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Pharma giants get face time with Trump; Roche denies plan to sell diabetes biz

* Roche Holding Ltd. reported a 7% increase in full year 2016 net income, to CHF9.73 billion, or CHF11.13 per share, from CHF9.06 billion, or CHF10.28 per share in 2015. Bloomberg News reported that the Swiss pharma group was reportedly considering a sale or spinoff of its diabetes care unit, although a spokesman told Reuters that there is "no change" as the company remains committed to its diabetes care business.

* Takeda Pharmaceutical Co. Ltd. booked a nearly 46% year-over-year increase in net profit for the nine-month period ended Dec. 31, 2016, of ¥165.7 billion, or ¥212 per share, as opposed to ¥113.6 billion, or ¥145 per share, in the corresponding period of fiscal 2015. The Japanese pharma giant raised its financial guidance for the fiscal year ending March 31, 2017, to a net profit of ¥93 billion, or ¥119 per share, from ¥91 billion, or ¥116 per share, previously, to account for the ARIAD acquisition.

* Pfizer Inc. expects to file five biosimilar products in 2018 and 2019, including biosimilars for Roche Holding Ltd.'s Herceptin, Avastin and Rituxan, all used to treat cancer, and AbbVie Inc.'s Humira, according to John Young, Pfizer's group president of essential health. Executives hope these drugs can offset the decline of Prevnar, the vaccine for pneumococcal pneumonia, with sales for the product expected to be flat to declining this year, as about 50% of the U.S. population over 65 years old is already vaccinated, Albert Bourla, president of innovative health, noted.

* Meanwhile, U.S. President Donald Trump urged pharma executives in a meeting yesterday to lower the prices of their medicines and bring back operations and jobs to the U.S. "Pricing has been astronomical for our country," Trump said. The president also pledged to cut FDA regulations by as much as 80% and streamline the agency's approval process to make it faster and less complicated for medical products to enter the market.

Pfizer CEO Ian Read insisted in a conference call that the company would not change its practices in drug pricing as it has "always priced responsibly," Reuters wrote. Read also noted that tax reform is needed if Trump wants to bring back pharma jobs to the U.S.

Takeda CEO Christophe Weber also disregarded Trump's call to cut prices, telling reporters that the company "has for many years been reasonable in its price increases in the U.S. and we are very committed to single-digit price increase."

* Democrats on the Senate Finance Committee blocked a vote on President Donald Trump's nominees to lead the Treasury and the Department of Health and Human Services. None of the 12 Democratic members of the committee reported to the executive session scheduled yesterday morning, where Tom Price and Steven Mnuchin were to be voted on for positions as Health and Human Services secretary and Treasury secretary, respectively.

* Eli Lilly & Co. CEO David Ricks said the company is "preparing for all scenarios" if the Affordable Care Act is repealed, Reuters noted. Ricks added that he and Trump did not get into collaborative policy detail regarding the U.S. pricing environment.

M&A and capital markets

* Hologic Inc. completed the sale of its blood screening business to Grifols SA for $1.85 billion in cash. Grifols also acquired Hologic's California-based blood screening lab and R&D unit.

* Canadian medical marijuana maker Canopy Growth Corp. completed its acquisition of Mettrum Health Corp. Canopy Growth's share ticker will change to WEED upon the commencement of trading on the Toronto Stock Exchange on Feb. 1.

* UMN Pharma Inc. sold a 50% stake in biopharma company UNIGEN Inc., Reuters reported.

* Lonza Group Ltd. placed 5 million shares with selected institutional investors in and outside Switzerland via an accelerated book-building procedure for CHF865 million in gross proceeds, or CHF173 apiece. The company intends to use the net proceeds to partially finance its planned $5.5 billion acquisition of Capsugel Inc.

* Synergy Pharmaceuticals Inc. entered into an agreement to sell $125 million of its common stock in a registered underwritten public offering. Synergy intends to use the net proceeds from the offering to fund its commercialization activities related to Trulance, further clinical development of plecanatide and for working capital and other general corporate purposes.

Drug and product pipeline

* The U.S. FDA approved Sanofi's Xyzal as an over-the-counter treatment for allergies.

* Regeneron Pharmaceuticals Inc. and Sanofi said Health Canada approved Kevzara for the treatment of adult patients with moderately to severely active rheumatoid arthritis who have had an inadequate response or intolerance to disease-modifying anti-rheumatic drugs.

* The European Commission approved Merck & Co. Inc.'s Keytruda for the first-line treatment of metastatic non-small cell lung cancer in adults whose tumors have high PD-L1 expression with no EGFR or ALK positive tumor mutations.

Operational activity

* Japan-based Kyowa Hakko Kirin Co. Ltd. established Kyowa Kirin Frontier Co. Ltd. with ¥100 million in capital. The new company will work on getting manufacturing and marketing approval for authorized versions of NESP, Kyowa Hakko Kirin's key product used to help boost red blood cell production in patients with kidney disease.

* Moody's changed the outlook on Teva Pharmaceutical Industries Ltd. to negative from stable, after the U.S. District Court for the District of Delaware rejected the company's patent infringement claims against the generic versions of its drug Copaxone. Moody's believes the company will not be able to reduce leverage as there is an increasing risk of a Copaxone generic launch in 2017 after the court ruling.

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The day ahead

Early morning futures indicators pointed to a higher opening for the U.S. market.

In Asia, the Hang Seng fell 0.18% to 23,318.39, and the Nikkei 225 was up 0.56% to 19,148.08.

In Europe, as of midday, the FTSE 100 was up 0.64% to 7,144.27, and the Euronext 100 had climbed 1.08% to 926.64.

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