English translation

Summary of Financial Statements for the Fiscal Year Ended December 31, 2017
[Japanese GAAP] (Non-consolidated)
February 7, 2018
Company Name

SymBio Pharmaceuticals Limited

Listing: Tokyo Stock Exchange

Securities Code4582

URL http://www.symbiopharma.com/

Representative

Representative Director,
President and Chief Executive Officer

Fuminori Yoshida

Contact Person

Director, Finance & Accounting

Kenji Murata

TEL +81-3-5472-1125

Date of Dividend
Payment (plan)－

Ordinary Annual General Meeting
March 29, 2017of Shareholders
Scheduled Date to File Securities
March 29, 2017
ReportSupplementary materials for thefinancial statements:

Yes

Holding of earnings performanceYes
review:

No

No (For securities analysts and institutional investors)(yen in millions – rounded down, unless otherwise stated)
1. Business Results for FY 2017 (January 1, 2017 to December 31, 2017)(1) Operating Results
Net Sales
Operating Income (Loss)yen in millions% yen in millions%
FY 20173,444
45.4(3,947)－FY 2016
2,368
22.5(2,127)－Net Income (Loss) per
Share(Reference) Equity in earnings:

Ratio of Ordinary
Ratio of Operating
Ratio of Net
Income (Loss) toIncome (Loss) toIncome (Loss) toTotal Assets
Net Sales
Equity (ROE)
(ROA)
Yen
%
%
%
－
(102.6)(71.5)(114.6)－(50.4)(39.1)(89.8)

Diluted Net Income per
Share

Yen
(79.78)(58.82)

FY 2017
FY 2016(Percentages indicate year-on-year changes)
Ordinary Income (Loss)Net Income (Loss)yen in millions% yen in millions%(3,976)－(3,977)－(2,316)－(2,313)－

FY 2017－ million yen

FY 2016－ million yen(2) Financial Position

FY 2017
FY 2016

Total Assets
yen in millions
4,252
6,878

(Reference) Shareholders’ equity:

FY 2017

Net Assets
yen in millions
3,239
5,484
2,702 million yen

Equity Ratio
%
63.6
73.5

Net Assets per Share
Yen
50.00
108.61

FY 2016

5,053 million yen(3) Cash Flow

FY 2017
FY 2016

Cash Flow from Operating Cash Flow from Investing Cash Flow from Financing Cash and Cash Equivalents
Activities
Activities
Activities
at the End of the Yearyen in millions
yen in millions
yen in millions
yen in millions(3,816)
(77)
1,164
2,947
(1,960)
(43)
3,658
5,719

2. Dividends
Ratio of
Payout Ratio Dividends to
Net Assets
yen in millions
%
%
－
－
－
－
－
－

Annual Dividend per Share
1st Quarter
FY 2016
FY 2017
FY 2018 (Forecast)

2nd Quarter

3rd Quarter

Fiscal Year End

Yen
0.00
0.00
0.00

Yen
－
－

Yen
0.00
0.00
0.00

Yen
－
－
－

－

Total Dividends

Full Year
Yen
0.00
0.00
0.00

－

3. Earnings Forecasts for FY 2018 (January 1, 2018 to December 31, 2018)
Operating
Income (Loss)

Net Sales
Full Year

Ordinary
Income (Loss)(Percentages indicate year-on-year changes)
Net Income (Loss)Net Income (Loss)
per Share

yen in millions%

yen in millions%

yen in millions%

yen in millions

%

Yen

4,201

22.0

(2,981)－(3,044)－(3,056)－(56.55)

Notes:(1) Changes in accounting policies, changes in accounting estimates and restatements after error corrections(a) Changes in accounting policies due to revision ofYes ・ No
accounting standards:(b) Changes in accounting policies due to otherreasons:

Yes ・ No(c) Changes in accounting estimates:

Yes ・ No(d) Restatements after error corrections:

Yes ・ No

(2) Number of shares outstanding (common stock)(i) Number of shares outstanding at the end of
the year (including treasury stock)

FY 201754,049,224 shares

FY 2016

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

FY 201775 shares

FY 201675 shares(iii) Average number of shares during the year

FY 201749,857,917 shares

FY 2016

39,329,706 shares(Note) Refer to “Per share information” on Page 54 for the number of shares that forms the basis for calculating net income(loss) per share.
* These financial statements are not subject to audits.
* Explanation regarding the appropriate use of earnings forecasts and other matters(Notes on forward-looking statements)
All forecasts presented in this document, including earnings forecasts, 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“Business results analysis,” on Page 1 of the attachment.

Index of the attachment
1. Overview of business results, etc. …………………………………………………………………………………………….
(1) Overview of business results for the fiscal year under review ……………………………………………………………..
(2) Overview of financial position for the fiscal year under review ……………………………………………………………
(3) Overview of cash flows for the fiscal year under review …………………………………………………..………………
(4) Future outlook ………………………………………………………………………………………………….…...……..
(5) Basic policies concerning profit distribution and dividends …………………………………………………………..….
(6) Business risks ………………………………………………………………………………………………….…...……..
2. Status of corporate group ………………………………………………………………………………………………..........
3. Management policies ……………………………………………………..….………………………………………..……...
(1) Basic policy of company management …………………………..…………………………………………………..…...
(2) Key performance index ………………………………………..……………………………………………….……..…..
(3) Pipeline ………………………………………………………………………………………………………………........
(4) Medium to long-term strategy ………………………………………………………………………………….……...….
(5) Issues to be addressed by the Company …………………………………………………………………………………..
(6) Other important matters concerning the Company’s management …………………………………….…………………
4. Basic views on selection of accounting standards ………………………………………..……………..……………..……..
5. Financial statements and primary notes ………………………………………………………………………………………
(1) Balance sheets …………………………………………………………………………………………………….…..…..
(2) Statements of operations ……………………………………………………………………………………………..…...
(3) Statements of changes in net assets ……………………………………………………………………..…….……...…..
(4) Statements of cash flow …………………………………………………………………………………………..……....
(5) Events and conditions that indicate there could be substantial doubt about the going concern assumption…………….
(6) Significant accounting policies …………………………………………………………………………………....…......
(7) Notes on financial statements …………………………………………………………………………………….....……
(Balance sheets) …………………………………………………………………………………………………..…….
(Statements of operations) ………………………………………………………………………………..………..…...
(Statements of changes in net assets) …………………………………………………………………..………...……..
(Statements of cash flow) ………………………………………………………………………………………..….......
(Financial instruments) …………………………………………………………………………………..……………...
(Derivative transactions) ………………………………………………………………………………………………..
(Retirement benefits) ………………………………………………………………………………………….……..….
(Stock options) ………………………………………………………………………………………………….…...….
(Deferred tax accounting) ………………………………………………………………………………………………
(Asset retirement obligations) …………………………………………………………………………………………..
(Segment information) …………………………………………………………………………………………….……
(Related party information) …………………………………………………………………………………..….……...
(Per share information) ………………………………………………………………………………………………….
(Significant subsequent events) …………………………………………………………………………………………
6. Other ………………………………………………………………………………………………………………………….…
(1) Change in officers ………………………………………………………………………………………………………...
(2) Other ………………………………………………………………………………………………………………..…….

1
1
3
4
4
4
5
12
12
12
12
12
14
16
17
17
18
18
20
21
23
25
25
27
27
27
29
31
32
36
37
38
51
51
52
53
54
55
55
55
55

1. Overview of business results, etc.
(1) Overview of business results for the fiscal year under review(Business Results for the fiscal year under review)
Progress in the Company’s business for the fiscal year under review is as follows.
(i) Domestic[Anticancer agent: SyB L-0501 (lyophilized powder formulation), SyB L-1701 (ready-to-dilute (“RTD”) formulation), SyB
L-1702 (rapid infusion (“RI”) formulation) and SyB C-0501 (oral formulation) (generic name: bendamustine hydrochloride,
trade name: TREAKISYM®)]
The Company markets TREAKISYM® in Japan through its business partner, Eisai Co., Ltd. (“Eisai”). The Company
obtained marketing approval for first-line treatment of low-grade non-Hodgkin’s lymphoma and mantle cell lymphoma in
December 2016, and for chronic lymphocytic leukemia in August 2016. These are in addition to the approvals for theindications of recurrent/refractory low-grade non-Hodgkin’s lymphoma and mantle cell lymphoma which were obtained in
October 2010. This indication expansion has resulted in a significant in-market sales increase of 60.9% year-on-year (NHI
price basis). Net sales to Eisai also grew considerably, by 62.7% year-on-year.
In addition to the three already approved indications, the Company continues to work on obtaining approval forrecurrent/refractory intermediate/high-grade non-Hodgkin’s lymphoma (diffuse large B-cell lymphoma) to benefit patientsin need of new therapies and to further maximize product value. For these indications, the Company has completed a Phase
II clinical trial and in August 2017 began a Phase III clinical trial (designed in accordance with consultations with thePharmaceuticals and Medical Devices Agency (“PMDA”)) and completed the first patient enrollment in January 2018.
In addition to the ongoing label expansion initiatives, the Company concluded an exclusive license agreement with Eagle
Pharmaceuticals, Inc. (head office: New Jersey, U.S.) (“Eagle”) in September 2017, under which Eagle licensed to theCompany rights under Eagle’s intellectual property to develop, market, and sell Eagle’s RTD and RI liquid formulations(“TREAKISYM® liquid formulation”) (Note 1) in Japan. This will further enable the Company to extend the product life until
2031 through patent protection and maximize the value of TREAKISYM®, while bringing significant benefits to patientsand medical professionals. (See press release dated September 21, 2017 titled “Eagle Pharmaceuticals Licenses Japanese
Rights for Bendamustine Hydrochloride Ready-to-dilute and Rapid Infusion Injection Products to SymBio Pharmaceuticals
Limited.”)In addition to the development and expansion of the intravenous formulation product, the Company is exploring thedevelopment of an oral formulation of TREAKISYM® with a focus on the treatment of solid tumors and autoimmune
diseases and intends to further expand the business, with an aim to solidify its business through a platform of
TREAKISYM® products. Amid such initiatives, the Company commenced a Phase I clinical trial for progressive solid
tumors in January 2018, with the aim of examining the recommended dosage and schedule as well as tolerability and safetyof the oral formulation of TREAKISYM®, and narrowing down the types of potential target tumors.
(Note 1) RTD and RI are pre-dissolved liquid formulations that differ from currently available freeze-dried (“FD”) powder
injection. RTD (ready-to-dilute) will significantly reduce the preparation time and labor cost for healthcare
providers, and RI (rapid infusion) will reduce infusion duration to 10 minutes from the current 60 minutes,
providing significant benefit and value to both patients and healthcare providers.

