Is Takeda Pharmaceutical (TAK) Halal to invest in?

How much of Takeda Pharmaceutical’s revenue comes from haram?

Takeda Pharmaceutical develops pharmaceutical products focused on gastroenterology, rare diseases, plasma-derived therapies, oncology, neuroscience, and vaccines. 

Takeda Pharmaceutical earns its revenue from the following revenue sources:

  • Product Sale:

Includes revenue generated from selling pharmaceutical products in the key therapeutic areas.

  • Out-licensing and Service Income:

Includes revenue generated from royalty payments, upfront payments, and milestone payments from the out-licensing of intellectual property.

The contributions from each of Takeda Pharmaceutical’s revenue segments in their 2020 annual report were as follows:

Practical Islamic Finance concludes:

None of Takeda’s revenue comes from anything inherently haram.

Does Takeda rely on interest to operate?

Year-to-Date
for period ended
9/30/2021
Fiscal year
ended
3/31/2021
Fiscal year
ended
3/31/20
20
Interest Income$2,126$1,781$11,202
Total Revenue$1,794,423$3,197,800$3,291,200
Interest Expense$58,900$130,806$149,010
Total Expenses$1,202,996$2,859,501$3,016,480
Interest Income / Revenue0.12%0.06%0.34%
Interest Expense / Total Expense4.90%4.57%4.94%
*Numbers in millions, Japanese Yen

Practical Islamic Finance concludes:

Riba is used but not relied upon in Takeda’s operations.

What is Takeda’s Environmental, Social, and Governance (ESG) Impact?

Environment

Takeda achieved carbon neutrality in 2020, according to a press release published by the company.

Social

Takeda partners with governmental and non-governmental organizations to prevent diseases, train health workers, improve maternal, newborn, and child health, and improve access to quality diagnosis and treatment for patients worldwide. 

As part of Takeda’s instrumental Access Program, 948 scientific instruments were donated in 2019 to 67 research departments in 53 institutions, spanning 24 countries.

Takeda has a Glassdoor rating of 3.9 out of 5 from over 2500 current and previous employees compared to a 3.3 average for all other Glassdoor rated companies. 

Governance

Like many pharmaceutical companies, Takeda Pharmaceutical has had some governance issues in the past.

That said, they’ve had a rather clean record for the last 5 years.

Practical Islamic Finance concludes: 

Takeda has a net positive ESG impact. 

Comfort Rating 

From Takeda’s business, financial, and ESG reviews, Practical Islamic Finance rates Takeda Pharmaceutical stock as: 

Comfortable to invest in from a Halal perspective.

Sources

Takeda 2020 Annual Report 

Takeda Q2 2021 10-Q 

Takeda Achieved Carbon Neutrality in 2020 

Takeda 2020 Sustainability Report 

Takeda Reviews

Takeda Actos Lawsuit

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