Sawai To Take Over Facilities Owned By Scandal-Hit Kobayashi Kako
Japan’s Sawai Will Assume Ownership Of Eight Facilities Under New ‘Trust’ Subsidiary
Kobayashi Kako has agreed to transfer ownership of eight of its production, research and distribution facilities to Sawai, which will use them to expand the manufacturing of its own generics. Business was suspended at Kobayashi Kako for 116 days this year after the company’s manufacturing deficiencies were linked to two deaths.
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A major overhaul is in progress for Sawai’s Upsher-Smith business, after the Japanese parent company announced leadership changes and a “drastic restructuring” of the US unit in the wake of a significant impairment charge and a hefty annual operating loss that dragged down Sawai’s overall results.
Japan struggles to recover its ever-expanding supply chain for generic drugs after several key players had their production stopped because of a series of GMP violations. As the share of generics grows under government policy, some in the industry argue the problems are deeply rooted in a decades-old pricing system.
This month, generic competition to several lucrative brands, not least Bristol Myers Squibb’s $8.7bn Revlimid, are set to fall to generic competition in the US. Meanwhile, Sawai is looking to close on a key deal.