Takeda to Sell Drugs for Stock in Teva Partnership

While Teva Pharmaceutical and Takeda Pharmaceutical have framed a previously disclosed joint venture in Japan as a “partnership,” new details about the arrangement show that Takeda is selling off drugs for stock.

In late December, the two disclosed details of the arrangement, which were sparse in their initial announcement. Under the deal, Takeda will relinquish control of three of its off-patent drugs — the hypertension drug Blopress, the reflux disease drug Takepron and the diabetes drug Basen — to a third party, generic Japanese drugmaker Taisho Pharmaceutical, in exchange for stock.

Taisho will then be purchased by Teva at some point in April. Teva then will give Takeda 49 percent of Taisho’s stock as “consideration,” according to Takeda. Teva will hold the remaining 51 percent of stock in the company.

While Taisho will be renamed “Teva Takeda Yakuhin,” Takeda’s release shows the company will have no direct involvement in the operation; Teva will serve as “the parent company,” and Taisho and Teva will “jointly engage in the new business.” Adding to the confusion, Teva will rebrand its Japanese subsidiary as “Teva Takeda Pharma” as part of the arrangement.

The two companies previously had described the arrangement as a “collaboration to form an independent company” slated to start operations in the second half of 2016. According to Teva’s release, Takeda also may contribute other drugs to the venture in the future.

Taisho’s net sales for fiscal 2014 were $2.4 billion, according to a March financial statement. Sales estimates for the three drugs Takeda will relinquish were $1.03 billion in fiscal 2014, or about 7 percent of Takeda’s global revenue.