Japanese pharma giant eyes Saudi expansion, new product launches

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The Tokyo-headquartered company has placed its focus on providing products to the Kingdom in areas such as oncology and plasma-derived therapies. (File)
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Rodrigo Rodriguez, Takeda’s general manager for the Middle East.
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Updated 06 May 2021

Japanese pharma giant eyes Saudi expansion, new product launches

  • Takeda plans 5 major launches in Kingdom to gain bigger share of $10bn sector

JEDDAH: Japanese drug-making giant, Takeda Pharmaceutical Co., is eyeing Saudi Arabia as a key Middle East market as it aims to boost global sales by more than 50 percent to 5 trillion yen ($48.01 billion) over the next decade.

The Tokyo-headquartered company has placed its focus on providing products to the Kingdom in areas such as oncology, rare diseases, gastroenterology, and plasma-derived therapies.

Rodrigo Rodriguez, Takeda’s general manager for the Middle East, told Arab News: “From 2021 on, we expect growth in the Kingdom driven by these highly innovative inline products and the launches that we anticipate in key therapeutic areas.”

Over the next two years, the research-based firm plans to launch five new products in Saudi Arabia: Adynovate for the blood-clotting disorder hemophilia; Firazyr for acute attacks of hereditary angioedema (HAE), an allergic reaction resulting in skin swelling; HyQvia, which helps boost the immune system; and two other drugs for the treatment of rare and serious types of cancer.

Last year, Takeda launched two new products in the Kingdom, namely Takhzyro for HAE, and Cuvitru for the immune system.

“We believe we have a compelling portfolio with a high level of innovation in order to help patients in the Kingdom to improve their lives,” Rodriguez said.

He pointed out that while the coronavirus disease (COVID-19) pandemic had impacted every sector in the country, the main challenge was to ensure products got to clients and a continuity of supply was maintained.

“Considering the nature of our portfolio, we have potential lifesaving treatments which are highly innovative products. We believe that we were able to mitigate potential fluctuations and deviations in terms of supply and the overall results around the globe and in Saudi Arabia.

“Because of the nature of our products, we really believe that our key focus should be ensuring supply to patients in order to avoid any disruption in the treatment,” he added.

Despite the pandemic, the Saudi pharmaceutical market was expected to see continued growth over the coming years. According to a recent report by Coherent Market Insights, the market was last year estimated to be worth $10.191 billion and is predicted to have shown a compound annual growth rate of 7.3 percent by 2027. Saudi government reforms and increased healthcare expenditure were also forecast to aid market growth.

Coherent Market Insights said government data showed that healthcare and social development spending reached $45.9 billion in 2019. “Saudi Arabia is a core market for Takeda, and a positive outlook is anticipated by us and by analysts. The Kingdom is the largest pharmaceutical market in the Middle East, and we are happily expanding,” Rodriguez said.

And he had similar hopes for the other Gulf Cooperation Council (GCC) countries and the wider region. “At the same time, we are also introducing new products in the GCC region that will accelerate our offer to patients impacted by rare and complex diseases regionally,” he added.

Takeda, which has a presence in Jeddah and Riyadh, was last year named best employer in the Middle East for the second consecutive year and also received the Top Employers Institute’s prestigious Global Top Employer status for the fourth year in a row.

In July 2017, the Saudi Food and Drugs Authority mandated the private sector to boost the employment of Saudi nationals, as part of its Saudization program.

Rodriguez said: “Saudization is a priority for us, and we are exceeding the government’s requirements. The required number for customer-facing teams was 80 percent by December 2020, and we are currently at 84 percent. By June, we are expecting a 100 percent Saudization as per the guidance.”

He noted Takeda’s proud record of hiring female employees. “At the beginning of 2020, we more than doubled the number of females in our organization.”


Indian shares close at record highs as pandemic curbs ease, cases fall

Updated 15 June 2021

Indian shares close at record highs as pandemic curbs ease, cases fall

  • Many Indian states eased coronavirus restrictions on Monday, including the national capital New Delhi, where authorities allowed shops and malls to open as the number of new cases dropped to the lowest in more than two months

