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Takeda Pharmaceutical Co., Japan’s largest pharmaceutical manufacturer, announced that it has agreed to buy Cambridge MA-based Millennium Pharmaceuticals for $8.8 billion. Millennium, founded in 1993 by high profile MIT researchers and once heralded as one the most innovative American biotechnology companies, never lived up to analyst’s expectations. That said, the company did develop and win regulatory approval for an anti-cancer drug, Velcade, which is expected to garner additional approval for wider use in oncology later this year.

Velcade, which is used to treat relapsed multiple myeloma after other drugs fail generated more than $800 million last year. Millennium anticipates U.S. approval by June to promote Velcade as an initial therapy to treat these disorders. Millennium markets Velcade in the US and shares revenue with Johnson & Johnson which markets Velcade in 85 other countries. Analysts predict that the Takeda acquisition will help to propel Velcade to blockbuster status.

The Takeda-Millennium deal follows Eisai Co.’s (another Japanese company) agreement in December to buy the U.S.'s MGI Pharma Inc. for $3.9 billion as Japanese companies, aided by a weak dollar against the yen, seek growth abroad. Japanese companies have been hampered by government-ordered price cuts, weak pipelines and a lack of new products  As one financial analyst put it ``There's no doubt the weak dollar against the yen is making U.S. biotech very attractive right now to potential Japanese buyers,''

Takeda’s best seller is the diabetes drug Actos which is slated to lose patent protection in the near future. Acquisition of Millennium provides Takeda with an entrée into the oncology and cardiovascular markets both of which are poised for expansive growth in the next five years. Analysts also believe that the Millennium acquisition will boost Takeda’s drug discovery and development flow. Millennium is conducting human trials with experimental drugs for cancer, heart disease, gastrointestinal disorders and rheumatoid arthritis.

The ongoing acquisition of American biotechnology companies by Japanese pharmaceutical companies reminds me of  the Japanese foray into the US real estate market in the early 1990s. Only time will tell whether the Japanese will be able to hang on to their acquisitions this go around (they weren’t the last time).  Earlier this week, Switzerland's Novartis AG agreed to buy 77 percent of eye-care company Alcon Inc. in a two-step transaction totaling $39 billion. Does anybody else see a troubling trend developing here as a result of the recession that we are in or heading into?

Don’t be surprised to see some “asset reallocation” and downsizing at Millennium. The Japanese are well recognized for increasing efficiency and work output with smaller numbers of employees.

Until next time….

Good Luck and Good Job Hunting (not in Cambridge MA)!!!!!!!!

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An editorial published in this week’s New England Journal of Medicine and recommendations from an expert panel at an American College of Cardiology meeting being held in Chicago urged that the cholesterol-lowering medications Zetia and Vytorin should be used only as the last resort to treat patients with elevated LDL-cholesterol. Instead, the panel recommended that doctors and patients should use statins, older and sometimes cheaper medications, which have been clinically proven to lower cholesterol and reduce the risk of heart attack and stroke. The panel's recommendations were announced to the almost 30,000 physicians who were attending the conference.

As you may recall, Zetia and Vytorin, which reduce cholesterol levels by inhibiting its absorption from the intestinal tract, didn’t reduce the incidence of heart attack or stroke in patients taking the medications (in the Enhance clinical trial) even though LDL-cholesterol levels were lowered. Further, there is some emerging evidence which suggests that Zetia and Vytorin may actually speed rather than slow the development of plaque in arteries. Merck and Schering are conducting larger clinical studies (initiated in 2006) to measure effects of Zetia and Vytorin on heart disease and stroke. The results from these trials are not expected until 2012

Zetia and Vytorin are among the top selling drugs in the world with combined sales of $5 billion in 2007. Approximately 5 million people, including about 4.0 million Americans take the medications which were heavily advertised to US consumers. Many cardiologists believe that heavy marketing of the drugs has resulted in their over use. The fallout from the Enhance clinical trial controversy has already depressed the sales of both Zetia and Vytorin. A greater reduction in sales is anticipated as more doctors and patients digest the implication of the Enhance trial results.

The flap over the utility of Zetia and Vytorin will likely take a heavy toll on Schering Plough’s revenue stream. Analysts say that sales of Zetia and Vytorin produce almost 70% of Schering’s profits. The controversy will have less of a direct effect on Merck which co-markets Vytorin with Schering. However, Merck is still reeling from reports last week linking its popular asthma medication Singulair to suicide. 

Things are not looking too good in pharma land these days.

Until next time….

Good Luck and Good Job Hunting!!!!!!!

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