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Takeda to Divest OTC and Select Non-core Assets in Asia Pacific to Celltrion for up to $278 Million USD

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Takeda Pharmaceutical Company Limited (TSE:4502/NYSE:TAK) (“Takeda”) today announced that it has entered into an agreement to divest a portfolio of select non-core over-the-counter (OTC) and prescription pharmaceutical products sold exclusively in Asia Pacific to Celltrion Inc. (“Celltrion”), an Incheon, South Korea-based biopharmaceutical company specializing in the research, development and manufacturing of small molecules, biosimilars and innovative drugs. Takeda will receive $266 million USD upfront in cash and up to an additional $12 million USD in potential milestone payments, subject to customary legal and regulatory closing conditions.

The portfolio to be divested to Celltrion includes a variety of OTC products and pharmaceutical products in the Cardiovascular, Diabetes and General Medicine therapeutic areas sold predominantly in Australia, Hong Kong, Macau, Malaysia, Philippines, Singapore, South Korea, Taiwan and Thailand, which are part of Takeda’s Growth & Emerging Markets Business Unit. The portfolio generated FY 2018 net sales of approximately $140 million USD, driven by strong sales of prescription products Nesina® and Edarbi®. While the products included in the sale continue to play important roles in meeting patient needs in these countries, they are outside of Takeda's chosen business areas – Gastroenterology (GI), Rare Diseases, Plasma-Derived Therapies, Oncology and Neuroscience – that are core to its global long-term growth strategy.

“Across our Growth & Emerging Markets, Takeda must focus on accelerating the commercial availability of our highly innovative medicines for patients living with complex and rare conditions, and expanding our approach to Access to Medicines across the Region,” said Ricardo Marek, President, Growth & Emerging Markets Business Unit, Takeda. “Doing so, better addresses patient unmet needs. While we remain committed to Asia Pacific, and the Emerging Markets, divesting non-core products helps achieve those goals.”

“This announcement marks continued progress on our commitment to divest non-core products as we remain focused on maintaining our financial discipline and rapid deleveraging following our acquisition of Shire,” said Costa Saroukos, Chief Financial Officer, Takeda. “One of several transactions since the launch of the divestment program, the sale announced today will further focus Takeda on our five key business areas and our pipeline of innovative medicines. We look forward to continuing to execute and deliver on Takeda’s financial commitments, including paying down debt and focusing our portfolio.”

Takeda has made strong progress on its ongoing divestiture program. In March 2020, Takeda completed sales of non-core assets spanning the Russia-CIS region to STADA for $660 million USD and in countries spanning the Near East, Middle East and Africa region to Acino for $200 million USD. In July 2019, Takeda completed the divestiture of Xiidra® to Novartis for up to $5.3 billion USD. Additionally, earlier this year, Takeda announced the sales of non-core products in Latin America to Hypera Pharma for $825 million USD and in Europe to Orifarm Group for up to approximately $670 million USD, including the sale of two manufacturing sites in Denmark and Poland.

Takeda intends to use the proceeds from its divestitures to continue to reduce its debt and accelerate deleveraging toward its target of 2x net debt/adjusted EBITDA within March 2022 – March 2024.

Transaction Details

Takeda has entered into an agreement to sell a portfolio of 18 select OTC and prescription pharmaceutical assets sold in Australia, Hong Kong, Macau, Malaysia, Philippines, Singapore, South Korea, Taiwan and Thailand to Celltrion for a total value of up to $278 million USD. Takeda will receive $266 million USD upfront in cash and up to an additional $12 million USD in potential milestone payments, subject to customary legal and regulatory closing conditions.

Takeda and Celltrion have also entered into a manufacturing and supply agreement under which Takeda will continue to manufacture the portfolio of divested products and supply them to Celltrion. Under the terms of the agreement, Celltrion will acquire the rights, title and interest to the products in the portfolio exclusive to these countries.

The transaction is expected to close by end of the calendar year, subject to the satisfaction of customary closing conditions, receipt of required regulatory clearances and, where applicable, compliance with local works council requirements. Until then, Takeda remains the owner of these products and responsible for ensuring patient access to them.

Takeda is being advised by BofA Securities as its financial advisor and White & Case is its legal advisor in this transaction.

