Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Equity Capital Markets

<ul>
<li>Today after the close, one of the very large brokers in Japan (N_m_r_) has a block for sale of <a href="https://www.smartkarma.com/entities/otsuka-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:12292:1" rel="noopener">Otsuka Holdings (4578 JP)</a>. </li>
<li>It is only 2.4% of total shares out, and as such, it looks small. But it isn't that small. The shareholder structure is crowded with non-Real World Float holders.</li>
<li>The discount offered is large compared to absolute and sector-relative volatility. </li>
</ul>


Today after the close, one of the very large brokers in Japan (N_m_r_) has a block for sale of Otsuka Holdings (4578 JP). 
It is only 2.4% of total shares out, and as such, it looks small. But it isn't that small. The shareholder structure is crowded with non-Real World Float holders.
The discount offered is large compared to absolute and sector-relative volatility. 


Otsuka Holdings - Family Co Selldown for ¥56bn - Take It Vs Peers

APAC IPOs & Placements, Aequitas Research

Clarence Chu

APAC IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

<ul>
<li>Otsuka Estate is looking to raise US$389m via trimming its stake in <a href="https://www.smartkarma.com/entities/otsuka-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:12292:1" rel="noopener">Otsuka Holdings (4578 JP)</a>.</li>
<li>The deal is a relatively large one on an ADV basis, at 14.6 days of three month ADV. </li>
<li>In this note, we will talk about the firm’s track record and run the deal through our ECM framework.</li>
</ul>


Otsuka Estate is looking to raise US$389m via trimming its stake in Otsuka Holdings (4578 JP).
The deal is a relatively large one on an ADV basis, at 14.6 days of three month ADV. 
In this note, we will talk about the firm’s track record and run the deal through our ECM framework.


Otsuka Holdings Placement - While Enticing Discount, Management Selling Will Raise Eyebrows

Global Healthcare Analyst

Tina Banerjee

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/chugai-pharmaceutical-co-ltd" target="_blank" data-smartkarma-citation="entities:4489:1" rel="noopener">Chugai Pharmaceutical (4519 JP)</a> recorded double and triple-digit revenue growth from Hemlibra in domestic and export markets, respectively during 9M2022. Growth momentum is expected to continue.</li>
<li>Both Actembra and Ronapreve have limited revenue potential from COVID-related indications. Ronapreve reported revenue of ¥60.8 billion in 1Q22 in domestic market, with no reported revenue in two subsequent quarters.</li>
<li>Actemra will face biosimilar competition. This month China has approved first Actembra biosimilar, while a couple of others are under review of the FDA.  </li>
</ul>



Chugai Pharmaceutical (4519 JP) recorded double and triple-digit revenue growth from Hemlibra in domestic and export markets, respectively during 9M2022. Growth momentum is expected to continue.
Both Actembra and Ronapreve have limited revenue potential from COVID-related indications. Ronapreve reported revenue of ¥60.8 billion in 1Q22 in domestic market, with no reported revenue in two subsequent quarters.
Actemra will face biosimilar competition. This month China has approved first Actembra biosimilar, while a couple of others are under review of the FDA.  


Chugai Pharmaceutical (4519 JP): Hemlibra Is the Only Saviour; Competition Bites Mainstay Drugs

Event-Driven

Sun Pharmaceutical Industries / Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/sun-pharmaceutical-industries-limited" target="_blank" data-smartkarma-citation="entities:98:1" rel="noopener">Sun Pharmaceutical Industries (SUNP IN)</a> is acquiring the U.S.-based late-stage biotechnology company, <a href="https://www.smartkarma.com/entities/concert-pharmaceuticals-inc" target="_blank" data-smartkarma-citation="entities:9312:1" rel="noopener">Concert Pharmaceuticals (CNCE US)</a> for $576M in equity value. The transaction is expected to be completed in 1Q23.</li>
<li>Concert has completed the evaluation of the efficacy and safety of its lead candidate, deuruxolitinib in adult patients with moderate to severe Alopecia Areata in its phase 3 clinical program.</li>
<li>With the disease affecting up to ~1.5M people in the U.S., Alopecia represents potential blockbuster opportunity. Sun Pharma plans to file NDA for deuruxolitinib to the FDA in 1H23.</li>
</ul>



Sun Pharmaceutical Industries (SUNP IN) is acquiring the U.S.-based late-stage biotechnology company, Concert Pharmaceuticals (CNCE US) for $576M in equity value. The transaction is expected to be completed in 1Q23.
Concert has completed the evaluation of the efficacy and safety of its lead candidate, deuruxolitinib in adult patients with moderate to severe Alopecia Areata in its phase 3 clinical program.
With the disease affecting up to ~1.5M people in the U.S., Alopecia represents potential blockbuster opportunity. Sun Pharma plans to file NDA for deuruxolitinib to the FDA in 1H23.


