Securities CodeP4559

64th

Business Report
From April 1st, 2017 to March 31st, 2018

Contents
To Our Shareholders ……………………………………………… P.1
Summary of Our Business Operations (Consolidated) ………… P.3
Status of Research and Development …………………………… P.5
Research and Development Pipeline …………………………… P.6
Status of Production and Distribution /Outlook for Fiscal Year 2018 …………………………………… P.7
Special Offers to Our Shareholders ……………………………… P.8
Topics ……………………………………………………………… P.9
Financial Statements (Consolidated) ………………………… P.11
Company Information ………………………………………… P.13
Share Information ……………………………………………… P.14
Shareholder MemoTo Our Shareholders

We, Zeria Pharmaceutical Co., Ltd. (“Zeria”)
would like to express our thanks for yourparticular support.
We are pleased to report the business results offiscal year 2017 (64th business operations) for theperiod from April 1st, 2017 to March 31st, 2018.

President and COO

Mitsuhiro Ibe

1Chairman and CEO

Sachiaki IbeDuring the fiscal year under review, the Japanese economy proceeded with moderate recovery based on the background of
improvements in the environment for employment and income. These improvements occurred despite factors that continue tocause a sense of uncertainty regarding the impact on the Japanese economy. These factors include trade friction between the
United States and China, current monetary policy in the United States and the political situation on the Korean Peninsula.
For the pharmaceutical industry, both ethical pharmaceuticals and OTC drugs remain in a severe situation. Regarding ethicalpharmaceuticals, the drug price system was fundamentally revised by the government and generic brand pharmaceuticalutilization promotion has been strongly accelerated compared with previous years, both as part of initiatives to curtail
healthcare expenditures. With respect to OTC drugs, competition in the market is continuing to intensify.
Under such circumstances, the Zeria Group started the 9th Mid-Term Management Plan (three-year term starting from fiscal
year 2017 to fiscal year 2019). The Group has proactively invested resources in the business during the fiscal year underreview, the first year of the plan, to ensure the strong growth of the Ethical Pharmaceuticals and the Consumer Healthcare
businesses while accelerating the global expansion.
As a result of these activities, net sales for the current fiscal year were 64,568 million yen (down 0.4% from the previous fiscal
year). However, due to the contribution of bullish overseas performance combined with efficient use of expenses such as
research and development expenses, operating profit was 4,830 million yen (up 6.4%), ordinary profit was 5,089 million yen(up 14.7%) and profit attributable to owners of parent was 4,157 million yen (up 17.3%).
In the current fiscal year, the overseas sales to net sales ratio was 26.3%, compared with 24.6% in the previous fiscal year.

Operating profit (M)/Ordinary profit (M)/Profit attributable to owners of parent (M)Net sales(Unit: ¥million)(Unit: ¥million)

6,000

80,00062,47564,84964,5684,565 4,450

60,000
4,000

3,513

4,541 4,438

4,830

5,089
4,157

3,544

40,0002,000
20,0000

Fiscal Year 2015 Fiscal Year 2016 Fiscal Year 20170

Fiscal Year 2015 Fiscal Year 2016 Fiscal Year 20172

Summary of Our Business Operations (Consolidated)

Ethical Pharmaceuticals BusinessNet sales

34,583 million¥

up 0.4%from the previous fiscal year

Net sales of major products
Consumer
Healthcare
Business

Asacol53.7%

Net sales(composition
ratio)

Entocort
AcofidePromacAcinonOther

Asacol¥16.98 billion

Entocort¥4.46 billion

Acofide¥3.30 billion

Promac¥2.05 billion

Acinon¥1.80 billion

Consolidated net sales in Ethical Pharmaceuticals Business(Unit: ¥million)