[Anticancer agents: SyB L-1101 (intravenous formulation) and SyB C-1101 (oral formulation), generic name: rigosertib
sodium]U.S. Licensor Onconova Therapeutics, Inc. (head office: Pennsylvania, U.S.) (“Onconova”) is conducting a global Phase
III clinical trial (with trial sites in more than 20 countries) of the intravenous formulation of rigosertib sodium for higherrisk myelodysplastic syndromes (HR-MDS) which do not respond to the current standard treatment with hypomethylating
agents (“primary HMA failure”) or which relapse after treatment under the current standard of care. The Company is
responsible for clinical development in Japan and in December 2015 started a domestic trial for which 30 patients are
already enrolled. The Company completed the first patient enrollment in Japan in July 2016 and patient enrollment isproceeding favorably. Based on the results of the interim analysis completed in January 2018, the Company will continue
the trial with an increase in patient enrollment in accordance with pre-determined statistical criteria.
Regarding the oral formulation of rigosertib, the domestic Phase I clinical trial for combination therapy with azacitidine(Note 2) for the target indication of HR-MDS began in December 2015. Although delays with the investigational drug by
Onconova had delayed patient enrollment, Onconova has recently resumed provision of the investigational drug and the-1-Company commenced a new domestic Phase I clinical trial in June 2017 to confirm the safety of high-dose oral rigosertib,
which was added to the Phase II clinical trial being conducted by Onconova in the U.S. for first-line treatment andrecurrent/refractory treatment of patients with HR-MDS. First patient enrollment was completed in October 2017. After
safety is confirmed through this trial, the Company plans to conduct a domestic clinical trial for combination therapy withazacitidine, and to take part in Onconova’s planned global Phase III clinical trial for combination therapy with azacitidine
for the first-line treatment of patients with HR-MDS.
(Note 2) About azacitidine (Vidaza®: currently marketed by Nippon Shinyaku Co., Ltd.): This drug (for injection) wasapproved in 2011 upon successful confirmation of extended overall survival for the first time in the Phase III
clinical trial for the indication of MDS, and is currently used as a first-line drug for MDS patients who havedifficulties in hematopoietic stem cell transplantation. MDS is a preleukemic state, and decrease in tumor
suppressor gene due to excessive methylation of DNA is thought to be related to the disease. Hypomethylating
agents such as azacitidine are thought to suppress progress to leukemia by restoring tumor suppressor gene with adeterrent effect against methylation of DNA.
[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 ofUS-based The Medicines Company (Head Office: New Jersey, U.S.) for an exclusive license to develop and commercialize
SyB P-1501 in Japan. The Company commenced a domestic Phase III clinical trial for SyB P-1501 in June 2016 andcompleted the first patient enrollment in November 2016, with enrollments accumulating. The Company, acting in the bestinterest of patients, determined on April 21, 2017 to temporarily suspend new patient enrollment due to its recently arisingconcern as to the continuity of The Medicines Company’s business regarding the product. The license agreement with
Incline Therapeutics, Inc. terminated effective November 30, 2017.
The Company initiated an arbitration against The Medicines Company on October 11, 2017, under the rules of theInternational Chamber of Commerce, seeking damages of 82 million U.S. dollar (approximately 9.0 billion yen) arisingfrom The Medicines Company’s repudiation of the license agreement. (See press releases “Initiation of an Arbitration
against The Medicines Company,” dated November 13, 2017, and “Termination of License Agreement between SymBio
Pharmaceuticals Limited and The Medicines Company,” dated November 30, 2017.)
In conjunction with the termination of the license agreement, the Company will terminate the development of SyB P1501, a process that the Company expects to complete by March 31, 2018.
[New drug candidates]
The Company continues to actively seek new drug candidates and in-licensing opportunities globally, aiming to expand
both profitability and growth potential over the medium-to-long-term, and discussions with multiple potential licensors are
ongoing.
In May 2016, the Company established a wholly-owned subsidiary, SymBio Pharma USA, Inc. (Menlo Park, California,
U.S., “SymBio Pharma USA”), as the Company’s planned strategic base for overseas business development. Acquiring
rights to new drug candidates through SymBio Pharma USA as the base of global business will be part of the Company’s
continued transformation into a global specialty biopharmaceutical company with capability to develop and commercialize
new drugs in the U.S., Japan, Europe, and other major global markets.
(ii) Markets outside Japan
SyB L-0501 is also marketed in South Korea, Taiwan, and Singapore, and product sales of SyB L-0501 in these countries
progressed favorably at a pace exceeding the Company’s forecasts.
(iii) Business results
As a result of the above, net sales totaled 3,444,206 thousand yen for the fiscal year ended December 31, 2017, primarilyreflecting product sales of TREAKISYM® in Japan. Product sales showed a year-on-year increase of 61.1%. Accordingly,
overall net sales rose 45.4% year-on-year.
Selling, general and administrative expenses totaled 4,978,327 thousand yen (a year-on-year increase of 64.2%),
including research and development (“R&D”) expenses of 3,017,812 thousand yen (a year-on-year increase of 81.0%)
primarily due to the upfront payment relating to the license agreement with Eagle Pharmaceuticals for TREAKISYM®
liquid formulation (RTD and RI formulations) and expenses associated with the clinical trial for TREAKISYM®, the-2-intravenous and oral formulations of rigosertib as well as SyB P-1501, and other selling, general and administrative
expenses of 1,960,514 thousand yen (a year-on-year increase of 43.7%).
As a result, an operating loss of 3,947,061 thousand yen was recognized for the fiscal year ended December 31, 2017(an operating loss of 2,127,049 thousand yen for the previous fiscal year). In addition, the Company recorded non-operating
expenses totaling 34,229 thousand yen primarily comprising stock issuance costs of 14,477 thousand yen, foreign exchange
losses of 10,421 thousand yen, and commission fees of 9,090 thousand yen, and non-operating income totaling 4,506
thousand yen primarily due to interest income of 3,092 thousand yen and dividend income of 1,339 thousand yen. This
resulted in an ordinary loss of 3,976,784 thousand yen (an ordinary loss of 2,316,806 thousand yen for the previous fiscal
year) and net loss of 3,977,862 thousand yen (a net loss of 2,313,233 thousand yen for the 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) Overview of financial position for the fiscal year under review(Analysis of assets, liabilities, net assets, and cash flow)
Total assets as of December 31, 2017 stood at 4,252,284 thousand yen, a decrease of 2,626,100 thousand yen from theprevious fiscal year end. This was primarily due to increases of 89,789 thousand yen in merchandise and finished goods, 23,598
thousand yen in software and 20,585 thousand yen in lease and guarantee deposits, offsetting decreases of 2,772,266 thousand
yen in cash and deposits, 47,705 thousand yen in advances paid and 24,806 thousand yen in tools, furniture and fixtures.
Liabilities stood at 1,012,882 thousand yen, a decrease of 380,632 thousand yen from the previous fiscal year end, primarilyreflecting increases of 282,522 thousand yen in accounts payable-trade and 18,226 thousand yen in income taxes payable,
offsetting decreases of 450,000 thousand yen in bonds payable and 221,642 thousand yen in accounts payable-other.
Under net assets, the decrease of 3,977,862 thousand yen in retained earnings (accumulated deficits) due to recording of net
loss was offset mainly by an increase of 813,378 thousand yen in common stock, an increase of 813,378 thousand yen in legal
capital surplus and an increase of 105,637 thousand yen in stock acquisition rights; thus, total net assets decreased by 2,245,468
thousand yen from the previous fiscal year end to 3,239,402 thousand yen. As a result, the equity ratio decreased by 9.9
percentage points from the previous fiscal year end to 63.6%.
Cash and cash equivalents (“cash”) as of December 31, 2017 stood at 2,947,059 thousand yen, a decrease of 2,772,266
thousand yen from the previous fiscal year end. This was mainly due to recording of loss before income taxes despite a cash
increase resulting from issuance of new shares.
Cash flow from each activity and factors for this fiscal year end are as follows:(Cash flow from operating activities)
Cash flow from operating activities showed an overall decrease of 3,816,793 thousand yen (a decrease of 1,960,089
thousand yen in the previous fiscal year) due to decreasing factors such as loss before income taxes of 3,974,062 thousand
yen, a decrease in accounts payable-other of 208,540 thousand yen, an increase in inventories of 89,789 thousand yen and anincrease in consumption taxes receivable of 63,674 thousand yen, despite increasing factors such as an increase in accounts
payable-trade of 282,522 thousand yen, share-based compensation expenses of 121,205 thousand yen, a decrease in advances
paid of 47,705 thousand yen, depreciation of 29,569 thousand yen, and foreign exchange losses of 42,195 thousand yen.
(Cash flow from investing activities)
Cash flow from investing activities showed an overall decrease of 77,507 thousand yen (an decrease of 43,836 thousand
yen in the previous fiscal year) mainly due to purchase of non-current property, plant and equipment of 10,657 thousand yen,purchase of intangible assets of 46,364 thousand yen and payments of lease and guarantee deposits of 23,550 thousand yen.
(Cash flow from financing activities)
Cash flow from financing activities showed an increase of 1,164,230 thousand yen (an increase of 3,658,177 thousand yen
in the previous fiscal year) due mainly to proceeds from issuance of stock resulting from exercise of stock acquisition rights of
1,146,042 thousand yen and proceeds from issuance of stock acquisition rights of 32,560 thousand yen.

-3-

(3) Overview of cash flows for the fiscal year under review

Equity ratio (%)
Equity ratio on a fairmarket value basis (%)
Debt redemption period(years)Interest coverage ratio

9th Term

10th Term

11th Term

12th Term

13th Term

Fiscal year ended

Fiscal year ended

Fiscal year ended

Fiscal year ended

Fiscal year ended

December 2013

December 2014

December 2015

December 2016

December 2017

95.4

90.7

82.9

73.5

63.6

151.4

155.1

150.8

165.1

278.4

－

－

－

－

－

－

－

－

－

－

Equity ratio: Equity (total shareholders’ equity)/total assets
Equity ratio on a fair market value basis: Total market value of common stock/total assets
Debt redemption period: Interest-bearing debt/cash flow from operating activities
Interest coverage ratio: Cash flow from operating activities/interest payments(Notes)
1. Total market value is calculated based on the number of shares issued, excluding treasury stocks.
2. Debt redemption period and interest coverage ratio are not available due to negative cash flow from operating
activities.

(4) Future outlook
The Company expects net sales of 4,201 million yen in FY 2018, a 22.0% increase from FY 2017, mainly as a result of growthin sales of TREAKISYM® in Japan. Meanwhile, in R&D, the Company will continue to pursue the development of
TREAKISYM® for recurrent/refractory intermediate/high-grade non-Hodgkin’s lymphoma (diffuse large B-cell lymphoma),
TREAKISYM® RTD and RI liquid formulations, and the oral formulation of TREAKISYM®, as well as intravenous and oral
formulations of rigosertib.
With the aim of further enhancing corporate value over the long term, the Company will continue to consider in-licensing new
drug candidates and will continue to advance the development of its current pipeline. To this end, the Company anticipates R&D
expenses of 2,311 million yen (3,017 million yen in FY 2017) and selling, general and administrative expenses of 4,350 million
yen (4,978 million yen in FY 2017), including R&D expenses.
Key development milestones for the Company’s current pipeline are as follows:[TREAKISYM®]
Regarding recurrent/refractory intermediate/high-grade non-Hodgkin’s lymphoma (diffuse large B-cell lymphoma), theCompany will actively accumulate patient enrollments in the Phase III clinical trial that is already underway.
Regarding TREAKISYM® RTD and RI liquid formulations in-licensed from Eagle Pharmaceuticals, Inc., the Company willpromptly finalize concrete development plans for both products.
Regarding the oral formulation of TREAKISYM®, the Company will aim at an early date for first patient enrollment in the
Phase I clinical trial that has already started.
[Intravenous and oral formulation of rigosertib]
As for the intravenous formulation of rigosertib, the Company is currently accumulating patient enrollments in Japan as part of
the global Phase III trial, and will continue to actively pursue development.
As for the oral formulation of rigosertib, after safety has been confirmed through the domestic Phase I clinical trial as amonotherapy, for which patient enrollment is currently underway, the Company will aim to promptly conduct a clinical study for
combination therapy with azacitidine.
As a result of these planned activities, net sales of 4,201 million yen, operating loss of 2,981million yen, ordinary loss of 3,044
million yen, and net loss of 3,056 million yen are projected for FY 2018.

(5) Basic policies concerning profit distribution and dividends
The Company has not distributed dividends to date.

-4-

Although the Company has recorded product sales of TREAKISYM®, the Company continues to use funds for development
activities. Therefore, it is our policy to attempt to improve the balance sheet and retain funds for sustainable development
activities rather than for profit distribution. However, we recognize that the return of profit to shareholders is an importantmanagement issue and will continue to consider the distribution of profits based on future business performance and financial
conditions.
The articles of incorporation state that the Company can pay an interim dividend, based on a corporate resolution by the Boardof Directors, on June 30 every year as the record date. The Company can also distribute surplus by designating a record date inaddition to year end and interim dividends. The decision making body for the interim dividend is the Board of Directors, and forthe year end dividend the shareholders (shareholders’ meeting).

