Takeda Sells Xiidra and TachoSil to Novartis and Ethicon for Total Deal Value of $5.7 Billion

VCBeat (WeChat Official Account: vcbeat) has learned that Takeda Pharmaceutical Company Limited recently announced the signing of separate sale agreements with Novartis and Ethicon, a subsidiary of Johnson & Johnson. Novartis will acquire Xiidra (lifitegrast ophthalmic solution), a product under Takeda’s portfolio, while Ethicon will acquire TachoSil, a fibrin sealant patch, also from Takeda’s portfolio.

Under the agreement, Takeda Pharmaceutical Company Limited will receive $3.4 billion in upfront cash and $1.9 billion in potential milestone payments from Novartis, as well as approximately $400 million in upfront cash from Ethicon. Takeda plans to use these funds to reduce corporate debt and accelerate deleveraging.

Takeda Pharmaceutical Company Limited will continue to focus on drug research and development in multiple key business areas, including gastroenterology, rare diseases, oncology, and neuroscience. This will enable Takeda to continue delivering highly innovative medicines and transformative care services to patients worldwide, thereby creating long-term value for its shareholders.

Christophe Weber, President and Chief Executive Officer of Takeda Pharmaceutical Company Limited, stated, “These two acquisitions represent a significant step forward in advancing our strategic growth following the transformational acquisition of Shire at the beginning of the year. As a global, R&D-driven biopharmaceutical company, we are working to strategically simplify and optimize our portfolio while rapidly deleveraging.”

Xiidra is the only FDA-approved prescription drug for treating the signs and symptoms of dry eye disease, with a mechanism of action targeting inflammation. The acquisition is expected to be completed in the second half of 2019. Upon closing, approximately 400 Takeda Pharmaceutical employees, primarily based in the United States and Canada, will transfer to Novartis. In the fiscal year ended December 31, 2018, net sales of Xiidra by Takeda Pharmaceutical amounted to $388 million. In this acquisition, Evercore Group served as the financial advisor to Takeda Pharmaceutical, while Davis Polk & Wardwell LLP acted as its legal counsel.

TachoSil is a surgical patch designed to achieve safe, rapid, and reliable hemostasis. The acquisition is expected to be completed in the second half of 2019, upon which approximately 80 employees will transfer to Ethicon. In the fiscal year ended March 31, 2018, Takeda Pharmaceutical Company Limited reported net sales of approximately $155 million for TachoSil.

Under the terms of the agreement, Ethicon will acquire the assets and licenses supporting the manufacturing, licensing, and commercialization of TachoSil. Takeda Pharmaceutical Company Limited will retain ownership of its manufacturing facility in Linz, Austria. Takeda has entered into a long-term manufacturing services agreement with Ethicon. Under this agreement, Takeda will continue to manufacture TachoSil products and supply them to Ethicon. In this acquisition transaction, Nomura served as the financial advisor to Takeda, and Linklaters served as the legal advisor to Takeda.

(Compiled by: Li Chengping)