Sun Pharmaceutical Ind (SUNP IN): Acquisition Adds Late-Stage Biopharma Product in Derma Franchise

<ul>
<li>
<a href="https://www.smartkarma.com/entities/ono-pharmaceutical-co-ltd" target="_blank" data-smartkarma-citation="entities:8979:1" rel="noopener">Ono Pharmaceutical (4528 JP)</a> is an innovation driven pharmaceutical company, with major focus on oncology. Opdivo, Forxiga, and Orencia are the top three products, together contributing ~75% of product revenue.</li>
<li>While the competition intensified, use of Opdivo for malignant tumors was expanded to first-line treatment for NSCLC, esophageal cancer, and gastric cancer, resulting in FY22 sales of ¥112.4B (+14% y/y).</li>
<li>Ono’s second largest drug Forxiga is also on a double-digit growth path. The company has been expanding its pipeline beyond Opdivo by reinforcement of in-house research and in-licensing activities.</li>
</ul>



Ono Pharmaceutical (4528 JP) is an innovation driven pharmaceutical company, with major focus on oncology. Opdivo, Forxiga, and Orencia are the top three products, together contributing ~75% of product revenue.
While the competition intensified, use of Opdivo for malignant tumors was expanded to first-line treatment for NSCLC, esophageal cancer, and gastric cancer, resulting in FY22 sales of ¥112.4B (+14% y/y).
Ono’s second largest drug Forxiga is also on a double-digit growth path. The company has been expanding its pipeline beyond Opdivo by reinforcement of in-house research and in-licensing activities.


Ono Pharmaceutical (4528 JP): Key Drugs On High Growth Trajectory; Pipeline Expands Beyond Opdivo

Japan

Astellas Pharma Inc. is a pharmaceutical company committed to the therapeutic fields of Urology, Immunology including Transplantation and Infectious Diseases, Oncology, Neuroscience and DM Complications and Metabolic Diseases. With over 17,000 global employees, Astellas researches, develops, manufactures, and promotes its prescription drugs through subsidiaries in the US, Europe, and Asia

Eisai Co., Ltd. produces prescription drugs and medical equipment and sells mainly to sales agents and subsidiaries.  Through its subsidiary, Sanko Junyaku, the Company produces and sells diagnostic drugs.  Eisai also markets its products through related companies in the US, Europe, and Asia.  The Company also manufactures and sells foods, livestock feeds, chemical, and agrochemicals.

ONO PHARMACEUTICAL CO., LTD. manufactures and sells pharmaceuticals.  The Company mainly researches and develops prescription drugs.

Takeda Pharmaceutical Co Ltd focuses on the Research & Development, Manufacturing, Sales and Marketing and Import/Export of Pharmaceutical Drugs. The Company focuses on the following core therapeutic areas: Cardiovascular & Metabolic, Oncology, Central Nervous System, Respiratory & Immunology, General Medicine (Gastrointestinal & Genitourinary) and Vaccine.

Kyowa Hakko Kirin Co.,Ltd. develops, manufactures, and markets pharmaceuticals. The Company's products include a protein produced by genetic recombination technology, an anti-anemia agent that attaches new sugar chains through partial modification of the amino acid sequence of human erythropoietin (EPO), and a glycoprotein, human erythropoietin.

Shionogi & Company Ltd., is a pharmaceutical company. The Company develops prescription & over-the-counter drugs and diagnostics.

Takeda Pharmaceutical Company Limited is engaged in research and development, manufacturing, sales and marketing, and import and export of pharmaceutical drugs. The Company focuses on the core therapeutic areas of oncology, gastrointestinal, and central nervous system disease.

ROHTO PHARMACEUTICAL CO., LTD. manufactures and markets pharmaceuticals and cosmetics products.  The Company's products include eyewash, bath soaps, gastrointestinal medicine, and hand cream.  Rohto Pharmaceutical also has a license agreement with its subsidiary, Mentholatum (US) to sell their brand products.  The Company also manufactures contact lenses and health foods.

SANTEN PHARMACEUTICAL CO., LTD. produces and sells ophthalmic medicine.  The Company manufactures a variety of products including eye drops and ointments. Santen Pharmaceutical also imports lenses and tools and equipment used by optometrists and produces anti-rheumatic drugs.