BENGALURU: ndian shares ended at record highs on Tuesday, as declining COVID-19 infections prompted many states to re-open businesses, with a rally in broader markets also helping the sentiment.
The blue-chip NSE Nifty 50 index rose 0.36 percent to 15,869.25 and the benchmark S&P BSE Sensex climbed 0.42 percent to 52,773.05 at close.
Many Indian states eased coronavirus restrictions on Monday, including the national capital New Delhi, where authorities allowed shops and malls to open as the number of new cases dropped to the lowest in more than two months.
India on Tuesday reported 60,471 new infections, the lowest since March 31.
The sentiment also tracked global stocks that hit a record high, as investors bet likely “transitory” inflation pressures will restrain the US Federal Reserve from signalling a shift in policy settings.
Many investors expect the Fed to maintain its dovish stance at its two-day meeting starting on Tuesday. Some board members, however, have said the central bank should start discussing tapering its bond buying.
In Mumbai trading, financial stocks provided a boost to the Nifty 50, with ICICI Bank and HDFC Bank ending 1.6 percent and 0.7 percent higher, respectively.
The Nifty Bank Index and the Nifty Private Bank Index, which have so far gained more than 0.55 percent this week, were among the top performers across sub-indexes rising between 0.85 percent and 1.07 percent.
Software services firm Infosys rose 0.8 percent, lifting the Nifty IT index by 0.23 percent.
Shares of Future Retail closed 10 percent higher, after staying at those levels since early trade.


Emirates reports $5.5bn loss as group headcount falls by 33,000

Updated 15 June 2021

Emirates reports $5.5bn loss as group headcount falls by 33,000

  • Emirates Group revenues fell some 66 percent to $9.7 billion over the year

DUBAI: Emirates reported a full-year loss of $5.5 billion, the first time it has fallen into the red in more than 30 years.
The results highlight the devastating impact of the pandemic on the carrier that has helped Dubai become one of the world’s most important international aviation hubs.

Overall employee numbers for the wider Emirates Group, which includes dnata, fell by more than 33,000 over the year as its headcount fell 31 percent to about 75,000. It carried 6.6 million passengers over the year, down 88 percent on a year earlier.

“No one knows when the pandemic will be over, but we know recovery will be patchy,” said Sheikh Ahmed bin Saeed Al-Maktoum, the chairman and CEO of Emirates Airline and Group. “Economies and companies that entered pandemic times in a strong position, will be better placed to bounce back.”
While the pandemic has had a brutal impact on airlines worldwide, the crisis has impacted carriers and airports differently, depending on their route and passenger profiles. Because Emirates relies heavily on international travel without a domestic network, it has not benefited from the bounce back in domestic airline travel in other parts of the world, such as the US and China.
“It is not surprising that Emirates has reported a substantial loss and as with all airlines recovery will take an extended time,” aviation consultant John Strickland told Arab News. “However short term it has been able to benefit from the cargo capabilities of its 777-300ER’s. It is already evaluating options for the future shape of its fleet and network as new aircraft types enter its fleet and will extend the close partnership with flydubai which also increases its flexibility for network development options.”
Emirates Group revenues fell some 66 percent to $9.7 billion over the year. The company said it had received a capital injection of 11.3 billion dirhams ($3.1 billion) from its ultimate shareholder, the government of Dubai. Its dnata unit, which includes ground handling, travel services and catering, also received 800 million dirhams in relief, it said.
Emirates has cut costs across the group by renegotiating contracts and restructuring financial obligations which resulted in estimated savings of 7.7 billion dirhams for the year, it said.
Sheikh Ahmed said the airline aimed to recover its full operating capacity as quickly as possible.
“Together with Dubai’s undiminished ambitions to grow economic activity and build a city for the future, I am confident that Emirates and dnata will recover and be stronger than before,” he said.
Emirates’ total passenger and cargo capacity declined by 58 percent. It received three new A380 aircraft during the financial year and phased out 14 older aircraft comprising of 9 Boeing 777-300ERs and 5 A380s, leaving its total fleet count at 259 at the end of March.
Its order book for 200 aircraft remains unchanged.

 

 


After 17 years, truce nears in US-Europe jet subsidy war

Updated 15 June 2021

After 17 years, truce nears in US-Europe jet subsidy war

  • A deal to pause the world’s largest corporate trade dispute would help US planemaker Boeing and Europe’s Airbus , while granting relief to dozens of other industries affected by tit-for-tat tariffs that were suspended in March

