English translation

Summary of Financial Results
for the First Quarter of Fiscal Year Ending December 31, 2017
[Japanese GAAP] (Non-consolidated)
May 11, 2017
Company Name

SymBio Pharmaceuticals Limited

Listing: Tokyo Securities Exchange

Securities Code4582

URL: http://www.symbiopharma.com/

Representative

Representative Director,
President and Chief Executive Officer

Fuminori Yoshida

Director, Finance & Accounting

Contact Person
Scheduled Date to File
Quarterly Report

Kenji Murata
Date of Dividend
Payment (plan)May 11, 2017

Supplementary materials for quarterly financial results:

Yes

No

Holding of quarterly earnings performance review:

Yes

No

TEL +81-3-5472-1125－(millions of yen – rounded down, unless otherwise stated)

1. Business Results for the First Quarter of FY 2017 (January 1, 2017 to March 31, 2017)(1) Operating Results (cumulative)(Percentages indicate year-on-year changes)
Operating Income
Ordinary Income
Quarterly Net Income
Net Sales(loss)(loss)(loss)
millions of yen%

millions of yen%

millions of yen%

millions of yen

%

869
193

350.1
(52.7)

(525)
(518)

－
－

(583)
(655)

－
－

(582)
(652)

－
－

1Q FY 2017
1Q FY 2016

Quarterly Net Income(loss) per share

Diluted Quarterly Net
Income per shareYen
Yen
1Q FY 2017(12.12)－
1Q FY 2016
(20.15)－(Note) Diluted quarterly net income per share is not stated above due to quarterly net loss per share, despite the potential dilution of shares.
(2) Financial Position

1Q FY 2017 (as of March 31, 2017)
FY 2016 (as of December 31, 2016)(Reference) Equity:

Total Assets

Net Assets

millions of yen
6,478
6,878

millions of yen
5,450
5,484

1Q FY 2017 (as of March 31, 2017)
FY 2016 (as of December 31, 2016)

Equity Ratio
%
77.0
73.5

4,985 million yen
5,053 million yen

2. Dividends

FY 2016
FY 2017
FY 2017 (Forecast)

1st Quarter
Yen－－

Annual Dividend per Share
2nd Quarter
3rd Quarter
Fiscal Year End
Yen
Yen
Yen
0.00
－
0.00
0.00

(Note) Revision of dividend forecasts recently announced:－
Yes ・ No

0.00

Full Year
Yen
0.00
0.00

3. Earnings Forecasts for FY 2017 (January 1, 2017 to December 31, 2017)(Percentages indicate year-on-year changes)

Operating
Income (loss)

Net Sales
millions of yen

Full Year

2,903% millions of yen

22.6(3,238)

Ordinary
Income (loss)

Net Income (loss)
per share% millions of yen%

millions of yen

%

Yen

－

－

(3,306)－(71.07)(3,303)
Yes ・ No

(Note) Revision of earnings forecasts recently announced:

Notes:(1) Application of special accounting treatment in
preparation of quarterly financial reports:

Net Income (loss)

Yes ・ No

(2) Changes in accounting policies, changes in accounting estimates and restatements after error corrections(a) Changes in accounting policies due to revisionof accounting standards:

Yes ・ No(b) Changes in accounting policies due to otherreasons:

Yes ・ No(c) Changes in accounting estimates:

Yes ・ No(d) Restatements after error corrections:

Yes ・ No

(3) Number of shares outstanding (common stock)(i) Number of shares outstanding at the end of
the period (including treasury stock)

1Q FY 2017

48,964,524 shares

FY 2016

46,530,824 shares(ii) Number of shares of treasury stock at theend of the period

1Q FY 201775 shares

FY 201675 shares(iii) Average number of shares during the period(cumulative)

1Q FY 2017

48,095,755 shares

1Q FY 2016

32,390,848 shares* The quarterly financial statements are not subject to quarterly reviews.
* Explanation regarding the appropriate use of earnings forecasts and other matters
All forecasts presented in this document, including the outlook on earnings, are based on the information currently available tomanagement and assumptions judged to be reasonable. Actual results may differ substantially from these forecasts due to various
factors. Regarding the assumptions on which the Company’s earnings forecasts are based and their usage, please refer to “1.
Qualitative Information Concerning Quarterly Financial Results, (3) Qualitative information concerning earnings forecasts,” onPage 2 of the attachment.

