Third Quarter Consolidated Financial Results
for the Fiscal Year Ending March 31,
31 2012
1. Overview of consolidated results
2. Actual and Forecast of Main Subsidiary Companies
3. Main Product Sales Update
4 Development pipeline
4.
【Reference】
5. Segment information
5
6. Financial summary

February 3, 2012

KYORIN Holdings, Inc.
These forecast performance figures are based on information currently available to theCompany and may include uncertain factors or risk that affect our future performance.
Accordingly, actual business results may materially differ from the forecasted figures due
to various factors in the future.

Outline of Third Quarter Consolidated Financial Results
for the Fiscal Year Ending March 31, 2012（¥ million）

YoY
change(%)

Dec/2009

66 361
66,36174 57974,57975 82175,82177 41377,413+2.1%
2 1%

105 100
105,100

+1.0%
1 0%

Operating Income

5,339

11,045

11,312

11,668+3.1%

14,900△9.4%

Ordinary Income

5,451

11,86011,84812,358+4.3%

15,600

△8.8%

842

7,537

7,535

7,227

△4.1%

10,100△7.6%

Net Income

Dec/2011

Mar/2012

Dec/2008

N tS
Net
Sales
l

Dec/2010

YoYchange(%)(forecast)Third Quarter Consolidated Financial Results for the Fiscal Year Ending March 31
31, 2012【 Net sales】 Sales of Japan ethical drugs increased for steady sales of our main products year on year ,under the influence of the excess
distribution inventory at the end of the fiscal year ended March in association with the Great East Japan Earthquake.
Sales of overseas ethical drugs this year was less than that of last year, and sales of generic drugs had no fluctuation as compared to lastyear. AsA a result,
lt C
Consolidated
lid t d N
Nett SSales
l iincreased
d2
2.1%
1% year on year, tto ¥77.4¥77 4 billi
billion.
【 Net income】 Gross Profit rose due to the increase of Net Sales and decrease of Cost of Sales . SG&A Expenses rose due to increase of
R&D Expenses for progress of R&D. Net Income decreased 4.1%, to ¥7.2 billion year on year , due to the tax system revision and amortizeddeferred tax asset.
Consolidated Financial Results for the Fiscal Year Ending March 31, 2012(forecast)【 Net sales, Net income 】 We will not revise the full-year (consolidated) results forecast of Net sales and Net income announced on
N
Novemberb 8
8, 2011 at thishi moment .
(degree of progress: Net sales: 73.7%, operating income: 78.3%)
1

Highlights of Business Performance（ Units: ¥ billion ）Highlight ①◇ Net Sales increased ¥1.6 billion year
on year.

Cost of Sales

Cost of Sales

27.4

27 7
27.7

Highlight ②◇Cost of Sales declined ¥0.3bln.
(The Cost of Sales Ratio fell 1.1 points.)◇Gross Profit increased(up ¥1.9bln year on year).

Cost of Sales Ratio

Cost of Sales Ratio

35.4%

36.5%

Net sales

Net sales

R&D

R&D

77.4

9.1

10.2
SG&A

SG&A

SG&A

36 8
36.8

(excluding R&D)

SG&A

38 3
38.3

◇SG&A expenses increased ¥1.5bln
year on year.
(R&D expenses increased ¥1.1bln.)(excluding R&D)

27.7

◆Operating Income rose ¥0.4
bln year on year.

28.1
O
Operatingti IncomeI

Operating Income

Dec/10Highlight ③

Dec/11
2

Consolidated Financial Results
for the Third Quarter ending
g March 31,, 2012
Year onYear≪Dec/2010(actual) vs.Dec/2011(actual)≫（¥ billion）

Dec/2010

Dec/2011

change■Net Sales¥77.4bln(+ 1.6)◆Ethical drugs business¥75.5bln(+ 1.7)¥64.6bln(+ 0.2)¥1.4bln(△0.4)¥6.5bln(● Sales of new ethical drugs
Dec/2010 ⇒Dec/2011

Net Sales (total)

75.8

77.4

+1.6

Ethical drugs
Business

73.8

75.5

+1.7

66.0
64 6
64.6
1.4

+2.0

●Overseas

64.0
62 2
62.2
1.8

△0.4

◆Generic drugs

6.5

6.5

0.0

◆Over-thecounter drugs

3.2

3.0

△0.2

Healthcare(Skin care)
B iBusiness

2.1

1.9

△0.2

◆Sales of new
ethical drugs●JapanOperating
Income+2 4+2.4

・ Kipres・ Mucodyne
・ Pentasa
・ Uritos

24.4
15.9
15.1
3.9

⇒
⇒
⇒
⇒

27.6
16.0
14.2
4.8

(+ 3.2)(+ 0.1)(△0.9)(+ 0.9)●Sales of new ethical drugs in Overseas
・ Gatifloxacin

1.5 ⇒

1.2

(△0.5)●Sales of Generic drugs

0.0)・Health insurance pharmacy market’s
market s sales increased,
increased
contract manufacturing’s sales decreased.

