Asahi Kasei makes $1.1bn bid to buy Calliditas

Asahi Kasei has offered to buy Sweden’s Calliditas Therapeutics for SEK 11.8 billion ($1.1 billion) as part of a plan to expand internationally in healthcare.

The Japanese group’s tender offer is a premium of around 83% on Calliditas’ closing share price yesterday and has been recommended by the biotech’s board, which says a takeover would enhance its ability to develop and commercialise its products.

Calliditas specialises in developing drugs for rare diseases and has one product on the market – corticosteroid-based Tarpeyo (budesonide) for IgA nephropathy (IgAN), which is also sold as Nefecon in China and Kinpeygo in Europe – and a pipeline headed by dual NADPH oxidase (NOX4/1) inhibitor setanaxib.

The Swedish company is projecting sales of Tarpeyo will reach around $150 million this year, but Asahi Kasei’s interest will also likely be driven by the potential of setanaxib, which has been described as a “pipeline-in-a-product” and has the potential to be first-in-class.

The drug is being developed for a range of fibrotic rare diseases and solid tumours, with three phase 2 readouts expected this year in primary biliary cholangitis (PBC), idiopathic pulmonary fibrosis (IPF), and squamous cell carcinoma of the head and neck (SCCHN).

Asahi Kasei is a diversified industrial group – with fingers in a lot of pies, including chemicals, construction, and energy – but in recent years has made expansion in the pharma and medical device sectors a priority; for example, buying critical care products developer Zoll in 2012 and transplant care specialist Veloxis in 2020. Last year, healthcare accounted for 20% of net sales and around a third of operating profit.

The company said in a statement that buying Calliditas ties in with its strategy to “expand its businesses globally through specialising in the areas of immunology, transplantation, and adjacent diseases.”

Tarpeyo fits squarely into its current areas of expertise in health and has potential as the only fully approved product shown to reduce the loss of kidney function in adults with primary IgAN who are at risk for disease progression, it added. Calliditas was recently awarded seven years of market exclusivity for the drug, giving it protection from generic competition until 2030.

Other benefits of the takeover will include a stronger presence in the US market through expanded in-house sales in the renal and autoimmune disease categories. It will also give it a presence in Europe – initially in R&D – and contribute to the company’s plan to build a global specialty pharma business.