Press review

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German pharma families show up in Paradise Papers

Country : Germany

Keywords :
BERLIN, Nov 10 (APM) - Two German billionaires who made their money from pharma have appeared in the 'Paradise Papers' leak on offshore companies, SZ reported on Monday (p11) and Thursday (p8).
Curt Engelhorn, heir to chemical company BASF and former head of Boehringer Mannheim, which he sold to Roche in 1997 for over $10 billion, and Frederik Paulsen, heir of Ferring pharma, were clients of the Bermuda-based law firm Appleby from which the Paradise Papers were leaked.
A 2016 tax case against Engelhorn, who died that year, resulted in a 145 million-euro fine - the biggest tax offence ever handled in Germany, the paper said. But Paradise Paper data show dozens of trusts attributable to the Engelhorn family which the German tax authorities did not know anything about.
In 2009 Frederik Paulsen opened a private museum on an island in northern Germany containing his personal art collection. Minister President of the region (Schleswig-Holstein) Peter Harry Carstensen (CDU) retired from politics shortly after to become director of the museum on a voluntary basis.
Carstensen never declared income from the position, but the Paradise Papers have revealed payments made to him by Paulsen.

Novartis criticised for irresponsible practices revealed in Paradise Papers

Information revealed in the Paradise Papers suggests that several Swiss companies, including Novartis, have neglected their corporate responsible policies in developing countries, SZ reports on Friday (p6).
The country is considering a new law that would hold companies legally responsible for environmental and human rights abuses committed in Switzerland and abroad, the paper said.
The Federal Council rejected a 2015 initiative from civil society organisations to draw up a similar law, but there is renewed interest in the issue and Swiss voters will decide whether or not to adopt the initiative in an upcoming referendum.

Limited expectations for Novo's semaglutide

Diabetes specialists are awaiting the launch of Novo Nordisk's semaglutide because it could greatly improve and simplify treatment of type 2 diabetes, but there are concerns about its price, reported Die Welt on Wednesday (p20).
Semaglutide is a once-daily oral medication which could replace insulin injections. It mimics the body's own hormone, causing a reaction only as required, whereas an insulin injection automatically lowers blood sugar levels, said Baptist Gallwitz from the German diabetes society.
Clinical studies also showed that patients are losing weight with semaglutide, but there are concerns about its price. The drug is expected to cost almost 3 to 4 euros per tablet, whereas insulin is much cheaper. The EU approval is expected to be granted soon.

Merck KGaA cautious on annual forecast

Merck KGaA expects to reach only the lower end of its 2017 sales forecast, which ranges from 15.3 to 15.7 billion euros, due to currency headwinds, reports FAZ on Friday (p18) (APMHE 55517).
Operating earnings in 2017 are expected to be between 4.4 billion and 4.6 billion euros. Q3 sales remained consistent with the previous year, at 3.7 billion euros.

Bayer submits application for extended indication of Xarelto in EU

Bayer has filed its oral anticoagulant Xarelto (rivaroxaban), in combination with aspirin, for an extended indication in the treatment of coronary or peripheral artery disease in Europe, reported FAZ on Tuesday (p21) (APMHE 55461).
The U.S. filing in this indication is expected by the end of 2017, the paper said.

Stada profits up in Q3 2017

German generic drugmaker Stada increased its operating profit by 12% to about 99 million euros in the third quarter of 2017 despite high costs due to advisory expenses linked to its acquisition by Bain Capital and Cinven, FAZ reports on Friday (p18).
In Q3, sales grew 9%, with both generics and branded drugs contributing positively, the paper said (APMHE 55527).

MorphoSys increased sales in Q3 thanks to partner Janssen

German biotech MorphoSys saw a 20% increase in its third quarter 2017 sales to 15 million euros, thanks in part to licensing income and milestone payments from its U.S. partner Janssen, reported FAZ on Wednesday (p22).
The first royalties following the launch of Tremfya (guselkumab) for moderate to severe plaque psoriasis by Janssen in the U.S. will be reported in Q4.
For the financial year 2017, MorphoSys expects to reach revenues in the range of 46 to 51 million euros.

Biotest's takeover by China's Creat falters

The takeover of Hessian pharmaceutical company Biotest by Chinese investment company Creat has faltered due to security concerns from the U.S. Foreign Investment Agency (CFIUS), reported FAZ on Wednesday (p23) (APMHE 55478).
CFIUS announced it will not finalise the transaction, said Biotest on Tuesday, but Creat said in a message it will continue to pursue the acquisition, the paper said.
The investigation likely concerns Creat's access to the personal data of plasma donors and patients in the U.S., where Biotest has a subsidiary.
Creat and Biotest have decided to withdraw the application and submit a new file in an accelerated review process.

Evotec sales up 42% in Q3

In the first nine months of 2017, Hamburg-based biotech company Evotec profited from partnerships with pharmaceutical companies, reported FAZ on Thursday (p21).
Sales increased by 42% in this period to just under 171 million euros. The acquisition of research and development company Aptuit, which has been included in the balance sheet since August, also contributed, the paper said.

McKesson must pay more to former Celesio shareholders

The German Federal High Court (BGH) has granted additional compensation to former shareholders of pharmaceutical wholesaler Celesio, reported FAZ on Thursday (p27).
In 2014, shareholders received 23.50 euros per share as part of the sale of Celesio to the American McKesson Group. But the court has decided to add 7.45 euros per share because McKesson paid significantly more to one investor - hedge fund Elliott Management - which held convertible bonds.
Elliott played a key role in the successful acquisition of Celesio, noted FAZ. McKesson failed in its first attempt because Elliott did not tender its papers (including 24% shares), causing it to fall short of the 75% share threshold. Shortly thereafter, Elliott allied with Haniel, Celesio's main shareholder at the time, to make a deal.
The BGH made it clear that the price paid for the indirect purchase of shares via derivatives should be equal to the minimum price for a public takeover offer.

First hearing in German cancer drug lawsuit

The first hearing in the lawsuit over fraudulent cancer drugs sold by a pharmacist of the Rhine city of Bottrop will take place on November 13, reported Die Zeit on Thursday (p15-17).
The pharmacist is accused of diluting almost 62,000 cancer drug preparations in order to increase his profit margins between 2012 and 2016. He has allegedly embezzled 56 million euros from health insurers.
The prosecution has identified 27 cases of physical injury and fraud, but has still to determine how many patients suffered damages and to what extent. Because the pharmacist prepared dosages correctly in some cases, it cannot be said with certainty how many patients are victims of his actions.

Division between 'rich' and 'poor' statutory insurers in Germany

Germany's statutory insurance system - in which about 90% of Germans participate, the other 10% being enrolled in private plans - may look like a strong and cohesive unit but in fact suffers from a destabilising disparity, Handelsblatt wrote on Monday (p6,15).
Altogether, the more than 100 statutory health payers are expected to close 2017 with a hefty surplus of 2.8 billion euros and reserves in the double-digit billion euro range, and the additional contribution rate is expected to fall in 2018, the paper wrote.
However, some payers are in much better financial shape than others and a financial imbalance or even bankruptcy of a large health insurer would undermine confidence in the entire healthcare system, the paper said.
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