Takeda Sells EUCAN Non-Core Assets to Cheplapharm for Up to $562 Million in Sixth Divestment of the Year

Yiou Health News on the 8th reported that,Takeda PharmaceuticalTakeda Pharmaceutical Company Limited announced today that it has reached an agreement to divest its Europe and Canada (EUCAN) business unit for up to $562 million.OTCand selected non-core assets to Cheplapharm. The transaction is expected to be completed by the end of fiscal year 2020 (March 2021).

Cheplapharm is a specialized pharmaceutical company headquartered in Germany, providing branded medicines worldwide. Over the past 25 years, Cheplapharm has successfully completed more than 90 transactions with renowned pharmaceutical companies in over 120 countries and regions.Acquisition. The total transaction value exceeded €1.3 billion. By focusing on an internationally oriented acquisition strategy, Cheplapharm’s operating growth rate has risen year after year.

It is reported that Takeda this timeFor SaleThe product portfolio divested to Cheplapharm comprises non-core prescription pharmaceuticals across various therapeutic categories, including cardiovascular diseases, metabolic disorders, and anti-inflammatory agents. This portfolio is primarily marketed in Europe and Canada and generated approximately USD 260 million in net sales for Takeda Pharmaceutical Company Limited during the 2019 fiscal year. However, this portfolio does not fall within Takeda’s five core business areas: gastroenterology, rare diseases, plasma-derived therapies, oncology, and neuroscience.

Currently, Takeda intends to use the proceeds from this transaction to reduce debt and accelerate deleveraging, aiming to achieve a net debt-to-adjusted EBITDA ratio of 2x within the fiscal years 2021 to 2023. Through this divestiture, Takeda’s EUCAN region is expected to focus more sharply on its core business areas.

Since 2019, Takeda has been frequently divesting its non-core assets in an effort to accelerate deleveraging. Media reports have linked this strategy to the merger and restructuring associated with Takeda’s $62 billion acquisition of Shire in early 2019.

Prior to the acquisition of Shire, Takeda was highly active in the M&A market, continuously expanding its product portfolio. Industry analysts attribute this strategy to Takeda Pharmaceutical’s inability to sustain its previous high growth rate, due to adverse factors such as the successive expiration of patents on its original drugs, the carcinogenicity controversy surrounding pioglitazone, and the depreciation of the yen.

Shire’s R&D potential in the field of rare diseases made it a highly coveted target for Takeda. In March 2018, Takeda first signaled its intention to acquire Shire, and ultimately secured the deal after five rounds of public bidding. Following Takeda’s $62 billion acquisition of Shire, the industry has closely monitored its leverage and debt issues. On the day the merger and restructuring announcement was released, Takeda CEO Christophe Weber publicly stated that the company was considering divesting $10 billion in non-core assets to alleviate the $48 billion in debt incurred from the Shire acquisition.

According to public media reports, Takeda has been divesting assets since May last year, with nine transactions completed to date. Since January this year, the company has sold non-core assets six times, covering businesses in Latin America, Europe, the Asia-Pacific region, and other markets.

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