Takeda Announces Further Details of Transformational Pharmaceutical Sciences Partnership with Bushu

-Takeda Splits off a Part of its Pharmaceutical Sciences Businesses to its Wholly-owned Subsidiary
via Simple Absorption-type Company Split
-Takeda Transfers the Subsidiary’s Shares to Bushu

Osaka, Japan, May 15, 2017 Takeda Pharmaceutical Company Limited (TSE: 4502) (“Takeda”) today announced that it has entered into an agreement for an absorption-type company split with its wholly-owned subsidiary, SPERA PHARMA, Inc., that was established in April 2017 (“SPERA PHARMA”), aiming to transfer a part of Takeda's Pharmaceutical Sciences/CMC* businesses to Bushu Pharmaceuticals Ltd. (“Bushu”). Takeda will transfer all of the issued shares in Succeeding Company to Bushu based on the share transfer agreement signed on February 28, 2017.

In alignment with Takeda's global R&D strategy, Takeda and Bushu announced their partnership on February 28, 2017. As Takeda’s strategic partner, Bushu will deliver on process chemistry, formulation and analytical development, as well as development, manufacturing and associated work of clinical trial materials.
* CMC stands for chemistry, manufacturing and controls, which is the research and development activities including the design of API (active pharmaceutical ingredients) or formulation and product quality, and the development of manufacture processes to put new drug candidates discovered through research onto the market.

Since the company split is an absorption-type company split carried out between Takeda and Succeeding Company, certain details are omitted from disclosure, in line with the Tokyo Stock Exchange disclosure guidelines.

1. Purpose of transaction
Takeda is in the process of implementing steps to accelerate its research and development (R&D) transformation by refocusing on three key therapeutic areas – Oncology, Gastroenterology and Central Nervous System, plus Vaccines, and concentrating R&D activities in Japan and the U.S. This transformation is critical to provide the company with the necessary organizational and financial flexibility to drive innovation, enhance partnerships, and improve R&D productivity for long-term, sustainable growth. As a part of this initiative, Takeda entered into a pharmaceutical sciences partnership agreement with Bushu in February 2017. This partnership, which enables a more agile and flexible approach for clinical trial material development and manufacturing, will allow Takeda to improve its operating efficiencies and create a more agile organization to better meet patient needs.

Subsequent to the company split, all of the issued shares in SPERA PHARMA will be transferred to Bushu. Through this share transfer, will be a wholly-owned subsidiary of Bushu, which is scheduled to be effective as of July 1, 2017.

2. Details of transaction
1) Schedule of transaction

Date of conclusion of agreement on share transfer of SPERA PHARMA shares (between Takeda and Bushu)

February 28, 2017

Date of establishment of SPERA PHARMA

April 20, 2017

Date of decision on company split by the Director delegated by the Board of Directors

May 15, 2017

Date of conclusion of absorption-type company split agreement

May 15, 2017

Effective date of the company split

July 1, 2017 (scheduled)

Date of transfer of shares

July 1, 2017 (scheduled)

(Note) The company split is to be conducted by Takeda in accordance with Article 784, paragraph 2 of the Companies Act. Accordingly, no approval by a general meeting of shareholders as defined in Article 783, paragraph 1 of the Companies Act is required.

2) Method of company split
In this company split, Takeda will be the splitting company and SPERA PHARMA will be the succeeding company.

3) Details of stock allocation
As consideration for the company split, SPERA PHARMA will issue 7,800 shares of common stock and allocate them to Takeda.

4) Treatment of stock options and corporate bonds with stock options for the splitting company
Although Takeda has issued stock options, there will be no change in the treatment of these stock options due to the company split.

5) Increase or decrease of capital stock due to the company split
There will be no increase or decrease of the capital stock of Takeda.

6) Rights and obligations to be succeeded by the succeeding company
SPERA PHARMA will succeed the assets relating to the business to be split off in accordance with the terms and conditions of the absorption-type company split agreement, as well as the rights and obligations incidental thereto.

7) Capability of satisfying liabilities
Takeda has judged that SPERA PHARMA will not have any problem in performing its obligations relating to the liabilities it will bear following the effective date of the absorption-type company split; however, Takeda will not be liable for SPERA PHARMA's liabilities as a guarantor.

3. Outline of the companies

 

Splitting company (as of March 31, 2017)

(1)

Company name

Takeda Pharmaceutical Company Limited

(2)

Location

1-1, Doshomachi 4-chome, Chuo-ku, Osaka 540-8645, Japan

(3)

Representative

President & CEO: Christophe Weber

(4)

Scope of business

Research and development, manufacturing, sales and marketing of pharmaceutical products, etc.

