Astellas' Japan Harnal sales volumes recover

TOKYO (Reuters) - Astellas Pharma Inc. (4503.T), Japan's third-biggest drug maker, said on Wednesday domestic sales volumes for key drug Harnal had recovered in the past two months after falling 9 percent in the first half of the business year.

Chief Executive Masafumi Nogimori said co-promotion with incontinence drug Vesicare, recently launched in Japan, had helped Harnal, which is used to treat men with difficulty urinating, reclaim ground taken by generics.

"Things are looking fairly good with September and October levels recovering to be flat or better," Nogimori said in an interview in Tokyo for the Reuters Health Summit in New York.

"We're aiming for the second half to be flat in volume terms and that's looking achievable."

Sales of the drug, whose patent has expired in Japan and Europe and which has suffered a 13.4 percent price cut in its home market, fell 12 percent in yen terms globally during the April-September period. In Japan, the decline was 19 percent.

The company expects Harnal's global sales to decline 14 percent to 118.7 billion yen ($1 billion) for the full year to end-March. Total company sales are estimated at 918 billion yen.

The sharp drop in sales of Harnal, which is also known as Flomax, on fierce competition from generics and a government-mandated cut in prescription drug prices, has caused concern among analysts.

Harnal's weak domestic sales, and a smaller than expected rise for cholesterol-lowering Lipitor, which it sells under license from Pfizer Inc (PFE.N), pushed Astellas' share price 1.7 percent lower to 5,200 yen on Wednesday compared with a 0.5 percent decline for the drug sector subindex .IPHAM.T.

The share price also weakened after Astrellas began legal action against Pfizer, asserting its Lipitor sales contract is valid until 2016. Pfizer says the contract is valid until 2011.

Nogimori also said Astellas, which is 45 percent owned by foreign investors, was considering, among other options, adopting a poison pill to minimize the risk of becoming a takeover target.

Astellas ranks about 16th to 17th among major global drug makers, a size which analysts believe could make it a takeover target.

"We are looking at many ways to minimize that risk, including a poison pill," Nogimori said.

Eisai Co. Ltd. (4523.T), Japan's No. 4 drug maker, adopted a poison pill early this year.

Astellas, established in April 2005 through Yamanouchi Pharmaceutical's purchase of Fujisawa Pharmaceutical, last month mapped out mild profit growth over the next four business years in a new mid-term plan.

It is aiming for operating profit of 250 billion yen in the next business year, a goal that analysts have said now may be more difficult than they thought in light of weak domestic sales growth.

"It is challenging but it is a goal that is possible to reach," Nogimori said. "It's not our style to set goals that are just easy to cruise to."

($1=117.63 Yen)