Takeda sells dry eye drug to Novartis to help cut debt

TOKYO (Reuters) – Takeda Pharmaceutical Co Ltd agreed to sell its dry eye drug to Swiss drugmaker Novartis AG for $3.4 billion and potential milestone payments of up to $1.9 billion, in the first divestment since its takeover of Britain’s Shire.

Japan’s biggest drugmaker aims to dispose of $10 billion worth of assets to cut debt taken on for the huge Shire acquisition sealed in January, which catapulted it into the world’s top 10 drugmakers by sales but also made it one of the most indebted.

The sale of Shire’s Xiidra dry eye treatment is likely to close in the second half of 2019, Takeda and Novartis said in a statement.

Xiidra, approved to treat signs and symptoms of dry eye in the United States, Canada and Australia, would bolster Novartis’ front-of-the-eye portfolio, the Swiss drugmaker said.

Dry eye occurs when tears fail to provide adequate lubrication, and if left untreated, can become extremely painful, leading to permanent damage to the cornea and vision. It affects an estimated 34 million people in the United States, Novartis’ statement showed.

Novartis said it would take on about 400 employees associated with Xiidra, which earned about $400 million of revenue in 2018.

Takeda also said it is selling TachoSil, a surgical patch for bleeding control, to Ethicon for about $400 million.

Takeda’s shares rose as much as 3.3 percent in early trading on Thursday.