PARIS: The United States and Europe are expected to announce a five-year suspension of tariffs in their 17-year-old dispute over aircraft subsidies on Tuesday, allowing them to focus on the threat posed by China’s nascent commercial aircraft industry, people familiar with the matter said.
A deal to pause the world’s largest corporate trade dispute would help US planemaker Boeing and Europe’s Airbus , while granting relief to dozens of other industries affected by tit-for-tat tariffs that were suspended in March. They face a renewed trade war within weeks if there is no progress.
US Trade Representative Katherine Tai discussed the dispute in her first face-to-face meeting with EU counterpart Valdis Dombrovskis on Monday ahead of Tuesday’s US-EU summit, where China will also be a key topic. Tai travels to Britain on Wednesday.
The European Commission, which oversees EU trade policy, and the United States had vowed to find a solution by July 11 when the currently suspended transatlantic tariffs are due to resume.
Officials had targeted a permanent solution through a pair of treaties — one between the United States and European Union, the original parties, and another between Washington and London following Britain’s exit from the EU — on new ground rules for aerospace.
But reaching a detailed accord has proven complex, given nearly two decades of legal wrangling and thousands of pages of documents, said one source briefed on the talks.
A standstill agreement would push back the resumption of tariffs by years at a time when US President Joe Biden has vowed to reset relations with European partners after four tumultuous years under former President Donald Trump.
Freezing the conflict over jet subsides, some of which have been rescinded or wound down, would give both sides more time to focus on broader agendas such as concerns over China’s state-driven economic model, several of the sources said.
The tariffs on $11.5 billion of goods were progressively imposed from 2019 after the United States and EU both won partial victories at the World Trade Organization over claims of unfair aid for Boeing and Airbus.
The dispute has dragged on since 2004 when the United States withdrew from a 1992 aircraft subsidy pact and took the EU to the WTO, claiming Airbus had managed to equal Boeing’s share of the jet market thanks in part to subsidized government loans.
The EU counter-sued over what it termed unfair R&D support and subsidized tax incentives for Boeing.
In recent months, top European, British and US officials have engaged in intense discussions to settle the dispute and focus on other challenges, including China.
Tai told Reuters in May she was optimistic about reaching a deal with Brussels, adding that the two sides needed to look at “the bigger question” of China’s ambitions to become a global player in the commercial aircraft industry.
The US has floated a joint review of aerospace funding in non-market economies like China, two of the people said.
One of the sources said the two sides had agreed to increase information-sharing, but gave no further details.
“There’s no question that the rise of China’s aircraft industry is ... on everybody’s proverbial radar,” US Chamber of Commerce Senior Vice President Marjorie Chorlins told reporters on Monday, noting what she described as China’s “heavy subsidization” of its industries.
She said settling the dispute would provide “a tremendous boost of goodwill” for broader US-European ties.
Brussels and Washington remain at odds over steel and aluminum tariffs, but are expected at Tuesday’s summit to set a Dec. 1 deadline to end punitive tariffs related to the dispute, according to a draft communique seen by Reuters.
Like the United States, the EU has sparred with Beijing on trade and security this year. But its 27 nations could struggle to agree a common front on topics like aerospace.
In April, for example, Hungary blocked an EU statement criticizing China’s new Hong Kong security law, sparking a row over the right of member states to veto EU foreign policy.
The Chinese embassy in Washington had no immediate comment.
None of the parties agreed to comment on the talks.
In a potentially key breakthrough, the United States had watered down opposition to the principle of future public loans for Airbus and removed its demand for compensation.
But its insistence on advance notice of any future public loans had triggered concerns among EU officials, who rejected giving Washington any veto power, people familiar with the talks said.
Even more critical is the benchmark to be used when deciding whether the interest on any future loans is market-compatible.
Under the 1992 subsidy pact, one third of a project could be financed by direct government support such as loans and cleared indirect R&D support up to 4 percent of a company’s revenue.
One option is to revisit that framework with market rules replacing subsidy quotas and a new cap on indirect R&D support.
Brexit has also complicated negotiations.
Britain and the United States came close to striking an aerospace agreement in December that could have forced the hand of Brussels in its own talks with Washington.
Britain’s ability to negotiate trade deals independently of the EU is central to its new “global Britain” stance. But its flexibility on Airbus is cramped by its role as one of four core nations involved in the planemaker, pre-dating its EU accession.
Airbus, which has 14,000 staff in Britain, has made plain work could shift abroad if the UK turns its back on aerospace.


Oil rises as threat recedes of Iran supply resuming soon

Updated 15 June 2021

Oil rises as threat recedes of Iran supply resuming soon

  • Indirect discussions between the US and Iran resumed on Saturday in Vienna and were described as “intense” by the EU

