Amgen deal covers experimental drugs

Amgen Inc. said Monday that it had agreed to sell the rights to 13 of its experimental drugs to Takeda Pharmaceutical Co. in a bid to defray costs and generate cash as sales of its biggest-selling anemia drug slow amid safety concerns.

Under the agreement, Takeda, Japan’s largest pharmaceutical company, will pay Amgen $200 million up front and as much as $702 million more if key development milestones are met. Amgen would also receive a double-digit royalty on Japan sales of any commercialized product.

In addition, Takeda will pay Amgen $100 million up front and as much as $175 million in milestones for rights to its experimental cancer drug motesanib diphosphate, formerly known as AMG-706. Amgen would receive double-digit royalties on Japan sales and the two companies would split the profit 50-50 outside Japan.

Takeda will acquire all the shares of Thousand Oaks-based Amgen’s Japanese subsidiary.

Analysts say the agreement will not hurt Amgen, the world’s biggest biotechnology company, but will not help it much either.

“I don’t see this deal as meaningful at all,” said Eric Schmidt, an analyst at Cowen & Co. “The money Amgen will take in is a pittance relative to their overall research spending, and royalties from Japan are likely to be modest also.”

Amgen’s shares slipped 18 cents to $47.18.

Kevin Sharer, Amgen’s chief executive, said that Takeda’s confidence in Amgen’s experimental products “validates their potential to become innovative therapies for patients in Japan and worldwide.”

But analysts are not impressed.

“For a younger, less established firm this might represent a nice validation of the compounds, but you would think Amgen would be beyond that,” said Christopher Raymond, an analyst at Robert W. Baird.

Amgen has been hit by a sharp decline in its top-selling anemia drug Aranesp on safety concerns, prompting it to restructure and cut costs.