Shire's oncology exit weighs on potential Takeda bid

Shire's oncology exit weighs on potential Takeda bid

The deal comes after Takeda expressed interest for a complete takeover, wooed analysts for support and reportedly sought loans to fund the effort - and just days ahead of the April 25 deadline for the Japanese drugmaker to make a bid. Its biggest investors include US-based Blackrock, Capital Group and JP Morgan. He added that the company will review its portfolio for other assets to sell "to unlock further value and sharpen our focus on rare disease".

The oncology unit was an area that Takeda had identified as a driver for its potential takeover approach.

Ornskov said the board will consider returning the proceeds of the sale back to shareholders through a buyback programme.

Oncology is therefore a small part of Shire's business, but was highlighted by Takeda as one of three therapeutic categories that could be bolstered by merging the two companies.

Don't expect the sale of the oncology business to spark a cash infusion into Shire's R&D. Reuters writes, "Buying Shire would be transformational for Takeda but would be a huge financial stretch, since the company is worth around $10 billion more than the Japanese group". Launched in 19 countries, Lonsurf generated €62 million ($76.8 million) in revenue during 2016-2017, according to a Servier announcement that did not furnish revenues for Pixuvri.

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Two sources with direct knowledge of the matter said last week that Takeda had sounded out its major creditors for loans to fund a potential Shire bid.

Shire's oncology business includes products such as Oncaspar (pegaspargase), part of a multi-agent treatment for acute lymphoblastic leukemia (ALL) and ex-U.S. rights to Onivyde (irinotecan pegylated liposomal formulation), part of a multi-agent treatment for metastatic pancreatic cancer after gemcitabine-based therapy, and Calaspargase Pegol (Cal-PEG), which is now under review by the U.S. Food and Drug Administration (FDA) for the treatment of ALL and early stage immuno-oncology pipeline collaborations.

Shire Chief Executive Flemming Ornskov said the sale of the oncology business to Servier demonstrated the value embedded in Shire as shares in the company rose 0.8 percent by 1230 GMT. "I have an impression that Takeda and Shire are heading in the same direction", Saito said.

Servier believes that the acquisition will help the firm to establish direct commercial presence in the USA, in addition to expanding its oncology pipeline and portfolio of in-market drugs.

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