Index of the attachment
1. Qualitative Information Concerning Quarterly Financial Results …………………………………………………….……

1(1) Qualitative information concerning business results ……………………………………………………………………

1(2) Qualitative information concerning financial position …………………………………………….……………………

2(3) Qualitative information concerning earnings forecasts …………………………………………………………………

2

2. Quarterly Financial Statements ………………………………………………………………………………………….….

3(1) Balance sheets …………………………………………………………………………………………………………..

3(2) Statements of operations (cumulative)…………………………………………………………………………………..

4(3) Notes on quarterly financial statements …………………………………………………………………………………

5(Notes regarding going concern assumption) ……………………………………………………………………………

5(Notes regarding significant changes in shareholders’ equity) ………………………………….………………………

5(Significant subsequent events) …………………………………………………………..……………….………………

6

1. Qualitative Information Concerning Quarterly Financial Results(1) Qualitative information concerning business results
Progress in the Company’s business for the first quarter of FY 2017 is as follows:(i) Domestic[Anticancer agent: SyB L-0501 (generic name: bendamustine hydrochloride, trade name: TREAKISYM®)]
The Company markets TREAKISYM® in Japan through its business partner, Eisai Co., Ltd. (“Eisai”), for the new
indications of chronic lymphocytic leukemia for which the Company obtained marketing approval in August 2016 and thefirst-line treatment of low-grade non-Hodgkin’s lymphoma and mantle cell lymphoma, for which it obtained marketing
approval in December 2016, in addition to the indication of recurrent/refractory low-grade non-Hodgkin’s lymphoma andmantle cell lymphoma (for which marketing approval was obtained in October 2010). By expanding the indications for thisagent, net sales increased significantly by 28.0% year-on-year (NHI price basis) and net sales through Eisai also grewconsiderably by 312.4% year-on-year.
In addition to the above three indications of this agent for which approval has already been obtained, the Company
continues to pursue approval for the fourth indication for patients who need new therapies and for maximizing the productvalue. Regarding the indication of recurrent/refractory intermediate/high-grade non-Hodgkin’s lymphoma (diffuse large Bcell lymphoma), for which the Phase II clinical trial has been completed, the Company, in response to strong medical needs,
is currently in consultation with the Pharmaceuticals and Medical Devices Agency (“PMDA”) and continues to discuss thepath forward for approval.
Furthermore, in order to solidify its management foundations, the Company will utilize TREAKISYM® as a firm base forits business activities, and to this end it is exploring the development of the oral formulation of TREAKISYM®, in addition
to the intravenous formulation which is currently being developed and marketed, with a focus on the treatment of solid
tumors and autoimmune diseases, considering the possibility of further expanding its business.
[Anticancer agents: SyB L-1101 (intravenous formulation) and SyB C-1101 (oral formulation), generic name: rigosertib
sodium]For the global Phase III clinical trial of the intravenous formulation of rigosertib sodium conducted by Onconova
Therapeutics, Inc. (Head office: Pennsylvania, U.S.; “Onconova”), the U.S. Licensor, the Company is in charge of theclinical development in Japan and started the domestic trial in December 2015. This trial is conducted with clinical trialsites in more than ten countries worldwide, for higher-risk myelodysplastic syndromes (HR-MDS) which do not respond tothe current standard treatment with hypomethylating agents (“primary HMA failure”) or which relapse after treatment under
the current standard of care. The Company completed the first patient enrollment in Japan in July 2016, and enrollments are
currently accumulating.
Regarding the oral formulation of rigosertib sodium, the Company started its domestic Phase I clinical trial in
combination with azacitidine (Note) for the target indication of HR-MDS in December 2015. However, the provision of theinvestigational drug by Onconova has been delayed. At present, patient enrollment has not yet been started. As soon as thisissue on the provision of the investigational drug is resolved, the Company will resume patient enrollment, and uponcompletion of the Phase I clinical trial, consider its participation in the global clinical trial to be conducted by Onconova.
(Note)

About azacitidine (Vidaza®: currently marketed by Nippon Shinyaku Co., Ltd.): This drug was approved in 2011
upon successful confirmation of extended overall survival for the first time in the Phase III clinical trial for theindication of MDS, and is currently used as a first-line drug for MDS patients who have difficulties inhematopoietic stem cell transplantation.

