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[Interpreted] Thank you very much for your participation in the conference call for the financial results for Q1 fiscal year 2021. My name is Christopher O'Reilly, Global Head of Investor Relations.
First, I'd like to explain the language setting. At the bottom of the Zoom window, there is a language button. If we want to listen to Japanese, please select Japanese. If you want to listen to English, please select English. Or if you want to listen to the original language, please turn it off. Before starting, I'd like to remind everyone that we'll be discussing forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those discussed today. The factors that could cause our actual results to differ materially are discussed in the most recent Form 20-F and in our other SEC filings. Please also refer to the important notice on Page 2 of the presentation.
Now please let me introduce today's presenters and panel. Christophe Weber, President and CEO; R&D President, Andy Plump; Costa Saroukos, Chief Financial Officer; Masato Iwasaki, Japan General Affairs; Ramona Sequeira, President U.S. Business Unit and the Global Portfolio Commercialization; Julie Kim, President, Plasma-Derived Therapies Business Unit.
I would like to start with the presentation by Christophe, followed by Andy and Costa. After that, we will have a question-and-answer session. Now we start the presentations.
Thank you, Chris. It's Christophe Weber here. Thank you very much for attending our Q1 earning results. If we can go to the first slide, please. What -- in a nutshell, as you know, this year is an inflection year for Takeda, an inflection year in terms of revenue dynamic and momentum. Our growth will accelerate in 2021. It's also an inflection year with our pipeline. And this is exactly what we are seeing in -- during the Q1, which is a great start of the year. Our revenue grew 3.8%, driven by our 14 global brands, and we are really looking forward to continue to accelerate our growth in 2021. We also are very active to facilitate, to help with the vaccination. Again, the COVID-19 vaccine is in Japan, and you will have seen that we have expanded our partnership with Moderna to bring 100 million dose of the Moderna vaccines in Japan. So good start of the year in terms of topline momentum, in spite of some variability product by product. Overall, we are starting with an acceleration of our topline growth.
An inflection year also with the pipeline. It's a very important year in terms of submission and approval. You saw that in the last 2 weeks, 2 of our product got a breakthrough status designation in the U.S. It's a demonstration that we are also aiming for a very innovative pipeline. So TAK-994 got the breakthrough designation status as well as TAK-999. We are also continuing with the development of the Novavax vaccine in Japan with a potential approval in the second part of the year. On the vaccines, we are focusing on dengue as well as the COVID-19 and Zika. The dengue and COVID-19 is very much our focus, and you will have seen that we just did a partnership to continue the development of our norovirus vaccines, but with a partner instead of fully doing it by ourselves with the capital investment which is required. So in a nutshell, very good momentum for the Q1, both on the top line and on the pipeline.
And now Andy will explain further our situation regarding our pipeline. Thank you very much.
Great. Thank you very much, Christophe. I'm trying to turn my video on and -- great. If someone essentially could turn my video on. Well, good evening, everybody, and thank you very much, Christophe.
Three themes to my presentation this morning. The first is we have a very exciting and very dynamic pipeline, and we are 100% focused on delivering and sharpening our ability to deliver on that pipeline predictably. Secondly, we follow the science, whether that's for our pipeline or for our global brands, and you'll see a great example of the success story for ENTYVIO. And then thirdly, this is, as Christophe just said, a year of significant R&D pipeline inflection. We expect major milestones coming up over the rest of this year and into early next year.
So if we can go to the next slide, please. just showing you here a chronology of the major inflections and the momentum that we started late last year, and it continues into this fiscal year and into the beginning and throughout next fiscal year. And not to make this slide too complex, but it's broken into really 3 buckets. Above the timeline, you see a chronology of our submissions, expected submissions and expected approvals of our global brands. These are all pipeline products that have been or will be submitted in the U.S. and/or the EMA. In the middle bucket, you see the progress that we're making with our Orexin franchise, which includes all 3 of our development candidates, all 3 with the potential to become medicines for patients in the marketed setting, in particular the major events for our lead molecule for which we're quite excited, TAK-994. And then very importantly, you see on the bottom row, across oncology, GI and rare genetics hematology, our other 3 therapeutic areas of focus, a very significant, very meaningful proof-of-concept inflections that we're expecting to see over the course of this year that will set us up for the future.
We can go to the next slide, please. I'm not going to dive into this slide in any detail. This is a list of the major milestones for our pipeline that we put out in front of you in May at our Q4 2020 earnings announcement. There is a similar visual for our marketed brands in the appendix. In essence, it's our report card, how we judge ourselves for our success over the course of the year.
And if you go to the next slide, what I will do, though, is dive into the accomplishments that -- and the major events that we've had up to date in this fiscal year. So let's just start with very significant regulatory interactions, and Christophe has already alluded to some of these, and I'll just do a deeper dive. Firstly, very excited about the approval of the Moderna mRNA COVID vaccine in Japan. In addition, as you know, we're very focused on expanding our global portfolio into Japan and China. And we had 4 approvals between Japan and China, 2 in Japan and 2 in China for our global brands. And then thirdly, a very significant submission in the EU for ENTYVIO, which I'll mention in just a second.
