Core Insights - Takeda Pharmaceutical Company Limited (NYSE:TAK) is identified as one of the best healthcare stocks to buy for 2026, despite facing challenges due to VYVANSE's loss of exclusivity [1][2] Financial Performance - For Q3 FY2025, Takeda reported a revenue of ¥3,411.2 billion, reflecting a year-over-year decline of 3.3% at constant exchange rates [2] - Core operating profit decreased by 3.4% to ¥971.6 billion, while reported operating profit increased by 1.2% to ¥422.4 billion [2] - Operating cash flow rose by 15.8% to ¥966.9 billion, and adjusted free cash flow increased by 10.1% to ¥625.9 billion, indicating strong cash flow management [2] Product Performance - Growth and launch products contributed positively, rising by 6.7% at constant exchange rates and now accounting for 52% of total revenue [1] - Key growth drivers included Entyvio (+7.4%), Livtencity (+43.6%), and Qdenga (+22.1%), which helped mitigate the impact of VYVANSE's significant decline of 45.7% [1] Upcoming Products - The company is preparing to launch three transformative medicines—Oveporexton, Rusfertide, and Zasocitinib—between late 2026 and early 2027, aiming to drive long-term growth [2] - Takeda is also accelerating late-stage programs in gastrointestinal, neuroscience, and oncology sectors [2] New Product Launch - On January 22, Takeda announced the U.S. launch of GAMMAGARD LIQUID ERC, an immunoglobulin therapy for primary immunodeficiency patients aged two and older, which can be administered without reconstitution [3] - The product features Enhanced Removal Capability to lower IgA levels and is available in various vial sizes, enhancing treatment options for patients [3] Company Overview - Takeda is a top-20 global, R&D-driven biopharmaceutical company headquartered in Japan, focusing on innovative medicines in oncology, rare diseases, neuroscience, gastroenterology, plasma-derived therapies, and vaccines [4]

Core Viewpoint - Takeda announced improved earnings results for Q3 FY2025, highlighting a narrowing gap between incremental Growth & Launch Products revenue and VYVANSE erosion, alongside operational efficiencies leading to reduced operating expenses [1] Financial Performance - The company reported year-on-year reductions in operating expenses, including R&D, indicating effective cost management strategies [1] - Takeda raised its full-year forecasts, attributing this to cost discipline and favorable foreign exchange (FX) conditions [1] Revenue Management - The narrowing gap between Growth & Launch Products revenue and VYVANSE erosion suggests a positive trend in product performance and revenue management [1]

Financial Performance - FY2025 Q1 revenue was JPY 1,1067 billion, a decrease of 84% compared to FY2024 Q1[16] - FY2025 Q1 core operating profit was JPY 3218 billion, a decrease of 158% compared to FY2024 Q1[16] - FY2025 Q1 reported operating profit increased by 110% to JPY 1846 billion, primarily due to lower impairment and restructuring expenses[16, 28] - Adjusted free cash flow for FY2025 Q1 was JPY 1901 billion, a significant increase of 7036% compared to FY2024 Q1[16] - Takeda maintains its FY2025 forecast with revenue of JPY 4,5300 billion, a decrease of 11%[34] Portfolio Performance - Growth & Launch Products increased by 50% at CER in Q1[18] - Growth & Launch Products accounted for JPY 5581 billion (USD 39 billion), representing 50% of total revenue[19] - VYVANSE revenue is expected to decline by JPY 1096 billion (-30% at CER) in FY2025[34] Pipeline and Milestones - Oveporexton (TAK-861) Phase 3 met all primary and secondary endpoints, showing transformative potential in NT1[40] - Zasocitinib is in Phase 3 for Psoriasis with a head-to-head start vs deucravacitinib[46, 49] - Rusfertide is targeting US filing for Polycythemia Vera in H1 FY25[49]