40,00035,00033,902

34,43034,58330,00025,00020,0000

Fiscal Year 2015 Fiscal Year 2016 Fiscal Year 20173

In the Ethical Pharmaceuticals business, according to basis ofcompliance with promotion codes, Zeria sought to improve thequality of its medical representatives (MRs), and took steps toupgrade its medical information activities in medical institutions.
As for the main product, Asacol®, a therapeutic agent for ulcerative
colitis, domestic sales faced tight competition due to the impact ofgeneric brands and other competitive products. This struggle
occurred despite securing approval for once-per-day usage anddosage in May 2017, which improved product competitiveness.
However, sales grew satisfactorily overseas due to expansion inareas such as the U.K. and Northern Europe, securing increased
earnings overall. Additionally, domestic sales for Entocort, theinflammatory bowel disease therapeutic agent (domestic sales
name: Zentacort®), grew steadily as dosing period limits were lifted
and long-term prescriptions became possible in December 2017.
However, overall sales increased only slightly due to businessdevelopment that was slower than planned in some overseas
regions, after the transfer of sales control from AstraZeneca.
Furthermore, sales for Acofide ® , the therapeutic agent forfunctional dyspepsia, are expanding but market development isbehind schedule. We are continually aiming for progress, working
to uncover potential functional dyspepsia patients, primarily at
medical institutions that conduct endoscopies. Also, we began ajoint promotion of Infliximab BS for I.V. Infusion 100 mg “Nichiiko”
with Nichi-Iko Pharmaceutical Co., Ltd., the producer of the
product, in November 2017. This initiative is aimed at providingo p t i o n s f o r i n f l a m m a t o r y b o w e l d i s e a s e t re a t m e n t a n dstrengthening our product line-up.
As a result of these, net sales in the business amounted to 34,583
million yen (up 0.4% from the previous fiscal year).

Consumer Healthcare BusinessNet sales

29,831 million¥

down 1.5%
from the previous fiscal year

Net sales of major products
EthicalPharmaceuticals
Business

Hepalyse range

46.3%

Net sales(composition
ratio)

Chondroitin
range
WithOne range
Other¥12.84 billion

Hepalyse range
Chondroitin range¥6.59 billion

WithOne range¥1.64 billion

In the Consumer Healthcare business, on the progress of thesuper-aged society, Zeria worked to develop markets through the
supply of products which support self-medication for the
consumer.
As for its main brand, the Hepalyse® range, Zeria has attempted to
improve product awareness by developing intensive advertising
activities such as TV advertisements. During the fiscal year underreview, we strengthened our product line-up by launching two
new products, Hepalyse® Super Pastille Type and Hepalyse® W
Premium Pastille Type. Thanks to these sales expansion measures,
sales continued to grow. Additionally, shipment of Hepalyse ® W
Premium Kiwami, launched in April 2018, began in March of thesame year. Sales also grew steadily for the WithOne ® range of
herbal laxatives, despite a shrinking laxative market. Meanwhile,regarding Chondroitin product range, overwhelming market sharehas been maintained firmly as a result of sales activities that
promoted its efficacy, safety and high quality as a range ofpharmaceuticals and clearly distinguished it from health foods. The
market share was maintained despite a hard fight due tointensified market competition.
As a result, net sales in the business amounted to 29,831 million
yen (down 1.5% from the previous fiscal year).
OTC drugs

Consolidated net sales in Consumer Healthcare Business(Unit: ¥million)

35,00030,00028,41930,277

29,831

25,00020,00015,0000

Fiscal Year 2015 Fiscal Year 2016 Fiscal Year 2017
Hepalyse® W series

4Status of Research and Development

In the Research and Development division, Zeria is actively

pancreatic cancer.

promoting domestic and overseas clinical trials of its own

In the area of Consumer Healthcare products, as well as

original drugs. At the same time, Zeria acquires in-licensed

pushing ahead with the development of European herbal

drugs that have gained global success and develops them

medicines, Zeria also launched new products one after thefor the Japanese market.

other.

As part of its efforts to strengthen its new drug pipeline in

Meanwhile, Tillotts Pharma AG is developing therapeutic

the priority gastrointestinal field, Zeria jointly conducted adrugs for lower gastrointestinal disease primarily in Europe.

Phase III trial with Kyowa Hakko Kirin Co., Ltd. for

Tillotts Pharma AG completed a Phase III trial for improved

additional once-per-day usage and dosage of Z-206

formulation of mesalazine (TP05), using new technologies,(Asacol®) targeting ulcerative colitis, and obtained approval

targeting ulcerative colitis and submitted an application forfor it in May 2017. Regarding development of Asacol® inapproval in Europe in January 2017.