●Sales of Over-the-counter drugs¥3.0bln(△0.2)◆Healthcare (Skin care) Business¥1.9bln(△0.2)(△0.2)●Sales declined at Dr. Program■Operating Income¥11.7bln(+ 0.4)◆Operating Income margin rose 0.2 percentage points to 15.1%●Cost of Sales : down ¥0.3bln (¥27.7bln⇒¥27.4bln)◆Cost of Sales Ratio : 36.5%⇒35.4% down 1.1 percentage points
・Increased sales of in-housein house products with lower cost of sales
・a rise in the factory operation ratio , ・a decrease of manufacturing cost

●R&D expenses : up ¥1.1bln (¥9.1bln⇒¥10.2bln)

11.3

11.7

+0.4

◆R&D Ratio : 12.0%⇒13.2% up 1.2 percentage points
・Expenses associated with the progress of the R&D(Application of Pentasa ,Once a day oral administration etc.)

Ordinary
Income

11.8

12.4

+0.6

Net Income

7.5

7.2

△0.3

●SG&A (excluding R&D expenses) : up ¥0.5bln (¥27.7bln⇒¥28.1bln)◆SG&A Ratio (excluding R&D expenses) : 36.5%⇒36.3% down 0.2 percentage points■Net Income¥7.2bln・Amortized deferred tax asset due to the tax system revision.

( △0.3)3

Actual and Forecast of Main Subsidiary Companies（unit : billion）

Mar/2012

Dec/2010

Dec/2011

Mar/2011

Sales

67.2

70.3

92.5

94.7

Operating Income

10.6

11.2

15.6

14.2

72
7.2

72
7.2

10 7
10.7

99
9.9

Dec/2010 ※Dec/2011

Mar/2011

Sales

7.7

7.1

10.3

10.5

Operating Income

0.5

0.3

0.8

0.6

Net Income

0.5

0.3

0.6

0.5

Dec/2010

Dec/2011

Mar/2011

Sales

2.1

1.9

2.8

2.8

Operating Income

0.1

0.0

0.1

0.1

Net Income

0.1

0.0

0.1

0.1

KYORIN pharmaceuticalN t IIncome
Net

KYORIN Rimedio

Dr. Program(forecast)

Mar/2012((forecast))

Mar/2012(forecast)※Associated with the integration of the wholesale trade channel into KYORIN Pharmaceutical (October 1), beginning inventories are posted in sales(¥0.6bln).

4

Main Product Sales Update（ Units: ¥ billion ）Interim term

Kipres(LT receptor antagonist)

Mucodyne
Sales of new
ethical drugs(Japan)（Mucoregulant）

Pentasa(Ulcerative colitis and Crohn’sdisease treatment)

Uritos（Kyorin）(O(Overactive
ti bl
bladder)
dd )

Ketas
(For bronchial asthma andcerebrovasculas disorders)

Sales of new
ethical drugs(over seas)

Gatifloxacin

Consumer
Healthcare
business

Milton(Bulk・Royalty)(Disinfectant)Third quarter（（April1 to December 31,2010））

Full term

FY10(results)

FY11(results)

FY10(results)

FY11(results)

ChangeProgress tofull term
forecast(%)

FY10(results)(forecast)

14.1

15.7

24.4

27.6

13.2%

75.3%

34.5

36.7

9.4

9.1

15.9

16.0

0.8%

75.0%

21.3

21.3

9.9

9.1

15.1

14.2

△6.3%

76.1%

19.4

18.6

2.4

2.9

3.9

4.8

21.9%

71.9%

5.5

6.6

2.0

1.8

3.0

2.7

△9.9%

76.3%

4.0

3.5

1.3

0.8

1.5

1.2

△21.6%

70.2%

2.2

1.7

0.9

0.9

1.5

1.5

1.4%

75.4%

1.9

2.0

FY11

5

Main R&D Activities① (February 3 , 2012 Release)※Changes from the previous announcement(November 8, 2011)