(6) Business risks
Described below are major issues that may lead to potential risks in the Company’s business activities. Issues that are notnecessarily considered significant by the Company are also disclosed in view of our commitment to actively provide information
to investors and shareholders as these issues may carry weight in making investment decisions or in understanding our businessactivities. The Company is fully aware of the potential risks, and will make utmost efforts to prevent such risks frommaterializing, but should they occur, we intend to take appropriate action. However, we realize that investment decisions
regarding our stock should be made carefully by evaluating the following matters, as well as other matters mentioned in othersections of this document. We would add that the following descriptions do not purport to cover all possible risks associated withinvestment in our stock. The future perspectives mentioned below reflect our understanding of our business circumstances as ofthe date of publication of this document.
(i) Risks associated with pharmaceutical development in general
The Company’s main business is to in-license new drug candidate compounds created by pharmaceutical companies andbioventures, and to develop these into pharmaceutical products. The R&D field of pharmaceuticals is replete with strong
competition, including pharmaceutical giants. In addition, specialty pharmaceutical companies, including the Company,
emulate each other in quality and speed within the sector. The process from development to manufacturing and marketing
involves many regulatory hurdles, necessitating a vast amount of capital input over a long period of time in business
operations. Their future prospects involve uncertainty and these risk factors are associated with the Company’s present andfuture business activities.
a) Uncertainty involved in pharmaceutical development
The pharmaceutical development process leading up to the launch of a drug generally requires a large amount ofexpenditure over a prolonged period. The probability of success is low. At each stage of development, it is not uncommon
to encounter obstacles or delays in progress. In pharmaceutical development, the different stages of development have to be
conducted in phases, and at each phase a decision is made regarding whether or not development should continue. It is not
unusual for a decision to be made to stop development in mid-process. The probability is low for development to progresssuccessfully through to product launch. Even after a product is successfully developed and launched, there remains a riskthat approval for the product is revoked due to patient safety concerns (see (f): “risk associated with side effects”). To
reduce these risks, the Company aims to have several drug candidates in its development pipeline and to prioritize insofar
as possible the in-licensing of drug candidates with confirmed POC (Note 3) in human subjects. For small specialty
pharmaceutical business such as the Company, the impact of removing a single drug candidate from the development
pipeline is highly material and could have a significant impact on the Company’s financial position, business performance,and cash flow.
(Note 3) POC (Proof of Concept) means confirming the efficacy and safety of a new drug candidate in clinical trials andverifying its practical potential.
b) Uncertainty of income
In order to generate income from the drugs in development, the Company must succeed at all stages of new drugcandidate development, obtain the requisite approvals from regulatory authorities, and successfully manufacture and market
the product either on our own or in partnership with a third-party. It is not assured that the Company will succeed in these
activities, or even if we do succeed, we may not be able to ensure the margin of profitability needed to continue thebusiness. Of the products currently in the development pipeline, SyB L-0501 was approved for manufacturing andmarketing in Japan on October 27, 2010, for the indications of recurrent/refractory low-grade non-Hodgkin’s lymphoma-5-and mantle cell lymphoma, and was launched as the anticancer agent TREAKISYM® in December 2010. In December
2015, the Company filed supplemental New Drug Applications (sNDAs) in Japan for the additional target indications offirst-line treatment of low-grade non-Hodgkin’s lymphoma and mantle cell lymphoma, and chronic lymphocytic leukemia.
Marketing approval for these indications was received in December 2016 and August 2016, respectively. Furthermore, weare currently conducting a Phase III clinical trial for recurrent/refractory intermediate/high-grade non-Hodgkin’s lymphoma(diffuse large B-cell lymphoma) and the preparation of concrete development plans for TREAKISYM® RTD and RI liquid
formulations is underway. With respect to rigosertib, we are currently conducting a global Phase III clinical trial in Japan
with the SyB L-1101 intravenous formulation for the target indication of recurrent/refractory higher-risk MDS and adomestic Phase I clinical trial with the SyB C-1101 oral formulation as a monotherapy with consideration of targeting theindication of first-line treatment of patients with higher-risk MDS. We are promoting the development of these compounds,
aiming to successfully launch the products onto the market to obtain income. In some cases, we may consider entering into
an alliance with other pharmaceutical companies in development and marketing so as to expedite the inflow of income.
Notwithstanding our efforts, the drug candidates in our pipeline will require a considerable amount of time underdevelopment before they reach the marketplace. There is no guarantee that they will make it onto the market as viable
products, or that an alliance agreement can be signed with other pharmaceutical companies. We are of the opinion that the
selection of indications and the methods of alliance and marketing identified thus far promise sufficient future profitability
after considering the market size and marketing performance of approved drugs. However, should we prove to be wrong in
our assessment, or should there be any change in the conditions on which the assessment is based and we fail to promptly
adapt to such changes, there could be a significant impact on our financial position, business performance, and cash flow.
c) Uncertainty in legislation and regulations requiring compliance, and the health insurance system
The pharmaceutical industry, the Company’s core business, is subject to various regulatory restrictions imposed by laws
and administrative guidance related to pharmaceutical drugs as well as other relevant legislation regarding all aspects ofbusiness operations (research, development, manufacturing, and marketing). We formulate our business plans in accordancewith the PMD Act and other current legislative regulations as well as the health insurance system, together with drug
pricing guidelines that derive from this legislation. Notwithstanding, there is a possibility that these regulations, regulatory
systems and pricing will change before the products that we are developing reach the marketplace. If any major change
does occur, there may be a significant impact on our financial position, business performance, and cash flow.
d) Risk concerning development and marketing overseas
We conduct our pharmaceutical business in Asian and other countries globally, not exclusively in Japan, where weanticipate the growth of healthcare needs and our position in certain therapeutic areas. In overseas markets, as in Japan,
pharmaceutical development and marketing generally require very large expenditure and are associated with various
business risks. To reduce investment expenditure and business risk, we out-license the development and marketing of someof our drug candidates to other overseas companies. Before out-licensing the rights we possess, we select a licensee after
careful due diligence and careful monitoring when necessary. The development and sales of out-licensed products are
subject to business conditions of the licensee or any changes in the regulatory and competitive environment in respective
countries, and may fall below initial expectations, resulting in lower than anticipated milestone revenue or royalty income.
In such cases, there may be an impact on our financial position, business performance, and cash flow.
e) Competition in the pharmaceutical industry
The pharmaceutical industry is an intensely competitive sector. A large number of both Japanese and foreign
pharmaceutical companies and research institutions, including giant multinational pharmaceuticals, compete in the arena.
Technological innovation is progressing rapidly. Many competitors have a comparative advantage over the Company interms of technology, marketing and financial position. Thus, these companies may more efficiently produce and sellcompetitor products, which are more effective than the Company’s developed products. This means that what transpires in
the competitive landscape with regards to development, manufacturing and marketing operations may have a significant
impact on our financial position, business performance, and cash flow.
f) Risk associated with side effects
Unexpected side effects may occur from the use of pharmaceutical products, from their clinical trial stage to postmarketing stage. If serious and unexpected side effects occur, compensation claims may be brought against the Company,
or depending on the situation, there is the risk of a delay in clinical trial timelines or even discontinuation of productdevelopment. In the case where such side effects could lead to further damage to the health of patients, there is the risk of-6-

cancellation of approval or discontinuation of sales. Regarding compensation claims, the Company has in place the liability
insurance necessary to minimize the financial damage should such claims arise. However, this does not exclude thepossibility that the compensation awarded exceeds the amount insured. If this should occur, it could have a significant
impact on the Company’s financial position, business performance, and cash flow.
g) Product liability
The development and manufacture of pharmaceutical products involves product liability risk. If in the future any
products that we have developed cause damage to health or any adverse events are discovered during clinical trials,
manufacturing, sales or marketing of the drug, the Company will be subject to product liability. This may have a significant
impact on the Company’s financial position, business performance, and cash flow. If a product liability suit is filed against
the Company, the Company’s corporate image could be damaged, leading to a loss of confidence in the Company and the
drugs it develops, impacting future business.
(ii) Risk in business operationsa) Risk concerning the Company’s business model
The Company does not own research and manufacturing facilities. Instead, mainly targeting orphan drugs (Note 4) in theareas of oncology, hematology and pain management, in-licensing drug candidates having POC established in humansubjects from pharmaceutical companies and bioventures, developing and marketing pharmaceutical products in Japan,
Asian and other countries globally (China, South Korea, Taiwan, Singapore, etc.), the Company has adopted a businessmodel to raise income and profit from such activities. In developing the pipeline and marketing, the Company plans toengage in alliances with other pharmaceutical companies. However, there is no guarantee that the Company cancontinuously in-license drug candidate compounds that satisfy in-house criteria and secure these partner companies. In
addition, as the Company mainly targets orphan drugs for in-licensing (Note 5), it may not be able to generate expected sales
turnover. Furthermore, in the event that development at a licensor is delayed or fails, there may be impact on thecorresponding development in Japan. These factors could impact the Company’s financial position, business performance,and cash flow. Needless to say, intense competition within the pharmaceutical sector and changes in the Company’s
financial position may force the Company to revise its business model. Should this occur, there may be a significant impact
on the Company’s business.
(Note 4) The rare-disease field is one in which the number of patients requiring drugs is small. Drugs for this field aretermed “orphan drugs.” The Japanese Ministry of Health, Labour and Welfare has established an orphan drug
designation system for drugs meeting the criteria of (1) a drug to treat a disease that affects less than 50,000
people in Japan, and (2) for which there is a great need for medical treatment. Once designation is obtained, thedrug will enjoy various advantages including shortening of the time from regulatory submission for review of the
drug to approval and the extension of the re-examination period for up to 10 years.
(Note 5) “In-licensed drug candidates” are compounds or products for which obtaining the rights of development andcommercialization from other companies is under consideration.
b) Dependency on specific partners and suppliers
As a specialty pharmaceutical company without production facilities, the Company needs to depend on the supply of
product from other companies when conducting clinical trials and marketing approved drugs. Given this fact, the financial
position and production conditions of the product supplier may have a significant impact on the Company’s financial
position, business performance, and cash flow. In pipeline development and marketing, while the Company has plans to
conduct sales on its own in the future, its current business plan focuses on forming alliances with pharmaceuticalcompanies. However, if the partner company’s management situation deteriorates unexpectedly or if management policies
change, which are matters beyond the Company’s control, initial business plans may not be realized. Also, if any breach ofcontract occurs that necessitates the termination of the license agreement as stipulated, the alliance may also end. In suchcases, there may be a significant impact on the Company’s financial position, business performance, and cash flow.
Typically, in license agreements with partner companies, revenues to be gained before the drug reaches the marketplace
will include an upfront payment upon signing the contract, funding for co-development and milestone payments. Of these,
milestone payments are extremely unstable and unpredictable income as they are based on the attainment of predefined
results. If development progress is delayed, there may be a significant impact on the Company’s financial position, businessperformance, and cash flow.

-7-c) Risk concerning intellectual property rights
During drug development activities, the Company makes use of various intellectual property rights which generally havebeen licensed to the Company by other companies such as pharmaceuticals and bioventures. There is a risk that patentapplications relating to an in-licensed drug candidate are not approved or are declared invalid. Moreover, it is difficult tocompletely avoid the possible creation of an intellectual property right by a third-party that supersedes the intellectual
property right of the Company’s in-licensed drug candidate. These situations could lead to a significant impact on the
Company’s financial position, business performance, and cash flow. To date, no lawsuit has been filed by a third-party
against the Company concerning intellectual property rights, including patents in connection with product development.
When in-licensing a product, the Company will seek advice from lawyers and conducts a thorough due diligence
investigation through patent firms in order to reduce such intellectual property risks. Nevertheless, it is difficult to realize
full protection from the occurrence of intellectual property right disputes involving the infringement of third-party rights,
and these may have a significant impact on the Company’s financial position, business performance, and cash flow. The
candidate compounds that the Company in-licenses are not necessarily protected by patents. On the other hand, even if adrug candidate is not protected by a patent, the assignment of the compound for re-examination review by the regulatory
authorities would restrict the entry of generic drugs during the review period, giving rise to a limited period of marketingexclusivity.
d) Information protection
To reduce the risk of significant confidential information relating to pipeline development and other business activities
leaking outside the Company, the Company engages in rigorous information protection. The Company requires directors
and employees, Scientific Advisory Board (SAB) members, outsourcing partners, and other business partners to signconfidentiality agreements. Even with the agreement in place, directors and employees, SAB members, outsourcing
partners and other business partners may not adhere to confidentiality, and should this occur, significant confidential
information may be divulged elsewhere, which may impact the Company’s business, financial position, businessperformance, and cash flow.
e) Risk concerning important contracts
If any contracts that may have a significant impact on conducting the Company’s business operations are terminated due
to expiration, breach of contract or for any other reason, there may be a significant impact on the Company’s financial
condition, business performance, and cash flow.
(iii) Risk associated with organizationa) Risk of being a young company
SymBio is a young company founded in March 2005. Since inception, the Company has engaged in in-licensing
activities of drug candidates for development. The founding President and CEO built up the pharmaceutical development
business from scratch, and the Company recorded income from product sales in August 2010, for the first time in its
history. There is the possibility that business issues that SymBio has never encountered arise in the future. At the moment,
however, it is difficult to accurately predict any changes in the external environmental factors that may affect theCompany’s business results. Therefore, the Company considers business results for the past several years to be an
inadequate reference to pass judgment on whether or not the Company can continue to grow.
b) Risk of being a small corporation
The Company uses contract research organizations (CROs (Note 6)) in conducting R&D, thereby forming a development
framework requiring relatively small staff numbers. With progress in the development of the pipeline already in place andwith newly in-licensed drug candidates coming on line, the Company’s human resources in R&D is likely to be further
increased. However, for whatever reason should an alliance with a CRO terminate, or should the Company fail to secure theplanned number of staff or should existing staff decide to leave, the Company’s business operations may be hampered,leading to a possible impact on the Company’s financial position, business performance, and cash flow.
(Note 6) A contract research organization (CRO) is an organization that provides support to pharmaceutical companies
through the provision of research and other services. The details of the commissioned activities may include
monitoring to ensure that clinical studies are carried out in full accordance with study protocols and clinical data
management.

