Tanabe Pharma sells manufacturing unit and 17 off-patent drugs to Towa Pharmaceutical

JAPAN—Tanabe Pharma has agreed to sell its manufacturing subsidiary, Tanabe Pharma Factory, together with the marketing rights to more than a dozen medicines, to fellow Japanese drugmaker Towa Pharmaceutical as part of its strategy to streamline operations and strengthen its focus on innovation.

The transaction, announced on July 3, includes Tanabe Pharma Factory’s production facilities in Onoda and Yoshitomi.

Although the companies did not disclose the financial terms of the agreement, the deal marks a significant step in Tanabe’s ongoing business transformation following its acquisition by Bain Capital last year.

Tanabe Pharma Factory employed more than 500 people as of April 1 and manufactures a broad portfolio of pharmaceutical products.

Ownership of the facilities, along with the associated manufacturing operations, will transfer to Towa Pharmaceutical upon completion of the transaction.

According to Tanabe, the sale will allow the company to concentrate more resources on research and development (R&D) and business development while enabling the manufacturing sites to maximise their operational potential under Towa’s ownership.

Drug portfolio and transition timeline

The companies expect to complete the share transfer in November.

However, the transfer of marketing rights and manufacturing responsibilities for the affected medicines will take effect during or after April 2027, allowing sufficient time for a phased transition.

Among the products included in the agreement are the antiplatelet medicine Anplag, the cardiovascular drug Kalgut, and the angiotensin-converting enzyme (ACE) inhibitor Tanatril, alongside several other established pharmaceutical brands.

By transferring these mature products, Tanabe aims to sharpen its strategic focus on developing innovative therapies while ensuring uninterrupted production and supply through Towa Pharmaceutical.

Building on Bain Capital acquisition

The transaction follows Tanabe’s acquisition by Bain Capital in a deal valued at US$3.3 billion.

After completing the acquisition, the private investment firm supported the company’s decision to rebrand by dropping the “Mitsubishi” name and becoming simply Tanabe Pharma.

Bain Capital stated that the acquisition was designed to position Tanabe for long-term growth within Japan’s innovative pharmaceutical sector while providing the financial resources needed to strengthen its research-driven business.

The latest divestiture aligns with that strategy by separating manufacturing assets from Tanabe’s core innovation activities.

Towa expands manufacturing and product portfolio

For Towa Pharmaceutical, the acquisition supports the objectives outlined in its current mid-term business plan, which prioritises growth in the domestic Japanese market while gradually expanding its international presence.

The company said the acquisition will strengthen its product portfolio, improve manufacturing efficiency, and increase production capacity by integrating the two facilities into its existing operations.

The agreement also reflects a broader trend across the pharmaceutical industry, in which companies increasingly separate manufacturing and mature-product businesses from innovative drug development.

Several major pharmaceutical companies, including Sanofi, GSK, Johnson & Johnson, and Pfizer, have pursued similar restructuring strategies in recent years, concentrating investment in higher-growth research and development programmes while streamlining their operations.