Takeda Deal Gets EU Approval, Clearing Biggest Regulatory Hurdle

(Bloomberg) -- Takeda Pharmaceutical Co. cleared the last major regulatory hurdle in its takeover of Shire Plc, receiving European Union approval for the $62 billion deal after agreeing to sell an inflammatory bowel disease treatment Shire is developing.

  • "Takeda would be unlikely to continue developing Shire’s new anti-integrin treatment" that rivals Takeda’s Entyvio, the European Commission said in an emailed statement on Tuesday. "This would have meant a serious loss of innovation on a market where patients currently have few treatment options."
  • The companies’ pledge to sell the Shire treatment removes EU’s concerns, it said. The treatment, along with rights to its development, manufacturing and marketing, must be sold "to a purchaser that would have an incentive to develop the drug," the EU said.

Key Insights

  • While Takeda’s biggest-ever acquisition has had smooth sailing through the regulatory process, getting approval from major markets including China and the U.S., the deal was expected to get more serious scrutiny from Europe. The EU has taken a keen interest in protecting innovative products that a takeover might eliminate.
  • The sale of the inflammatory bowel disease drug was a small concession to regulators and was expected, as Takeda said in October it was in discussions with the EU about divesting the medicine to gain regulatory clearance.
  • The focus now shifts to shareholders, and Takeda has set a date of Dec. 5 for a vote on the deal. While a dissident group -- which owns only about 1 percent of Takeda’s stock -- has sought to derail the transaction, the deal is expected to win the endorsement of a majority of shareholders.

Get More

  • Takeda has separately been considering other sales in order to reduce its debt level. It is reportedly weighing a disposal of assets from its over-the-counter business in Europe, as well as selling medicines such as its eye-disease treatment Xiidra and Shire’s Natpara drug.

©2018 Bloomberg L.P.