-8-c) Dependency on a specific person
Fuminori Yoshida, the Representative Director, founding President and CEO, has played a key role since the Company’s
foundation in the implementation and execution of all operations in the Company’s business management. Thus, in theevent that he cannot continue to perform his corporate responsibilities for some unforeseen reason, this could have asignificant impact on the Company’s business operations.
d) Scientific Advisory Board (SAB)The Scientific Advisory Board (“SAB”) is an advisory panel to the Company on the potential in-licensing of new drugcandidates. The Company invites members of the panel from clinicians and scientists engaged in basic research who arehighly regarded in the healthcare industry due to their successful track records and wealth of experience. The SAB meets
two or three times a year to engage in active discussion and debate, with each member giving his/her own perspective on an
in-licensed drug candidate. The Company will continue in its efforts to acquire members of excellence for the SAB.
However, if difficulty should arise in procuring members for reasons such as the cancellation of contracts with existing
members, retirement or refusal to renew, or should a brain drain occur, there may be an impact on the Company’s ability toevaluate and in-license quality drug candidates.
(iv) Business Resultsa) Business performance in previous years
The Company's key business indicators are given below:
Term

9th Term

10th Term

11th Term

12th Term

13th Term

Fiscal Year Ended

December 2013

December 2014

December 2015

December 2016

December 2017

Net sales (thousand
yen)

1,532,054

1,955,027

1,933,241

2,368,112

3,444,206

Operating income (loss)(thousand yen)

(1,680,528)(1,303,279)(2,551,662)(2,127,049)(3,947,061)

Ordinary income (loss)(thousand yen)

(1,601,424)(1,110,316)(2,630,386)(2,316,806)(3,976,784)

To date, with the exception of the 4th Term, the Company’s total R&D expenses and other general administrative
expenses exceeded the Company’s income, resulting in the posting of operating loss, ordinary loss and net loss. For thisreason, the Company does not consider the financial statements and indicators of previous years to provide adequate
reference data in making period comparisons of business performance or in forecasting future business performance.
b) Expected Increase in R&D Expenditures
The Company’s R&D expenses for the past five fiscal years are provided below:
Term

9th Term

10th Term

11th Term

12th Term

13th Term

Fiscal Year Ended

December 2013

December 2014

December 2015

December 2016

December 2017

R&D expenses(thousands of yen)

1,052,790

774,1032,034,714

1,667,098

3,017,812

The Company intends to continue R&D activities, resulting in an increase of cumulative loss for the foreseeable future.
With future increases in product sales revenue from additional indications of TREAKISYM®, the product sales channels
upon early approval for the intravenous and oral formulations of rigosertib, and the income from alliances withpharmaceutical companies, the Company intends to improve business performance as soon as possible; however, there is no
guarantee that such assumptions will materialize and swift performance improvement will be realized.
c) Negative retained earnings (accumulated deficits) brought forward
SymBio is a specialty pharmaceutical company. Until products under development at the clinical stage reach the market sothat the Company can continuously earn stable income through product sales and royalty income, the Company willcontinue to carrysignificant upfront outlay of R&D expenditure. Due to this, with the exception of the 4th Term (2008), theCompany has posted net current losses since its foundation. At the end of the 13th Term, the fiscal year ended December
31, 2017, the Company recorded a negative balance of 18,790,705 thousand yen as accumulated deficits brought forward.
SymBio aims to become profitable at the earliest possible date by advancing its quality clinical programs in a rapid, precise,-9-and efficient manner. However, the possibility still exists that profits may not be generated in the planned timeframe.
Should the Company’s business fail to develop and fail to generate net profits as planned, reaching profitability may takelonger than planned.
d) Fundraising
As a specialty pharmaceutical company, the Company requires a large amount of R&D funding. If SymBio’s businessplan does not take shape as planned and it suffers a shortfall in funding, the Company will endeavor to procure funds bychanging strategic alliances, securing new alliance contracts or issuing new stock. However, if the Company fails togenerate funds when they are required, there may be serious doubt over the continuation of its business operations.
e) Net operating loss for tax purposes
The Company currently has net operating loss carryforwards for tax purposes. For this reason, the Company is not
subject to corporate tax, local inhabitant tax and local enterprise tax at the standard rates and expects this to continue forseveral years into the future. However, if net operating loss expires earlier than expected and can no longer be used as anoffset to taxable income due to such reasons as the revision of current tax treatment of net operating loss, the Company
would become liable for the payments of corporate tax, local inhabitant tax and local enterprise tax at standard rates, which
may have an impact on net profit/loss and cash flow currently planned.
(v) Other Risksa) Profit distribution to shareholders
Since the foundation of the Company, dividends have not been distributed. SymBio is currently at the business stage ofmaking upfront investment for the development of pharmaceutical drugs and continues to prioritize the use of funds forstrengthening its financial position and for continued R&D activities. Thus, the Company has at present no plans formaking dividend payouts. However, the Company recognizes that the return of profit to shareholders is an importantmanagement issue and will consider profit distribution based on future business performance and financial condition.
b) Procurement of funds
As the Company rapidly expands its business, it expects to see an increase in development funding requirements. One
option for procuring funds is to issue new stock. By doing so, the number of outstanding stock will increase, potentiallydiluting the value per share of the Company’s stock.
c) Stock value dilution by execution of stock acquisition rights
The Company adopted the stock option plan in order to motivate and encourage higher business performance of board
directors and employees, and to attract human resources of excellence. In accordance with the Commercial Code of 1890
Article 280-19, 280-20 and 280-21, and the Companies Act Article 236, 238, 239 and 240, stock acquisition rights are
granted to board directors and employees.
The Company made a resolution at the Board of Directors meeting held on December 27, 2012 to issue the 1st unsecured
convertible bonds with stock acquisition rights (total issue price: 1 billion yen) and the 29th warrant (total issue price: 5.1
million yen by way of third-party allotment, total issue price of stocks when issued through the exercise of stock acquisitionrights: 500 million yen). The Company made a resolution at the Board of Directors meeting held on November 14, 2014 toissue the 2nd unsecured convertible bonds with stock acquisition rights (total issue price: 500 million yen) and the 34th
warrant (total issue price 10,363 thousand yen by way of third-party allotment, total issue price of stocks when issued
through the exercise of stock acquisition rights: 1 billion yen). Moreover, the Company made a resolution at the Board of
Directors meeting held on April 6, 2016 to issue the 3rd unsecured convertible bonds with stock acquisition rights (total
issue price: 3 billion yen) and the 39th warrant (total issue price 9,776 thousand yen by way of third-party allotment, total
issue price of stocks when issued through the exercise of stock acquisition rights: 943,592 thousand yen). The Company
also made a resolution at the Board of Directors meeting held on August 9, 2017 to issue the 42nd warrant (total issue price
32,560 thousand yen by way of third-party allotment, total issue price of stocks when issued through the exercise of stockacquisition rights: 1,892,000 thousand yen). Among these warrants, as of December 31, 2017, the following remained
unexercised: 4,171,000 shares of the number of shares issued upon the exercise of the 39th warrant and 3,765,200 shares of
the number of shares issued upon the exercise of the 42nd warrant.
As of December 31, 2017, the number of potential dilutive shares from the above-mentioned stock acquisition rights(“number of potential shares”) totaled 11,686,800 shares and comprised approximately 17.8% of the total number ofoutstanding shares and potential shares added together. There is the possibility that stock value per share for the Company- 10 -

will be diluted if these potential shares are exercised in the future. To attract talent, the Company may continue to offer
similar incentives. This means that if these stock acquisition rights are exercised in the future, the stock value per share of
the Company may be diluted.
d) Stock holding by venture capitalIn general, venture capital and investment partnerships own shares for the purpose of realizing capital gains by sellingshares after IPO. There is the possibility that venture capitals and investment partnerships that own SymBio shares may sell
all or a portion of such shares, and should this occur, it could have an impact on the market price of the Company’s shares.
e) Risk of loss on foreign exchange
While continuously performing research on drug candidates for new development to expand its pipeline, the Company
arranges large amounts of fund procurements by means of deposits denominated in foreign currency or foreign exchange
contracts based on the assumption that deposit payments in U.S. dollars will be required upon in-licensing. Where such
assets denominated in foreign currency are stated at market value in financial statements at every year end, there is a risk ofloss from fluctuating currency valuation in the future and this may have an impact on the Company’s financial position,business performance, and cash flow.
f) Risk associated with natural disasters
Any disasters (earthquake, typhoon, fire, etc.) and plague that occur in the Company’s geographic business domain,
leading to the occurrence of human and material damage, or suspension and delay in business, fall in social credibility andcompensation issues, may have an impact on the Company’s financial position, business performance, and cash flow.

(This part is intentionally left blank)- 11 -

2. Status of corporate group
None to be reported.

3. Management policies(1) Basic policy of company management
SymBio Pharmaceuticals Limited was established in March 2005 by Fuminori Yoshida, who previously served concurrently
as Corporate VP of Amgen Inc. (Note 7) (United States) and President of Amgen K.K., a wholly owned subsidiary of Amgen Inc.,(now part of Takeda Pharmaceutical Company Limited) for 12 years since its establishment.
The Company aims to achieve social and management responsibilities by responding to unmet medical needs (Note 8) based on
the guiding principle of mutual harmony, creating an intricate symbiotic relationship between patients, physicians, scientists,
regulators and investors.
The Company regards underserved therapeutic areas with extremely significant medical needs as a business opportunity andremains focused on the areas of oncology, hematology, and pain management where high entry barriers exist due to the highdegree of specialization required. In this sense, SymBio is the first specialty pharmaceutical company (Note 9) in Japan. Rather than
exploring opportunities to in-license and develop new blockbuster drugs (drugs with sales exceeding 100 billion yen), theCompany channels its resources into the development of drugs in underserved markets where medical needs are high despite
limited patient numbers. Securing multiple drug approvals in these key therapeutic areas will enable the Company to build asolid and diverse pipeline to ensure profitability and sustainability of its business.
(Note 7) Applied Molecular Genetics, or Amgen Inc., the world’s largest company in the biopharmaceutical field, wasfounded in Thousand Oaks, California, in 1980, and started business in Japan as Amgen K.K. on May 1, 1993.
After Takeda Pharmaceutical Company Limited (“Takeda”) acquired 100% of Amgen K.K.’s stock in February
2008, its operations were merged into Takeda.
(Note 8) “Unmet medical needs” means requirements for medical treatment that have not yet been fulfilled. It refers to asituation in which no effective drugs or treatments are currently available, despite strong demand by patients
and/or physicians.
(Note 9) “Specialty pharmaceutical company” refers to a company that develops new drugs and has been given a
consistently high international reputation for a particular field of excellence. This is based on the definition in the
Ministry of Health, Labour and Welfare’s “Vision for the pharmaceutical industry” (2002).

(2) Key performance index
In order to enhance SymBio’s enterprise value as a specialty pharmaceutical company, it is important to continually in-license
drug candidates for development, to successfully complete clinical development and secure marketing approvals in order to selldrugs in the marketplace with the establishment of a sales and support system. To this end, the Company intends to continue
aggressively investing resources into R&D activities.
The Company recorded net sales from SyB L-0501 for the first time since the drug was initially approved for sale in Japan andSingapore in 2010. However, product sales have not generated sufficient revenue to cover the above-mentioned upfront
investment at this time, and generating net profit has still to be realized. While the Company continuously seeks stableprofitability through further expansion of sales in collaboration with Eisai, additional indications for TREAKISYM®, acquisitionof approval for the intravenous and oral formulations of rigosertib, as well as introduction, promotion of development andacquisition of approval for new pipeline products, no performance index targets such as ROE or ROA will be set until profits arerecorded in a single year through the achievement of these measures.

(3) Pipeline
The Company currently has the following pipeline products under development: SyB L-0501, SyB C-0501, SyB L-1101, SyB
C-1101, SyB L-1701 and SyB L-1702. The Company will continue to in-license candidate drugs to expand and build its pipeline
portfolio with a balanced risk-return trade-off.
(i) [Anticancer agent: SyB L-0501 (lyophilized powder formulation), SyB L-1701 (RTD formulation), SyB L-1702 (RI
formulation) and SyB C-0501 (oral formulation) (generic name: bendamustine hydrochloride, trade name: TREAKISYM®)]- 12 -