China, Zeria also submitted an application for its approval

In addition, upon re-examination of both development

in May 2013 following the completion of a Phase III trial. It

plans, we decided to discontinue development of Z-215, a

is currently under regulatory review by the Chinese

long lasting proton pump inhibitor in-licensed from EA

authorities.

Pharma Co., Ltd., and a therapeutic agent (TP09) targeting

As for Zeria’s own original drug Z-338 (Acofide ), it isfamilial adenomatous polyposis that was being co-conducting a Phase III trial in patients with functional

developed by Tillotts Pharma AG and Cancer Prevention

dyspepsia in Europe.

Pharmaceuticals, Inc. (USA).

Zeria has completed the Phase III trial for Z-213, a

Meanwhile, in March 2018, we decided to acquire in-treatment for iron deficiency anemia and in-licensed drug

licensed Veltassa (generic name: Patiromer), a therapeutic

from Vifor (International) AG in Switzerland, and appliedagent for hyperkalemia, from Vifor (International) AG and

for approval for its manufacture and sale in March 2018.

are preparing for clinical trials.

In addition, Zeria is conducting a global Phase III clinicalAs a result of these activities, research and development

trial for Z-100 which is targeting for cure of cervical cancer,

expenses for the current fiscal year decreased from thein the Asian region including Japan.

results of the previous fiscal year to 7,331 million yen

As for Z-360, Zeria is implementing a global Phase II clinical(down 13.3% from the previous fiscal year).

®

trial in the Asian region including Japan in patients with5

Research and Development Pipeline

P Status of Pipeline of New Drugs
I. DomesticStage
NDA filed
Phase III

(Asia Global Development)

Phase II

(Asia Global Development)

Clinical Study inpreparation(As of May 11, 2018)
Development Code/
Generic Name

Development

Indications

Classification

SourceZ-213/Ferric carboxymaltose Zeria

Iron deficiency anemia

Intravenous iron replacement

In-licensed

Z-100

Zeria

Cervical cancer

Immunomodulator

Original

Z-360

Zeria

Pancreatic cancer

Gastrin CCK2 receptor antagonist

Original

Patiromer

Zeria

Hyperkalemia

Potassium binder

In-licensed

Products developed and launched
Launch Date
May 18, 2017

Development Code/
Generic Name

Development

Indications

Classification

Zeria
Z-206/Mesalazine(Asacol® additional dosage (Co-development with Ulcerative colitis
and administration)
Kyowa Hakko Kirin)

pH-dependent controlled-releaseformulation

Notes
Original(Tillotts Pharma AG)

II. Overseas
Stage
NDA filed(China)Phase III(Europe)Phase III
(Asia)

NDA filed(Europe)Phase II completed(North America)

Phase II
(Asia)Development Code/
Generic Name

Development

Indications

Classification

SourceZ-206/Mesalazine

Co-development of Zeria
Ulcerative colitis
and Tillotts Pharma

pH-dependent controlled-releaseformulation

Original(Tillotts Pharma AG)

Z-338/Acotiamide

Zeria

Functional dyspepsia

Upper gastrointestinal motility
modulator

Original

Z-100

Zeria

Cervical cancer

Immunomodulator

Original

TP05/Mesalazine

Tillotts Pharma

Ulcerative colitis

OPTICORE formulation

Original(Tillotts Pharma AG)

Z-338/Acotiamide

Zeria

Functional dyspepsia

Upper gastrointestinal motility
modulator

Original

Z-360

Zeria

Pancreatic cancer

Gastrin CCK2 receptor antagonist

Original

Reference

Phase I Clinical Trials

Phase II Clinical Trials

Phase III Clinical Trials

After confirmation of the efficacy and safety by animalstudies, “drug candidates” are tested on a small groupof healthy subjects. These trials aim for determination of
not only safety, but also how long it takes for the bodythrough an absorption of the drug and the degree towhich the body excretes the drug.

After safety has been confirmed by Phase I
clinical trials, the efficacy and safety of the “drugcandidate,” as well as the appropriate methodof use such as dosage and administration
method, are tested on a small number ofpatients against placebo*.

