TOKYO (Reuters) – Takeda Pharmaceutical Co Ltd ( 4502.T ) 's offer to London-listed specialist for rare diseases Shire Plc ( SHP.L ) is 64 Billions of dollars of Japan's most outward-looking drug company, a template-breaking image that has been in production for more than a decade.
Under the Managing Director Christophe Weber and his predecessor Yasuchika Hasegawa, Takeda has reduced her involvement in Japan, brought overseas acquisitions expertise and opened her leadership positions to foreign talent.
Some investors fear that Takeda could overflow cash for the Shire deal with just $ 4.3 billion.
The company's shares fell more than 7 percent on Wednesday after Shire said it was ready to recommend the offer to shareholders, and have dropped 18 percent since news of Takeda's interest in a deal ended March was published.
But few argue that Takeda's management is not ready to become global.
Already today, only 30 percent of drug sales come from Japan, and 70 percent of the workforce work overseas. The Shire deal would radically accelerate this shift and add more than $ 9 billion in revenue.
"Takeda was, is and remains the truly international pharmaceutical company of Japanese descent," said Philippe Auvaro, Tokyo president of Orphan Pacific Inc and a friend of Weber.
To get there, the company transformed its corporate culture by deflecting a revolt against Hasegawa, which focused on overseas business as a future.
Takeda declined to provide Weber or Hasegawa for this story. Shire declined to comment.
Hasegawa was the architect of Takeda's layer. He took over the company from Kunio Takeda, the last member of the founding family, to lead the 237-year-old pharmaceutical company.
Hasegawa was determined to look for growth and leadership. His philosophy drove the company to the continent when it acquired US biotechnology company Millennium Pharmaceuticals in 2008 and Swiss pharmaceutical manufacturer Nycomed in 2011.
His quest for foreigners to fill Takeda & # 39; s leadership positions cut against the Japanese insularity.
The surprising decision to appoint Weber, then the company's chief operating officer, as his successor led to an outright revolt among some of Takeda's old guards.
In 2014, more than 100 former executives and investors signed an appeal that described Weber's appointment as "abduction by so-called foreign capital … which should never be allowed."
But Hasegawa was undeterred. Acquisitions are essential if the pharmaceutical company wants to rebuild its pipeline, as drugs would no longer have patent protection, he told the shareholders. Weber is the best choice to bring Takeda new products, he said.
In the end, Weber's appointment passed with more than 90 percent of the vote at the Annual General Meeting.
At first glance, the meek Weber does not seem to be the most likely choice to orchestrate the largest overseas acquisition in Japanese history.
But those who have worked with him praise his ability to convince others of the need for radical change, making him ideal for a company looking to expand globally.
Peter Feldinger, who worked for Nycomed and Takeda before becoming a consultant, said the merger of the two companies had stalled until Weber took over responsibility.
"It was difficult to adopt an old, conservative Japanese organization" and to understand that the world has changed, he said.
Weber grew up in the alpine town of Annecy, the son of two physicians, and spent two decades with GlaxoSmithKline ( GSK.L ), including head of the vaccination center.
In 2015, he assumed the position of Chief Executive after joining Takeda a year earlier as Chief Operating Officer.
Hasegawa remained as chairman and used his position to act as a "shield" while Weber enforced unpopular steps, said Tosh Nagate, formerly at Takeda and today managing director of e-Projection, a company helping foreign pharmaceutical companies expand Japan. Hasegawa entered into a consultancy role last year.
One of the toughest decisions was the reduction in the number of research and development areas. The company has also withdrawn at two key locations: Boston and Shonan, southwest of Tokyo.
Takeda's commitment to the Japanese market has continued to decline. The US now accounts for 35 percent of drug sales, but Takeda has promised to retain its headquarters in Japan.
Weber was also active in halting cross-border business. He announced the purchase of US cancer drug maker Ariad Pharmaceuticals Inc last year and biotech biotech group TiGenix NV in January to renew the drug pipeline.
While the question arises as to whether Takeda has overpaid for its earlier acquisitions, the drugs on the market are producing stronger, more recent results. [nL4N1PR2AM]
The acquisition of Shire would change Takeda's position in rare diseases, gastrointestinal disorders, and neuroscience, where Shire is a leader in ADHD medications.
At the moment, many of his colleagues continue to be heavily affected by Japan, although a shrinking population and annual drug price changes have encouraged them to rethink their own expansion plans.
Ono Pharmaceutical Co Ltd ( 4528.T ), co-developing the blockbuster cancer drug Opdivo with Bristol-Myers Squibb Co ( BMY.N ), said recently, this is the case in the US to build its own distribution network and to consider acquisitions.
Eisai Co Ltd ( 4523.T ) prefers a different approach. Last month, the company signed a collaboration agreement with Merck & Co Inc ( MRK.N ) to develop and sell its cancer drug Lenvima, both alone and in combination with Merck's immunotherapy product Keytruda. [nL2N1QP262]
Weber will be under pressure to prove that his strategy is the right one – especially as one of the highest-paid executives in Japan. His annual pay is more than 1 billion yen.
"Highly paid and saying that he will continue until 2025, it is possible that he will have to do something big for his reputation as CEO," said UBS analyst Atsushi Seki.
To make matters worse, Chief Financial Officer Costa Sarouko, who oversaw the finances of Takeda's companies in Europe and Canada, just started this month with his new role.
Takeda's former CFO James Kehoe abruptly dropped in March, pointing to Japan's high tax rates and desire to return to the US
Sam Nussey's report, additional coverage by Ritsuko Shimizu; Arrangement of Gerry Doyle