Takeda(US:TAK)2022-02-03 19:09Financial Data and Key Metrics Changes - Year-to-date underlying revenue growth was 7.1% and reported revenue growth was 11% [9][10] - Reported operating profit was ¥462.5 billion, showing significant growth of 28.9% year-over-year [48] - Core operating profit was ¥757.9 billion, a decline of 2.9% compared to the previous year, mainly due to divestitures and increased R&D investment [49][60] - Reported EPS was ¥154, reflecting a growth of 34.5%, while core EPS was ¥333, with underlying core EPS growth of 9.9% [50][69] Business Line Data and Key Metrics Changes - Gastrointestinal (GI) segment grew by 8%, driven by ENTYVIO, which had sales of ¥395 billion year-to-date and underlying growth of 17% [52][55] - Rare diseases declined by 1%, impacted by the decline in rare hematology [52] - Plasma-derived therapies (PDT) immunology grew by 10% [52] - Oncology grew by 8%, and neuroscience was up 10%, with Vyvanse and Trintellix both posting double-digit growth [52] Market Data and Key Metrics Changes - The 14 global brands generated over ¥1 trillion (approximately $9.3 billion) in revenue year-to-date, with an underlying growth of 12% [54] - The company expects significant revenue growth from global brands in the near to medium term, particularly as it expands into new markets [10][57] Company Strategy and Development Direction - The company is focused on advancing innovative life-transforming medicines in oncology, rare genetic and hematologic diseases, neuroscience, and gastroenterology [12] - Strategic R&D investments are being made in plasma-derived therapies and vaccines, with recent approvals for LIVTENCITY and EXKIVITY [12][23] - The planned acquisition of Adaptate Biotherapeutics is aimed at enhancing the immuno-oncology portfolio [15] - A new global portfolio division is being created to enhance launch capabilities for new therapies [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's long-term growth potential, supported by solid margins and strong cash generation [8][11] - The company is upgrading its full fiscal year 2021 forecast for revenue and core operating profits due to strong third-quarter results [11][67] - Management highlighted the importance of digital evolution and data utilization in driving future growth [16] Other Important Information - The company is actively involved in COVID-19 vaccine development and has partnered with Novavax for the development of TAK-019 [21] - The company has made significant debt prepayments and is on track to reduce net debt to adjusted EBITDA ratio to low 2s by the end of fiscal year 2023 [46][64] Q&A Session Summary Question: Reason for the increase in full-year guidance and cost control - Management noted strong business momentum, particularly from the 14 global brands and additional doses of Spikevax in Japan, contributing to the revenue increase [77] - Cost of goods headwinds were attributed to donor fees and foreign exchange impacts, which affected operating profit [78][79] Question: ENTYVIO market share in Crohn's disease - Management indicated that ENTYVIO remains a strong choice for Crohn's disease treatment, with no expected impact from biosimilars [86] Question: Timing for Phase 1 data disclosure for orexin 861 program - Management stated that timelines for various ongoing activities, including the orexin program, will be shared in the fourth quarter [88] Question: Concerns regarding TAK-003 Dengue vaccine candidate - Management clarified that the delay in guidance for the CHMP advisory decision is due to the complexity of the data submitted, not issues with the data itself [91] Question: SG&A costs and Velcade launch timing - Management confirmed that SG&A expenses have increased due to foreign exchange impacts but are being managed effectively [96] - The expected launch for Velcade is still anticipated in Q4 of fiscal year 2021 [97]