FOCUS-Takeda CEO prescribes surgical R&D cuts after $62 billion Shire deal - (London South East via NewsPoints Desk)

  • Takeda CEO Christophe Weber said the drugmaker will aim to carefully pursue the large spending cuts needed to make the company's $62-billion acquisition of Shire viable without affecting innovation, as reported London South East Thursday.

  • Weber identified smooth planning, peed and a surgical focus on eliminating experimental drugs that fail to provide value as key components of a successful merger.

  • "It's really important that we don't waste resource on assets that are moderately innovative," Weber explained, adding "when you combine two pipelines you can be more stringent."

  • Takeda anticipates cost synergies of at least $1.4 billion three years after completing the deal, including $600 million in R&D savings.

  • "They are cutting quite deep in R&D and it is not clear if the amount of money they are saving is going to be beneficial or harmful," commented John Rountree of consulting firm Novasecta, continuing "merging R&D is never easy. There are going to be lay-offs and that creates uncertainty and disruption and sometimes the best talent just leaves."

  • Takeda estimated that it will reduce the combined workforce of the companies by 6 percent to 7 percent, with one-third of the cuts occurring in R&D.

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