Japan stock market week to March 24, 2008

Tokyo rallied in the week ended March 24 (four trading days because March 20 was a national holiday in Japan). The Nikkei 225 was up 5.9%, recovering the 12,000 line at the close, while the Topix index rose 6.7%. Tokyo's rebound was helped by the strength of New York markets based on the news that the Federal Reserve Bank had lowered its federal funds rate target by 0.75 percentage point. A lull in the surge of the yen against the US dollar also came as a relief. The report eliminated the previous worry that the US credit crisis may broaden with additional failures of financial institutions, following Bear Sterns. The pharmaceutical index ended up 2.7%, underperforming the market.

Eisai rose 8.9%, after it submitted an application in Japan for an oral jelly presentation of the company's mainstay Aricept (donepezil HCl), a treatment for Alzheimer's disease (Marketletter March 24). The new formulation is expected to benefit some elderly AD patients who have difficulties in swallowing oral formulations. This new form is in addition to currently-available tablets, fine granule and oral rapid-disintegrating tablets.

Takeda advanced 3.7% after it reached an agreement with Abbott Laboratories of the USA, to evenly divide the value of TAP Pharmaceutical Products, their 50/50 joint venture between Takeda America Holdings, Takeda's US subsidiary (see page 3). Takeda's move is aimed at restructuring its US operations. Based on the accord, TAP will become a wholly-owned subsidiary of TAH and will be integrated into Takeda Pharmaceuticals North America. Then TPNA will transfer the integrated development function of TAP to Takeda Global Research & Development Center in the USA. Abbott will obtain the rights to Lupron (leuprorelin) for the treatment of prostate cancer. TAP will retain the proton pump inhibitor anti-ulcer drug Prevacid (lansoprazole) and new PPIs, including dexlansoprazole (TAK-390MR) and ilaprazole (Y-81149). TAP will also gain febuxostat (TMX-67) for the treatment of hyperuricemia. Takeda's share performance was also helped by its submission of a New Drug Application in Japan for a fixed-dose combination of the angiotensin receptor blocker anti-hypertensive drug Blopress (candesartan) and the diuretic hydrochlorothiazide for treatment of hypertension. The firm expects that the new drug will better control blood pressure and improve patients' compliance. The move is part of a strategy to promote the lifecycle management of a drug by pursuing the possibility of fixed combinations for the product line. The combination of the anti-diabetes agent Actos (pioglitazone) with a sulfonylurea (glimepiride) and Actos with a biganide (metformin) are already available overseas.