With respect to our Wave 1 pipeline, both maribavir and mobocertinib have been filed globally in the United States. Both have priority review, and we're looking forward -- we're engaged in discussions with FDA currently. We're looking forward to potential approvals for both of these agents in the not-too-distant future.
As you know, we've submitted our dengue vaccine. The dengue vaccine was initially accepted as an accelerated approval. That's actually been converted by the EMA to a standard assessment. This is a process that's quite common. About half of applications that are submitted will convert, and the vast majority of these are still accepted, if they're initially designated as an accelerated assessment. We're still expecting a CHMP opinion in this fiscal year. . And then lastly, with our Wave 1 pipeline, we had, as Christophe mentioned, 2 big events just this week with TAK-994 and TAK-999, both designated with breakthrough designations.
We're also making decisions on our pipeline. We've made decisions to prioritize our investments and to focus our attention and energy on those programs in our Wave 1 and Wave 2 pipeline and our research pipeline that are most aligned strategically and drive the greatest value for Takeda. And so we found partnerships for 3 of our very exciting programs. There's still very significant potential in these programs. And there are 2 points that I'd like to highlight. One is that by finding partners, we remove ourselves not just from financial obligations and costs for these programs, but also from the operational burden, so we can redirect our attention on our priorities. And secondly, we maintain very significant economic upside with these programs.
If we go to the next slide, please. Let me just walk you through a new indication that we're pursuing in Europe for ENTYVIO. So this is a very interesting story. It's a condition known as antibiotic-refractory pouchitis, a very high unmet medical need. And just the brief fact story is that in 2016, we initiated randomized, double-blind, placebo-controlled, multicentered trial. The trial was known as EARNEST. It was a Takeda-sponsored trial. It was a trial that was conducted with the highest quality standards, but it was a Phase IV study in antibiotic-refractory pouchitis. What is that? Well, 10% to 15% of ulcerative colitis patients will undergo colectomy. About 50% of patients who have undergone colectomy with the formation of what's known as an anatomical pouch will develop an inflammatory condition known as pouchitis. And then a very high percentage, as much as 15% of these individuals, become refractory to existing standards of care, which is predominantly antibiotics. So this can be quite worrisome for patients and even in some cases, fatal. So we ran this study. It was a high-quality study, and we saw striking results. In fact, you can see in the lower right, clinical remission of over 30% with ENTYVIO and under 10% with the standard of care, highly significant. We're not presenting our multiple secondary endpoints, but suffice it to say, we will present these -- suffice it to say that all of our major secondary endpoints were consistent with our primary, including continued benefits well beyond week 14. Given the high unmet medical need and the robustness of these data, we made the decision to submit this dossier to the EMA. That submission has been validated and accepted and is under review. We think that there's a good shot at getting a labeled indication. There are some risks. It was a Phase IV study, which means we didn't have agreement with the EMA on what those endpoints for registration would look like. And it's a single study, but that's now under review.
So if we just go to the next slide, please, Chris, and last slide. I'll just end before I hand it over to Costa, just emphasizing that it's a really exciting time for our pipeline. Our pipeline is dynamic, it's moving and it's really starting to deliver value.
With that, Costa, I will hand it over to you.
Okay. Thank you, Andy, and hello, everyone. I'm just waiting for the video to come up, just coming up now. So thank you so much, Andy.
Great. As Christophe highlighted in his opening slide, from fiscal year 2021, we are pivoting towards acceleration of the topline growth. And I'm pleased to say that we started off quarter 1 in a solid format, and we're on track towards our full year guidance, our full year mid-single-digit underlying revenue growth.
Firstly, on the topline. Reported revenue growth in quarter 1 was 18.4%, benefiting from the business momentum, favorable foreign exchange and the sale of our diabetes portfolio in Japan, offsetting the divestiture headwinds. Please note that this portfolio sale has been excluded from the core and the underlying revenue. Underlying revenue growth was positive at 3.8%, although there were some quarterly phasing headwinds for products such as TAKHZYRO and our immunoglobulin products, which we would not expect to see going forward, and both are on track to delivering our full year guidance. We also saw strong contribution from China, where we had 4 new approvals this -- last year.
Moving on to margins and our focus on profitability. Reported operating profit grew at 48.6%, including the benefit from the sale of the Japanese diabetes portfolio, while core operating profit declined 11.4% due to divestitures and our increase in R&D investment. Even so, we are still able to deliver a margin of 30.5%.
