Takeda Pharmaceutical Company Limited
) recently announced that it has mutually terminated its
worldwide agreement with Amylin Pharmaceuticals, Inc., a
wholly-owned subsidiary of Bristol-Myers Squibb (BMY).
Takeda and Amylin had signed an agreement in October 2009 for
the co-development and commercialization of obesity compounds.
However, back in 2011, both companies decided to discontinue the
development of obesity candidate, pramlintide/metreleptin. At
that time, pramlintide/metreleptin had been in a phase II
On a financial basis, the termination of the partnership will
not affect Takeda's business in fiscal 2012. Takeda said that it
will continue to focus on obesity as well other core therapeutic
areas. Obesity is an attractive market that could be worth many
billions of dollars. Moreover, obesity is linked to increased
health risk of several medical conditions. Recently approved
obesity treatments include
) Qnexa and
Meanwhile, we currently have a Neutral recommendation on
Bristol-Myers, which carries a Zacks #3 Rank (Hold) in the short
run. The company is going through a challenging phase given the
genericization of blockbuster blood-thinner Plavix. Bristol-Myers
is looking to combat the generic threat through partnering deals
and acquisitions. Towards fulfilling this objective and
bolstering its position in the lucrative diabetes market,
Bristol-Myers acquired Amylin in August 2012.
We note that the Amylin acquisition is the second major deal
for Bristol-Myers this year. In February 2012, Bristol-Myers had
purchased Inhibitex, Inc., for $2.5 billion targeting the
lucrative hepatitis C virus (HCV) market.
Pharma stocks that currently look attractive include companies
). Both companies carry a Zacks #2 Rank (Buy).
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