Japan stock market week to April 7, 2008

Tokyo extended its rally in the week ended April 7. The Nikkei 225 ended up 7.4%, recovering the 13,450 mark, the highest close since the end of February, while the Topix index advanced 7.6%. The rally was caused by the recess in the surge of the yen against the US dollar as well as investor perception that the worst of the global financial crisis triggered by America could be over due to rescue measures led by the US Federal Reserve Bank for the troubled investment house Bear Sterns. The Bank of Japan's "Tankan" quarterly business sentiment survey was no surprise because the reported diffusion index of plus 11 was in line with the forecast. The pharmaceutical index rose 8.4%, outperforming the market.

Takeda climbed 11.4% after it reported new data from a clinical study using intravascular ultrasound technology which found that Actos (pioglitazone HCI) reduced the atherosclerotic burden in the coronary arteries of type 2 diabetes patients compared to glimepiride and prevented progression compared with baseline (Marketletter April 7). The data were derived from the PERISCOPE trial and were presented at the Annual Scientific Session of the American College of Cardiology. The share performance overcome the negative news that it has discontinued development of TAK-475 (lapaquistat acetate) for the treatment of hypercholesterolemia, also reported last week. In October 2007, the US Food and Drug Administration requested additional clinical data prior to the submission of a New Drug Application for the drug, recommending the suspension of trials with higher doses. Takeda's decision this time is based on the deliberation that the drug's profile is not superior to existing compounds, following review of data from Phase II clinical study results in Japan and discussions with the regulatory authorities. The company is set to realize the earliest possible launch of core new drugs on file in the USA, including the antidiabetic SYR-322 (alogliptin) and the antiulcerant TAK-390MR (dexlansoprazole).

Daiichi Sankyo rose 6.3%, reacting to its unveiling, jointly with Eli Lilly, study results which showed that their antiplatelet drug prasugrel plus aspirin demonstrated statistically-significant reduction in the risk of coronary stent thrombosis in patients who received a stent as compared to clopidogrel (Sanofi-Aventis' Plavix) and aspirin (Marketletter April 7). The reduction was observed as early as three days and out to 450 days. The finding came from a stent analysis of the TRITON-TIMI 38 trial which compared prasugrel with clopidogrel. The overall results of the trial, which had been previously published, were presented at the meeting of the American College of Cardiology's Innovation in Intervention.