Third Quarter Consolidated Financial Results
for the Fiscal Year Ending March 31,
31 2013
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 4, 2013

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 dueto various factors in the future.

Outline of Third Quarter Consolidated Financial Results
for the Fiscal Year Ending March 31, 2013（¥ million）

Dec/2009

Dec/2010

Dec/2011

Dec/2012

YoY change(%)

Mar/2013(forecast)

YoY change(%)

Net Sales

74 57974,57975 82175,82177 41377,41379 22979,229

+2 3%
+2.3%

107,800

+4.4%
4.4%

Operating Income

11,045

11,312

11,66813,711+17.5%

17,400+20.3%

Ordinary Income

11,86011,84812,35814,288+15.6%

18,000+17.8%Net Income

7 537
7,537

7 535
7,535

7 227
7,227

9 262
9,262+28.2%
28 2%

11 80011,800+27 8%+27.8%

Third Quarter Consolidated Financial Results for the Fiscal Year Ending March 31, 2013

【 Net sales 】 Sales of Kipres and Uritos, and Generic drugs increased year on year, under the influence of the revisionof drug prices in April this year. And sales of KYORIN Pharmaceutical Facilities which commenced operations on Oct 1st/2012 contributed to increase of net sales. As a result,, consolidated net sales increased 2.3% yyear on yyear,, to ¥79.2bln.
【 Net income 】 Gross Profit decreased year on year due to the increase of Cost of Sales Ratio. Meanwhile, SG&AExpenses fell, given a decrease in R&D Expenses. Consequently, Operating Income climbed 17.5% year on year, to¥13.7 bln,and Net Income rose 28.2% year on year to ¥9.3bln.
Consolidated Financial Results for the Fiscal Year Ending March 31, 2013(forecast)【Net sales, Net income】 We will not revise the full-year (consolidated) results forecast of Net sales and Net incomeannounced on November 7, 2012 at this moment .
(degree of progress: Net sales: 73.5%, operating income: 78.8%)1Highlights of Business Performance（ Units: ¥ billion ）Highlight ①◇ Net Sales increased ¥1.8bln year onyear.

Cost of Sales

Cost of Sales

27 4
27.4

29.6

35.4%

Net sales

R&D

79.2

10.2
SG&A

SG&A

37.3%

◇Cost
C t off Sales
S l iincreasedd ¥02.2bln.
¥02 2bl
Cost of Sales Ratio increased 1.9
points.

R&D◇Gross Profit decreased ¥0.3bln year onyyear.

7.6

Highlight ③

Cost of Sales Ratio

Cost of Sales Ratio

Net sales

Highlight ②

38 3
38.3

SG&A
(excluding R&D)

SG&A

36 0
36.0

◇SG&A expenses decreased ¥2.3bln
year on year.
(R&D expenses decreased ¥2.6bln.)(excluding R&D)

28.1

Operatingpg IncomeO
Operatingti IncomeI

Dec/11◆Operating Income rose ¥2.0
bln year on year.

28.4

Dec/122

Consolidated Financial Results
for the Third Quarter ending
g March 31,, 2013
Year onYear（¥ billion）

Dec/2011

Dec/2012

change■Net Sales¥79.2bln(+ 1.8)◆Ethical drugs business¥77.8bln(+ 2.3)¥65.1bln(+ 0.5)● Sales of new ethical drugs
Dec/2011⇒Dec/2012

Net Sales (total)

77.4

79.2+1.8Ethical drugs
Business

75.5

77.8+2.3◆Sales of new
ethical drugs●Overseas

66.0
64 664.6
1.4

66.8
65 165.1
1.7+0.8+0 5+0.5+0.3◆Generic drugs

6.5

7.7+1.2◆Over-thecounter drugs

3.0

3.4+0.4

Healthcare(Skin care)
B iBusiness

1.9

1.4

－0.5

Operating
Income11.7

13.7+2.0

Ordinary
Income

12.4

14.3

+1.9

Net Income

7.2

9.3

+2.1

●Japan・ Kipres
・ Mucodyne
・ Pentasa
・ Uritos

27.6 ⇒ 28.4 (+ 0.8)
16.0 ⇒ 14.6 (- 1.4)
14.2 ⇒ 13.8 ((- 0.4))5.7 (+ 0.9)
4.8 ⇒・KYORIN Pharmaceutical Facilities commenced operations on Oct 1st /2012●Sales of new ethical drugs in Overseas ¥1.7bln
・ Gatifloxacin
1.2 ⇒
1.4 (+ 0.2)

