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Takeda sells dry-eye drug to Novartis in US$ 5.3 billion deal
Swiss drug major Novartis is buying dry-eye drug — Xiidra — from Japanese drug major Takeda Pharmaceutical for up to US$ 5.3 billion. The deal involves an upfront payment of US$ 3.4 billion, and milestone payments of up to US$ 1.9 billion.
Takeda is selling the drug to reduce the debt incurred for its US$ 62 billion acquisition of Irish drugmaker Shire Plc. It aims to dispose of US$ 10 billion worth of assets to cut debt. It is also selling TachoSil, a surgical patch for bleeding control, to Johnson & Johnson’s Ethicon for US$ 400 million.
For Novartis, the acquisition of Xiidra will beef up its eye-care portfolio. Expected to close after July, the transaction also includes 400 Takeda employees. According to analysts from Bank Vontobel in Zurich, these employees will give Novartis a marketing team to sell not only Xiidra but another prospective eye drug entrant — RTH258 — that’s awaiting regulatory approval.
“Despite generic competition...we think that Xiidra is sufficiently differentiated,” Vontobel analyst Stefan Schneider said. “The market (is) big enough for it to reach blockbuster status, justifying the price.”
With sales of US$ 400 million, Xiidra competes with Allergan’s older dry-eye drug Restasis. Xiidra has bagged regulatory approval in markets such as US, Canada and Australia.
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