With regards to cash flow, in quarter 1, we delivered free cash flow of JPY 129.9 billion or approximately USD 1.2 billion, and we're on track towards our full year target of JPY 600 billion to JPY 700 billion. Net debt to adjusted EBITDA is at 3.3x, a slight increase from the end of March, reflecting the half year dividend payment as well as cash out for the acquisition of Maverick. In summary, we're very pleased with our performance in the first quarter as we delivered a solid start, and we remain firmly on track towards delivering our full year 2021 guidance.
Next slide, please, Chris. So Slide 13 is a summary of our fiscal year '21 quarter 1 results. So reported revenue was JPY 949.6 billion, up 18.4% versus the prior year, mainly due to JPY 133 billion booked as revenue from the sale of our Japan diabetes portfolio. Core revenue, which adjust out its onetime impact, was JPY 816.6 billion with growth of 1.8% as business momentum and favorable foreign exchange more than offset the impact of divestitures. Underlying revenue growth, which further adjusts out the foreign exchange and divestitures, grew at 3.8%.
Reported operating profit was JPY 248.6 billion with a significant growth of 48.6% versus prior year. This was mainly due to the gain of the sale of the diabetes portfolio in Japan as well as lower purchase price accounting and integration costs. Core operating profit was JPY 248.9 billion. This was a decline of 11.4% versus prior year due to the increase in R&D investment and the impact of divestitures. If we adjust for the foreign exchange and divestitures, underlying core operating profit decline was 2.1%, which is predominantly a reflection of the increased R&D investment. Despite the R&D investment, our core and underlying core operating profit margins were both over 30%. Reported EPS was JPY 128 with growth of 141.9% as a result of quarterly phasing of tax and core EPS was JPY 113. Underlying core EPS growth was 3.9%. Operating cash flow was JPY 166.9 billion, up 14.4% versus prior year. And our free cash flow was JPY 129.9 billion, down 11.2%, with the operating cash flow increase offset by higher sales of marketable securities in quarter 1 of fiscal year 2020.
Slide 14 gives more insight into our revenue growth dynamic. So moving from left to right, you can see quarter 1 in 2020, our reported and core revenue was JPY 801.9 billion. You can see, we had underlying momentum -- underlying growth momentum of 3.8%, predominantly driven by our 14 global brands. Divestiture headwinds was minus 5.8 percentage points, but we also saw some favorability in foreign exchange. So net-net, our core revenue growth was 1.8%. Adding to that is the JPY 133 billion of sale of the Japan diabetes portfolio gets us a revenue growth of 18.4%.
Thank you. Next slide, please. This slide is our -- moving to Slide 15 is our portfolio. It talks about our 5 key business areas. It shows that we remain focused on our 5 key business areas, which now represents 87% of total revenue. This has increased from 82% for full year 2020 as a result of our execution of our noncore asset divestitures. GI, which represents approximately 1/4 of the total revenue, delivered 8% growth, spearheaded by ENTYVIO, which grew at 18%. Rare diseases is down slightly by 3% and impacted by continued decline of rare hematology, as expected, and also impacted, as we mentioned, on some quarterly phasing of TAKHZYRO, which impacted our HAE growth.
PDT immunology was also impacted by some phasing. It was down 2% with immunoglobulin impacted by quarter-on-quarter fluctuations and higher revenue in Q1 of prior year. Oncology grew at 9%, neuroscience returned to growth of 3% and VYVANSE rebounding strongly after being impacted last year by COVID-19 stay-at-home restrictions. Finally, I'd like to draw your attention to the right-hand side of the -- or other. Here, you can see we saw some growth in quarter 1 by 9%. This is predominantly due to the fact that we divested many of the noncore assets, which were declining assets, and at the same time, we did book some revenue for the Moderna vaccine in Japan in quarter 1.
Slide 16 shows the revenue of our main products within our key business areas. In particular, we are focused on maximizing our 14 global brands indicated here by the red globe symbol. In total, these products generated JPY 335.6 billion or USD 3 billion in quarter 1 and grew at 6.8% on an underlying basis. As I mentioned on the previous slide, immunoglobulin was impacted by quarterly phasing, declining almost 7%. However, we remain confident that this will recover in coming quarters, and we maintain our forecast of 5% to 10% growth for the full year. Quarterly phasing also impacted TAKHZYRO, which grew 6%, mainly due to a strong quarter in the prior year. But again, we remain on our guidance for the full year growth of anywhere between 20% to 30%.
Moving now to Slide 17, which shows the bridge from reported to core operating profit. Here, what's really important to note is, our reported operating profit reflects the gain on the sale of the diabetes portfolio and declining purchase price allocation or purchase price accounting and integration costs, which are then adjusted out of the core. So this quarter 1, you can see the reported and core are very similar, JPY 248.6 billion for reported operating profit and our core is JPY 248.9 billion.