By administering to a large number of patients, the efficacy, safety andmethod of use of the “drug candidate” are studied as a final stage. During
this phase, the “drug candidate” is tested against other drugs on themarket or placebo*. In many cases, stringent testing methods called
double-blind trials are performed.

* Placebo: A fake drug that does not contain the active ingredient, but which is indistinguishable from the “drug candidate” by outer appearance or taste, etc.

6

Status of Production and Distribution / Outlook for Fiscal Year 2018

P Status of Production and Distribution

P Outlook for Fiscal Year 2018

In Zeria’s Production and Distribution division, operation isproceeding with the securing of quality set as top priority. In
departments related to Production, we are focusing on the
securing of even higher quality while reducing the cost of
goods. Meanwhile, distribution costs in departments related
to Distribution are rising steeply, and we are working to
reduce costs by further raising operational efficiency.
Furthermore, we are utilizing improved equipment at the
Tsukuba Plant, which completed renovation work aimed
at increasing production capacity during the previous fiscal
year, in order to provide a stable supply of drink products
such as the Hepalyse® range.

Regarding outlook for the consolidated results of fiscal
year 2018 (ending March 31, 2019), Zeria forecasts that
it will secure increases in both sales and profits, with net
sales of 68.0 billion yen (up 5.3% from the previous fiscal
year), operating profit of 5.2 billion yen (up 7.7%), ordinary
profit of 5.2 billion yen (up 2.2%), and profit attributable toowners of parent of 4.3 billion yen (up 3.4%).

P Close-up
New product launch of Hepalyse® W Pastille TypeWe have begun sales of our Hepalyse® W Premium PastilleType dietary supplement, which contains ingredients suchas liver extract, turmeric extract (curcumin), extract of black
pepper and chondroitin, at convenience stores nationwide.

Characteristics of Hepalyse® W Premium Pastille TypeOEasily portable pastille type
We condensed 250 mg of liver extract, which is the sameamount as Hepalyse® W Premium, and turmeric extract

Net sales
In the Ethical Pharmaceuticals business, Zeria expects
increased earnings due to growth in overseas markets for
Asacol® and Entocort and domestic market expansion for
Acofide® and Zentacort® despite continuing difficult domestic
conditions involving NHI price reductions and the impact ofgeneric brands. In the Consumer Healthcare business, Zeria
expects increases in sales due to sales growth driven by main
products including the Hepalyse® product range.
ProfitDespite expectations that research and development
expenses, advertising expenses and other expenses will
increase, Zeria forecasts higher operating profit, ordinary
profit and profit attributable to owners of parent comparedwith the fiscal year under review, due to increased sales.

(curcumin) into three tablets
inconveniently

64th Term

portable

packaging.

Net Sales

OAlso includes otherdelightful ingredients
Also includes chondroitin,
vitamins

andextract

Operating Profit(

Ordinary Profit

absorption of curcumin.
Profit Attributable to
Owners of Parent

64,568 million¥) (down 0.4%
from the previous fiscal year¥

68,000 million)

up 5.3%from the previous fiscal year

4,830 million¥

5,200 million(upfrom6.4%(upfrom7.7%
the previous fiscal year)
the previous fiscal year)of

black pepper, which aids the7¥

65th Term (Forecast)¥(

5,089 million¥) (up 14.7%
from the previous fiscal year¥

4,157 million

5,200 million)

up 2.2%from the previous fiscal year¥

4,300 million(upfrom17.3%(upfrom3.4%
the previous fiscal year)
the previous fiscal year)Special Offers to Our Shareholders

Chondroitin-Content Intensive Nighttime Essence

Zeria offers a hospitality program to its shareholders in recognitionof their constant support.
Shareholders who own 1,000 or more of Zeria’s shares can choose
from one of the six options A to F. Shareholders who own 100 or
more but less than 1,000 of Zeria’s shares receive option G.

