Takeda Completes Sale of Select Non-Core Assets to Cheplapharm

Rhea-AI Summary

Takeda Pharmaceutical Company Limited (TSE:4502/NYSE:TAK) has successfully concluded the sale of a non-core portfolio of 16 prescription products to Cheplapharm for $562 million. This divestment, originally announced in September 2020, aligns with Takeda's strategy to streamline its focus on key therapeutic areas including Gastroenterology and Oncology. Proceeds from the sale will be allocated towards reducing debt, aiming for a net debt/adjusted EBITDA ratio of 2x by 2023. Takeda has exceeded its $10 billion divestiture goal with a total of 11 deals worth approximately $11.6 billion since January 2019.

Positive

• Sale of non-core assets for $562 million strengthens financial position.
• Focus on key therapeutic areas aligns with long-term growth strategy.
• Use of proceeds to reduce debt enhances balance sheet health.

Negative

• None.

Takeda Pharmaceutical Company Limited (TSE:4502/NYSE:TAK) (“Takeda”) today announced the completion of its previously-announced sale of a portfolio of select prescription products to Cheplapharm for a total value of $562 million USD¹. The portfolio includes 16 prescription pharmaceutical products sold predominantly in Europe which is part of Takeda’s Europe and Canada Business Unit. This divestment agreement was first announced in September 2020.

The divested portfolio is comprised of non-core prescription pharmaceutical products in a variety of therapeutic categories that includes Cardiovascular/Metabolic and Anti-Inflammatory products along with Calcium. In line with Takeda’s long-term growth strategy, these products, while addressing key patient needs in these countries, are outside of Takeda’s five core business areas: Gastroenterology (GI), Rare Diseases, Plasma-Derived Therapies, Oncology and Neuroscience.

Takeda remains focused on executing its long-term growth strategy to optimize our business mix around our key business areas, and simplifying our operations to better serve patients by delivering innovative treatments in these areas.

The Company intends to use the proceeds from the sale to reduce its debt and accelerate deleveraging towards its target of 2x net debt/adjusted EBITDA within Fiscal Years 2021–2023.

Takeda has sustained momentum in its divestiture strategy in 2020 and exceeded its $10 billion non-core asset divestiture target, announcing 11 deals since January 2019 to date for a total aggregate value of up to approximately $11.6 billion, including agreements to divest:

• Takeda Consumer Healthcare Company Limited to Oscar A-Co KK, a company controlled by funds managed by The Blackstone Group Inc. and its affiliates for a total value of approximately JPY 242.0 billion ($2.3 billion USD).
• Other non-core portfolio assets within the Growth & Emerging Markets Business Unit, totaling up to approximately $2.3 billion with five separate buyers.²
• Select OTC and non-core assets in Europe to Orifarm for up to approximately $670 million.
• The TachoSil Fibrin Sealant Patch to Corza Health, Inc. for approximately €350 million.

About Takeda Pharmaceutical Company Limited

Takeda Pharmaceutical Company Limited (TSE:4502/NYSE:TAK) is a global, values-based, R&D-driven biopharmaceutical leader headquartered in Japan, committed to discover and deliver life-transforming treatments, guided by our commitment to patients, our people and the planet. Takeda focuses its R&D efforts on four therapeutic areas: Oncology, Rare Genetic and Hematology, Neuroscience, and Gastroenterology (GI). We also make targeted R&D investments in Plasma-Derived Therapies and Vaccines. We are focusing on developing highly innovative medicines that contribute to making a difference in people's lives by advancing the frontier of new treatment options and leveraging our enhanced collaborative R&D engine and capabilities to create a robust, modality-diverse pipeline.

Our employees are committed to improving quality of life for patients and to working with our partners in health care in approximately 80 countries.

For more information, visit https://www.takeda.com.

