Takeda Pharmaceutical Co has posted a major decline in first-half earnings, hit by the effects of the $8.8 billion acquisition of the US cancer specialist Millennium, but the firm recorded a healthy sales rise

For the six months ended September 30, Japan’s largest drugmaker says that operating profit was down 67.1% to 71.8 billion yen (around $721 million), heavily impacted by costs associated with the absorption of TAP Pharmaceuticals, Takeda’s former joint venture with Abbott Laboratories in the USA as well as the Millennium purchase, which was announced in April. However, sales were up 13.9% to 807.1 billion yen.

Once again, revenue growth was driven by the diabetes drug Actos (pioglitazone), which brought in 203.2 billion yen, down 1.9% as a result of currency effects. The gastrointestinal drug Prevacid/Takepron (lansoprazole) leapt 92.2% to 149.1 billion yen, due to the consolidation of TAP which used to market the drug in the USA.

Sales of the blood pressure drug Blopress (candesartan cilexetil) were up 5.8 percent to 119.4 billion yen, while turnover from the prostate cancer treatment Leuplin (leuprorelin) edged up 0.9% to 65.1 billion yen.

The strength of the yen has forced Takeda to lower its full-year net profit guidance to 195 billion yen, down from a previous estimate of 200 billion yen. The firm noted that “our market environment is becoming more challenging due to the implementation of a stricter approval process for new drugs, in addition to initiatives in Japan, the USA and Europe” to promote generics and “further restrain healthcare expenditures”.

In order to combat these factors and achieve sustained growth of sales and profits, “the priority in this financial year is the leveraging of the company’s established US franchises for Actos and lansoprazole”. Takeda added that it also hopes to get US marketing approval of alogliptin, a dipeptidyl peptidase IV inhibitor for type 2 diabetes also known as SYR-322 and its Prevacid follow-up TAK-390MR (dexlansoprazole).

However, the Osaka-headquartered group was recently notified by the US Food and Drug Administration that the reviews on the two drugs were delayed, though the problem lies with the agency and the staff shortages it is suffering from, not any safety issues.