Option2 bottles of ZZ:CC® ADSORB ESSENCE
(30g)

D

Zeria hopes its shareholders will try the gift products for better
understanding of its wide-ranging product structure.
Three-product Quality Moisturizer Set

IONA Three-product Basic Skincare Set
Soft drinks, Designated quasi-drug, Food for specified health uses

Set of aluminum can drinks and Hepalyse® W
OptionA

OptionE

High-purity chondroitin with natural ions tomoisturize and give firmness to aging skin
Health drink

OptionB

OptionF

2 bottles ofChondrobe®
Concentrate,
JUNKOU®

IONA R
Two-productSpecial Care Set

Drink containing liver extract and turmeric extract
Cosmetics and health products

Set of ChondroMax® and Aposty®
OptionC

10 bottles of Hepalyse® W
OptionG

P Options D to F are available at the Zeria online store (http://www.zeriaonline.com/).

8Topics

Applied for approval to manufacture and sell Z-213, a treatment for iron deficiency anemia
On March 29, 2018, Zeria submitted an application for approval to manufacture and sell this iron injection treatment for irondeficiency anemia (generic name: Ferric carboxymaltose) to the Ministry of Health, Labor and Welfare.
This treatment is a non-dextran intravenous iron replacement therapy drug with an active ingredient of ferric carboxymaltosethat was developed by Vifor (International) AG (headquarters: St. Gallen, Switzerland). This treatment has gained marketing
authorization in 75 countries worldwide for the treatment of iron deficiency where oral iron preparations are ineffective or
cannot be used. Zeria anticipates that this treatment will become a new and contributive option for iron deficiency anemia
patients and medical personnel in Japan as well.

Entered into an exclusive licensing agreement for the domestic development
and sale of VELTASSA, a therapeutic agent for hyperkalemia.
In March 2018, Zeria entered into an exclusive licensing agreement with Vifor (International) AG for the domestic development
and sale of Veltassa (generic name: Patiromer), a therapeutic agent for hyperkalemia.
Hyperkalemia is a condition in which potassium concentration in the blood is abnormally high and occurs at a high rate inpatients of chronic kidney disease (CKD), high blood pressure, diabetes and heart failure. It is a serious condition that can leadto life-threatening arrhythmia or sudden death.
Veltassa improves hyperkalemia conditions when taken orally by binding with excess potassium in the intestinal tract andthen being excreted with the feces. It should be used once per day and has very little odor or taste, for a pharmaceuticalformulation that is easy to use.
This product has been sold in the United States since December 2015 and received approval in Europe from the European
Medicines Agency in July 2017. Zeria anticipates that Veltassa will become a new treatment option for hyperkalemia in Japan
as well.

9

Launch of Hepalyse® W Premium Kiwami, the topmost product in the Hepalyse® W Series
Zeria began selling Hepalyse® W Premium Kiwami (a soft drink) at convenience stores nationwide on April 2, 2018.

We have been selling Hepalyse® W series, which includes Hepalyse® W Premium, at convenience stores, and the series has
been very popular.
With Hepalyse® W Premium Kiwami, we increased the amount of liver extract to 400 mg, the highest in the Hepalyse® W
series and additionally included ingredients that are good for the body. By adding this product to our line-up, we support all
people who care for their own health.

Characteristics of Hepalyse® W Premium Kiwami
The topmost product in the Hepalyse® W seriesThis product includes 400 mg of liver extract, the highest amount in the Hepalyse® W Series, as well as turmeric extract (45mg of curcumin) and chondroitin. We additionally included 300 mg of ornithine as well as royal jelly and hirami lemon extract.
A crisp and satisfying citrus flavor
We formulated this product to have a crisp citrus flavor that is satisfying to drink. The same delicious and smooth taste has
been preserved, even with higher levels of liver extract.
A fancy label
A gold hot stamp on a black backgroundwith a lamé (fabric with interwoven goldor silver threads) and “Kiwami” written
in silver letters. This label was designed toinspire a sense of luxury.

