Shinichiro Muraoka

Shinichiro Muraoka inquired about Takeda's financial outlook for the next fiscal year, including new product contributions, marketing expenses, Vyvanse impact, and dividend policy. Muraoka also asked for an update on Zasocitinib's UC/CD phase 2 outcomes, dosing, and psoriasis safety data.

Answer

CFO Milano Furuta stated that the next fiscal year's budget is being finalized, noting that growth and launch products are maturing but the gap with LOE is shrinking. He confirmed continued cost-saving efforts but highlighted increased launch costs for three new products and rising R&D expenses due to new assets. Furuta reiterated the progressive dividend policy. President of R&D Andrew Plump confirmed UC and Crohn's disease phase 2b data for zasocitinib will be available this year, with higher doses being studied for IBD. He added that the psoriasis safety profile is consistent with previous phase 2 data.

Shinichiro Muraoka (Morgan Stanley) inquired about Takeda's financial outlook for the next fiscal year, specifically regarding new product contributions, marketing expenses, the tapering impact of Vyvanse, profit expectations, and the company's dividend policy. He also asked for an update on zasocitinib's UC/CD phase II outcome timing, specific dosing used in UC phase II, and details on the psoriasis safety data.

Answer

Milano Furuta (CFO) stated that official guidance would be provided in May, but noted the shrinking gap between growth products and LOE impact. He highlighted ongoing cost-saving efforts, acknowledged increased launch costs for three new products, and anticipated higher R&D expenses due to the Innovent partnership. Furuta reaffirmed Takeda's progressive dividend policy, considering core EPS, reported EPS, cash flow, and debt reduction. Andrew Plump (President, R&D) confirmed UC and Crohn's disease phase II-B data for zasocitinib would be available this year, with dose-ranging studies where the 30mg psoriasis dose is the low end for IBD. He added that the psoriasis safety profile is consistent with phase II data and will be presented at an upcoming medical conference.

Shinichiro Muraoka from Morgan Stanley asked about the sustainability of the 100-250 bps OP margin improvement target into the next fiscal year and the potential for a dividend increase. He also sought an update on the timing of Entyvio biosimilar entry.

Answer

Executive Milano Furuta affirmed the policy is to improve core OP margin and that the dividend is not at risk of being reduced. CEO Christophe Weber reiterated that the U.S. biosimilar entry for Entyvio is still anticipated between 2030 and 2032, based on the strength of patents expiring in 2032.

Shinichiro Muraoka from Morgan Stanley questioned Takeda's confidence in achieving the ambitious 16% full-year growth target for ENTYVIO, asking for evidence of its expected acceleration. He also asked if proof-of-concept data for mezagitamab in IgAN would be presented at the upcoming R&D Day.

Answer

Julie Kim, President, U.S. Business Unit, affirmed confidence in ENTYVIO's growth, citing the U.S. Pen launch for both UC and Crohn's disease, expanding patient access, and expected lower EU clawbacks. Andrew Plump, President of R&D, confirmed that mezagitamab will be a key focus at the R&D Day and that the company intends to disclose IgAN data at a fall medical conference, making it available for the event, pending competitive considerations.

Shinichiro Muraoka from Morgan Stanley asked about Takeda's confidence in achieving the 16% full-year growth target for ENTYVIO given its Q1 performance, and whether proof-of-concept data for mezagitamab in IgAN would be presented at the upcoming R&D Day.

Answer

Executive Julie Kim affirmed confidence in ENTYVIO's growth, citing the accelerating U.S. Pen launch, improved patient access, and lower expected EU clawbacks. R&D President Andy Plump indicated that they intend to disclose the mezagitamab IgAN data at a fall medical conference and share it at the December R&D Day, while remaining mindful of the competitive landscape.

Shinichiro Muraoka from Morgan Stanley asked about the soft Q1 sales for key products including Entyvio, IG, Vyvanse, and QDenga, and questioned if a recovery was expected. He also sought details on the clinical advantages of the next-generation orexin agonist.

Answer

President and CEO Christophe Weber stated that the soft Q1 does not reflect underlying product dynamics and reaffirmed full-year guidance. He attributed the weakness to temporary factors like market access for the Entyvio Pen, a high year-over-year comparator for Vyvanse, and supply/shipment timing for IG and QDenga. R&D President Andrew Plump explained the broader orexin franchise strategy aims to address a spectrum of diseases, with new molecules possessing differentiated pharmacology for more common disorders.

Asked for an updated outlook on the next fiscal year (FY2024) following previous comments that it would be a 'tough year', and inquired about the clinical development pathway for TAK-279 in IBD (UC and CD) after the Phase IIb studies.

Answer

The outlook for FY2024 remains a 'tight' or 'flattish' year, as the first half will still be impacted by the VYVANSE generic entry, while the second half will have a more stable comparison base. For TAK-279 in IBD, the next step after successful Phase IIb trials is to conduct Phase III studies for both UC and CD; acceleration will come from execution excellence rather than skipping steps, with potential approvals by the end of the decade.

Shinichiro Muraoka of Morgan Stanley asked for justification of the large SG&A increase relative to the China sales forecast for Xocova and questioned the rationale behind suspending certain R&D programs, asking if it was due to prioritization or other factors.

Answer

Masako Kudou, VP of Finance and Accounting, explained that the SG&A budget is tied to achieving profit targets in China and would decrease if the approval is delayed. She also clarified that R&D program suspensions were a result of strategic prioritization to manage the JPY 100 billion R&D budget effectively, given the high cost of late-stage global trials.