[Patient-controlled iontophoretic transdermal system for the short-term management of acute post-operative pain: SyB P1501]
In October 2015, the Company entered into an agreement with Incline Therapeutics, Inc., a wholly-owned subsidiary of
U.S.-based The Medicines Company (Head Office: New Jersey, U.S.) for an exclusive license to develop andcommercialize SyB P-1501 in Japan. The Company commenced a domestic Phase 3 clinical trial for SyB P-1501 in June
2016 and completed the first patient enrollment in November 2016, with enrollments accumulating. However, theCompany, acting in the best interest of patients, decided on April 21, 2017 to temporarily suspend new patient enrollment in
the trial due to its recently arising concern as to the continuity of The Medicines Company’s business regarding the product.

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[New drug candidates]
The Company continues with search and evaluation activities to acquire license rights of new drug candidates in global
terms, aiming to grow into a biopharmaceutical company with both profitability and growth potential, always from a
medium-to-long-term perspective, and negotiations for multiple licensing agreements are currently underway.
Meanwhile, in May 2016, the Company established a wholly-owned subsidiary, SymBio Pharma USA, Inc. (Head office:Menlo Park, California, U.S., “SymBio Pharma USA”), as the Company’s strategic base for its overseas businessdevelopment. By actively acquiring the worldwide rights concerning new drug candidates through SymBio Pharma USA as
the base of global business, the Company will continue its transformation into a global specialty biopharmaceuticalcompany with the aim of developing and commercializing new drugs in the U.S., Japan, Europe and other major global
markets.
(ii) Overseas
SyB L-0501 is also marketed in South Korea, Taiwan and Singapore, and product sales of SyB L-0501 in these countries
progressed essentially as planned.
(iii) Business results
As a result of the above, net sales totaled 869,614 thousand yen for the first quarter of fiscal year ending December 31,
2017, primarily reflecting product sales of TREAKISYM®. Accordingly, overall net sales rose 350.1% year-on-year.
Selling, general and administrative expenses totaled 764,216 thousand yen (a year-on-year increase of 32.9%), including
research and development (“R&D”) expenses of 395,148 thousand yen (a year-on-year increase of 76.8%) primarily due to
expenses associated with the clinical trial for the intravenous and oral formulations of rigosertib sodium as well as SyB P1501, and other selling, general and administrative expenses of 369,067 thousand yen (a year-on-year increase of 5.0%).
As a result, operating loss of 525,204 thousand yen was recognized for the first quarter of fiscal year ending December
31, 2017 (operating loss of 518,404 thousand yen for the first quarter of the previous fiscal year). In addition, mainly
because the Company recorded non-operating expenses totaling 59,426 thousand yen primarily comprising foreignexchange losses, ordinary loss totaled 583,008 thousand yen (ordinary loss of 655,445 thousand yen for the first quarter ofthe previous fiscal year) and net loss totaled 582,768 thousand yen (net loss of 652,631 thousand yen for the first quarter ofthe previous fiscal year).
Segment information has been omitted as the Company operates within a single segment of the pharmaceutical industry
which includes the development and commercialization of drugs, manufacturing, marketing and other related activities.
(2) Qualitative information concerning financial position
Total assets as of March 31, 2017 stood at 6,478,104 thousand yen, a decrease of 400,279 thousand yen from the previous
fiscal year end. This was primarily due to decreases of 674,991 thousand yen in cash and deposits, 55,740 thousand yen inaccounts receivable-trade and 26,003 thousand yen in advances paid, offsetting increases of 340,931 thousand yen inmerchandise and finished goods, 13,179 thousand yen in prepaid expenses and 11,250 thousand yen in software in progress.
Liabilities stood at 1,027,702 thousand yen, a decrease of 365,812 thousand yen from the previous fiscal year end, primarilyreflecting decreases of 450,000 thousand yen in bonds payable, 16,911 thousand yen in income taxes payable, and 14,922
thousand yen in accounts payable-other, offsetting an increase of 124,609 thousand yen in accounts payable-trade.
Net assets decreased by 34,467 thousand yen from the previous fiscal year end to 5,450,402 thousand yen, due to a decrease of582,768 thousand yen in retained earnings following the recognition of net loss, offsetting the exercise of stock acquisitionrights, etc. (including exercise of stock acquisition rights for bonds with convertible bond type stock acquisition rights).
As a result, the equity ratio increased by 3.5 percentage points from the previous fiscal year end to 77.0%.
(3) Qualitative information concerning earnings forecasts
No revision was made to the earnings forecasts for FY 2017 as of the date of this document.

