TOKYO -- Pharmaceutical giant Daiichi Sankyo aims to boost sales in Japan and streamline research and development to counter a dent in revenue set to kick in next year from the expiration of the U.S. patent for olmesartan, its popular drug to combat high blood pressure.
The company looks to maintain an operating profit of around 100 billion yen ($795 million) projected for this fiscal year, up 34% from fiscal 2014, for three years through March 31, 2018, by adopting such measures for the lean times.
Daiichi Sankyo expects earnings growth to return as early as fiscal 2018 thanks to anticoagulant drug edoxaban, which has drawn high expectations from investors. President Joji Nakayama told The Nikkei that the company will turn edoxaban "into a major drug that will globally sell at least 100 billion yen to 200 billion yen a year."
Though olmesartan sales reached about 300 billion yen last fiscal year, the expiration of its patent in the U.S., its main market, may reduce revenue as the drug will be replaced by generics.
"To maintain the profit level of 100 billion yen would be a tall order, but we will achieve it by increasing domestic sales," Nakayama said.
Daiichi Sankyo intends to boost sales of peptic ulcer drug Nexium, which saw sales growth of more than 10% last fiscal year in Japan, and of Memary, a drug to treat Alzheimer's disease.
The company also plans to curb the growth of its R&D budget, which totaled about 190 billion yen in fiscal 2014, by having more drug candidates be jointly developed with other companies.
The company will distribute a 10-yen dividend this fiscal year to mark the 10th anniversary of the integration of its predecessors, Sankyo and Daiichi Pharmaceutical. Combined with the ordinary dividend of 60 yen, the company will pay out 70 yen in dividend, up from 60 yen the previous year.
"The 10-yen portion is for commemorative purposes only," Nakayama said, indicating that this special dividend will not be converted into ordinary dividend in fiscal 2016.