About Takeda Pharmaceutical Company Limited

Takeda Pharmaceutical Company Limited (TSE:4502/NYSE:TAK) is a global, values-based, R&D-driven biopharmaceutical leader headquartered in Japan, committed to bringing Better Health and a Brighter Future to patients by translating science into highly-innovative medicines. Takeda focuses its R&D efforts on four therapeutic areas: Oncology, Rare Diseases, Neuroscience, and Gastroenterology (GI). We also make targeted R&D investments in Plasma-Derived Therapies and Vaccines. We are focusing on developing highly innovative medicines that contribute to making a difference in people's lives by advancing the frontier of new treatment options and leveraging our enhanced collaborative R&D engine and capabilities to create a robust, modality-diverse pipeline. Our employees are committed to improving quality of life for patients and to working with our partners in health care in approximately 80 countries.

For more information, visit https://www.takeda.com.

Important Notice

For the purposes of this notice, “press release” means this document, any oral presentation, any question and answer session and any written or oral material discussed or distributed by Takeda Pharmaceutical Company

Limited (“Takeda”) regarding this release. This press release (including any oral briefing and any question-and-answer in connection with it) is not intended to, and does not constitute, represent or form part of any offer, invitation or solicitation of any offer to purchase, otherwise acquire, subscribe for, exchange, sell or otherwise dispose of, any securities or the solicitation of any vote or approval in any jurisdiction. No shares or other securities are being offered to the public by means of this press release. No offering of securities shall be made in the United States except pursuant to registration under the U.S. Securities Act of 1933, as amended, or an exemption therefrom. This press release is being given (together with any further information which may be provided to the recipient) on the condition that it is for use by the recipient for information purposes only (and not for the evaluation of any investment, acquisition, disposal or any other transaction). Any failure to comply with these restrictions may constitute a violation of applicable securities laws.

The companies in which Takeda directly and indirectly owns investments are separate entities. In this press release, “Takeda” is sometimes used for convenience where references are made to Takeda and its subsidiaries in general. Likewise, the words “we”, “us” and “our” are also used to refer to subsidiaries in general or to those who work for them. These expressions are also used where no useful purpose is served by identifying the particular company or companies.

Forward-Looking Statements

This press release and any materials distributed in connection with this press release may contain forward-looking statements, beliefs or opinions regarding Takeda’s future business, future position and results of operations, including estimates, forecasts, targets and plans for Takeda. Without limitation, forward-looking statements often include words such as “targets”, “plans”, “believes”, “hopes”, “continues”, “expects”, “aims”, “intends”, “ensures”, “will”, “may”, “should”, “would”, “could” “anticipates”, “estimates”, “projects” or similar expressions or the negative thereof. These forward-looking statements are based on assumptions about many important factors, including the following, which could cause actual results to differ materially from those expressed or implied by the forward-looking statements: the economic circumstances surrounding Takeda’s global business, including general economic conditions in Japan and the United States; competitive pressures and developments; changes to applicable laws and regulations; the success of or failure of product development programs; decisions of regulatory authorities and the timing thereof; fluctuations in interest and currency exchange rates; claims or concerns regarding the safety or efficacy of marketed products or product candidates; the impact of health crises, like the novel coronavirus pandemic, on Takeda and its customers and suppliers, including foreign governments in countries in which Takeda operates, or on other facets of its business; the timing and impact of post-merger integration efforts with acquired companies; the ability to divest assets that are not core to Takeda’s operations and the timing of any such divestment(s); and other factors identified in Takeda’s most recent Annual Report on Form 20-F and Takeda’s other reports filed with the U.S. Securities and Exchange Commission, available on Takeda’s website at: https://www.takeda.com/investors/reports/sec-filings/ or at www.sec.gov. Takeda does not undertake to update any of the forward-looking statements contained in this press release or any other forward-looking statements it may make, except as required by law or stock exchange rule. Past performance is not an indicator of future results and the results or statements of Takeda in this press release may not be indicative of, and are not an estimate, forecast, guarantee or projection of Takeda’s future results.

Contact information

Investor Relations
Takashi Okubo
takeda.ir.contact@takeda.com
+81 (0) 3-3278-2306

Media:
Japanese Media
Kazumi Kobayashi
kazumi.kobayashi@takeda.com
+81 (0) 3-3278-2095

Media outside Japan
Sandy Rodriguez
sandy.rodriguez@takeda.com
+1 (224) 940-3926

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