-2-2. Quarterly Financial Statements(1) Balance sheets

AssetsCurrent assets
Cash and deposits
Accounts receivable-trade
Merchandise and finished goods
Prepaid expenses
Advances paid
Other
Total current assets
Non-current assets
Property, plant and equipment
Buildings, net
Tools, furniture and fixtures, net
Total property, plant and equipment
Intangible assets
Software
Software in progress
Total intangible assets
Investments and other assets
Shares of subsidiaries
Long-term prepaid expenses
Lease and guarantee deposits
Total investments and other assets
Total non-current assets
Total assets
Liabilities
Current liabilities
Accounts payable-trade
Accounts payable-other
Income taxes payable
Forward exchange contracts
Other
Total current liabilities
Non-current liabilities
Bonds payable
Provision for retirement benefits
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Common stock
Capital surplus
Retained earnings (accumulated deficits)
Treasury stock
Total shareholders’ equity
Stock acquisition rights
Total net assets
Total liabilities and net assets-3-

FY 2016(as of December 31, 2016)(Unit: thousands of yen)
1Q FY 2017(as of March 31, 2017)

5,719,325
487,471
272,725
79,104
66,46559,9196,685,011

5,044,333
431,730
613,656
92,284
40,46262,2136,284,680

31,395
43,12974,52430,71040,493
71,203

41,985－41,98538,388
11,25049,6380
11,64965,21476,863
193,373
6,878,384

0
9,495
63,086
72,582
193,424
6,478,104

321,860
552,510
36,586－
31,161
942,118

446,470
537,587
19,674
5,853
16,726
1,026,312

450,000
1,396
451,396
1,393,514

－
1,390
1,390
1,027,702

9,948,298
9,918,298(14,812,843)(17)
5,053,735
431,135
5,484,870
6,878,384

10,205,382
10,175,382(15,395,611)(17)
4,985,135
465,2675,450,402
6,478,104

(2) Statements of operations (cumulative)(For the first quarter of the fiscal year ending December 31, 2017)(Unit: thousands of yen)
1Q FY 2016
1Q FY 2017(from January 1, 2016
(from January 1, 2017
to March 31, 2016)
to March 31, 2017)
193,183
869,614
136,676
630,60256,506
239,012574,911764,216(518,404)(525,204)

Net sales
Cost of goods sold
Gross profit
Selling, general and administrative expenses
Operating loss
Non-operating income
Interest income
Other
Total non-operating income
Non-operating expenses
Interest expenses
Commission fees
Stock issuance costs
Foreign exchange losses
Total non-operating expenses
Ordinary loss
Extraordinary gain
Gain on reversal of stock acquisition rights
Total extraordinary gain
Extraordinary loss
Loss on retirement of non-current assets
Total extraordinary loss
Loss before income taxes
Income taxes-current
Total income taxes
Net loss

-4-

1,849
－
1,849

1,552
69
1,621

1
2,243
－
136,644
138,890(655,445)

－
2,260
1,969
55,19759,426(583,008)

4,903
4,903

1,190
1,190

1,139
1,139
(651,681)
950
950(652,631)－－(581,818)950
950(582,768)

(3) Notes on quarterly financial statements(Notes regarding going concern assumption)
None to be reported.
(Notes regarding significant changes in shareholders’ equity)
During the first quarter of fiscal year ending December 31, 2017, a portion of the third unsecured bonds withconvertible bond type stock acquisition rights was converted into new shares through the exercise of the rights. In
addition, new shares were issued upon the exercise of part of the 39th stock acquisition rights. As a result, during
the first quarter of fiscal year ending December 31, 2017, common stock and capital surplus increased by 257,084
thousand yen and 257,084 thousand yen respectively, amounting to 10,205,382 thousand yen and 10,175,382
thousand yen respectively as of March 31, 2017.

-5-

(Significant subsequent events)
Issuance of 40th stock acquisition rights (stock option)
At the Board of Directors’ meeting held on March 29, 2017, a resolution was passed regarding the issuance ofstock acquisition rights as stock option to the six (6) Directors of the Company as follows. The stock option wasallotted to relevant Directors on the allotment date of April 24, 2017.
Number of stock option
2,800 units
Class and number of shares
Common stock 280,000 shares
underlying the stock option
Issue price/ Total issue price
Issue price
20,300 yenof the stock option
Total issue price
56,840,000 yen
Amount to be paid in: 203 yen per share
Amount to be paid in for the stock
The Person Granted* shall set off his/her claims for compensation
optionagainst the Company in lieu of payment of monies for the stockacquisition rights allotted.
Exercise price of the stock option
Exercise price per share of one (1) yen

1.