Bendamustine hydrochloride (the generic name), the active pharmaceutical ingredient of TREAKISYM®, is an anticancer
agent that has been in use for a number of years in Germany under the trade name of Ribomustin® for the treatment of nonHodgkin’s lymphoma (Note 10), multiple myeloma, and chronic lymphocytic leukemia. The Company decided to in-license thisproduct because there is currently no effective medication for the indications of recurrent/refractory low-grade non-Hodgkin’s
lymphoma and mantle cell lymphoma. These are underserved therapeutic areas aligned with the Company’s corporate mission
and also fall within one of SymBio’s targeted therapeutic fields (hematologic cancer). Astellas Pharma GmbH, a German
subsidiary of Astellas Pharma Inc., is the worldwide licensor of bendamustine hydrochloride. Cephalon, Inc. (United States)
in-licensed rights to bendamustine for North America from Astellas Pharma GmbH and obtained approvals from the U.S.
Food and Drug Administration (FDA) to use the drug for the treatment of chronic lymphocytic leukemia and refractory B-cell
non-Hodgkin’s lymphoma in March 2008 and October 2008, respectively. Mundipharma International Corporation Limited(United Kingdom) and Janssen-Cilag (United Kingdom) are also licensed from Astellas Pharma GmbH and have obtained
exclusive rights for the development and commercialization of bendamustine in Europe and other regions, respectively.
The Company is licensed from Astellas Pharma GmbH with exclusive rights for the development and commercialization of
bendamustine in Japan, China, Hong Kong, South Korea, Singapore and Taiwan. In Japan, the drug has received approval forthe indications of recurrent/refractory low-grade non-Hodgkin’s lymphoma and mantle cell lymphoma (October 27, 2010),
and was launched under the trade name TREAKISYM® on December 10, 2010. For additional indications, in December 2015,
the Company filed sNDAs in Japan for the target indications of first-line treatment of low-grade non-Hodgkin’s lymphoma
and mantle cell lymphoma, and chronic lymphocytic leukemia. The Company received approval of an sNDA for the indicationof chronic lymphocytic leukemia in August 2016 and of first-line treatment of low-grade non-Hodgkin’s lymphoma andmantle cell lymphoma in December 2016. The Phase II clinical trial for recurrent/refractory intermediate/high-grade nonHodgkin’s lymphoma (diffuse large B-cell lymphoma) has been completed, and the Phase III clinical trial is currently being
conducted. In order to maximize the commercial value of TREAKISYM® by further promoting product life cycle
management, the Company concluded an exclusive license agreement with Eagle Pharmaceuticals, Inc. (head office: New
Jersey, U.S.) (“Eagle”) in September 2017 to develop, market and sell Eagle’s ready-to-dilute (“RTD”) and rapid infusion(“RI”) liquid formulation injection products in Japan.
In addition to the indications of these intravenous formulation products, the Company is exploring the development of anoral formulation of TREAKISYM® with a focus on the treatment of solid tumors and autoimmune diseases, further expanding
the business potential. To this end, the Company has commenced a Phase I clinical trial for progressive solid tumors with theaim of examining the recommended dosage and schedule as well as tolerability and safety of the oral formulation of
TREAKISYM®, and narrowing down the types of tumors.
Eisai has signed an agreement on TREAKISYM® with SymBio for the rights of joint development and exclusive sales inJapan, and is currently selling TREAKISYM®.
In Asia, SyB L-0501 received the approval for the indication of low-grade non-Hodgkin’s lymphoma and chronic
lymphocytic leukemia in Hong Kong in December 2009. In Hong Kong, Cephalon, Inc. has the exclusive right to develop andsell bendamustine, and is currently generating sales. In addition, approval for the indications of low-grade non-Hodgkin’s
lymphoma and chronic lymphocytic leukemia was obtained in Singapore in January 2010. In South Korea, approval for theindications of chronic lymphocytic leukemia and multiple myeloma was obtained in May 2011, and approval for the indicationof recurrent/refractory low-grade non-Hodgkin’s lymphoma was achieved in June 2014.
In South Korea and Singapore, Eisai has agreements in place with SymBio for exclusive development and selling rights.
Eisai’s subsidiaries launched the product in Singapore and South Korea in September 2010 and October 2011, respectively.
In China, SymBio’s business partner Cephalon, Inc. applied for approval in March 2017, after the completion of clinical
trials. In Taiwan, SymBio’s business partner InnoPharmax Inc. (Taiwan) achieved approval for the indications of low-grade
non-Hodgkin’s lymphoma and chronic lymphocytic leukemia in October 2011, followed by product launch in February 2012.
In November 2017, InnoPharmax Inc. obtained approval for first-line treatment of low-grade non-Hodgkin’s lymphoma andmantle cell lymphoma.
(Note 10) Non-Hodgkin’s lymphoma (NHL) is a cancer of the lymphatic system in which lymphocytes develop malignant
growths other than Hodgkin’s lymphoma. The majority of Japanese patients are suffering from NHL.
(ii) [Anticancer agents: SyB L-1101 (intravenous formulation) and SyB C-1101 (oral formulation) (generic name: rigosertib)]
Rigosertib is an anticancer agent with a unique type of multi-kinase inhibitory activity (Note 11). It is currently being
developed in the U.S. and Europe by a U.S. company, Onconova Therapeutics, Inc. (“Onconova”), for the target indications of
myelodysplastic syndromes (“MDS”). MDS is the pre-pathological state for malignant tumors of blood cells, which has shown
increasing numbers of patients in recent years; it frequently affects elderly people; and it is a refractory disease, with a high- 13 -

probability of developing into leukemia. No effective medication is available yet, especially for recurrent/refractory MDS, andit therefore constitutes an underserved therapeutic area. In July 2011, the Company signed a license agreement with
Onconova, providing the exclusive right to develop and commercialize rigosertib in Japan and South Korea. Based on thisagreement, the Company continues to develop the intravenous (IV) rigosertib formulation for the target indication ofrecurrent/refractory higher-risk MDS and the oral formulation for the target indication of higher-risk MDS (in combination
with azacitidine) and transfusion-dependent lower-risk MDS.
In February 2014, Onconova released the results from the Phase III randomized ONTIME trial of IV rigosertib in patientswith recurrent/refractory higher-risk MDS. Treatment with IV rigosertib did not demonstrate a statistically significant
improvement in median overall survival when compared to BSC only. However, a post-hoc analysis demonstrated astatistically significant increase in median overall survival in the subset of patients who had progressed on or failed previous
treatment with hypomethylating agents (HMAs), thus demonstrating potential activity of rigosertib in these MDS patients.
Based on this, Onconova is conducting a global Phase III clinical trial with clinical trial sites in more than 20 countries
worldwide, for HR-MDS patients who do not respond to treatment with HMAs (“primary HMA failure”) or who relapse after
treatment under the current standard of care.
The Company is participating in the global Phase III clinical trial and conducting the clinical trial in Japan.
As for the oral formulation of rigosertib, Onconova has been conducting a Phase II clinical trial for the target indication oftransfusion-dependent lower-risk MDS and Phase I/II clinical trial for the indication of first-line higher-risk MDS (incombination with azacitidine).
The Company has completed its domestic Phase I clinical trial of the oral formulation of rigosertib as a monotherapy for thetarget indication of lower-risk MDS, and is currently conducting a domestic Phase I clinical trial to confirm the safety of highdose as a monotherapy, in order to conduct the Phase I clinical trial in combination with azacitidine for the target indication of
first-line treatment of patients with higher-risk MDS. The Company is considering participating in global clinical trials after
completing the Phase I clinical trial. The development for the target indication of transfusion-dependent lower-risk MDS will
be considered in line with development by Onconova.
While Onconova is making steady progress with development, we will look into the option of developing indications otherthan MDS. By allocating development of the intravenous and oral formulations to different indications, it is hoped that
progress will be made with development of treatment methods that are easy for patients to use, and that place sufficientimportance on the need for compliance.
(Note 11) Multi-kinase inhibitors impede the growth, proliferation and metastasis of cancer cells, thereby eradicating them.

(4) Medium to long-term strategy
The Company is pursuing primarily the following five strategies in order to achieve our Long Range Plan (LRP).
(i) De-risking by post-POC strategy
We in-license drug candidates for which POC (proof of concept) is already confirmed in human subjects in principle.
Accordingly, they should be drugs that are in a relatively late stage of clinical development or already on the market overseas.
The advanced development is already conducted overseas for these drug candidates and their efficacy and safety are alreadyconfirmed in human subjects, thereby reducing the development risk. We utilize existing clinical data available overseas so as
to compress development timelines, reduce the development costs, and increase the likelihood of regulatory approvals in Japanand Asian markets.
(ii) Building a high-quality pipeline with exceptional search and evaluation capabilities
Our new drug search engine is connected to the diverse network of pharmaceutical companies and bioventures, and enables
us to select promising drug candidates from the vast amount of chemical compounds after the careful review by internal
experts. Using their wealth of experience at the forefront of research and development, Scientific Advisory Board (SAB)
members carefully evaluate and render final judgment on each drug candidate. The highly established screening process up to
the final selection of drug candidates, coupled with the post-POC strategy, reduces the development risk and compresses
timelines. It also helps to understand how satisfactorily the healthcare needs are met and to improve the accuracy of revenue
projections after the product launch.
(iii) Containment of fixed costs by labless/fabless strategy
The Company does not own any research or production facilities, which are often regarded as the main cause of fixed costs.
Once drug candidates are searched and selected, we focus on value-added activities such as the formulation and- 14 -

implementation of development strategy and outsource other necessary procedures. This enables us to reduce development
costs of pharmaceutical drugs and secure a flexible financial strategy.
(iv) Realization of high business efficiency by “Blue Ocean strategy” (Note 12)
There are many cases that the standard drug used overseas cannot be prescribed in Japan or a new drug is launched in Japan
five years behind its initial approval overseas. This problem is called “drug lag” and is becoming aggravated, while the term
“cancer patient refugee” has been created. This drug lag is particularly conspicuous in our strategic drug development areas ofrefractory cancer and hematological diseases, as well as moderate to severe pain management. There is a large and active
market of anticancer agents that continues to grow with the aging population. However, anticancer agents have a wide range ofindications and they are fragmented by the type of tumor, and in some therapeutic areas there are a limited number of patients.
The therapeutic area of pain management is an area with high unmet medical need and with many cases of undertreatment. As
many patients who suffer pain are elderly, the pain management market is expected to grow with the aging population.
Although an extremely high degree of specialization is required to develop new agents in these therapeutic areas, it is often
financially unattractive for larger pharmaceutical companies to pursue due to the small size of the potential market. This is partof the cause of the delay in drugs coming to market. On the other hand, obtaining approval and launching a new drug in one ofthese less competitive therapeutic areas creates an opportunity to achieve superior growth and profitability by continuous
indication expansion and bringing new products into the market.
(Note 12) “Blue Ocean strategy” means a strategy of redefining the market, avoiding marketplaces with fierce competition(termed “red oceans”), and instead creating a “blue ocean,” an unexploited market with reduced competition,
enabling profits to be maximized while providing customers with high-value products and services.
(v) Going global beyond Asia
Although the Company has been operating its businesses in Asia centered on Japan, it will carry out search and evaluation
activities to advance new drug candidates with a view to global development.

- 15 -

(5) Issues to be addressed by the Company
The Company is commited to making improvements in the following areas.
(i) Further expansion of the pipeline
In order to enhance the enterprise value as a specialty pharmaceutical company, we need to expand the pipeline throughongoing in-licensing of new drug candidates for development.
The Company is conducting or planning development of the following anticancer agents: SyB L-0501, SyB C-0501, SyB L1101, SyB C-1101, SyB L-1701 and SyB L-1702. Currently we are in discussion with counterparties regarding the inlicensing of several new drug candidates, and will continue with active efforts to in-license new products in order to further
expand our pipeline.
(ii) Life cycle management of products in the existing pipeline
In order to enhance the enterprise value, it is critical to maximize returns from each drug under development throughindication expansion after the in-licensed drugs’ initial approval.
TREAKISYM® is approved for manufacturing and marketing in Japan for the indications of recurrent/refractory low-grade
non-Hodgkin’s lymphoma and mantle cell lymphoma, chronic lymphocytic leukemia, and first-line treatment of low-grade
non-Hodgkin’s lymphoma and mantle cell lymphoma. The Company has completed a Phase II clinical trial forrecurrent/refractory intermediate/high-grade non-Hodgkin’s lymphoma (diffuse large B-cell lymphoma), and a Phase III
clinical trial is currently underway. In addition, the Company will pursue the development of TREAKISYM® RTD and RI
liquid formulations in-licensed from Eagle Pharmaceuticals, Inc. (head office: New Jersey, U.S.). The Company is also
exploring the development of an oral formulation of TREAKISYM® with a focus on the treatment of solid tumors andautoimmune diseases, further expanding the business potential. To this end, the Company has commenced a Phase I clinical
trial for progressive solid tumors with the aim of examining the recommended dosage and schedule as well as tolerability andsafety of the oral formulation of TREAKISYM®, and narrowing down the potential types of target tumors.
The development of rigosertib intravenous and oral formulations for the indication of myelodysplastic syndromes (MDS) is
also progressing. Few useful therapeutic agents are currently available for this indication, so it is an area with very high unmet
medical need. As for the global Phase III trial of the intravenous formulation for the target indication of recurrent/refractory
higher-risk MDS conducted by Onconova, the Company is conducting its clinical trial in Japan. As for the oral formulation,
the Company has completed the domestic Phase I clinical trial as a monotherapy for the target indication of lower-risk MDS,
and is currently conducting a domestic Phase I clinical trial to confirm the safety of high-dose as a monotherapy, in order to
conduct the Phase I clinical trial in combination with azacitidine for the target indication of first-line treatment of patients withhigher-risk MDS. The Company is considering participating in global clinical trials after completing the Phase I clinical trial.
The development for the target indication of transfusion-dependent lower-risk MDS will be considered based on thedevelopment progress made by Onconova.
The Company is focused on maximizing the value of TREAKISYM® and rigosertib through further indication expansion.
(iii) Global expansion for further growth
In addition to Japan, the Company operates its businesses in other Asian countries, including China, Korea, Taiwan, andSingapore.
However, with expanding medical expenditures due to the aging population in Japan, and the advent of the “era of genericdrugs comprising 80% of all drugs dispensed” as a governmental policy of Japan, the business environment for innovative
drug developers is expected to remain extremely challenging. Such a policy may also be implemented by other Asian
countries.
Under these circumstances, the Company will promote global expansion aiming for further growth. The Company will carryout the search, evaluation, and negotiation activities for new drug candidates, in order to acquire global rights on suchcandidates, utilizing its experience fostered through its business in Asia.
(iv) Securing personnel
The Company places the highest priority on personnel as the Company’s principal management resource. We cannot makesuperior achievements in exploring and developing new drugs without talent. We have been continually recruiting talented
people, especially after being listed; we have recruited the best and brightest people in order to strengthen the management
organization. Going forward, we plan to continue to strengthen our human resources by providing further employee training
and development programs.

- 16 -

(v) Financial issue
It is necessary for the Company to raise funds required for business activities such as R&D expenditures as the pipeline
development progresses and the number of drug candidates increases. Therefore, we make every effort to strengthen thefinancial base by continually diversifying the manner of fund raising and reducing costs through budget control.

(6) Other important matters concerning the Company’s management
Issuance of the 42nd stock acquisition rights
In order to secure the funds necessary for its research and development activities, the Company made a resolution at theBoard of Directors meeting held on August 9, 2017 to issue the 42nd warrant (total issue price 32,560 thousand yen by wayof third-party allotment, total issue price of stocks when issued through the exercise of stock acquisition rights: 1,892,000
thousand yen), and completed the payment of 1,115,042 thousand yen as of the current fiscal year end.

