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No. 350, November 1998

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Japanese Companies in the US


The world's second-biggest manufacturer of polyester film is now wholly owned by MITSUBISHI CHEMICAL CORP. Japan's top chemical company bought out partner HOECHST AG's equity interest in their seven-year-old joint production, research and development and marketing polyester film venture for an undisclosed price (see Japan-U.S. Business Report No. 344, May 1998, pp. 2-3). The acquisition includes the former HOECHST DIAFOIL CO. of Greer, South Carolina, now named MITSUBISHI POLYESTER FILM, LLC, in which Hoechst had a two-thirds stake, as well as a Wiesbaden, Germany firm that also was majority-owned by the German parent. The renamed MITSUBISHI POLYESTER FILM CORP., or what was DIAFOIL HOECHST CO., LTD., also is completely owned by MCC, which initially had put up two-thirds of this company's capital. These three companies, plus an operation in Indonesia, have annual sales of more than $600 million. They have a combined annual capacity of 170,000 tons and employ 2,000 people. Hoechst is divesting businesses that do not advance its goal of becoming a life sciences company.

Japan's top maker of diagnostic drugs has gained a U.S. supply base. For about $37.5 million, FUJIREBIO INC. acquired the in vitro diagnostic oncology business of CENTACOR, INC. Based in Malvern, Pennsylvania, this operation's products include immunoassays using monoclonal antibody technology that aid in the detection and the monitoring of solid tumor cancers. Its 1997 revenues were $35.4 million. Centacor, a biopharmaceutical firm, approached Fujirebio about buying its diagnostics division after deciding to shed this business so that it could concentrate on its core therapeutic products; these also are developed through monoclonal antibody technology. Fujirebio will continue to operate the diagnostics business in Malvern, using it to strengthen sales of diagnostics in the United States and Europe.

MEDICAL & BIOLOGICAL LABORATORIES CO., LTD., a producer of diagnostic reagents best known for its work in the area of autoimmune diseases, has established a second U.S. sales subsidiary. FU'-GENE INC., located in Park Ridge, Illinois, is marketing some 30 reagent kits, including the ELISA kit for screening antinuclear antibodies relevant to connective tissue diseases. Production of these diagnostic reagents has been outsourced to an unnamed American company. MBL is projecting Fu'Gene's sales at $1 million in FY 1999. The Nagoya-based company's other U.S. subsidiary is MBL INTERNATIONAL CORP. of Watertown, Massachusetts. Opened in 1993, it distributes reagents for basic research, MBL's second core business.

In the latest tie-up designed to advance its diversification into drugs based on recombinant technology, KIRIN BREWERY CO., LTD. has entered into a two-year collaboration with HYSEQ, INC. The Sunnyvale, California company will use its proprietary Gene Discovery platform to target novel genes involved in cell growth regulation from specific cell lines provided by Kirin Brewery's pharmaceutical division. The partners will codevelop any candidates identified as commercially relevant. The Japanese firm will pay an up-front fee of $3 million and make milestone payments. Kirin Brewery and Hyseq will have exclusive rights in their regional territories to products that result from the collaboration and will share marketing responsibilities elsewhere.

TOYAMA CHEMICAL CO. has given worldwide development and marketing rights to a broad-spectrum des-fluoroquinolone for the treatment of various antibacterial infections to BRISTOL-MYERS SQUIBB CO. The next-generation agent, T-3811/BMS- 284756, is said to show promise against respiratory and urinary tract infections as well as against skin and soft-tissue infections while offering advantages over other quinolones in terms of safety and efficacy. BMS will make up-front and milestone payments to Toyama Chemical, plus pay royalties on sales after marketing starts. The big drug company said that T-3811 provides a strong complement to its Tequin (gatifloxacin). That broad-spectrum quinolone, which is in Phase III clinical trials, was discovered by KYORIN PHARMACEUTICAL CO., LTD. and licensed to BMS for development in late 1996.

A treatment for urinary stress incontinence discovered by NIPPON SHINYAKU CO., LTD. will be developed and marketed by ABBOTT LABORATORIES on an exclusive basis in North America and certain other countries. The Kyoto company's NS-49, an alpha 1 agonist, currently is in Phase II clinical trials. In exchange for these rights, Abbott, which already has a major presence in the urology treatment market, will make milestone and royalty payments to Nippon Shinyaku. The U.S. health-care company sees an enormous and expanding market for NS-49 as the American population ages.

Yet another Japanese company has opted to license development and marketing of a drug emerging from its labs to a major American pharmaceutical house in order to generate a quicker payback. In this instance, it is MITSUBISHI CHEMICAL CORP., which awarded JOHNSON & JOHNSON exclusive rights outside Japan to a second- generation insulin-sensitizing agent and its backup compounds for the treatment of diabetes and related diseases. MCC-555 is described as minimizing diabetes- treatment effects on the pancreas since it reduces both blood glucose and insulin doses. J&J's sales of MCC-555 could produce royalty payments to MCC estimated anywhere from $82.6 million a year to four times that amount.

Wayne, Pennsylvania-based ASTRA PHARMACEUTICALS, L.P. has launched U.S. sales of Atacand (candesartan cilexetil), an antihypertensive agent discovered by TAKEDA CHEMICAL INDUSTRIES, LTD. for once-daily treatment of hypertension. Candesartan cilexetil, which is in a class of drugs known as angiotensin II receptor antagonists, was jointly developed by Takeda Chemical and Astra. Japan's top pharmaceutical company has exclusive rights to the antihypertensive agent at home and in other Asian markets. In major European markets, Takeda Chemical and Astra are comarketing or copromoting the product. Astra has exclusive American rights to Atacand.

An exchange rate of ¥121=$1.00 was used in this report.

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