●Sales of Generic drugsg¥7.7bln(+ 0.3)((+ 1.2))

・Health insurance pharmacy market’s sales and contract manufacturing’s sales increased.
●Sales of Over-the-counter drugs¥3.4bln(+ 0.4)◆Healthcare (Skin care) Business¥1.4bln(‐0.5)●Sales declined at Dr. Program(‐0.5)■Operating Income¥13.7bln(+ 2.0)◆Operating Income margin rose 2.2 percentage points to 17.3%●Cost of Sales : UP ¥2.2bln (¥27.4bln⇒¥29.6bln)◆Cost of Sales Ratio : 35.4%⇒37.3% up 1.9 percentage points
・Drug
Drug price revisions in the 6%range for KYORIN Pharmaceutical・Sales of generic drugs increased.
・ KYORIN Pharmaceutical Facilities commenced operations on Oct 1st /2012●R&D expenses : up ¥2.6bln (¥10.2bln⇒¥7.6bln)◆R&D Ratio : 13.2%⇒9.5% down 3.7 percentage points
・Expenses associated with the progress of the R&D were posted in the previous year
(PENTASA Ph3 、KRP-104Ph2b)●SG&A (excluding R&D expenses) : up ¥0.3bln (¥28.1bln⇒¥28.4bln)■Net Income¥9.3bln(+ 2.1)
3

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

Mar/2012

Mar/2013

Dec/2011

Dec/2012

Sales

70.3

71.3

93.7

96.4

Operating Income

11.2

13.2

14.0

17.1

Net Income

72
7.2

92
9.2

93
9.3

11 8
11.8

Dec/2011

Dec/2012

Mar/2011

Sales

7.1

7.8

10.3

10.5

Operating Income

0.3

0.1

0.8

0.6

Net Income

0.3

0.1

0.6

0.5

Dec/2011

Dec/2012

Mar/2011

Sales

1.9

1.4

2.8

2.8Operating Income

0.0－0.2

0.1

0.1

Net Income

0.0－0.2

0.1

0.1

KYORIN pharmaceutical

KYORIN Rimedio

Dr. Programg(forecast)

Mar/2012(forecast)

Mar/2012(f(forecast)t)4

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

Kipres(LT receptor antagonist)

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

Third quarter

Full term
Progress tofull term
forecast(%)

FY11

FY12

FY11

FY12

FY11

FY12

Change15 715.7

16 316.3

27 627.6

28 4
28.4

＋2 7%
＋2.7%

74 5%
74.5%

36 836.838 0
38.0

9.1

8.3

16.0

14.6

－9.3%

72.2%

21.5

20.1

9.1

9.0

14.2

13.8

－2.8%

77.0%

18.0

17.9

2.9

3.6

4.8

5.7

＋20.6%

72.9%

6.3

7.9

1.8

1.5

2.7

2.3

－14.9%

76.4%

3.4

3.0

0.8

0.9

1.2

1.4

＋17.3%

83.3%

1.7

1.7

0.9

1.0

1.5

1.6

＋9.4%

78.4%

1.9

2.0

(forecast)

Pentasa(Ulcerative colitis and Crohn’sdisease treatment)

Uritos（Kyorin）(Overactive bladder)

Ketas(For bronchial asthma andcerebrovasculas disorders)

Sales of newethical drugs(over seas)

Gatifloxacin

Consumer
Healthcare
business

Milton(Bulk・Royalty)(Disinfectant)

5Main R&D Activities -1 (Feb 4 , 2013 Release)※No Changes from the previous announcement(Nov 7, 2012)

Ph III ~ Application submitted
StageJapan

Overseas※Application
submitted(8/2012)Compound/
Code

Therapyarea/Action

Pentasa(suppository)

Ulcerativecolitis

FerringPharmaceuticals

Consideration of a new dosage form for the active
phase of ulcerative colitis (once a day)・Development of a newdosage form
・PhⅢcompleted(2/2012)

Oi iOriginF tFeatures

CCommentst※Application
submitted(9/2012)(US)SkyePharma: Application
submitted (3/2009)（Europe）
Mundipharma:Launched(9/2012)
Lh d(9/2012)

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)
・PhⅢcompleted(3/2012)※PhⅢ（9/2012）（Europe）
Almirall: Launched(9/2012)

KRP-AB1102（Inhaleddrug）

Chronic
Obstructive
Pulmonary
Disease(COPD)

