Tokyo saw a modest rebound in the week to May 29 following a see saw movement. The Nikkei 225 inched up 0.4% to close at the 15,900 level, while the Topix Index remained flat. Concerns about external factors such as US interest rates and stock markets remained, restraining investors from taking positive actions. High-priced technology issues met selling pressure. Additionally, the high level of long-margin positions has been a worry and the market's sentiment was weak. The market seems to be willing to see new incentives and positive news development on the Japanese economy for buying equities. and specialists recognize that there is an increasing shift of global funds from risky equity investments to bonds.
The pharmaceutical index gained 2.4%, outperforming the market. Kissei gained back the previous week's decline and advanced 10.7% as some investors expect a substantial earnings recovery in the fiscal year ending March 2007, led by Urief (silodosin), a treatment for dysuria launched in Japan in May and under co-marketing with Daiichi Sankyo, and the anti-diabetes drug Glufast (mitiglinide) first marketed in May 2005 under co-marketing with Takeda. The company projects that operating income will expand to 3.3 billion yen ($29.4 million) from 1.9 billion yen (which represented a 66% decline) in the fiscal year ended March 2006. The weakness of the previous year's operating results was caused by a setback of some core products and heavy R&D expenses. Revenues from Cabaser (cabergoline), a treatment for Parkinson's disease, managed to rise 3.3% to 10.3 billion but sales of Xanbon (sodium ozagrel), for cerebral thrombosis, fell 12.3% to 4.9 billion yen due to generic competition.
Kaken rose 2.9%, reacting to its solid operating performance on the growth of its mainstay drug Artz (hyaluronate sodium), a treatment for osteoarthritis. Total sales edged up 0.8% to 77.5 billion yen, operating income increased 5.9% to 8.4 billion yen and net income expanded 13.7% to 3.9 billion yen. Sales of Artz increased 4.0% to 22.6 billion yen. Kaken is engaged in marketing generic products and the combined sales of these drugs leapt 39.5% to 3.6 billion yen.
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