Ph IIb Application submitted
Stage

Compound/C d
CodeTherapyarea/Action/A i※Application
submitted(11/2011)

Pentasa(tablet)Ulcerative
colitisFerringPharmaceuticals

New dosage regimen for ulcerative colitis in theremission phase (once a day)PhⅢ
(11/2010)

Pentasa(suppository)

Ulcerative
colitisFerringPharmaceuticals

Consideration of a new dosage form for the active
phase of ulcerative colitis (once a day)*Development of a new
dosage form

Japan

Overseas

OriginFeatures

Comments

PhⅢ(8/2010)(US)
SkyePharma: Application
A li ti
submitted (3/2009)（Europe）
Mundipharma: Application
submitted (3/2010)

KRP-108(Inhalant)

Antiasthmatic

SkyePharma
PLC

An ICS/LABA combination product, which offers
better compliance and convenience to the patients・License agreement with
SkyePharma (4/2008)
・Domestic Ph II completed(4/2010)PhⅡ（2/2008）

PhⅡ（9/2007）

KRP-104

Anti-diabetes
agent

In-house

A DPPIV inhibitor to reduce blood glucose throughsuppression of the degradation of insulin-releasing
hormone. Diabetic therapy with fewer side effects is
expected than existing treatments.

・Overseas Ph II b completed(3/2011)・Domestic Ph II b completed(3/2010)6

Main R&D Activities② (February 3 , 2012 Release)※Changes from the previous announcement(November 8, 2011)

POC Project (Pre-clinical ~ Ph II)
Stage
Japan

Overseas

Compound/
Code

Therapyarea/Action

OriginFeatures

Comments

PhⅡ（POC)(12/2010)(Novartis)

KRP-203

Transplantation,
autoimmune
diseases,and
IBD

In-house

An immunosuppressant with a novel mechanism
called an S1P-agonist. It may have a better safety
profile than previous ones as well as an excellent
effect under concomitant use with other types of
immunomodulator.

PhⅠ（8/2010）

KRP-110

Opioid-induced
constipation andintractable pruritus

In-house

A highly selective μ-opioid receptor antagonist. It is
expected to block constipation induced by opioid
analgesics without interrupting the analgesic effectof opioids. It is orally effective in various itchingmodels, indicating potential of a novel anti-itch drug
for intractable pruritus.

PhⅡ*（8/2011）

PhⅢ
Merz

KRP-209

Tinnitus

Merz

KRP-209 (Neramexane) is expected to improve thepatients' annoyance and difficulties in their life
caused by tinnitus, mainly through its two
pharmacological properties: 1) NMDA antagonistic
activity and 2) Nicotinic acetylcholine antagonistic
activityti it

License agreement with
Merz (11/2009)
Merz:Ph I clinical trial ofJapanese patients in US
completed (3/2010)

Preparingfor clinical
trials（Europe）
Almirall: Preparing for
application(US)
ForestPharmaceuticals: Preparing for
application

KRP-AB1102（Inhaled drug）

Chronic Obstructive
Pulmonary Disease(COPD)

AlmirallThis bronchodilating agent has an acetylcholine
receptor antagonist action that offers long-lasting
improvement for breathing difficulty and shortness ofbreath associated with COPD.
①Fewer sistemic side effects②Twice-daily dosage offers a full-day
improvement in symptoms and respiratory
function③Short time required for the maximum effectLicense agreement with
Almirall (2/2011)

PhⅠ*（8/2011）

KRP-AM1977X(Oral agent）

New quinolone
synthetic
antibacterial agent

In-house

PhⅠ
preparations

KRP-AM1977Y(Injection）

New quinolone
synthetic
antibacterial agent

In-house①Superior ability to combat drug-resistant grampositive bacteria (incl.
(incl MRSA)②Outstanding ADME (oral absorption, tissue
migration)③High degree of safety expected since safety
hurdles cleared prior to clinical trials

PhⅠ（12/2010）

License agreement with
Novartis (2/2006)
New license agreement
IBD (11/2010)

7

Main R&D Activities③ (February 3 , 2012 Release)※Changes from the previous announcement(November 8, 2011)

Licensing Development
Stage

Compound/CodeLicensee/Collaborative
research

Therapy area/Action

OriginComments※Approval（1/2012）Alphagan/AlphaganP

Senju Pharmaceuticals

Glaucoma

Allergan (US)・Licensed from Allergan(Cross license of gatifloxacin ophthalmic solution)
・License-out to Senju (5/2004)