4. Basic views on selection of accounting standards
Over the near term, the Company will prepare its financial statements based on Japanese GAAP, taking into account the interperiod comparability of financial statements and comparability across companies.
In terms of the application of International Financial Reporting Standards (IFRS), the Company will take appropriate measures inlight of the existing circumstances in Japan and overseas.

- 17 -

5. Financial statements and primary notes(1) Balance sheets(Unit: thousands of yen)
FY 2017
FY 2016(as of December 31, 2016) (as of December 31, 2017)
AssetsCurrent assets
Cash and deposits
Accounts receivable-trade
Merchandise and finished goods
Supplies
Prepaid expenses
Advances paid
Consumption taxes receivable
Forward exchange contracts
Other
Total current assets
Non-current assets
Property, plant and equipment
Buildings
Accumulated depreciation
Buildings, net
Tools, furniture and fixtures
Accumulated depreciation
Tools, furniture and fixtures, net
Construction in progress
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- 18 -

5,719,325
487,471
272,725
663
79,104
66,46534,766
11,603
12,886
6,685,011

2,947,059
489,874
362,514558
73,72018,76098,44015,84429,7494,036,522

35,846(4,451)
31,39569,497(26,367)
43,129－74,52435,521(7,034)28,48649,291(30,968)
18,32264
46,873

41,985－41,98565,583
3,295
68,8780
11,64965,21476,863
193,373
6,878,384

0
14,20985,799100,008
215,761
4,252,284

(Unit: thousands of yen)
FY 2016
FY 2017(as of December 31, 2016) (as of December 31, 2017)
Liabilities
Current liabilities
Accounts payable-trade
Accounts payable-other
Income taxes payable
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
Legal capital surplus
Total capital surplus
Retained earnings (accumulated deficits)
Other retained earnings
Retained earnings (accumulated deficits)
brought forward
Total retained earnings (accumulated deficits)
Treasury stock
Total shareholders’ equity
Stock acquisition rights
Total net assets
Total liabilities and net assets- 19 -

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

604,382
330,867
54,813
21,427
1,011,490

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

－
1,392
1,392
1,012,882

9,948,298

10,761,676

9,918,298
9,918,298

10,731,676
10,731,676(14,812,843)(18,790,705)(14,812,843)(17)
5,053,735
431,135
5,484,870
6,878,384(18,790,705)(17)
2,702,629
536,772
3,239,402
4,252,284

(2) Statements of operations
FY 2016(from January 1, 2016
to December 31, 2016)
Net sales
Net sales of goods
Rights income
Total net sales
Cost of goods soldBeginning goods
Cost of purchased goods
Purchase allowance and returns
Total
Ending goods
Cost of goods sold
Gross profit
Selling, general and administrative expenses *1 *2
Operating loss
Non-operating income
Interest income
Interest on securities
Dividend income
Other
Total non-operating income
Non-operating expenses
Interest expenses
Commission fees
Stock issuance costs
Foreign exchange losses
Other
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 *3
Impairment loss *4
Total extraordinary losses
Loss before income taxes
Income taxes-current
Total income taxes
Net loss- 20 -(Unit: thousands of yen)
FY 2017(from January 1, 2017
to December 31, 2017)

2,137,337
230,775
2,368,112

3,444,206－
3,444,206

133,029
1,606,489
2,873
1,736,644
272,725
1,463,919
904,192
3,031,242(2,127,049)

272,725
2,588,681
85,951
2,775,455
362,5142,412,940
1,031,266
4,978,327(3,947,061)

5,235
249
1,221
4
6,710

3,092
－
1,339
75
4,506

4
8,975
11,658
158,514
17,315
196,467(2,316,806)－
9,090
14,477
10,421
240
34,229(3,976,784)

8,512
8,512

17,414
17,414

1,139
－
1,139
(2,309,433)
3,800
3,800
(2,313,233)－
14,692
14,692(3,974,062)
3,800
3,800
(3,977,862)

(3) Statements of changes in net assets
FY 2016 (from January 1, 2016 to December 31, 2016)(Unit: thousands of yen)
Shareholders’ equity
Retained earnings
Capital surplus(accumulated deficits)

LegalcapitalsurplusTotal
capitalsurplusOtherretained
Total
earnings
Total retained Treasury
shareholders’
Retainedstock
earnings
equityearnings(accumulated(accumulated
deficits)
deficits)brought
forward8,330,775

8,300,775

8,300,775(12,499,609) (12,499,609)

1,617,522

1,617,522

1,617,522

Commonstock

Balance at the
beginning of the year
Changes of items during
the yearIssuance of new shares(exercise of stockacquisition rights)
Net loss
Net changes of items
other thanshareholders’ equity
Total changes of
items during the year
Balance at the end of
the year

4,131,924

3,235,044(2,313,233)(2,313,233)(2,313,233)

1,617,522

1,617,522

1,617,522(2,313,233)(2,313,233)－

921,811

9,948,298

9,918,298

9,918,298(14,812,843) (14,812,843)(17)

5,053,735(Unit: thousands of yen)

Balance at the
beginning of the year
Changes of items during
the yearIssuance of new shares(exercise of stockacquisition rights)
Net loss
Net changes of items
other thanshareholders’ equity
Total changes of
items during the year
Balance at the end of
the year

(17)

Stock
acquisitionrightsTotal net
assets299,887

4,431,811

3,235,044(2,313,233)
131,247

131,247

131,247

1,053,058

431,135

5,484,870- 21 -

FY 2017 (from January 1, 2017 to December 31, 2017)(Unit: thousands of yen)
Shareholders’ equity
Retained earnings
Capital surplus(accumulated deficits)

LegalcapitalsurplusTotal
capitalsurplusOtherretained
Total
earnings
Total retained Treasury
shareholders’
Retainedstock
earnings
equityearnings(accumulated(accumulated
deficits)
deficits)brought
forward9,948,298

9,918,298

9,918,298(14,812,843) (14,812,843)

813,378

813,378

813,378

Commonstock

Balance at the
beginning of the year
Changes of items during
the yearIssuance of new shares(exercise of stockacquisition rights)
Net loss
Net changes of items
other thanshareholders’ equity
Total changes of
items during the year
Balance at the end of
the year813,378

813,378

813,378

10,761,676

10,731,676

10,731,676(Unit: thousands of yen)

Balance at the
beginning of the year
Changes of items during
the yearIssuance of new shares(exercise of stockacquisition rights)
Net loss
Net changes of items
other thanshareholders’ equity
Total changes of
items during the year
Balance at the end of
the yearStockacquisitionrightsTotal net
assets431,135

5,484,870

1,626,756(3,977,862)
105,637

105,637

105,637(2,245,468)

536,772

3,239,402- 22 -(17)

5,053,735

1,626,756(3,977,862)(3,977,862)(3,977,862)(3,977,862)(3,977,862)－(2,351,105)(18,790,705) (18,790,705)(17)

2,702,629

(4) Statements of cash flow
FY 2016(from January 1, 2016
to December 31, 2016)
Net cash provided by (used in) operating activities
Loss before income taxes
Depreciation
Amortization of guarantee deposits
Share-based compensation expenses
Impairment loss
Increase (decrease) in provision for retirement benefits
Interest income
Interest expenses
Foreign exchange losses (gains)
Commission fees
Stock issuance costs
Gain on reversal of stock acquisition rights
Loss on retirement of non-current assets
Decrease (increase) in accounts receivable-trade
Decrease (increase) in inventories
Decrease (increase) in prepaid expenses
Decrease (increase) in advances paid
Decrease (increase) in consumption taxes receivable
Decrease (increase) in other current assets
Decrease (increase) in long-term prepaid expenses
Increase (decrease) in accounts payable-trade
Increase (decrease) in accounts payable-other
Increase (decrease) in other current liabilities
Other
SubtotalInterest and dividends income received
Commitment fee paid
Interest expenses paid
Income taxes paid
Net cash provided by (used in) operating activities
Net cash provided by (used in) investing activities
Purchase of property, plant and equipment
Purchase of intangible assets
Purchase of shares of subsidiaries
Payments for lease and guarantee deposits
Proceeds from collection of lease and guarantee deposits
Net cash provided by (used in) investing activities- 23 -(Unit: yen in thousands)
FY 2017(from January 1, 2017
to December 31, 2017)(2,309,433)
25,6492,035
137,010－(141)(5,485)
4
196,365
8,975
11,658(8,512)
1,139(186,728)(139,695)(40,513)
13,173(34,766)(27,297)(10,421)
1,993
357,949
53,763－(1,953,277)
5,967(8,975)(4)(3,800)(1,960,089)(3,974,062)
29,5691,117
121,205
14,692(4)(3,092)－
42,1959,090
14,477(17,414)－(2,403)(89,789)
7,437
47,705(63,674)(21,038)
5,495
282,522(208,540)
7,274
309(3,796,925)
3,132(19,200)－(3,800)(3,816,793)(23,856)(4,056)(0)(15,923)－(43,836)(10,657)(46,364)－(23,550)
3,065(77,507)FY 2016(from January 1, 2016
to December 31, 2016)
Net cash provided by (used in) financing activities
Proceeds from issuance of stock resulting from exerciseof stock acquisition rights
Proceeds from issuance of bonds with rights
Proceeds from issuance of stock acquisition rights
Payments for issuance of common stock
Repayments for lease obligations
Other payments
Net cash provided by (used in) financing activities
Effect of foreign exchange rate change on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year *1- 24 -(Unit: yen in thousands)
FY 2017(from January 1, 2017
to December 31, 2017)

678,018

1,146,042

3,000,000
9,776(11,658)(642)(17,315)
3,658,177－
32,560(14,372)－－
1,164,230(196,365)(42,195)

1,457,886
4,261,438
5,719,325(2,772,266)
5,719,325
2,947,059

(5) Events and conditions that indicate there could be substantial doubt about the going concern assumption
None to be reported.

(6) Significant accounting policies
1.

Valuation basis and method of marketable and investment securities(1) Shares of subsidiaries
Shares of subsidiaries are stated at cost determined by the moving-average method.
(2) Available-for-sale securities with determinable market value
Available-for-sale securities with a determinable market value are stated at fair value with any changes
in unrealized holding gain or loss, net of applicable income taxes, included directly in shareholders’equity.
Cost of securities sold is calculated by the moving-average method.
Available-for-sale securities without determinable market value
Available-for-sale securities without determinable market value are stated at cost determined by themoving-average method.

2.

Valuation basis and method of derivative transactions
Derivative financial instruments are stated at fair value.

3.

Valuation basis and method of inventories
Inventories held for the purpose of ordinary sale are measured at the lower of cost determined by theweighted-average method or net selling value.

4.

Depreciation of non-current assets(1) Property, plant and equipment (excluding lease assets)
Depreciation of property, plant and equipment is computed by the straight-line method.
The useful lives of major property, plant and equipment are summarized as follows:
Buildings
3 to 18 years
Tools, furniture and fixtures
5 to 15 years(2) Intangible assets (excluding lease assets)
Amortization of intangible assets is computed by the straight-line method.
Capitalized software costs are being amortized over the period of the internal use of 5 years.
(3) Lease assets
Depreciation of lease assets is computed by the straight-line method over the lease term with no residual
value.

5.

Deferred assets
Stock issuance costs and bond issuance costs are charged to income upon payment.

6.

Foreign currency translation
Monetary assets and liabilities denominated in foreign currencies are translated into yen at the spot exchange
rates prevailing on the balance sheet dates, and resulting gains or losses are credited or charged to income.

7.

Basis for reserves and provisions(1) Allowance for doubtful accounts
The allowance for doubtful accounts is provided at an amount determined based on the historicalexperience of bad debt with respect to ordinary receivables and an estimate of uncollectible amounts
determined by reference to specific doubtful receivables from customers which are experiencing financial
difficulties.
For FY 2017, no allowance for doubtful accounts is provided due to no historical experience of bad debt
and no receivable balances that are deemed uncollectible.
(2) Provision for retirement benefits
The provision for retirement benefits is provided at an amount to be required as of the balance sheet date.
The Company applies the simplified method to calculate amounts of retirement benefit obligation andretirement benefit expenses. That is, amounts of retirement benefit obligation are the payments required forvoluntary retirement as of each fiscal year end.
- 25 -

8.

Cash and cash equivalents in the statements of cash flow
Cash and cash equivalents consist of cash on hand, cash in banks which can be withdrawn at any time andshort-term investments with a maturity of three months or less that can easily be converted to cash and are
subject to little risk of change in value.

9.

Other significant basis for the preparation of financial statements
Accounting for consumption tax
Transactions are recorded at amounts exclusive of consumption tax.

(Additional Information)(Application of Implementation Guidance on Recoverability of Deferred Tax Assets)
Symbio has applied “Implementation Guidance on Recoverability of Deferred Tax Assets (AccountingStandards Board of Japan (ASBJ) Guidance No. 26, March 28, 2016)” from the fiscal year ended December
31, 2017.