Next slide, please. This shows our impact -- factors impacting our growth of our Q1 core operating profit versus prior year. As you can see from the dark gray bars, our underlying business excluding the ramp-up in R&D investment was positive as was the impact of foreign exchange. However, as shown by the 2 red bars in the middle, our year-on-year growth was impacted by a significant step-up in R&D investment to support the innovative pipeline, as this is the inflection year, as well as the sizable impact from the divestitures. Just to remind everyone, this impact of divestiture, we expect to see the impact easing off from quarter 3 this year because last year in quarter 3 to March 2021, we divested 7 products. These factors overall resulted in our 2021 quarter 1 core operating profit of JPY 248.9 billion, which puts us in a strong position towards achieving our full year forecast of JPY 930 billion.
Slide 19 demonstrates our commitment to our margins. Here, you can see we're on track to our full year target. In 2020, we closed the year with underlying core operating profit margin of 30.2%. Quarter 1 was slightly ahead with 30.5%. And again, we're very much committed to delivering our full year guidance of approximately 30%.
Next slide, please. Here now, we want to switch towards the cash flow, and Slide 20 shows the evolution of our cash balance over the first quarter. Operating cash flow was JPY 166.9 billion. This includes the cash from the Japan diabetes portfolio, offset by cash flow litigation settlement and some phasing in working capital. Free cash flow was JPY 129.9 billion, reflecting CapEx of JPY 42.3 billion and the lack of significant asset sales in quarter 1 this year. Our cash balance evolution reflects a significant JPY 242.9 billion of debt prepayments made in quarter 1.
Slide 21 plots the net debt balance, also reflecting the half year dividend paid in June as well as other items, including the cash out for the Maverick acquisition. We ended the quarter with net debt to adjusted EBITDA at 3.3x. It's a slight bump, but just to remind you, this bump is due to half year dividend payout in quarter 1, coupled with the payout on Maverick. We expect the net debt to adjusted EBITDA to aggressively decline from quarter 2 onwards.
Slide 22 is the latest snapshot of our debt maturity ladder. I'd like to draw your attention to fiscal year 2021, where you can see the full debt obligations have been paid off for 2021, already in quarter 1. And on top of that, we made a prepayment of $2 billion that was due in fiscal year 2025. So already, we made $2 billion plus the $200 million that was due in fiscal year 2021. So what we see is, in August, we expect to make a payment for prepayment for EUR 1.5 billion bonds, which we called in July. So in total, we expect approximately $4.1 billion of prepayments paid in actual fiscal year 2021. As a result, what you'll see in fiscal year '22, our debt obligation will be approximately JPY 200 billion. So cash that we'll generate from quarter 2 all the way to the end of fiscal year 2022 will allow us to continue to accelerate and rapidly pay down future debt.
Next slide, please. So now moving to Slide 23. We are confirming that we're on track to our full year 2021 guidance with no changes to the targets that we communicated during our May earnings. And finally, on Slide 24, I'd like to emphasize our solid start to the year and that we're on track, as I mentioned, to deliver the full year guidance. Topline, we're seeing an acceleration. Last year, underlying revenue grew at 2.2%. We're accelerating already in quarter 1 at 3.8%, despite some of the phasing in some of the 14 global brands. But it's important to note that we are accelerating 3% to 3.8% in quarter 1, and we expect to deliver mid-single digit spurred by the acceleration of our 14 global brands and also based -- also driven by continued rollout of the Moderna vaccine here in Japan. Our margins, we started off well at 30.5%. We see ourselves continuing to improve that in the midterm, anywhere between low 30s to mid-30s. And our guidance for 2021 for operating profit, we're confident to deliver the JPY 930 billion. And finally, our free cash flow. We're on track to deliver our free cash flow target anywhere between the JPY 600 billion to JPY 700 billion and continue to focus heavily on our net debt to adjusted EBITDA ratios to low 2x by fiscal year '21 to 2023.
Thank you for your attention, and I will open it up for Q&A.
[Interpreted] [Operator Instructions]
The first speaker is Yamaguchi-san with Citi.
Can you hear me?
Yes, we can hear you.
Yamaguchi from Citi. Two questions upfront. The first question is regarding Hikari factory. I think the FDA inspection should happen in July. Today is the last day of July. So can you give me, if you have, any update on the Hikari factory inspection from the FDA? That's the first question -- on inspection and also the warning letter, future prospect as well, that's the first question.
Second question is a congratulations on the BTD for 994, which is exciting. But can you remind me, if you got the BTD, is that -- does it mean that FDA already saw some efficacy data? Not Phase I, but efficacy data, either Phase II or Phase IIb, to see the efficacy potential of that drug? And also, can Takeda use this opportunity to shorten the clinical trial or launching timing in the future through those BTD designation?
Thank you, Yamaguchi-san. It's Christophe here. I'll take the first question, and Andy will take the second question.
