Japan's Takeda flags profit slide as it bolsters drug pipeline

Rocky Swift
Updated ·2 min read
The logo of Japanese Takeda Pharmaceutical Co is seen at an office building in Glattbrugg

By Rocky Swift

TOKYO (Reuters) -Japan's Takeda Pharmaceutical Co on Thursday reported annual profit that missed estimates and flagged a decrease in the coming year as its mainstay drugs lose patent protection.

Japan's biggest drugmaker spent big in the past year to replenish its pipeline to make up for the loss of exclusivity on big sellers and give it time to develop some 40 treatments in the clinical stage.

Operating profit for the year ended March 31 came in at 490.5 billion yen ($3.63 billion), an increase of 6.4% from the prior period, Takeda said. That fell short of the company's earlier estimate of 530 billion yen and a consensus forecast of 535 billion yen from a Refinitiv poll of 15 analysts.

The shortfall was due to restructuring fees and also pre-launch inventory adjustments related to the company's newly approved dengue vaccine, CFO Costa Saroukos said.

Operating profit is expected to decline further to 349 billion yen in the current fiscal year due to the "big impact" of exclusivity expirations of blood pressure drug Azilva in Japan and hyperactivity drug Vyvanse in the United States, he added.

In the meantime, the company raised its planned dividend this year to 188 yen per share from 180 as part of a "progressive" payout policy after it reduced leverage.

Takeda agreed in December to buy an experimental psoriasis drug from U.S.-based Nimbus Therapeutics for as much as $6 billion, marking its first major purchase since its $59 billion takeover of Shire Plc in 2019.

"We think it's a potential best in class," chief executive Christophe Weber said. Takeda may explore applications for the drug on irritable bowel disorder (IBD) and other ailments as time goes on, he added.

Since absorbing Shire, Takeda has been under pressure to reduce debt, while also expanding its pipeline to compensate for the loss of patent protection of franchise drugs such as Vyvanse and Entyvio in the coming years.

Takeda's long-awaited dengue vaccine QDENGA was approved by European regulators last December, notching a needed win for the company's in-house pipeline and leading to annual sales of up to $2 billion for the shot.

($1 = 135.0500 yen)

($1 = 135.0500 yen)

(Reporting by Rocky Swift; Editing by Muralikumar Anantharaman and Kim Coghill)