Overseas Ph II（8/2005）

Ketas

MediciNova (US)

CerebrovasculardisordersdidIn-house

・KYORIN grants MediciNova an exclusive license in
all countries worldwide except for Japan, China,
South Korea and Taiwan to develop, manufactureand sell the compound and products for the multiple
sclerosis indication (10/2004)
Result of Ph II was reported in April 2008

Overseas Ph III(Anti-bronchial
Asthma: 11/2006)
Overseas PhⅡ/Ⅲ(Interstitial
cystitis: 5/2005)

KCA-757

MediciNova (US)Bronchial asthma andinterstitial cystitis

In-house

・KYORIN grants MediciNova an exclusive license in
all countries worldwide except for Japan, China,
South Korea and Taiwan to develop and sell thecompound and products・Interstitial cystitis: Result of Ph II/III was reported in
January 2007 and development ceased
・Bronchial asthma: Clinical trial overseas was
discontinued.

Overseas PhⅡ（POC)（12/2010）

KRP-203

Novartis (Switzerland)

Transplantation,
autoimmune,
and
d IBD

In-house

・Kyorin grants the right to develop and commercialize
KRP-203 worldwide for use as an immunosuppressanti organ transplants,inlandd right
i h to develop
d
l and
d
commercialize KRP-203 worldwide except in Japan,
Korea, China and Taiwan for the treatment of
autoimmune diseases and other diseases(February 2006)）
・New license agreement IBD (November 20108

Reference9Segment information
for the Third Quarter Ending March 31, 2012
Sales, Profit or Loss of each report segment(U it ¥ billion)(Units:¥billi )

S l
Sales

Y
Year
on YearY

Net Sales (total)

77.4

+1.6

11.7

+0.4

Ethical drugs business

75 5
75.5

+1 7
+1.7

11 5
11.5

+0 5
+0.5

66.0
64 6
64.6
1.4

+2.0
+2 4
+2.4
△0.4

◆Generic drugs

65
6.5

△0 0
△0.0

◆Over-the-counter drugs

3.0

△0.2

Healthcare(Skincare) business

19
1.9

△0 2
△0.2

00
0.0

△0.0
00

Amount of adjustment

－

－

0.2

+0.0

◆Sales of new ethical drugs●Japan●Overseas

P fit
ProfitYYear
on YearY(Note ) The Company is applying the Revised Accounting Standard for Disclosures about Segments of an Enterprise andRelated Information and the Guidance on the Accounting Standard for Disclosures about Segments of an Enterprise andRelated Information. As a result, the reported segments are the Ethical Drugs Business and the Consumer Healthcare Business.
10Consolidated Financial Results
for the Third Quarter ending March 31, 2012
Interim term
（ Units: ¥ million ）Third quarter（April 1,2011 to December 31,2011）

FY10(results)

FY11(results)

FY10(results)

FY11(results)

Sales

46,707

46,38775,821

77,413

Ethical drugs
gbusiness

45 37345,37345 15545,15573 75173,751

ethical drugs

39,20839,098●Japan37 70837,708●Overseas

Full term

YoY
Change(%)

Progress tofull term
forecast(%)

FY10(results)(forecast)

1,592

2.1%

73.7%

104,069

105,100

75 49575,495

1 744
1,744

2 4%
2.4%

73 9%
73.9%

101 271
101,271

102 200
102,200

64,03365,996

1,963

3.1%

74.7%

88,02088,30038 12938,12962 18862,18864 56264,562

2 373
2,373

3 8%
3.8%

74 9%
74.9%

85 28485,28486 20086,200

1,500

968

1,844

1,434

△410

△22.3%

68.3%

2,736

2,100

◆Generic drugs

4,115

4,097

6,498

6,450

△48

△0.7%

66.5%

8,871

9,700

◆OTC drugs andothers

2,049

1,959

3,218

3,047

△170

△5.3%

72.5%

4,378

4,200

Consumerhealthcare business

1,333
,

1,232
,

2,070
,

1,918
,

△151

△7.3%

68.5%

2,797
,

2,800
,

Operating income

4,201

4,900

11,312

11,668

355

3.1%

78.3%

16,443

14,900Ordinary income

4,542

5,253

11,84812,358

509

4.3%

79.2%

17,11015,600Net income

2,959

3,355

7,535

7,227

△308

△4.1%

71.6%

10,927

10,100◆Sales of new

YoYchangeFY1111