Sosei deal beefs up Japanese presence
Arakis, in a £106.5 million deal that includes a £213 million ($375
million) global partnership with Novartis for its lead product, a
once daily, inhaled, long-acting antimuscarinic agent for Chronic
Obstructive Pulmonary Disease.
As part of the deal Arakis brings a broad product pipeline of eight clinical products, with a further six in pre-clinical development and two in late stage pre-clinical research. The biopharmaceutical company, based near Cambridge, is collaborating with Novartis to develop, AD 237 both as a monotherapy and as a combination therapy with Novartis' long-acting beta agonist, QAB 149.
Under the terms of the agreement, Sosei will acquire Arakis for £106.5 million (€157 million), paid by an £11.7 million lump sum, and the issue of 35,630 new Sosei shares.
Arakis is to remain located in Chesterford Research Park and will be managed as an autonomous subsidiary of Sosei, responsible for worldwide research and development, outside Japan, for the Sosei Group.
"It was always part of Arakis' strategic ambition to develop its business on an international scale and the combining of our business with Sosei's complementary activities in Japan will enable us to achieve this vision," said Dr Ken Cunningham, chief executive of Arakis.
Sosei's acquisition of Arakis noticeably brings into play Arakis' development and regulatory capabilities in the EU and US, complementing those of Sosei in Japan.
Sosei said that they had begun to put in place a direct, global salesforce for hospital products, with a Japanese salesforce currently being established, a salesforce in the EU planned to be established over the next three years and with the ultimate objective to build a salesforce in the US in the longer term.
Sosei have in place its near term commercialisation opportunities, with the potential approval of Sosei's lead product, Eligard for prostate cancer, in Japan next year
Arakis also bring to the agreement another cancer candidate in clinical development. AD 923 is due to commence phase III trials later this year to treat cancer breakthrough pain. AD923 compliments AD 452, which is due to commence phase IIb trials in Q3 2005, for rheumatoid arthritis, and AD 337 for fibromyalgia currently in phase I.
According to GlaxoSmithKline, the scale of Japan's pharmaceutical market, which is second only to that of the US, grew from $52.1 billion in 1993 to $59.3 billion in 2002.
Foreign-based companies in recent years have enlarged their Japanese market shares through direct participation. This involvement began in 1984, when America's Merck & Co, acquired Banyu Pharmaceutical, and reorganized it as a subsidiary. More recently, the Swiss giant F. Hoffmann-La Roche in 2001 bought out Chugai Pharmaceutical, and Pfizer. merged Pharmacia K.K. into in 2003.