So yes, we -- remember that we asked for this reinspection because we felt that we met the requirements, and we progressed a lot to remediate the finding associated to the warning later. So we are very pleased that the FDA could do this inspection in July. It was complicated because, of course, of the quarantine and all the environment, but the inspection did happen. So we are very pleased with that. I cannot tell you the outcome of the inspection because it takes time to write the report and to conclude, but it has happened as we asked, and we are very pleased with that. And we will as soon as we can, we will disclose the finding, but for us, it was a good event that it could happen.
Christophe, maybe I take the 994 FDA question. So Yamaguchi-san, thank you very much for the question. So the answer to the first part of your question is, absolutely, FDA have seen data from the TAK-994-1501 study Part A. So we haven't shared that broadly externally because it's an ongoing study, but we have alluded to the significance and the robustness of the results that we've seen in that study. To be clear, the breakthrough designation by the FDA is typically allocated for a very particular indication. And in this case, it's excessive daytime sleepiness for type 1 narcolepsy.
With regard to your second question, you asked about acceleration. So our base plan for this program is already hyper accelerated. So this -- the lead molecule TAK-994 went into the clinic in November of 2019 and our expected base case, which we're still tracking on, is to have this submitted and approved in 2024. Having a breakthrough designation only enables that and could potentially allow for further acceleration. The breakthrough designation is an incredible opportunity to have a very privileged and iterative dialogue with FDA. So when a key issue comes up, you're not waiting months to get in front of them. You have individuals who you're working very closely with. So it's an affirmation of the data that we've shared with you, and it gives us an opportunity to look to accelerate even further, yes.
So next question is Stacy Ku from Cowen.
Stacy Ku from Cowen. Congratulations on all the progress in the quarter. A few questions. So first, any updated thoughts on TAKHZYRO? Any implications from BioCryst's ORLADEYO launch now with nearly half a year impact in the prophylaxis market. That's the first question.
And the second question is going to be around mobocertinib. Can you talk about the commercial launch preparation ahead of the PDUFA date? And looking at J&J and their latest earnings release, they didn't speak too much about their launch for RYBREVANT. So what are you seeing? What are you seeing on end?
Ramona, could you take the first question?
Yes. I'll jump right in then with TAKHZYRO, Chris, are you -- I'm assuming that you can hear me okay, but please let me know if not. So thank you so much for your question, Stacy.
Really, as we look through the year with TAKHZYRO, the quarter 1 was largely due to phasing, but we're very confident in our full year growth projections for TAKHZYRO. We said 10% to 20% and very confident in being able to achieve that goal. .
TAKHZYRO is going to be driven this year by geographic expansion. So we're [ pulling ] to launch in markets outside the U.S. In the U.S., we've penetrated pretty deeply into the market, but we do see a continuing growth of the prophy market. And so we believe that over time, that will help TAKHZYRO well as we continue to grow in prophy and the prophy market continues to grow. And obviously, the COVID recovery is only still happening in the U.S. So we think there's upside there, too, as the COVID recovery continues to happen, and we're seeing some of that underlying business.
Certainly, ORLADEYO has made an impact in the U.S. I think it's good to have options for patients, and certainly, it's good to have competitors for us as a company. It keeps us on our toes and it makes sure that we are ready to truly position ourselves in our strength, which is efficacy. And I think that's what we continue to hear from TAKHZYRO, even to patients that might have switched and then have switched back to TAKHZYRO, the efficacy allows people to live without the stress and the anxiety of having an HAE attack. And we continue to see that being a very strong feature for TAKHZYRO and something that people continue to rely on. We've just released the data from our longer-term extension HELP trial, which sort of shows that continued impact. So we're confident in our ability to grow both with the COVID recovery, with the prophy market growth, with our geographic expansion, based on the strength of the brand right now.
Thank you, Stacy, for your question regarding mobocertinib. So one thing I want to stress out is that with the type of pipeline progression that we are aiming for and the inflation that we are looking for, one area we are focusing on very much is about new product launch and being ready. And Teresa Bitetti was heading our global oncology business unit -- is very much focusing on the oncology. And Ramona is leading the preparation of the launch for all other products, working very closely with our R&D colleagues and our regional commercial businesses. So when a product will be approved, will be ready for launch, I can't guarantee you, because that's very much our focus. And we know that it is a major challenge to -- and a major opportunity to launch a new product, but you have to be ready. So we'll be very much ready with mobocertinib.
[Interpreted] We would like to move on to the next question. Mr. Arai of BoD (sic) [ BoA ] Securities.
I have a quick question about the past quarter results, like versus like full year guidance. Could you walk through, I believe, we -- like which business unit is stronger than expected or which business unit is weaker? That is my first question.
And my second question is about the plasma-derived therapy business, like I see sales is declining year-on-year. Could you sort of, would the declining be like the higher [ volumes ] compared like with a market average. So my question is about a declining IG business year-on-year. That's the second question.
Costa, you take the first one? And Julie, second.
Appreciate it, Arai-san, for the questions.