Almirall- New Chemical Entity: Aclidinium Bromide- Long Acting Muscarinic Agonist (LAMA)- Twice Daily administration-Onset of Action on the first dayGenuair®
1) Designed with a feedback system, which through a'colored control window' and an
audible click helps confirm that the patient has inhaledcorrectly2) Counter for remaining doses
3) Safety features such as an anti-double-dosing
anti double dosing
mechanism and an end-of-dose lock-out
system to prevent use of an empty inhaler

License agreement with
Almirall (2/2011)(US)
ForestPharmaceuticals: Launched(12/2012)

6

Main R&D Activities -2 (Feb 4 , 2013 Release)※No Changes from the previous announcement(Nov 7, 2012)

POC Project (Pre-clinical ~ Ph II)
Stage

Compound/CodeTherapy area/Action

OriginFeatures

Comments

JapanOverseas

PhⅡ（5/2012）(Europe & US)
Almirall: Ph Ⅲ
(US)Forest
L b t iLaboratories: PhⅢ

KRP-AB1102F(Fixed dosecombination
inhaled drug)g)Chronic Obstructive
Pulmonary Disease(COPD)

Almirall

Combination of aclidinium bromide with the long acting
beta agonist formoterol :This combination is aimed at providing higher efficacy
than each component alone,as well as the improved
convenience
ioff having
h i ththe ttwo products
d t iin th
the sameeasy to use inhalation device.This is currently in phase
Ⅲ clinical development.

PhⅡ（8/2011）

PhⅢ
Merz

KRP-209

Tinnitus

Merz

KRP-209 (Neramexane) is expected to improve thepatients' annoyance and difficulties in their life caused
byy tinnitus,, mainlyy throughg its two pharmacologicalpg
properties: 1) NMDA antagonistic activity and 2)
Nicotinic acetylcholine antagonistic activity

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

PhⅠ（12/2010）

PhⅡ（POC)(12/2010)(Novartis)

KRP-203

Transplantation,
autoimmune
diseases anddiseases,and
IBD

In-house

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

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

PhⅠ（8/2011）

KRP-AM1977X(Oral agent）

New quinolone
synthetic
antibacterial agent

In-house

PhⅠ（7/2012）

KRP-AM1977Y(Injection）

New quinolone
synthetic
antibacterial agent

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

7Reference8Segment information
for the Third Quarter Ending March 31, 2013
Sales, Profit or Loss of each report segment(U it ¥ billion)(Units:¥billi )S lSalesYYear
on Year
YP fitProfitYYear
on YearY

Net Sales (total)

79.2+1.8

13.7+2.0Ethical drugs business

77 877.8+2 3+2.3

13 813.8+2 3+2.366.8
65 165.1
1.7+0.8+0 5+0.5+0.3◆Generic drugs

777.7+1 2+1.2◆Over-the-counter drugs

3.4+0.4

Healthcare(Skincare) business141.4－00.5
5－00.22－00.22－0.1－0.1◆Sales of new ethical drugs●Japan●Overseas

Amount of adjustment－(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.
9Consolidated Financial Results
for the Third Quarter ending March 31, 2013
Interim term

Third quarter（ Units: ¥ million ）Full term
Progress tofull term
forecast(%)

FY12

FY11

FY12

FY11

FY12

YoYchangehYoYCh
Change(%)
(%)

Sales

46,38747,954

77,413

79,229＋1,815

＋2.3%

73.5%

103,232

107,800

Ethical drugsbusiness

45 15545,15547 03447,03475 49575,49577,845＋2,350

1%
＋3.1%
＋3

73 6%
73.6%

100 654
100,654

105 700
105,700

39,09839,68465,99666,755

＋758

＋1.1%

73.3%

88,011

91,10038 12938,12938 661
38,66164 56264,56265,063

＋501

8%
＋0.8%
＋0

73 4%
73.4%

85 99585,99588,600●Overseas

968

1,023

1,434

1,691

＋257 ＋18.0%

67.6%

2,015

2,500

◆Generic drugs

4,097

5,056

6,450

7,707

＋1,256 ＋19.5%

75.6%

8,656

10,200◆OTC drugs andothers

1,959

2,292

3,047

3,382

＋335

＋11.0%

76.9%

3,987

4,400

Consumerhealthcare business

1,232920

1,918

1,383－534 －27.9%

65.9%

2,577

2,100

Operating income

4,900

6,269

11,66813,711＋2,043 ＋17.5%

78.8%

14,464

17,400Ordinary income

5,253

6,609

12,35814,288＋1,930 ＋15.6%

79.4%

15,27518,000Net income

3,355

4,295

7,227

9,262

＋2,035 ＋28.2%

78.5%

9,231

11,800◆Sales of new
ethical drugs●JapanFY11(forecast)10