10Financial Statements (Consolidated)

Consolidated Balance Sheets (Summary)
Term
Item

(Unit: ¥million*)

Previous Fiscal Year Current Fiscal Year(As of March 31, 2017) (As of March 31, 2018)

AssetsItem

Previous Fiscal Year Current Fiscal Year(As of March 31, 2017) (As of March 31, 2018)

Liabilities

45,17836,159Notes and Accounts Payable-Trade

2,272

2,072

15,613

Short-Term Loans Payable

33,061

24,926

8,608

9,375

Other

9,843

9,160

718

750

5,674

14,230

3,599

3,372

Long-Term Loans Payable

2,884

8,676

(33)

(22)

Net Defined Benefit Liability

757

750

75,592

76,830Asset Retirement Obligations

54

54

Property, Plant andEquipment

24,154

23,340

1,978

4,748

Buildings and Structures

8,252

7,709

50,85350,390Machinery, Equipment
and Vehicles

3,764

3,267

11,698

11,701

57,92854,773Land

Capital Stock

6,593

6,593

Construction in Progress

58

292

Capital Surplus

11,685

11,685

Other

379

370

Retained Earnings

39,65442,096

Intangible Assets

33,88432,337(5)(5,600)Investments and Other Assets

17,553

21,152

5,423

10,758Investment Securities

9,206

6,935

231

752

Deferred Tax Assets

31

25

2,520

3,260

7,686

13,571

Accumulated Other Comprehensive
IncomeValuation Difference on Available-forSale Securities
Foreign Currency Translation
Adjustment
Remeasurements of Defined
Benefit Plans

2,670

6,745

Other

670

659

Non-Controlling Interests

152

163

Allowance for Doubtful Accounts

(41)

(40)

Total Net Assets

63,50465,696

114,357

116,086

114,357

116,086

38,764

39,255

Cash and Deposits

9,250

10,166

Notes and Accounts Receivable-Trade

16,620Inventories

Current Assets

Deferred Tax Assets
Other
Allowance for Doubtful Accounts
Noncurrent Assets

Net Defined Benefit Asset

Total Assets

11

Term

Current Liabilities

Noncurrent Liabilities

Other
Total Liabilities
Net Assets
Shareholders’ Equity

Treasury Stock

Total Liabilities and Net Assets

Unit: ¥million rounded down to nearest million

Consolidated Statements of Income (Summary)
Term
Item

(Unit: ¥million*)

Consolidated Statements of Cash Flows (Summary)Previous Fiscal Year Current Fiscal Year
(From April 1, 2016
to March 31, 2017)(From April 1, 2017
to March 31, 2018)

64,84918,16846,68058
48
46,69142,149
4,541
337
440
4,438
810
327
4,920
600
744
3,575
31
3,544

64,56818,341
46,22648
38
46,23541,405
4,830
490
231
5,089
691
203
5,577
869
524
4,183
25
4,157

Net Sales
Cost of Sales
Gross Profit
Reversal of Provision for Sales Returns
Provision for Sales Returns
Gross Profit-Net
Selling, General and Administrative Expenses
Operating Profit
Non-Operating Income
Non-Operating Expenses
Ordinary Profit
Extraordinary Income
Extraordinary Loss
Profit before Income Taxes
Income Taxes-Current
Income Taxes-Deferred
Net Profit
Profit Attributable to Non-Controlling Interests
Profit Attributable to Owners of Parent

Term
Item

(Unit: ¥million*)

Previous Fiscal Year Current Fiscal Year
(From April 1, 2016
to March 31, 2017)(From April 1, 2017
to March 31, 2018)

Net Cash Provided by (Used in)Operating Activities

7,238

8,821

Net Cash Provided by (Used in)Investing Activities

(703)

1,563

Net Cash Provided by (Used in)
Financing Activities(8,982)(9,628)

Effect of Exchange Rate Change
on Cash and Cash Equivalents

(644)

159

Net Increase (Decrease) in Cashand Cash Equivalents(3,092)

916

Cash and Cash Equivalents
at Beginning of Year

12,2109,118

Cash and Cash Equivalents
at End of Year

9,118

10,034

Unit: ¥million rounded down to nearest million

Unit: ¥million rounded down to nearest million

Consolidated Statements of Changes in Net Assets (Summary) (From April 1, 2017 to March 31, 2018)
Shareholders’ Equity

Balance at the Beginning of Current Period(Unit: ¥million*)

Accumulated Other Comprehensive Income

CapitalStock

CapitalSurplusRetained
Earnings

Treasury
Stock

6,593

11,68539,654(5)