So if you look at our 5 key business areas, we're on track. We're targeting -- our GI is doing well. We're seeing 8% growth. We still expect an acceleration there for the full year as we have in the data book we've communicated. So we expect 10% for the full year. So we're getting there on the GI portfolio. Rare disease, rare metabolic is on track. Rare hematology is also on track on the basis of our expectations with the competitive landscape there. . HEA, that's the one that we're -- as Ramona mentioned, we have some phasing there. We expect that to drive upside in quarter 2, particularly for TAKHZYRO. And then also, Julie can talk to you about the plasma-derived therapies, in particular, some of the phasing that we saw. So in quarter 1 of 2020 and also in 2021. Oncology doing well. Overall, strong growth 9%, predominantly driven by some variances or dynamics between [ Elara ] and VELCADE because of the switch between oral last year. We had some bumpiness quarter-by-quarter, particularly in quarter 1 of last year. Because of the pandemic, many customers switched from IV to oral. And in quarter 1, now that it's opened up -- the markets opened up, in particular in the U.S., we're seeing the switch come back to the impact there of the variation between prior year.
What's really important is the rebound in neuroscience where you're seeing VYVANSE particularly showing acceleration of growth as the markets in the U.S. are opening up.
And again, the other portfolio, we've divested numerous numbers of noncore assets in that area. And for the first time, you're seeing growth here at 9%. In particular in the past, it was always double-digit decline in the last year or so. So this is an opportunity that we continue to see growth. And then on top of that, we're seeing an acceleration of the COVID-19 Moderna vaccine. We just started to record revenue here in quarter 1. This will ramp up in quarter 2 as well. So overall, the 14 global brands are growing at 6.8% in quarter 1. We believe growth will accelerate, very similar to the levels of what we saw last year, where it was growing at 16%. So we have a good runway, good start to the quarter, but we see a positive runway, especially with the 14 global brands.
And Christophe, I'll take it from here for the IG question. So thank you, Arai-san. In terms of the IG growth, when you look at quarter by quarter, it's very difficult to take a quarter performance and extrapolate for the final year. So last year in quarter 1, we had very significant growth due to phasing and a difficult comparison with the previous year in FY '19. So if we take all of that into consideration in FY '19, we had a minus 2% growth in quarter 1, and we ended the year with a 7% growth overall for IG. In 2020, we had roughly 30% growth for IG in quarter 1. We ended the year with roughly 16% growth of IG. And this quarter, again, it's a difficult comparison with the 30% growth from FY '20 Q1, but we are on track to achieve the 5% to 10% growth for the year. To give you some confidence in that, if we look at our 12-month trailing growth, we are already in the mid-single digits. So again, very much on track to achieve the year-end results.
We would like to move on to our next question. Hashiguchi-san from Daiwa Securities.
[Interpreted] This is Hashiguchi from Daiwa Securities. I have 2 questions. The first question, why did phasing occur for TAKHZYRO and for immunoglobulin? Not comparing to last year, but just looking at the sales for the first quarter of this year, I think the volume value is low. Why did phasing occur to come to this number? Can you be more specific?
And the second question about TAK-999. Breakthrough therapy designation from FDA was achieved. And in the slides given, 2025 and after as breakthrough pipeline, that is the target for your approval. But in the first half of '21, POC data will be available. That is what I read on the slides. And with this BTD, the POC data, would it be possible for you to apply for accelerated approval? Is that a possibility? That is my second question.
Thank you, Hashiguchi-san. I mean the phasing -- year-on-year basis, the phasing -- there are phasing dynamics because last year was a very exceptional year because of the pandemic. This year is still within the pandemic with a different situation. So you have different dynamic. Take VYVANSE, for example. You didn't mention that. So you need to go product by product to get an explanation. So let's take immunoglobulin, perhaps Julie can give a bit more granularity on the situation and then Ramona on the TAKHZYRO.
Yes. Thank you, Mr. Hashiguchi-san. So again, I would emphasize where we are when you look at the 12-month trailing growth, which is mid-single digits because there is, I'll just call it, lumpiness in terms of the sales of IG, both in terms of tender sales as well as contracts in the U.S. So it's not something that on a quarter-by-quarter basis can be extrapolated for annual growth.
Yes. And I can speak a little bit to TAKHZYRO. And as Christophe mentioned, really every product because of COVID has had a bit of a unique circumstance. So for instance, last year with VYVANSE, all of the school shut down, and so we saw the impact on the child market with VYVANSE. This year, we're growing on top of that. And at the same time, we're seeing the adult market really grow this year in the second quarter, as an example. For TAKHZYRO, a little bit of a different situation. So last year, as we were heading into the pandemic, there was a little bit of, I would say, hoarding. It was very, very strong adherence and a little bit of buy-in from the channel to make sure that they had product available for patients. Now this year, we're more in a steady state with the pandemic. We don't see those shifts of buying in, and so we're more in a steady state with the pandemic. And so we're not seeing that -- that we saw last year. So that would be the TAKHZYRO example.