(5)

Capital

65,203 million yen

(6)

Date established

January 29, 1925

(7)

Number of shares issued

790,521,195 shares

(8)

Fiscal year end

March 31

(9)

Major shareholders and
ratio of shares held

Nippon Life Insurance Company

The Master Trust Bank of Japan, Ltd. (Trust account)

Japan Trustee Services Bank, Ltd. (Trust account)

JP Morgan Chase Bank 380055

Takeda Science Foundation

6.42%

5.32%

4.62%

4.31%

2.27%

(10) Financial results of the previous fiscal year (consolidated, IFRS)

 

Total equity

1,894,261 million yen

 

Total assets

4,355,782 million yen

 

Equity attributable to owners of the company per share

2425.92 yen

 

Revenue

1,732,051 million yen

 

Operating profit

155,867 million yen

 

Profit before income taxes

143,346 million yen

 

Profit attributable to owners of the company

114,940 million yen

 

Basic earnings per share

147.15 yen

 

Dividend per share

180.00 yen

 

 

Succeeding company (as of May 15, 2017)

(1)

Company name

SPERA PHARMA, Inc.

(2)

Location

17-85, Jusohonmachi 2-chome, Yodogawa-ku, Osaka 532-0024, Japan

(3)

Representative

Representative Director : Mitsuhiro Niimi

(4)

Scope of business

Development and manufacturing of clinical trial materials, etc.

(5)

Capital

10 million yen

(6)

Date established

April 20, 2017

(7)

Number of shares issued

200 shares

(8)

Fiscal year end

March 31

(9)

Major shareholders and
ratio of shares held

Takeda Pharmaceutical Company Limited

100%


4. Outline of the business to be split off from Takeda to the succeeding company
1) Details of the business to be split off
The portion of the business to be split off is a part of Takeda’s business related to the development and manufacturing of clinical trial materials, etc. that is operated by Takeda's Pharmaceutical Sciences.

2) Financial results of the business to be split off
The business has not recorded external revenue.

3) Book value of assets and liabilities to be split off (as of March 31, 2017)

Assets

Liabilities

Item

Book value

Item

Book value

Current assets

230 million yen

Current liabilities

240 million yen

Fixed assets

620 million yen

Fixed liabilities

220 million yen

Total

850 million yen

Total

460 million yen


5. Status after the company split
1) There will be no change in Takeda’s company name, location, representative, scope of business, capital or fiscal year end after the company split.

2) The amount of SPERA PHARMA's capital will increases from 10 million yen to 310 million yen through the company split.

3) With respect to SPERA PHARMA, Takeda will transfer all of the outstanding shares in SPERA PHARMA to Bushu through a share transfer.

4) President of SPERA PHARMA will be Toshio Yoshioka immediately after the effective date of the absorption-type company split and the subsequent share transfer, i.e. July 1, 2017 (scheduled).

6. Share transfer
1) Profile of the subsidiary (succeeding company) to undergo changes
Please see 3. above.

2)  Transferee of the share transfer (as of March 31, 2017)

(1)

Company name

Bushu Pharmaceuticals Ltd.

(2)

Location

1 Takeno, Kawagoe-city, Saitama

(3)

Representative

Representative Director, President and CEO: Jun Yokohama

(4)

Scope of business

Contract manufacturing of pharmaceuticals and clinical samples

(5)

Capital

1 billion yen

(6)

Date established

August 3, 1998

(7)

Major shareholders and percentage holdings thereof

Bushu Pharmaceuticals Holdings KK                            100%

(8)

Relationship between Takeda and Bushu

Capital relationships

There is no capital relationship between Takeda and the company worthy of note. There are also no noteworthy capital relationships between personnel and affiliates of the company and personnel and affiliates of Takeda.

Human relationships

There is no human relationship between Takeda and the company worthy of note. There are also no noteworthy human relationships between personnel and affiliates of the company and personnel and affiliates of Takeda.

Trading relationships

Takeda outsources the manufacturing of some products to the company.

Related parties

The company is not a related party of Takeda. Personnel and affiliates of the company are also not related parties of Takeda.


3) Change in ownership ratio of shares through the share transfer

(1)

Number of shares held prior to the transfer

8,000 shares

(Number of votes: 8,000 votes)

(% of total votes: 100%)

(2)

Number of shares to be transferred

8,000 shares

(Number of votes: 8,000 votes)

(3)

Number of shares held after the transfer

0 shares

(Number of votes: 0 votes)

(% of total votes: 0%)

The Transfer price is undisclosed in accordance with an agreement with the transferee of the share, which is a privately-owned company.

7. Future outlook
Takeda’s financial forecast for FY2017, which was announced on May 10, 2017, includes the impact of this transaction.

(Reference) Consolidated earnings forecast for this fiscal year (as of May 10, 2017) and consolidated results for the previous fiscal year (in million yen)

 

Revenue

Operating profit

Profit before
income taxes

Profit attributable to
owners of the Company

Forecast for the current
FY ending March 2018

1,680,000

180,000

190,000

138,000

Results for the previous
FY ended March 2017

1,732,051

155,867

143,346

114,940

 


Media Contacts:
Kazumi Kobayashi
kazumi.kobayashi@takeda.com
+81 (0) 3-3278-2095

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