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Takeda (TKPYY) Axes Sales Jobs, Forces Hundreds of Employees to Relocate to Boston

7/18/2017 6:08:39 AM

Takeda Axes Sales Jobs, Forces Hundreds of Employees to Relocate to Boston July 18, 2017
By Mark Terry, Breaking News Staff

Chicago, Ill. – Takeda Pharmaceuticals (TKPYY) is shifting hundreds of executives from the Chicago area to relocate to Boston. It is also cutting hundreds of field sales positions throughout the U.S.

In March, the company indicated it was making job cuts in the Cambridge, Mass. area after its acquisition of Ariad Pharmaceuticals (ARIA) for about $5.2 billion. At that time, Takeda said that at the end of February, 180 Ariad employees were laid off. Of the approximately 300 Ariad employees, 120 found placement in Takeda’s Boston operations. Of the other 180, Amy Atwood, Takeda Oncology spokeswoman, said that about 50 might find jobs at Takeda’s contract research organization, PRA.

Takeda currently employs about 5,000 people across the U.S. Approximately 2,150 are working in the Boston and Cambridge, Mass. area. The company’s global research and development and vaccine business units were located in Deerfield, Ill., a Chicago suburb, but over the last two years, the company has been gradually moving those units to the Boston area.

Modern Healthcare indicates that about 600 Deerfield-based research-and-development staffers and 150 vaccine workers were relocated. In March, Takeda laid off 480 sales staff and managers in field office nationwide. Less than 10 were in the Chicago area.

Modern Healthcare writes, “The affected employees worked with Takeda’s primary care business, which include drugs that treat gastrointestinal problems. That unit is being pruned in order to divert more resources to oncology, which executives believe has a potentially more lucrative future.”

Takeda is one of the oldest drug companies in the world. Technically it was founded in 1781, but it actually goes back much further to imperial Japan, Modern Healthcare notes, “when the Takeda clan ruled the mountainous region west of Tokyo. In 1781, a family member began selling traditional Japanese and Chinese medicines, creating what is today Japan’s largest pharma company by revenue.”

Last year, Takeda reported more than $15.3 billion in sales, but, like much of pharma, is being battered by loss of patent protection and generic competition. Takeda doesn’t have a deep pipeline, which in part is behind its acquisition of Ariad.
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Ariad has two targeted therapies that fit in well with Takeda’s oncology portfolio. The largest is Iclusig, which has been approved for chronic myeloid leukemia (CML) and a subset of acute lymphoblastic leukemia (ALL). Brigatinib, still in trials, has the potential to be approved in a genetically-defined subpopulation of non-small cell lung cancer (NSCLC). Brigatinib received Breakthrough Therapy designation from the U.S. Food and Drug Administration (FDA) in October 2014.

In 2011, Takeda’s Actos, a best-selling drug for type 2 diabetes, lost patent protection. At that time, it laid off about 1,600 people, including approximately 500 in the Chicago area. Another drug, Velcade, a chemotherapy drug it acquired when it bought Millennium Pharmaceuticals in 2008, will expire at the end of this year. And another blockbuster drug, Dexilant, for heartburn, will face generic competition in 2020.

The company’s president and chief executive officer, Christophe Weber, is the first non-Japanese executive and only the second person not a member of the Takeda family to run the company in its history. When the company’s chairman, Yasuchika Hasegawa, retired in June, investors and analysts noted that the pressure was on Weber to get results and that Hasegawa was his biggest supporter.

Nikkei Asian Review wrote, “The company’s many problems include falling profitability. Consolidated net profit came to 114.9 billion yen ($1.02 billion) for the year ended March 31. Astellas Pharma (ALPMY) earned twice as much while ringing up less in sales. Weber himself acknowledges improving margins as Takeda’s top priority. Net profit was down from the 285.3 billion yen of fiscal 2003, the year Hasegawa became president. Market capitalization and sales were barely better or a little bit worse.”

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