NonValuation
Foreign
Total Accumulated
Net
Total
Controlling Total
Difference on Currency Remeasurements
Other
AssetsShareholders’ Available-forof
DefinedInterests
Translation Benefit Plans
Comprehensive
EquitySale Securities Adjustment
Income57,928

231

2,520

2,670

5,423

152

63,504

Changes of Items during the Period
Dividends from Surplus(1,716)(1,716)

Profit Attributable to Owners of Parent

4,157

4,157

4,157

(5,595)(5,595)(5,595)Purchase of Treasury Stock
Net Changes of Items Other
than Shareholders’ Equity(1,716)

520

739

4,074

5,334

10

5,345

Total Changes of Items during the Period

-

-

2,441

(5,595)(3,154)

520

739

4,074

5,334

10

2,191

Balance at the End of Current Period

6,593

11,68542,096(5,600)54,773

752

3,260

6,745

10,758163

65,696

Unit: ¥million rounded down to nearest million

12Company Information (As of March 31, 2018)

Company Outline

Place of Business

Established:

December 1955

O Headquarters

O Keiji Sales OfficePaid-in Capital:¥6,593,398,500

O Sapporo Branch

O Hokuriku Sales Office

Number of Employees: 1,753 (Consolidated)

O Sendai Branch

O Chugoku & Shikoku BranchBusiness Activities: 1. Manufacturing, sales, import andexport of pharmaceuticals, quasidrugs and reagents.

O Tokyo Branch

O Okayama Sales Office

O Tokyo 3rd Sales Office

O Takamatsu Sales Office

O Kanagawa Sales Office

O Fukuoka Branch

O Saitama Sales Office

O Central Research Laboratories

O Chiba Sales Office

O Saitama Plant

O Kita Kanto Sales Office

O Tsukuba Plant

O Koshinetsu Sales Office

O Sapporo Distribution Center

O Nagoya Branch

O Tokyo Distribution Center

O Shizuoka Sales Office

O Saitama Distribution Center

O Osaka Branch

O Osaka Distribution Center

O Osaka 2nd Sales Office

O Kyushu Distribution Center

2. Manufacturing, sales, import andexport of cosmetics, health foods,
soft drinks, hygienic goods andmedical devices.

Directors and Audit & Supervisory Board Members
Chairman and CEO

Sachiaki Ibe

President and COO

Mitsuhiro Ibe

Executive Vice President

Hirokazu EndoManaging Director

Makoto Kishimoto

Director

Tetsuo Komori

Director

Kikuo Nomoto

Director

Hiroki Kato

Number of Consolidated Subsidiaries: 13

Director

Yoshihiro Hiraga

O Tillotts Pharma AG (Switzerland)

Director

Katsuyuki Ishii

Director

Toshiaki Kawagoe

Director

Mitsuyuki Yoshijima

Director

Kenji Kusano

Director

Hiroyasu Nishioka

Audit & Supervisory Board Member Shigeya Furuhata
Audit & Supervisory Board Member Koujirou Takami
Audit & Supervisory Board Member (Outside) Yukiko Naka
Audit & Supervisory Board Member (Outside) Hiroshi Wakabayashi

13

O Kobe Sales Office

O Other Sales Office

Aomori, Utsunomiya, Kanetsu, Takasaki, Yamaguchi,
Yonago, Matsuyama, Kochi, Nagasaki, Kumamoto,
Oita, Kagoshima, Okinawa

O ZPD A/S (Denmark)O Zeria Healthway Co., Ltd.
O Tillotts Pharma AB (Sweden)
O Tillotts Pharma Ltd. (Ireland)
O Tillotts Pharma UK Ltd. (United Kingdom)
O Tillotts Pharma Czech s.r.o. (Czech Republic)
O Tillotts Pharma Spain S.L.U. (Spain)
O Tillotts Pharma GmbH (Germany)
O Tillotts Pharma France SAS (France)
O IONA INTERNATIONAL CORPORATIONO Zevice Co., Ltd.
O Pharmaceutical Joint Stock Company of February 3rd (Vietnam)

Share Information (As of March 31, 2018)

