JAPAN — Daiichi Sankyo, a Japanese pharmaceutical company, is setting its sights on independent development of future cancer drugs, aiming to build upon the success of Enhertu (trastuzumab deruxtecan), a groundbreaking treatment partnered with AstraZeneca.

Hiroyuki Okuzawa, the company’s chief operating officer, shared this strategic vision in a Bloomberg report.

To support this endeavor, Daiichi Sankyo is bolstering its production capacity and expanding its sales and development teams globally.

Enhertu has played a pivotal role in elevating Daiichi Sankyo’s profile, attracting world-class talent, and enhancing its capabilities in the field of oncology.

Originally developed by Daiichi Sankyo, AstraZeneca paid an upfront sum of US$1.35 billion in 2019 for the rights to jointly develop this antibody-drug conjugate (ADC).

Sales of Enhertu are projected to reach US$2.4 billion this year, a significant increase from US$1.6 billion in the previous 12-month period. Industry analysts anticipate that the drug’s sales will eventually surpass US$10 billion.

Moreover, Daiichi Sankyo has several other cancer drug candidates in various stages of development.

Okuzawa emphasizes the company’s newfound ability and experience to independently handle its entire cancer drugs portfolio, stating that a good drug brings business solutions.

Alongside AstraZeneca, Daiichi Sankyo is collaborating on the development of another ADC called Dato-DXd, targeting lung and breast cancer. Additionally, the company has multiple cancer drug candidates in early stages of development.

As part of their expansion strategy, Daiichi Sankyo is increasing its sales and development workforce globally, while also focusing on enhancing production capacity. However, Okuzawa declined to provide further details regarding the scale of this expansion.

This aspiration reflects the growing ambitions of Japanese pharmaceutical companies, which have recently achieved notable success in pioneering revolutionary treatments.

Daiichi Sankyo’s Enhertu represents a shining example of the emerging class of drugs known as antibody-drug conjugates (ADCs), which target cancer cells without harming surrounding healthy cells.

Last September, Eisai’s Alzheimer’s drug became the first medication to demonstrate efficacy in slowing the progression of the most common form of dementia through a definitive, large-scale trial.

Due to limitations in resources for global trials and distribution networks, Japanese companies often enter profit-sharing development agreements with Western pharmaceutical giants.

AstraZeneca, in 2019, invested nearly US$7 billion to partner with Daiichi Sankyo, with roughly half of Enhertu’s profits outside of Japan being shared.

Enhertu has the potential to significantly expand the number of breast cancer patients receiving powerful and targeted treatments with reduced side effects.

The success of cancer drugs has played a vital role in Daiichi Sankyo’s impressive stock performance, tripling its value over the past five years and making it one of the most valuable companies on Japan’s benchmark Topix Index.

While Daiichi Sankyo aspires to independently handle its cancer drugs business, Okuzawa acknowledges that the possibility of partnerships with other firms remains open, especially for drugs that may exceed the company’s capacity for development and commercialization.

Breast cancer affects approximately 2.3 million women worldwide each year, resulting in approximately 685,000 fatalities, according to the World Health Organization.

Approximately 15% to 20% of these cases are driven by a protein called HER2, which Enhertu has shown greater success in combating during advanced stages of the disease compared to existing treatments.

The results of a study conducted by Daiichi Sankyo and AstraZeneca, investigating whether Enhertu can replace chemotherapy as the first-line treatment for breast cancer, are expected by September.

To reduce future reliance on its oncology business, Daiichi Sankyo is also investing in areas such as gene therapy and mRNA vaccines.

Currently, cancer drugs contribute to one-fifth of the company’s total revenue, a figure projected to rise to nearly half by the end of the fiscal year in March 2026.

Partnerships still an option

While Daiichi Sankyo has expressed its determination to independently develop future cancer drugs, the company remains open to partnerships if certain medications prove to be beyond its capabilities.

Hiroyuki Okuzawa, the Chief Operating Officer who assumed the position in April, acknowledged this aspect.

He emphasized that the full potential of cancer drugs often becomes apparent during the development process, and there is a possibility that a drug’s potential could surpass the company’s capacity. In such instances, partnerships could still be a viable option.

Okuzawa highlighted the importance of identifying the next path for growth while the company still benefits from ample cash flow generated by the success of Enhertu.

He also acknowledged the risks associated with drug patent expiration, reinforcing the need for strategic planning to ensure sustained growth.

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