(This part is intentionally left blank)- 26 -

(7) Notes on financial statements(Balance sheets)
1. The Company has overdraft and commitment line contracts with three banks in a business relationship to efficiently
procure working capital. The status of the bank overdraft and loan commitments based on these contracts at the end ofeach fiscal year is as follows:(Unit: thousands of yen)
FY 2016(as of December 31, 2016)

FY 2017(as of December 31, 2017)

1,350,000

1,350,000－
1,350,000－
1,350,000

Total amounts of bank overdraft limit andloan commitment line
Balance of borrowing outstanding
Unused balance(Statements of operations)* 1 The selling expenses ratio is roughly 6.5% and 6.1 % for FY 2016 and FY 2017, respectively, and theadministrative expenses ratio is roughly 93.5% and 93.9% for FY 2016 and FY 2017, respectively.
Major expense items and amounts are as follows.
(Unit: thousands of yen)
FY 2016
FY 2017(from January 1, 2016
(from January 1, 2017
to December 31, 2016)
to December 31, 2017)
150,289
389,769908
1,667,098
10,215
137,257

Directors’ compensation
Salaries
Retirement benefit expenses
Research and development expenses
Depreciation expenses
Fees paid

166,292
387,415769
3,017,812
11,322567,117* 2 Total amounts of research and development expenses included in general and administrative expenses(Unit: thousands of yen)
FY 2016
FY 2017(from January 1, 2016
(from January 1, 2017
to December 31, 2016)
to December 31, 2017)
1,667,098
3,017,812* 3 Details of loss on retirement of non-current assets

Tools, furniture and fixtures
Software

FY 2016(from January 1, 2016
to December 31, 2016)(Unit: thousands of yen)
FY 2017(from January 1, 2017
to December 31, 2017)

0
1,139

－
－

- 27 -

* 4 Impairment loss
FY 2017 (from January 1, 2017 to December 31, 2017)
For FY 2017, the Company has recorded impairment loss for the following asset.
(Unit: thousands of yen)
Location

Use

Category

Impairment loss

Head office
Idle asset
Tools, furniture and fixtures
14,692(Minato-ku, Tokyo)
Impairment loss has been recognized for tools, furniture and fixtures with no prospect to be used in the future.
The recoverable amount of the asset is zero; therefore, its total carrying value has been recorded as impairment loss
under extraordinary loss.

(This part is intentionally left blank)- 28 -

(Statements of changes in net assets)
FY 2016 (from January 1, 2016 to December 31, 2016)
1. Shares issued and outstanding/Treasury stock(Unit: number of shares)
At the beginning of
the fiscal year

IncreaseAt the end of the
fiscal year

Decrease

Shares issued
Common stock

32,390,923

14,139,901－

46,530,824

Total

32,390,923

14,139,901－

46,530,824

Common stock

75

－

－

75

Total

75

－

－

75

Treasury stock(Notes) Increase of 14,139,901 shares in common stock is due to the exercise of stock acquisition rights.
2. Stock acquisition rights and treasury acquisition rights

Company

Description

Type ofshares to beissuedBalance
as ofDecemberAt the end of 31, 2016
the fiscal (thousands
Decreaseyearof yen)Number of shares to be issued
At thebeginning of
the fiscal
year

Increase

The 29th warrant

Common stock795,750－

795,750－－

The 34th warrant

Common stock

3,030,400－

2,054,600

975,800

3,337

The 39th warrant

Common stock－

4,472,000－

4,472,000

9,776

Common stock－ 14,218,009 12,085,301

2,132,708(Note 2)－－

418,022

3,826,150 18,690,009 14,935,651

7,580,508

431,135

The 3rd unsecured
The
Company bonds withconvertible bond typestock acquisitionrightsStock acquisitionrights as stock options
Total

－

－

－

(Notes) 1. The information about type of shares to be issued and the number of shares to be issued is described in“Stock options.”
2. The 3rd unsecured bonds with convertible bond type stock acquisition rights are computed by the lump-sum
method.
(Main reasons for increase/decrease)
Decrease due to expiration of exercise period of the 29th warrant: 795,750 shares
Decrease due to exercise of the 34th warrant: 2,054,600 shares
Increase due to issuance of the 39th warrant: 4,472,000 shares
Increase due to issuance of stock acquisition rights for the 3rd unsecured bonds with convertible bond type stockacquisition rights: 14,218,009 shares
Decrease due to exercise of stock acquisition rights for the 3rd unsecured bonds with convertible bond type stockacquisition rights: 12,085,301 shares
3. Dividends
None to be reported.
- 29 -

FY 2017 (from January 1, 2017 to December 31, 2017)
1. Shares issued and outstanding/Treasury stock(Unit: number of shares)
At the beginning of
the fiscal year

IncreaseAt the end of the
fiscal year

Decrease

Shares issued
Common stock46,530,824

7,518,400－

54,049,224

Total

46,530,824

7,518,400－

54,049,224

Common stock

75

－

－

75

Total

75

－

－

75

Treasury stock(Notes) Increase of 7,518,400 shares in common stock is due to the exercise of stock acquisition rights.
2. Stock acquisition rights and treasury acquisition rights

CompanyThe
Company

Description

Type ofshares to beissuedBalance
as ofDecemberAt the end of 31, 2017
the fiscal (thousands
Decreaseyearof yen)Number of shares to be issued
At thebeginning of
the fiscal
year

Increase

The 34th warrant

Common stock

975,800－

975,800－－

The 39th warrant

Common stock

4,472,000－

301,000

4,171,000

9,118

The 42nd warrant

Common stock－

8,800,000

5,034,800

3,765,200

13,9312,132,708－

2,132,708－(Note 2)

－

－

－

－

513,723

7,580,508

8,800,000

8,444,308

7,936,200

536,772

The 3rd unsecured
bonds withconvertible bond type Common stock
stock acquisitionrightsStock acquisition－rights as stock options
Total(Notes) 1. The information about type of shares to be issued and the number of shares to be issued is described in“Stock options.”
2. The 3rd unsecured bonds with convertible bond type stock acquisition rights are computed by the lump-sum
method.
(Main reasons for increase/decrease)
Decrease due to expiration of exercise period of the 34th warrant: 975,800 shares
Decrease due to exercise of the 39th warrant: 301,000 shares
Increase due to issuance of the 42nd warrant: 8,800,000 shares
Decrease due to exercise of the 42nd warrant: 5,034,800 shares
Decrease due to exercise of stock acquisition rights for the 3rd unsecured bonds with convertible bond type stockacquisition rights: 2,132,700 shares
3. Dividends
None to be reported.

- 30 -

(Statements of cash flow)*1 Cash and cash equivalents as of the fiscal year end are reconciled to the accounts reported in the balance sheets asfollows:(Unit: thousands of yen)
FY 2016(from January 1, 2016
to December 31, 2016)
5,719,325
5,719,325

Cash and deposits
Cash and cash equivalents
2

FY 2017(from January 1, 2017
to December 31, 2017)
2,947,059
2,947,059

Details of significant non-cash transactions
Exercise of stock acquisition rights for bonds with convertible bond type stock acquisition rights:(Unit: thousands of yen)
FY 2016(from January 1, 2016
to December 31, 2016)

Amount of increase in common stock due to theexercise of stock acquisition rights
Amount of increase in capital surplus due to the exerciseof stock acquisition rights
Amount of decrease in corporate bonds due to theexercise of stock acquisition rights- 31 -FY 2017(from January 1, 2017
to December 31, 2017)

1,275,000

225,000

1,275,000

225,000

2,550,000

450,000(Financial instruments)
1. Financial instruments(1) Policies for financial instruments
The Company procures the funds necessary in light of the pipeline development plan (primarily by third-party
allotment and offering by new stock issuance). A temporary surplus fund is invested in financial instruments
which are highly safe and liquid.
As a principle, the Company does not enter into derivative transactions for speculative trading purposes but uses
them within the scope prescribed in the Company’s internal rules.
(2) Types of financial instruments and related risks
Operating receivables such as accounts receivable-trade and advances paid in connection with joint development
are exposed to the credit risk of customers and joint development partners. Operating receivables denominated inforeign currencies are exposed to foreign exchange fluctuation risk.
The Company intends to invest in marketable and investment securities which have a relatively low risk offalling below initial investments, however, it might entail a finite risk.
Operating payables such as accounts payable-trade and accounts payable-other are mostly due within 75 days.
Operating payables denominated in foreign currencies are exposed to foreign exchange fluctuation risk.
The Company uses derivative transactions to avoid foreign exchange fluctuation risks and enters into forward
exchange contracts within the scope prescribed in the internal rules based on balances of receivables and payables
denominated in foreign currencies as well as the actual volume of exports and imports transactions denominated inforeign currencies.
Lease and guarantee deposits are mostly security deposits related to leased office premises and their refunds are
subject to the credit risk of the lessor.
Lease obligations are associated with the finance lease transactions that are intended to finance capital
expenditures and the longest maturity of the lease term is one year after the current fiscal year end.
(3) Risk management for financial instruments(i) Monitoring of credit risks (the risk that customers or counterparties may default on obligations)
In accordance with the Company’s internal credit policies for managing credit risk arising from operatingreceivables, the Company’s marketing department periodically monitors the creditworthiness of major
customers and monitors due dates and outstanding balances by individual customers. In addition, theCompany is making efforts to promptly identify and mitigate risks of bad debts from customers who arehaving financial difficulties.
The Company enters into derivative transactions only with financial institutions which have a sound credit
profile in order to mitigate the counterparty risk.
(ii) Monitoring of market risk (the risk arising from fluctuations in foreign exchange rates, interest rates andothers)The Company deposits cash primarily with financial institutions with high credit ratings.
For marketable and investment securities, the Company intends to avoid risks of falling below initialinvestments by investing in securities with a satisfactory credit rating and investment period in accordancewith the Company’s internal investment policies.
The Company enters into forward exchange contracts in order to avoid foreign exchange fluctuation risks inconnection with receivables and payables denominated in foreign currencies.
Followed by appropriate authorization procedures prescribed in the Company’s internal rules, the Finance &Accounting department executes and monitors derivative transactions. Monthly transaction performances arereported to the executive management committee.

- 32 -

(iii) Monitoring of liquidity risks (the risk that the Company may not be able to meet its obligations on thescheduled due date)
Based on the report from each department, the responsible department of the Company prepares and updates
its cash flow plans on a timely basis and ensures to maintain the liquidity on hand to manage liquidity risk.
(4) Supplementary explanation of the estimated fair value of financial instruments
The fair value of financial instruments is based on their quoted market price, if available. When there is noquoted market price available, fair value is reasonably estimated. Since various assumptions and factors arereflected in estimating the fair value, different assumptions and factors could result in different fair value. In
addition, the notional amounts of derivatives in notes to “Derivative transactions” are not necessarily indicativeof the actual market risk involved in derivative transactions.
(5) Concentration of credit risk
As of December 31, 2017, all operating receivables are from one particular major customer.
2. Fair value of financial instruments
The carrying value on the balance sheets, fair values and their differences are as follows. The financial instruments
whose fair value is extremely difficult to determine are not included. (See Note 2.)

FY 2016 (as of December 31, 2016)(Unit: thousands of yen)
Carrying value(1) Cash and deposits

Fair value

Differences

5,719,325

5,719,325－(2) Accounts receivable-trade487,471487,471－(3) Advances paid

66,46566,465－

Assets, total

6,273,262

6,273,262－(1) Accounts payable-trade

321,860

321,860－(2) Accounts payable-other552,510552,510－(3) Income taxes payable

36,58636,586－(4) Bonds with convertible bondtype stock acquisition rights

450,000

448,935(1,064)

1,360,956

1,359,892(1,064)

11,603

11,603－Liabilities, total
Derivative transactions, total (*)(*) Net assets and liabilities arising from derivative transactions are presented on a net basis and net liabilities areshown in parentheses.

- 33 -

FY 2017 (as of December 31, 2017)(Unit: thousands of yen)
Carrying value(1) Cash and deposits

Fair value

Differences

2,947,059

2,947,059－(2) Accounts receivable-trade489,874

489,874－(3) Advances paid

18,76018,760－Assets, total

3,455,694

3,455,694－(1) Accounts payable-trade604,382

604,382－(2) Accounts payable-other

330,867

330,867－(3) Income taxes payable

54,81354,813－Liabilities, total

990,062

990,062－

Derivative transactions, total (*)

15,844

15,844－(*) Net assets and liabilities arising from derivative transactions are presented on a net basis and net liabilities areshown in parentheses.
(Notes)1. Fair value measurement of financial instruments and other matters related to securities and derivative transactions
Assets(1) Cash and deposits, (2) Accounts receivable-trade and (3) Advances paid
The carrying value is deemed as the fair value since these are scheduled to be settled in a short period oftime.
Liabilities(1) Accounts payable-trade, (2) Accounts payable-other and (3) Income taxes payable
The carrying value is deemed as the fair value since these are scheduled to be settled in a short period oftime.
Derivative transactions
See notes to “Derivative transactions.”
2. Financial instruments whose fair value is extremely difficult to determine(Unit: thousands of yen)
FY 2016(as of December 31, 2016)
Lease and guarantee deposits

65,214

FY 2017(as of December 31, 2017)85,799Lease and guarantee deposits are not included in the above tables since no market quote is available and their fairvalue is extremely difficult to determine.

