Tokyo saw a further advance in the week ended April 10, when the Nikkei 225 rose 0.7% to close at the 17,400 level, while the Topix Index gained 1.0%. The Nikkei 225 continued an uptrend in mid-week to close temporarily at the 17,500 mark for the first time in six years but weakened on the last trading day due to caution about the recent fast climb of the market and concerns about higher interest rates in the USA. However, the basic tone of the market was firm, supported by continued expectation of a bright economic outlook of Japan. The market's supply and demand situation was favorable since few participants were willing to sell. There was a hope that new funds would flow in from institutional investors with the start of the new business year.
The pharmaceutical index was up 3.3%, outperforming the market. Hisamitsu was the best performer, with a 10.0% gain, as it reported solid results for the fiscal year ended February 2006 thanks to growth of its mainstay prescription-use anti-inflammatory patch Mohrus Tape (containing ketoprofen). Revenue from prescription drugs worth 8.1 billion yen ($68.0 million) transferred from SS Pharmaceutical contributed to the sales growth. Turnover was up 22.9% year-on-year to 102.7 billion yen, exceeding the 100.0 billion yen mark for the first time. Operating income was up a moderate 5.9% to 22.8 billion yen due to a hike in R&D expenses and additional personnel costs incurred with employees moving from SS.
Astellas leapt 5.5%, reflecting the news that it has agreed with US firm Biogen Idec to purchase the worldwide rights of Amevive (alefacet; Marketletter April 10). The drug is a biologic anti-inflammatory compound for the treatment of moderate-to-severe plaque psoriasis and was approved by the US Food and Drug Administration in January 2003. Biogen Idec will continue to manufacture the drug and supply to Astellas, which expects that the in-licensing will help strengthening its North American dermatology franchise. The share performance was also helped by a report in the previous week that the company had concluded a basic licensing agreement for the marketing and joint development in Japan of an oral formulation of the quinolone antibiotic T-3811 (garenoxacin) originated by Toyama. The conclusion is based on the letter of intent in January 2006. Toyama will manufacture the product and supply it to Astellas through Taisho Toyama Pharmaceutical, a joint venture of Taisho and Toyama for marketing prescription drugs.
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