Takeda’s proposed acquisition of Shire may have come as a surprise to many commentators, but the appointment of an audacious French CEO in the form of Christophe Weber had already set the tone for the radical transformation upon which the Japanese company has embarked in its dual quest for internationalisation and enduring profitability.

 

The position that Takeda found itself in a mere 5 years ago — facing a shrinking domestic market, patent expiry of their best selling diabetes drug and an unwaveringly Japanese-style conservative approach to business — meant that the company was compelled to make drastic changes to reinvigorate. The hiring of its first ever non-Japanese CEO in 2015 highlighted, in many respects, Takeda’s resignation to attempt a much more global focus.

 

Christophe Weber stated earlier this year, that the path to survival for the Japanese pharma giant was to scale up. The purchase of Shire, an altogether larger entity, would catapult the company to the top ranks of global pharma. This aggressively western approach to M&A deals was much needed for the unflinchingly Japanese company.

 

In an interview with Sarah Neville, the Global Pharmaceuticals editor for the Financial Times earier this week, Weber outlined the biggest challenges the company faced following the absorption of Shire, a speciality player dedicated to countering rare diseases. These comprised improving R&D productivity and navigating price pressures within healthcare systems around the globe.

 

With regard to the former, Weber announced that the Takeda research team, “is focused on developing the pipeline with our own research but also with external partners.”

He went on to say that, “45% of our pipeline is with partners. This is the right way to increase our R&D productivity.”

 

Neville enquired whether the on-going US-China trade stand-off was of any concern to Weber and his Japanese outfit to which he responded — “This is indeed concerning” pointing to the possibility of contagion.

“If this trade scenario continues it could slow down the economy for the rest of the world. The pharma industry is often at the forefront of economic recession but we feel the pain later.” he explained.

 

On price pressures, Weber noted that pricing constraints are considerably greater in the US, but that, on the flip side, it remains a “core innovation market.” He went on to say that, “the US is absolutely critical [to innovative drug developers] as they have the fastest market access which means that American patients are getting treatment faster than anywhere else in the world”

 

An obvious downside of the US pharma industry is, of course, their opaque and convoluted pricing system, “which can be optimised” by big pharma. Weber stated that, “there is a need for more transparency as what patients are paying is not being reflected in the net price of the product.”

 

Weber used the example of an iPhone or designer clothing — products that can be sold for the same high price in any market in the world. He proclaimed that pricing for medicines should not be this way. When it comes to medicines he said that, “pricing in each country should reflect the wealth of the people.”

 

The landmark deal between Takeda and Shire should finally close in Q2 2019 depending on unanimous shareholder approval.