TSUMURA & CO. manufactures and sells pharmaceutical products including Chinese medicines.  The Company also manufactures and sells bathing products, cosmetics, and other healthcare and toiletry products.  Tsumura & Co. sells its products in Japan and overseas markets.

Cipla Limited manufactures and sells pharmaceutical and personal care products. The Company offers active pharmaceutical ingredients, and formulations in therapeutic areas, such as allergy, analgesic, anti malarial, anti-infectives, cardiology, dermatology and cosmeceuticals, diabetology, gastroenterology, steroids, iron chelators, nutritional products.

Cadila Healthcare Ltd. manufactures, and markets healthcare solutions ranging from formulations, active pharmaceutical ingredients, vaccines, diagnostics, health and dietetic foods, animal healthcare to cosmeceuticals.  The Company's products are available in tablets, capsules, injections, liquids, dry syrups, powders, granules, and ointments.

Jiangsu Hengrui Medicine Co., Ltd. develops, manufactures, and markets a variety of medicines and medicine packing materials. The Company's products include anti-tumor medicines, pain-killers, anti-infection medicines, aluminum foil, and other related products.

Zhangzhou Pientzehuang Pharmaceutical Co., Ltd. manufactures and markets Chinese traditional medicines, including Pientzehuang, Pientzehuang capsules, Pientzehuang lozenge, cough syrup, and other related products.

Zhangzhou Pientzehuang Pharmaceutical Co., Ltd. (600436 CH)

Zhangzhou Pientzehuang Pharmaceutical Co., Ltd.

Torrent Pharmaceuticals Ltd. manufactures bulk drugs and pharmaceutical formulations. The Company's formulations include cardio-vascular, psychotropic and anti-biotic drugs while its bulk drugs include atenolol, ciprofloxacin and norfloxacin. Torrent Pharmaceuticals has wholly owned subsidiaries in several regulated and less regulated international markets.

Dr. Reddy's Laboratories Limited provides a complete range of pharmaceutical services. The Company manufactures bulk drugs and formulations including verapamil and cephalexin. The Company also manufactures and exports molecules such as norfloxacin, ciprofloxacin, and varieties of semi-synthetic penicillin. The Company markets its products in India and around the world.

Yunnan Baiyao Group Co., Ltd. manufactures and markets traditional Chinese medicines.  The Company also operates in pharmaceutical wholesale and retail trading, empty capsules manufacturing, and hotel operation.

UCB SA is a biopharmaceutical company. The Company specializes in the treatment of central nervous system disorders and inflammatory diseases. UCB operates worldwide.

Hansoh Pharmaceutical Group Company Limited operates as a pharmaceutical company. The Company manufactures and sells anti-infectives, anti-neoplastic agents, diabetes drugs, and other products. Hansoh Pharmaceutical Group markets its products throughout China.

Teva Pharmaceutical Industries Limited operates as a pharmaceutical company. The Company develops, manufactures, and markets generic and branded human pharmaceuticals, as well as active pharmaceutical ingredients. Teva Pharmaceutical Industries serves customers worldwide.

Otsuka Holdings Co Ltd is a pharmaceutical company. The Company manufactures, sells, imports and exports pharmaceuticals, clinical testing, and medical equipment for intractable diseases.

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Otsuka Holdings (4578 JP)

Otsuka Holdings - Family Co Selldown for ¥56bn - Take It Vs Peers

One of the Otsuka family entities is selling a 2.4% stake in Otsuka Holdings (4578) in an accelerated Block Offering. I'd take it.

Travis Lundy

Otsuka Holdings Placement - While Enticing Discount, Management Selling Will Raise Eyebrows

Otsuka Estate is looking to raise US$389m via trimming its stake in Otsuka Holdings (4578 JP). In this note, we will talk about the firm’s track...

Clarence Chu

Chugai Pharmaceutical (4519 JP): Hemlibra Is the Only Saviour; Competition Bites Mainstay Drugs

Fast growth from Chugai’s new products falls short of compensating the revenue loss from the mainstay products. Chugai may not be able to meet 2022...

Tina Banerjee

Sun Pharmaceutical Ind (SUNP IN): Acquisition Adds Late-Stage Biopharma Product in Derma Franchise

Sun Pharma is acquiring US-based Concert Pharmaceuticals for $576M. Post-acquisition, the priority will be to materialize Concert’s plan to submit...

Tina Banerjee

Ono Pharmaceutical (4528 JP): Key Drugs On High Growth Trajectory; Pipeline Expands Beyond Opdivo

Driven by indication expansion, Ono expects Opdivo sales to reach ¥155B in FY23, up 38% y/y. The company is developing clinical pipeline beyond...

Tina Banerjee

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