It's all -- I would say that we had expected and planned for this. So as we look our forecast for the year, we had planned for kind of these different dynamics to happen in the quarters based on COVID recovery and based on last year. And I would say that looking at how we're tracking, we're tracking very much at or ahead of our plans that we had expected or forecasted.
I can add, Mr. Hashiguchi-san, on TAK-999. So of course, very excited about the breakthrough therapy designation. Just to step back, this is a partnership with Arrowhead Pharmaceuticals. Arrowhead runs the program through Phase II, and then Takeda takes over the program for pivotal studies and forward.
We actually -- the breakthrough designation was allocated based on open label data from a series of patients that Arrowhead has already presented in the public domain where we've seen quite striking results. There is a more formal Phase II study that will be unblinded later this year. So we'll see results from that study. The design of that study looked very similar to the design of the protocol that the patients that have already been disclosed have gone through, but we'll have much more robust data looking at reduction of what we think is the pathological factor in alpha-1 antitrypsin induced liver disease. And that's this aggregate of high PI*Z alpha-1 antitrypsin. We'll also get a sense for liver inflammation. We'll get a sense for liver fibrosis. Whether those data could be used as a source of accelerated filing -- well, now we have a breakthrough therapy designation, we could certainly have that conversation in a more direct way with the agency. The agency up until now has been very clear for all liver disease programs, starting with the very difficult challenging NASH space, but also down to other spaces. You actually do need to show changes in fibrosis over time and then commit to showing -- demonstrating clinical benefits. But I think the -- we're still sticking to our base case in terms of timelines. We're gearing up at Takeda to start Phase III studies next year, but certainly, having a breakthrough designation gives us a window to have a dialogue. And the FDA has been unpredictable lately in terms of what they're willing to discuss for accelerated approval. So we'll certainly be in that conversation.
[Interpreted] Next. Morgan Stanley, Mr. Muraoka, please?
[Interpreted] This is Muraoka, Morgan Stanley. My first question is about -- for SG&A. I think it's Y-o-Y plus 7%, JPY 218 billion. I think that this increase of SG&A is substantial. Are there any reasons behind? I think year-on-year, your forecast was to be flat. But if you consider this is not an issue, then could you also explain why do you think so?
Second question is Eohilia and maribavir that you submitted. In Page 6, looking at the timeline chart there, Eohilia approval, I think there seems to be delayed to Q4. So I'd like to know the reason of this delay. And maribavir, I think the PDUFA was May. But now it seems like it is expected to be in the third quarter. So could you also explain the background reason of this delay?
Thank you, Muraoka-san. Costa, the first question. And Andy, the second one.
Thank you very much, Muraoka-san, for your questions. Firstly, let me highlight that the SG&A increase in quarter 1 fiscal year '21 versus 2020, 50% of the SG&A increase is related to foreign exchange, when you're looking at the core and the reported SG&A number. So 50% of that increase is FX headwinds. Secondly, when you compare quarter 1 of last year when it was right in the middle of the beginning of the COVID pandemic, many of the markets and countries were locked down. So there wasn't much activity in that space in SG&A. 2021, where we're seeing the markets reopening, we're launching a significant number of new products, in particular in China. So we're seeing the China growth on the launching -- investment in the launching of new products, and that's reflected in the strong growth we're already seeing in topline revenue growth in China. So overall, SG&A increase is -- 50% of that is FX.
Secondly, the quarter 1 of last year is not a real great baseline to choose from. And thirdly, we're seeing investments in our launch preparation, in particular markets like China, to help drive top line revenue growth. Thank you very much for your question.
And Muraoka-san, it's Andy. Very briefly on maribavir. Just to kind of make sure you understand the situation. So we submitted the dossier earlier this year, and it was accepted in May. We received a priority review, which is a 6-month review cycle, which means our PDUFA date for maribavir is in November -- towards the end of November. So maribavir is tracking according to timeline. With Eohilia, we don't know what a target approval date looks like at this point. We had submitted that dossier at the end of last year. We had a PDUFA date earlier this year but the FDA missed the PDUFA date, which is a quite significant event for the FDA because there's -- they have an obligation to do their PDUFA agreement to hit a certain very high percentage of their PDUFA date. So every time they miss one, it has consequences. We're in dialogue with FDA. There are what are called information requests where sponsors iterate with FDA on the material. We still feel very confident in the clinical profile, the safety profile, the overall profile of this drug. And we're still hopeful that it will be approved, but we don't have a sense for timelines right now. And what you see on the time line chart, the chronology on Slide 6, is just our best sense directionally of when that might occur, but that's not based on any feedback from FDA.
[Interpreted] Moving on to the next question from Crédit Suisse Securities, Mr. Sakai. Sakai-san, are you there?
Can you hear me now?
Yes, we can hear you.
