The move – announced late last week – will see Osaka, Japan-based API Corporation – a subsidiary of Mitsubishi Chemical - take responsibility for the manufacture and sale of all active pharmaceutical ingredients (API) previously made by MTP from July 1 onward.
Similarly, Taisho Technos – a Tokyo-headquartered subsidiary of the Japanese Mutsui Sugar conglomerate – will take over the production and sale of all of MTP’s food additives and preservatives lines as well as its industrial antifungals range.
MTP did not specify what prompted the reorganisation or how it will impact either employees or the pharmaceutical firms it supplies. Instead the company stressed the move is in line with its plan to focus on the discovery and development of new drugs for unmet medical needs and will “further focus management resources on our pharmaceutical operations."
What is clear is that MTP’s fine chemicals business has struggled over the last 12 months. According to the firm’s recently published fiscal 2011 results falling demand and the ongoing impact of last year’s earthquake reduced fine chemicals revenues.
Pharma sales – which include MTP's ingredients business - were also down in the 12-months to March 2012. However, the firm attributed this to the impact of generic competition – and a temporary sales spike that followed the earthquake in fiscal 2010 - rather than any drop in demand.
Focus on Pharma
The decision to focus on innovative products follows just a few weeks after MTP partnered with Medicago and agreed to fund the research and development of virus like particles for vaccines development in exchange for licensing rights.
The withdrawal from fine chemical production is also in keeping with MTP's recent focus on biologics. In July last year it partnered with Fujifilm to establish a biopharmaceuticals production joint venture focused on contract biologics production.