Period during which the stock
option can be exercised

Terms and conditions for exerciseof the stock option

Increase in paid-in capital due tothe issuance of shares upon
exercise of the stock option

From March 30, 2020 to March 29, 2027
(1) The Person Granted must have the status as a director or employee of
the Company or its affiliates at the time of exercise. However, this is
not necessarily the case if: (a) the Person Granted is a director of theCompany or its affiliates and retires due to the expiry of her/his term,(b) the Person Granted is an employee of the Company or its
affiliates and retires due to compulsory retirement or (c) the Person
Granted is a director or employee of the Company or its affiliates andthe Board of Directors resolves that he/she has resigned or retired
with honorable recognition.
(2) For other terms and conditions, the Company and directors shallcomply with the Stock Option Allotment Agreement concluded
between the parties.
Increase in the amount of paid-in capital due to the issuance of shares
upon the exercise of stock option shall be one-half of the maximum
amount of paid-in capital increase and others, which is calculated inaccordance with Article 17 of the Corporation Accounting Rules, andany fraction less than one (1) yen arising therefrom shall be rounded up
to the nearest one (1) yen.

Matters concerning transfer of theRequires approval at the Board of Directors’ meeting.
stock option* Refers to those who receive the allotment of stock acquisition rights
2.

Issuance of 41st stock acquisition rights (stock option)
At the Board of Directors’ meeting held on March 29, 2017, a resolution was passed regarding the issuance ofstock acquisition rights as stock option to the 71 Company employees as follows. The stock option was allotted to
relevant employees on the allotment date of April 24, 2017.
Number of stock option
4,512 units
Class and number of shares
underlying the stock option
Issue price/ Total issue priceof the stock option
Amount to be paid in for the stock
optionExercise price of the stock option
Period during which the stock
option can be exercised
Terms and conditions for exerciseof the stock option

Common stock451,200 shares

Issue price
20,300 yen
Total issue price
91,593,600 yen
Amount to be paid in: 203 yen per share
The Person Granted shall set off his/her claims for compensation against
the Company in lieu of payment of monies for the stock acquisitionrights allotted.
Exercise price per share of one (1) yen
From March 30, 2020 to March 29, 2027
(1) The Person Granted must have the status as a director or employee of
the Company or its affiliates at the time of exercise. However, this is
not necessarily the case if: (a) the Person Granted is a director of theCompany or its affiliates and retires due to the expiry of her/his term,(b) the Person Granted is an employee of the Company or its-6-Increase in paid-in capital
due to the issuance of shares upon
exercise of the stock option
Matters concerning transfer of thestock option

affiliates and retires due to compulsory retirement or (c) the Person
Granted is a director or employee of the Company or its affiliates andthe Board of Directors resolves that he/she has resigned or retired
with honorable recognition.
(2) For other terms and conditions, the Company and the employees shallcomply with the Stock Option Allotment Agreement concluded
between the parties.
Increase in the amount of paid-in capital due to the issuance of shares
upon the exercise of stock option shall be one-half of the maximum
amount of paid-in capital increase and others, which is calculated inaccordance with Article 17 of the Corporation Accounting Rules, andany fraction less than one (1) yen arising therefrom shall be rounded up
to the nearest one (1) yen.
Requires approval at the Board of Directors’ meeting.

3.

Temporary suspension of new patient enrollment in the SyB P-1501 domestic Phase 3 clinical trial
While having entered into an agreement in October 2015 with The Medicines Company (through its subsidiary,
Incline Therapeutics, Inc.) for an exclusive license in Japan for SyB P-1501 and commencing a domestic Phase 3
clinical trial in June 2016 with a target indication for patient-controlled, short-term management of acutepostoperative pain during hospitalization, the Company, acting in the best interest of patients, decided on April 21,
2017 to temporarily suspend new patient enrollment in the trial due to its recently arising concern as to thecontinuity of The Medicines Company’s business regarding the product. Details are stated in the separately released
announcement, “Temporary Suspension of New Patient Enrollment in the Domestic Phase 3 Clinical Trial of thePatient-controlled Pain Management Drug “SyB P-1501” dated May 11, 2017..

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