Status of Shares

Distribution of Shares by Shareholder Type(i) Number of authorized shares:

119,860,000 shares(ii) Number of shares outstanding:

53,119,190 shares(iii) Number of shareholders:

12,124

Financial Instruments Business

Foreigners

326,219 shares(0.62%)

4,319,327 shares(8.13%)

Individual Shareholders
and Others

Major Shareholders
Number of Percentage
Shares Held Held (%)

Name of Shareholder

Ibe Corporation

4,741,847

9.4

Japan Trustee Service Bank, Ltd. (Trust Account)

2,300,100

4.6

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

2,107,050

4.2

Morinaga Milk Industry Co., Ltd.

2,040,215

4.1

Sachiaki Ibe

1,592,967

3.2

Sumitomo Mitsui Banking Corporation

1,406,131

2.8

Mizuho Bank, Ltd.

1,406,053

2.8

Resona Bank, Limited

1,182,385

2.3

The Master Trust Bank of Japan, Ltd. (Trust Account)

1,109,600

2.2

Zeria Pharmaceutical Co., Ltd. Employee Stockholding Plan

1,105,044

2.2

14,194,065 shares(26.72%)Distribution Ratioof Shares
Total
53,119,190 shares
Other Domestic
Corporations
17,316,850 shares(32.60%)Financial Institutions
16,962,729 shares(31.93%)(Note) The percentage held is calculated by subtracting treasury stock (totaling 2,743,545 shares).

Share Price and Trading Volume
Share Price (¥)

2,500
2,000

Number of
Shares Traded(1,000 shares)

1,500

6,000
5,000

1,000

4,000
3,000

500

2,000
1,000

0

2017
April

May

June

July

AugustSeptember

OctoberNovember December

2018
January0
February

March

14

Shareholder Memo
Fiscal Year

From April 1st of each year to March 31st of the following year

Ordinary General Meeting Late June of each yearof Shareholders
Record Date

Ordinary General Meeting of Shareholders and end ofterm dividend: March 31 of each year
Interim dividend: September 30 of each year

Transfer Agent

Sumitomo Mitsui Trust Bank, Limited
1-4-1 Marunouchi, Chiyoda-ku, Tokyo

Sumitomo Mitsui Trust Bank, Limited
Account Management
Institution for Special Account 1-4-1 Marunouchi, Chiyoda-ku, Tokyo
Mailing Address

Stock Transfer Agency Business Planning Department,
Sumitomo Mitsui Trust Bank, Limited
2-8-4 Izumi, Suginami-ku, Tokyo 168-0063(Inquiry information) TEL: 0120-782-031 (toll-free)Handling operation is conducted in main branch andall domestic branches of Sumitomo Mitsui Trust Bank,
Limited.

PApplications for change of address or for purchase demands offractional shares, etc.
Please send such notifications or applications to the securities company
where your account is held.
For shareholders for whom a special account has been opened because
there is no account held by a securities company, please send such
notifications or applications to Sumitomo Mitsui Trust Bank, Limited, theaccount management institution for the special account.
PApplications for payment of dividends payable
Please send such applications to the transfer agent, Sumitomo Mitsui
Trust Bank, Limited.
PStatement of Dividend Calculation
The “Statement of Dividend Calculation” that is sent to shareholders at
the time of dividends payment serves as your “Payment Notification
Statement,” based on the provisions of the Act on Special Measures
Concerning Taxation. When you file your final tax return, you can use thisdocument as the accompanying documentation.
Shareholders who receive payment of dividends by the dividend warrant
shall also receive the “Statement of Dividend Calculation.” Shareholders
who file final tax returns should store this document in a secure place.

Please refer to latest IR information on our website.
The Company has set up a website for the purpose of providing accurate information on atimely basis. The website contains a broad array of information useful for shareholders andinvestors, from IR information to the latest news.

http://www.zeria.co.jp/english/

Customer Service, Zeria Pharmaceutical Co., Ltd.
10-11 Nihonbashi-kobunacho, Chuo-ku, Tokyo 103-8351
TEL 03-3663-2351 (Main) FAX 03-3663-2352
03-3661-2080
http://www.zeria.co.jp/