Important Notice

For the purposes of this notice, “press release” means this document, any oral presentation, any question and answer session and any written or oral material discussed or distributed by Takeda Pharmaceutical Company Limited (“Takeda”) regarding this release. This press release (including any oral briefing and any question-and-answer in connection with it) is not intended to, and does not constitute, represent or form part of any offer, invitation or solicitation of any offer to purchase, otherwise acquire, subscribe for, exchange, sell or otherwise dispose of, any securities or the solicitation of any vote or approval in any jurisdiction. No shares or other securities are being offered to the public by means of this press release. No offering of securities shall be made in the United States except pursuant to registration under the U.S. Securities Act of 1933, as amended, or an exemption therefrom. This press release is being given (together with any further information which may be provided to the recipient) on the condition that it is for use by the recipient for information purposes only (and not for the evaluation of any investment, acquisition, disposal or any other transaction). Any failure to comply with these restrictions may constitute a violation of applicable securities laws.

The companies in which Takeda directly and indirectly owns investments are separate entities. In this press release, “Takeda” is sometimes used for convenience where references are made to Takeda and its subsidiaries in general. Likewise, the words “we”, “us” and “our” are also used to refer to subsidiaries in general or to those who work for them. These expressions are also used where no useful purpose is served by identifying the particular company or companies.

Forward-Looking Statements

This press release and any materials distributed in connection with this press release may contain forward-looking statements, beliefs or opinions regarding Takeda’s future business, future position and results of operations, including estimates, forecasts, targets and plans for Takeda. Without limitation, forward-looking statements often include words such as “targets”, “plans”, “believes”, “hopes”, “continues”, “expects”, “aims”, “intends”, “ensures”, “will”, “may”, “should”, “would”, “could” “anticipates”, “estimates”, “projects” or similar expressions or the negative thereof. These forward-looking statements are based on assumptions about many important factors, including the following, which could cause actual results to differ materially from those expressed or implied by the forward-looking statements: the economic circumstances surrounding Takeda’s global business, including general economic conditions in Japan and the United States; competitive pressures and developments; changes to applicable laws and regulations; the success of or failure of product development programs; decisions of regulatory authorities and the timing thereof; fluctuations in interest and currency exchange rates; claims or concerns regarding the safety or efficacy of marketed products or product candidates; the impact of health crises, like the novel coronavirus pandemic, on Takeda and its customers and suppliers, including foreign governments in countries in which Takeda operates, or on other facets of its business; the timing and impact of post-merger integration efforts with acquired companies; the ability to divest assets that are not core to Takeda’s operations and the timing of any such divestment(s); and other factors identified in Takeda’s most recent Annual Report on Form 20-F and Takeda’s other reports filed with the U.S. Securities and Exchange Commission, available on Takeda’s website at: https://www.takeda.com/investors/reports/sec-filings/ or at www.sec.gov. Takeda does not undertake to update any of the forward-looking statements contained in this press release or any other forward-looking statements it may make, except as required by law or stock exchange rule. Past performance is not an indicator of future results and the results or statements of Takeda in this press release may not be indicative of, and are not an estimate, forecast, guarantee or projection of Takeda’s future results.

¹ Based on the agreed price of 475 million EUR, and exchange rate at the time of the agreement in September 2020

² Includes agreement with Hasten Biopharmaceutic (China) for the sale of non-core products in China, Hypera S.A. for the sale of select non-core products in Latin America which remain subject to close; and, completed sales of non-core assets in the Russia-CIS region to STADA, the Near East, Middle East and Africa region to Acino, and Asia Pacific to Celltrion Inc.

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FAQ

What was the value of Takeda's divestiture of prescription products to Cheplapharm?

The divestiture was valued at $562 million.

How many prescription products were involved in the sale by Takeda?

A total of 16 prescription products were sold.

What is Takeda's target net debt/adjusted EBITDA ratio after this sale?

Takeda aims for a 2x net debt/adjusted EBITDA ratio by 2023.

When was the divestment agreement for the sale to Cheplapharm first announced?

The divestment agreement was first announced in September 2020.

What therapeutic areas does Takeda focus on after this divestiture?

Takeda focuses on Gastroenterology, Rare Diseases, Plasma-Derived Therapies, Oncology, and Neuroscience.