Japanese pharma giant Takeda Pharmaceuticals is said to be planning to bid for London’s leading drug company Shire Pharmaceuticals (Nasdaq: SHPG). The news sent Shire’s stock soaring more than 25% during the morning session in the U.K. market and it surged 18% in the U.S. market.
Shire, which has a market value of around $46.4 billion, focuses on rare disease treatments and hyperactivity medicines. Two months ago, the U.K. drugmaker announced plans to split its business into two divisions.
Shire has been struggling with stiff generic drug competition as well as heavy debt since its acquisition of Baxalta two years ago and has seen its shares drop over 20%. Takeda said the deal would bring opportunities for expansion in rare diseases therapy as well as the areas of neuroscience, oncology and gastrointestinal.
Takeda also sees an opportunity to gain market share in the United States through this deal. Takeda said it has not formally notified Shire of its intentions as the Japanese company is still mulling the various aspects of the deal. There is also no guarantee that a bid or deal will be made.
Takeda has plans to expand its footprint globally and it is looking for more deals and partnerships that will help it move towards this goal. The company wants to find new partners in the area of research and it is also striving to move its products through the pipeline to more advanced stages of development.
Two months ago, the U.K. drugmaker announced plans to split its business into two divisions.
The bid on Shire by Takeda is likely to attract other pharma giants like Pfizer (PFE) or Novartis (NVS) into the bidding arena. The healthcare industry is seeing a number of transactions like GlaxoSmithKline’s (GSK) purchase of Novartis’ stake in their JV and the ongoing bid for Pfizer’s consumer healthcare business.