TOKYO: Oil prices rose on Tuesday, with Brent gaining for a fourth consecutive session, as the prospect of extra supply coming to the market soon from Iran faded with talks dragging on over the United States rejoining a nuclear agreement with Tehran.
Brent crude was up by 17 cents, or 0.2 percent, at $73.03 a barrel by 0347 GMT, having risen 0.2 percent on Monday. US oil gained 15 cents, or 0.2 percent, to $71.03 a barrel, having slipped 3 cents in the previous session.
Indirect discussions between the United States and Iran, along with other parties to the 2015 deal on Tehran’s nuclear program, resumed on Saturday in Vienna and were described as “intense” by the European Union.
A US return to the deal would pave the way for the lifting of sanctions on Iran that would allow the OPEC member to resume exports of crude.
It is “looking increasingly unlikely that we will see the US rejoin the Iranian nuclear deal before the Iranian presidential elections later this week,” ING Economics said in a note.
Other members of the Organization of Petroleum Exporting Countries (OPEC) along with major producers including Russia — a group known as OPEC+ — have been withholding output to support prices amid the pandemic.
“Additional supply from OPEC+ will be needed over the second half of this year, with demand expected to continue its recovery,” ING said.
Still, prices were off their highs earlier in the day with US crude briefly tripping into negative territory.
“Daily technical indicators are currently pointing to crude oil in overbought territory and a pullback may be due,” said Avtar Sandu, senior manager commodities at Phillip Futures.
Investors and traders are also watching the outcome of the US Federal Reserve meeting that starts later on Tuesday for signals on when it will scale back monetary stimulus, he said.
The Fed is getting ready to starting debating how and when to start tapering a massive asset-purchase program that helped helped support the US economy during the pandemic.


DAMAC delisting plan piles pressure on shrinking Dubai market

Updated 15 June 2021

DAMAC delisting plan piles pressure on shrinking Dubai market

  • While the value of traded stocks in Dubai was once higher than rival Abu Dhabi, this changed in 2019 and ADX now has a more than four times higher average daily traded value

DUBAI: Dubai’s stock market is set for another delisting, raising a question mark over the future of one of the Gulf’s major exchanges, which was launched two decades ago.
A $595 million bid to take DAMAC Properties private by the firm’s founder Hussain Sajwani is the latest blow to the exchange, even as the Gulf city state’s property market showed signs of life in the first quarter.
“It is not that Dubai is becoming less attractive. Alternatives are becoming more attractive,” Khaled Abdel Majeed, founder at London-based Mena Capital LLP, told Reuters.
Majeed said Dubai needs to work harder to attract listings amid growing competition from within the Gulf region such as Abu Dhabi and Saudi Arabia where Tadawul, the region’s biggest exchange based on market value, wants to become a regional hub.
While the value of traded stocks in Dubai was once higher than rival Abu Dhabi, this changed in 2019 and ADX now has a more than four times higher average daily traded value.
ADX has also seen gains after its owner, ADQ, launched a market maker last year that tapped into a fund to boost liquidity on the bourse.
“It’s disappointing from a market point of view that you have companies de-listing ... at a time when we think the market needs added depth, more companies, which has not been happening since 2014-2015,” Mohammed Ali Yasin, chief strategy officer at Al Dhabi Capital in Abu Dhabi, said of the Dubai stock market.
Since the start of 2020, two prominent Dubai companies have de-listed from the Dubai Financial Market (DFM) and Nasdaq Dubai: Dubai parks operator DXB Entertainments and Dubai ports operator DP World.
And shares in Arabtec, once a high-flying Dubai construction company, were suspended in September after its shareholders voted to dissolve company.
Emaar Malls, operator and owner of the world’s largest shopping center, in March said it planned to offer to buy out minority shareholders and merge with Emaar Properties.
And Dubai real estate fund Emirates REIT, which is listed on the Nasdaq Dubai exchange, said in July it was considering de-listing.
Where Abu Dhabi is boosting liquidity through planned new listings and consolidation of assets of state holding company ADQ, Dubai appears to have become more tolerant of delistings, a Gulf M&A banker told Reuters.
Analysts say the move to de-list spares companies having to face scrutiny from investors, along with the running costs of a listing and disclosure and transparency requirements.
“If someone wants to take (their company) private; this is the time,” the M&A banker said.
Asked what steps, if any, it was taking to ensure that listed companies remained on the exchange and that it attracted new listings, the DFM declined to comment
The problem for listed Dubai real estate companies is that they are trading at a discount to the average price to earnings of the wider market, at around 8 times earnings, while the market is trading at around 20 times that.
“For DAMAC, I’m sure that the strategic investor, Hussain Sajwani, understands that the intrinsic value of the company is higher than the share price, Tariq Qaqish, chief executive of Salt Fund Placement in Dubai, said.
The two years leading to the COVID-19 pandemic exposed the vulnerabilities of Dubai’s homebuilders and property companies, said Samer Haydar, director of corporate ratings at Fitch.
And despite signs of recovery, many are “still facing the aftermath of the pandemic in terms of negative working capital, rising leverage, weak liquidity and overall un-absorbed supply in the market,” Haydar said.