Takeda cancels development of diabetes drug TAK-128

TOKYO, Nov 2 (Reuters) Takeda Pharmaceutical Co. Ltd., Japan's largest drug maker, said on Thursday it had cancelled development of its TAK-128 drug for nerve disorders caused by diabetes, saying studies had failed to show sufficient efficacy.

TAK-128, which had been discovered by Mitsubishi Pharma Corp., had been in phase II trials in Japan, North America and Europe.

''Expectations for this drug have not been that high so I think the cancellation will be neutral for the company's share price,'' said Yasuhiro Nakazawa, senior analyst at Mitsubishi UFJ Securities.

In diabetes-related medicines, Takeda also announced in September it had dropped development of TAK-654, a drug that it had hoped at one stage would be a successor to its popular Actos diabetes treatment.

Actos is currently a main driver of Takeda's earnings but its U.S. patent will expire in 2011.

Takeda's hopes for a successor to Actos have shifted to SYR-322, which belongs to a new class of drugs called dipeptidyl pepitase IV or DPP-4, inhibitors that work to enhance the body's own ability to lower blood sugar without the weight gain seen with some other drugs. Type 2 diabetes occurs when the body builds resistance to insulin needed to break down food and causes blood sugar levels to rise too high.

Separately, Takeda also announced that it had ended its Japan licensing agreement with BioNumerik Pharmaceuticals Inc. and Aska Pharmaceutical Co. Ltd. for the chemoprotective agent Tavocept, a widely expected move after it cancelled its agreement with BioNumerik covering the United States and Canada.

Prior to the announcements, Takeda's shares ended up 0.3 percent at 7,480 yen, in line with the pharmaceutical sub-index IPHAM.

REUTERS DKS DS1513