I'm sorry. I got stuck on mute. Yes, 2 questions. Now Plump-san, your comment just brought me a high level question. You said FDA recently is very unpredictable, especially on accelerated approval process. Now are you referring to recent development of the Alzheimer disapproval? Or can you specify what you mean by this unpredictability? Because this may be related to narcolepsy drug, the Phase I -- sorry, looking at Page 7 of your slide, you have important event coming, right, in the second half, especially this regulatory alignment for narcolepsy Type 1 Phase III development program? Now what are you going to be discussing here? Because you have already given break therapy status. Now that is given if proof of concept is mechanically innovative, but clearly, you have to get the Phase IIb outcome right? I just want to make sure I'm understanding this process, right? So these are -- I don't know how many questions I have here, but that's all my questions.
Yes. First, let me just say that was [indiscernible] When we say we have an accelerated program, that's different than the regulatory designation of an accelerated approval. The regulatory designation of an accelerated approval means that you're having a product approved by the agency, not based on clinical endpoints, but based on biomarkers that the agency believes will predict clinical end points. So that's exactly what happened with the neuroscience example that you just mentioned in Alzheimer's disease. Our base case for TAK-994 and narcolepsy Type 1 is not an FDA accelerated approval. Our base case is approval based on accepted endpoint for registration. So the timeline that we're putting forward actually is highly accelerated, but it's not dependent on an accelerated approval by FDA.
Now with the breakthrough therapy designation, we'll have a chance to sit very closely with FDA and discuss what exactly will be required, what's the length of the study, what are the end points, whether or not there are comparators. And this is a real privileged opportunity for us. And even with that opportunity, we still think that the data are so profound that we can do this in an accelerated fashion, but having that designation will certainly enable that path.
[Interpreted] Next question. Mr. Akama, Nikkei newspaper.
[Interpreted] This is Akama, Nikkei newspaper. I have 2 questions. First, question goes to Andy. Japanese MHLW actually had a discussion on pevonedistat regarding its innovative drug designation. And I believe that within FY '20 -- within the FY ending in March '22, you are going to submit this. What is your status regarding the Japanese submission? And what is the indication that you are planning to obtain? So I'd like to understand the approval status -- submission status in Japan?
Second is to Christophe. Moderna vaccine, it is said that the vaccine supply has been delayed in terms of delivery to Japan. And I believe that you will get 50 million doses by the end of September. But what is the current progress? Is it actually going to be achieved? Or what is the commitment made?
Christophe, would you like me to start with the pevo question?
Yes, please.
Yes. So Akama-san, thank you very much for the question. So the first step for pevonedistat is the global Phase III study, the PANTHER study in high-risk myelodysplastic syndrome and low-blast AML. We'll be receiving data from that study this fiscal year, and that will determine the next steps for pevonedistat on a global basis. I actually don't have the timelines for Japan registration in front of me. We can certainly get those to you. We are -- we will have to do bridging studies in Japan. And then what the registration package will look like fully will require a dialogue with -- further dialogue with MHLW, but we could certainly get to those dates.
Thank you, Akama-san, for the second question, I will ask Iwasaki-san to answer because he is working on a daily, hour, minute, second basis on providing the vaccines to the Japanese. So Masato, if you could take that?
[Interpreted] Thank you very much, I'd like to answer to your question. Thank you very much for your question. Today, from the Minister Kono, there was an announcement made, and I am repeating what already announced. The Moderna's outside of U.S. partner in manufacturing, during its inspection process, some issues were found. Therefore, vaccine supply outside of U.S. has been delayed, and that's what we also heard. And what we know at this point in time is that for Moderna, together with partners, how we'll be able to minimize such delay of any necessary supply that's been under discussion and also already, the manufacturing is put back on track. So for us, as soon as we get a vaccine from Moderna, our importing the process and delivery within Japan -- we are ready, and we will focus on achieving those as quick as possible on our side. Thank you very much.
[Interpreted] Because of time constraints, we'd like to make the next question the last question for tonight. From JPMorgan, Mr. Wakao, please.
Okay. Can you hear me? This is Wakao from JPMorgan. I have one question about Novavax vaccine. Where will we know the profit impact of Novavax vaccine? Is it after the approval is obtained or when the government purchases it? And will it be booked in the current fiscal year, March '22?
Well, I think we will include it in our guidance, in our forecast as soon as we have greater [ clarity ], greater information and -- about the approval date and the possible launch in Japan as well as the formalization of the supply delivery. So we are very, very committed. And we are working very hard to bring the Novavax vaccine as soon as possible in Japan, but we need a bit more time to precise the information about when it could be introduced in Japan and what would be the type of supply delivery schedule that we could commit to.
[Interpreted] With that, we'd like to conclude the webinar call today. Thank you very much for joining us, despite your very busy schedule. Thank you, and please continue to support Takeda. Thank you.
Thank you very much.
Thank you.
[Portions of this transcript that are marked [Interpreted] were spoken by an interpreter present on the live call.]