical and scientific officer Andrew Plump. "We have a few fundamental partnerships that will be coming up, but at the same time our internal labs have now really been rejuvenated," he noted.
In the past six months, Takeda has entered 25 new external partnerships, in addition to the 50 or so signed in the previous 12 to 18 months, as the Japanese big pharma company went through a reorganization that called for a push on external research tie-ups. "We love the model of 50/50 partnerships where we share cost and reward," Plump noted.
But with Takeda raising its financial outlook, and new products starting to enter the company's research pipeline, there might be fewer opportunities for biotechs around the world to attract such a keen partner to the table.
In the first six months of fiscal 2017, ending Sept. 30, 2017, three potential new medicines have moved into Phase II, and two new projects have entered preclinical studies, Plump told analysts during the company's first-half earnings call on Nov.1. The Takeda executive highlighted the development of an unnamed immuno-oncology agent that has just entered clinical studies and for which preclinical data have been "absolutely remarkable", plus the move of pevonedistat into Phase III studies for high-risk myelodysplastic syndrome, as examples of products now moving through the research pipeline.
Refocusing Takeda's R&D pipeline on specialty medicines including immune-oncology agents, the setting up of external R&D collaborations, and making cultural and organizational changes are all making "terrific progress", Plump said. (Also see "Interview: Setting The Course For Takeda’s R&D Future" - Scrip, 30 Jun, 2017.)
This is in marked contrast to the situation in the previous 12 months, when Takeda's internal labs did not initiate or progress any R&D projects, and when external partnerships or the billion-dollar acquisition of the US company Ariad Pharmaceuticals Inc. accounted for the eight programs that did enter the research pipeline. During that time, Takeda discontinued 15 research programs.
Next-Generation Immuno-Oncology
Takeda's CSO said the company's interest in next-generation immune-oncology agents has now solidified around six or seven platforms. These include the gamma-delta class of T-cells that it is exploring in its collaboration with GammaDelta Therapeutics Ltd. (Also see "Takeda Picks Next Big Thing In Immunotherapy: Gamma Delta T Cells" - Scrip, 15 May, 2017.)
Takeda is also collaborating with the Tokyo, Japan-based biotech, Noile-Immune Biotech Inc., which has technology that has the potential to direct T-cells to solid as well as hematologic tumors. Noile-Immune was founded in 2015 with next-generation CAR-T technology developed by Koji Tamada, a professor at Yamaguchi University.
Among other anticancers, the SYK inhibitor, TAK-659, that also has activity against FLT3, has shown activity in patients with diffuse large B-cell lymphoma (DLBCL) and has entered Phase II, Plump reported.
And Takeda is also working on a compound that could rival Johnson & Johnson/Genmab AS's Darzalex (daratumumab) – the antibody-drug conjugate, TAK-573, is a "really-interesting molecule" consisting of a CD38 monoclonal antibody conjugated to interferon-alfa, that has the potential to be a truly best-in-class CD38 agent, Plump said.
In the CNS area, Takeda is collaborating with MedImmune (AstraZeneca PLC) on an alpha-synuclein monoclonal antbody, MEDI 1341, which is due to enter the clinic in coming months to test the pathologic role of alpha-synuclein aggregation in Parkinson's disease and other CNS disorders. (Also see "AZ Partners Parkinson's Compound With Takeda" - Scrip, 29 Aug, 2017.)
And in epilepsy, TAK-935 is an inhibitor of an enzyme found only in the brain, cholesterol 24-hydroxylase, that may inhibit excitatory glutaminergic NMDA receptor signaling, and has shown activity in preclinical models of seizures, and is Phase II ready in its partnership with Ovid Therapeutics Inc. (Also see "The New Revolutionary: Ovid's Levin On Pioneering In Neurology" - Scrip, 7 Jun, 2017.)
Financial Outlook Improved
Takeda raised its financial outlook for the full year, with revenues in the 2017 fiscal-year expected to reach JYN1,720bn ($15.1bn) instead of JYN1,680bn, and with net profit of JYN152bn instead of JYN138 bn.
Takeda's First Half Financials In Brief
Reported Revenues: JPY881.4bn (+3.6%)
Operating Profit: JPY234.3bn (+44.6%)
Net Profit: JPY172.8 (+39%)
EPS: 221 Yen (+39.2%)
Potential headwinds could include the start of generic competition in the US to Velcade (bortezomib). Currently Takeda is forecasting revenues of around JPY106bn for the product in fiscal year 2017, based on two or three generics entering the market in November 2017. However, the company refrained from speculating on the outcome of regulatory and legal moves – patent suits have been filed against a number of generic companies.
Takeda's growth drivers include the inflammatory bowel disease therapy Entyvio, (vedolizumab) now approved in 62 countries; Velcade sales; and the growth in US sales of the antidepressant Trintellix (vortioxetine), whose sales grew 58.7% in the first half. The company is planning to launch the multiple myeloma drug, Ninlaro (ixazomib) in China next year. Important for the long-term success of Ninlaro is ongoing clinical studies of its use in combination with Darzalex for multiple myeloma, the company noted. During the first half, sales of Alunbrig (brigatinib) and Iclusig (ponatinib) from the acquired company Ariad showed strong performances.
Plump also highlighted the changes in the regulatory landscape in China, that has lead the company to expect seven new medicines to be approved and launched there in the next five years.