- 34 -

3. The redemption schedule for monetary assets and securities with maturities
FY 2016 (as of December 31, 2016)(Unit: thousands of yen)
Due after one
Due after fiveDue in one year
Due after ten
year through five years through ten
or less
years
years
years
Deposits

5,719,293－－－

Accounts receivable-trade487,471－－－

Advances paid

66,465－－－

6,273,230

－

－

－

Total
FY 2017 (as of December 31, 2017)(Unit: thousands of yen)
Due after one
Due after fiveDue after ten
Due in one year
year through five years through ten
years
or less
years
years
Deposits

2,946,982－－－

Accounts receivable-trade489,874－－－

Advances paid

18,760－－－3,455,617

－

－

－

Total

4. Maturities of bonds with convertible bond type stock acquisition rights after the fiscal year end
FY 2016 (as of December 31, 2016)
Due in one
year or less

(Unit: thousands of yen)
Due after one Due after two Due after three Due after four
Due after five
year through years through years through years throughyears
two years
three years
four years
five years

Bonds with convertible
bond type stockacquisition rights－－

450,000

－

－

－

Total

－

－

450,000－－－

FY 2017 (as of December 31, 2017)
None to be reported.

- 35 -

(Derivative transactions)
1. Derivative transactions to which hedge accounting is not applied
Currency-related transactions
FY 2016 (as of December 31, 2016)(Unit: thousands of yen)Classification

Type

Portion due
after
one year
Notional amountincludedhereinFair value

Unrealized gain

Forward exchange contract
OTC transactions

Buy
U.S. dollars
Euro
Total

－

－

－

－

574,873－

11,603

11,603574,873－

11,603

11,603(Note) Fair value measurement
The fair value is measured based on the quoted prices obtained from financial institutions with which theCompany has a business relationship.
FY 2017 (as of December 31, 2017)(Unit: thousands of yen)Classification

Type

Portion due
one year
Notional amount after
includedhereinFair value

Unrealized gain

Forward exchange contract
OTC transactions

Buy
U.S. dollars
Euro
Total

－

－

－

－

1,366,477－

15,844

15,844

1,366,477－

15,844

15,844(Note) Fair value measurement
The fair value is measured based on the quoted prices obtained from financial institutions with which theCompany has a business relationship.
2. Derivative transactions to which hedge accounting is applied
None to be reported.

- 36 -

(Retirement benefits)
1. Outline of retirement benefit plans
The Company has adopted a defined contribution pension plan. A lump-sum payment plan (non-contributory plan) is
applied for certain employees based on the Company’s internal rules for retirement benefits.
The simplified method is applied to calculate amounts of retirement benefit obligation and retirement benefit
expenses.
2. Retirement benefit plan under simplified method(1) The reconciliation between the retirement benefit obligation at the beginning and the end of the fiscal year is asfollows.
(Unit: thousands of yen)
FY 2016(from January 1, 2016
to December 31, 2016)
Provision for retirement benefits at the beginning of the fiscal year

FY 2017(from January 1, 2017
to December 31, 2017)

1,537

1,396

Service costs

219

147

Contribution made for defined contribution pension plan

(360)

(151)

1,396

1,392

Retirement benefit obligation at the end of the fiscal year

(2) The reconciliation between the retirement benefit obligation or provision for retirement benefits and the net defined
benefit liability on the balance sheet is as follows.
(Unit: thousands of yen)
FY 2016
FY 2017(as of December 31, 2016) (as of December 31, 2017)
Unfunded retirement benefit obligation

1,396

1,392

Net defined benefit liability on the balance sheet

1,396

1,392
(Unit: thousands of yen)

FY 2016
FY 2017(as of December 31, 2016) (as of December 31, 2017)
Provision for retirement benefits

1,396

1,392

Net defined benefit liability on the balance sheet

1,396

1,392

(3) Retirement benefit expenses
Retirement benefit expenses calculated under the simplified method

FY 2016: 219 thousand yen
FY 2017: 147 thousand yen

3. Defined contribution pension plan
The amount of the Company’s contribution to the defined contribution pension plan for FY 2016 and FY 2017 were
1,965 thousand yen and 1,836 thousand yen, respectively.

- 37 -

(Stock options)
1. The account name and the amount of stock options charged as expenses(Unit: thousands of yen)

Selling, general andadministrative expenses

FY 2016(from January 1, 2016
to December 31, 2016)

FY 2017(from January 1, 2017
to December 31, 2017)

137,010

121,205

2. The account name and the amount of income recognized for vested shares that expired unexercised(Unit: thousands of yen)

Gain on reversal of stockacquisition rights

FY 2016(from January 1, 2016
to December 31, 2016)

FY 2017(from January 1, 2017
to December 31, 2017)

5,452

14,077- 38 -

3. Description of stock options/Changes in the size of stock options(1) Description of stock options

Individuals covered by theplan and number of persons
granted stock options
Class and number of shares
to be issued upon the exerciseof the stock options
Grant date

Vesting conditions

Vesting period
Exercise period

Individuals covered by theplan and number of persons
granted stock options
Class and number of shares
to be issued upon theexercise of the stock options
Grant date

Vesting conditions

Vesting period
Exercise period

The 14th Series
Directors of the Company
5
Auditor of the Company
1
Total
6

The 16th Series
External collaborators

14

Common stock 207,000 shares

Common stock 85,000 shares

October 1, 2008
1. The Person Granted must have thestatus as the Company’s director,
auditor & supervisory board member,advisor or employee at the time of
exercise. However, this is notnecessarily the case if the Person
Granted retires due to the expiry ofher/his term or compulsory
retirement; if otherwise the Board of
Directors approves; or if the Person
Granted is an external collaborator.

October 1, 2008

2. The Company’s stock must be listed ona stock exchange.
The vesting period is not fixed.
From October 1, 2010 to September 30,
2018
The 17th Series
Directors of the Company
Auditor of the Company
Total

Same as on the left

Same as on the left
From October 1, 2010 to September 30,
2018
The 19th Series314

External collaborators

Common stock 72,000 shares

Common stock 12,500 shares

March 18, 2009
1. The Person Granted must have thestatus as the Company’s director,
auditor & supervisory board
member, advisor or employee atthe time of exercise. However, thisis not necessarily the case if the
Person Granted retires due to the
expiry of her/his term orcompulsory retirement; ifotherwise the Board of Directors
approves; or if the Person Granted
is an external collaborator.
.
2. The Company’s stock must be listed
on a stock exchange.
The vesting period is not fixed.
From March 19, 2011 to March 18, 2019

March 18, 2009

- 39 -

2

Same as on the left

Same as on the left
From March 19, 2011 to March 18, 2019

Individuals covered by theplan and number of persons
granted stock options
Class and number of shares
to be issued upon theexercise of the stock options
Grant date

Vesting conditions

Vesting period
Exercise period

The 20th Series
Directors of the Company
Auditor of the Company
Total

The 21st Series
6
17

Vesting conditions

Vesting period
Exercise period

50

Common stock 361,000 shares

Common stock 326,500 shares

March 31, 2010
1. The Person Granted must have thestatus as the Company’s director,
auditor & supervisory board member,advisor or employee at the time of
exercise. However, this is notnecessarily the case if the Person
Granted retires due to the expiry ofher/his term or compulsory
retirement; if otherwise the Board of
Directors approves; or if the Person
Granted is an external collaborator.
.
2. The Company’s stock must be listed ona stock exchange.
The vesting period is not fixed.
From April 1, 2012 to March 31, 2020

March 31, 2010

The 22nd Series
Individuals covered by theplan and number of persons
granted stock options
Class and number of shares
to be issued upon theexercise of the stock options
Grant date

Employees of the Company

External collaborators

Same as on the left

Same as on the left
From April 1, 2012 to March 31, 2020
The 23rd Series

13

Employees of the Company

Common stock 153,000 shares

Common stock 32,000 shares

March 31, 2010
1. The Person Granted must have thestatus as the Company’s director,
auditor & supervisory board member,advisor or employee at the time of
exercise. However, this is notnecessarily the case if the Person
Granted retires due to the expiry ofher/his term or compulsory
retirement; if otherwise the Board of
Directors approves; or if the Person
Granted is an external collaborator.

October 15, 2010

2. The Company’s stock must be listed ona stock exchange.
The vesting period is not fixed.
From April 1, 2012 to March 31, 2020

- 40 -

9Same as on the left

Same as on the left
From October 15, 2012 to October 14,
2020

The 24th Series
Individuals covered by theplan and number of persons
granted stock options
Class and number of shares
to be issued upon theexercise of the stock options
Grant date

Vesting conditions

Vesting period
Exercise period

Directors of the Company

The 25th Series
5

Employees of the Company

Common stock 192,000 shares

Common stock 195,000 shares

March 31, 2011
1. The Person Granted must have thestatus as the Company’s director,
auditor & supervisory board member,advisor or employee at the time of
exercise. However, this is notnecessarily the case if the Person
Granted retires due to the expiry ofher/his term or compulsory
retirement; or if otherwise the Boardof Directors approves.

March 31, 2011

2. The Company’s stock must be listed ona stock exchange.
The vesting period is not fixed.
From March 31, 2013 to March 30, 2021

(This part is intentionally left blank)- 41 -

59

Same as on the left

Same as on the left
From March 31, 2013 to March 30, 2021

The 26th Series
Individuals covered by theplan and number of persons
granted stock options
Class and number of shares
to be issued upon theexercise of the stock options
Grant date

Vesting conditions

Vesting period
Exercise period

Directors of the Company

The 27th Series
4

Common stock 362,500 shares

Vesting conditions

Vesting period
Exercise period

70

Common stock 430,700 shares

May 2, 2012
May 2, 2012
No specific conditions are prescribed in
the allotment agreement for stockacquisition rights entered into between the
Company and the Person Granted, except Same as on the left
for certain vesting conditions stipulated in
the exercise conditions. The exercise
conditions are described in *(1) to (6).
The period that fulfills the requirement ofSame as on the leftthe exercise conditions *(2) and (3).
From April 18, 2014 to April 17, 2022
From April 18, 2014 to April 17, 2022
The 30th Series

Individuals covered by theplan and number of persons
granted stock options
Class and number of shares
to be issued upon theexercise of the stock options
Grant date

Employees of the Company

Directors of the Company

The 31st Series
5

Employees of the Company

Common stock 116,000 shares

Common stock 124,000 shares

May 29, 2013
No specific conditions are prescribed in
the allotment agreement for stockacquisition rights entered into between the
Company and the Person Granted, except
for certain vesting conditions stipulated in
the exercise conditions. The exercise
conditions are described in *(1) to (6).
The period that fulfills the requirement of
the exercise conditions *(2) and (3).
From May 15, 2015 to May 14, 2023

May 29, 2013- 42 -

68

Same as on the left

Same as on the left
From May 15, 2015 to May 14, 2023

The 32nd Series
Individuals covered by theplan and number of persons
granted stock options
Class and number of shares
to be issued upon theexercise of the stock options
Grant date

Vesting conditions

Vesting period
Exercise period

Directors of the Company

The 33rd Series
5

Common stock 252,000 shares

Common stock 330,000 shares

April 30, 2014
No specific conditions are prescribed in
the allotment agreement for stockacquisition rights entered into between the
Company and the Person Granted, except
for certain vesting conditions stipulated in
the exercise conditions. The exercise
conditions are described in *(1), (3), (4),(7) and (8).
The period that fulfills the requirement of
the exercise conditions *(3).
From April 16, 2017 to April 15, 2024

April 30, 2014

The 35th Series
Individuals covered by theplan and number of persons
granted stock options
Class and number of shares
to be issued upon theexercise of the stock options
Grant date

Vesting conditions

Vesting period
Exercise period

Employees of the Company

Directors of the Company

Same as on the left

Same as on the left
From April 16, 2017 to April 15, 2024
The 36th Series

6

Employees of the Company

Common stock 204,200 shares

Common stock 312,000 shares

April 10, 2015
No specific conditions are prescribed in
the allotment agreement for stockacquisition rights entered into between the
Company and the Person Granted, except
for certain vesting conditions stipulated in
the exercise conditions. The exercise
conditions are described in *(1), (3), (4),(7) and (8).
The period that fulfills the requirement of
the exercise condition *(3).
From March 27, 2018 to March 26, 2025

April 10, 2015

- 43 -

68

61

Same as on the left

Same as on the left
From March 27, 2018 to March 26, 2025

The 37th Series
Individuals covered by theplan and number of persons
granted stock options
Class and number of shares
to be issued upon theexercise of the stock options
Grant date

Vesting conditions

Vesting period
Exercise period

Directors of the Company

The 38th Series
6

Common stock 236,500 shares

Common stock 395,000 shares

April 14, 2016
No specific conditions are prescribed in
the allotment agreement for stockacquisition rights entered into between the
Company and the Person Granted, except
for certain vesting conditions stipulated in
the exercise conditions. The exercise
conditions are described in *(1), (3), (4),(7) and (8).
The period that fulfills the requirement of
the exercise condition *(3).
From March 31, 2019 to March 30, 2026

April 14, 2016

The 40th Series
Individuals covered by theplan and number of persons
granted stock options
Class and number of shares
to be issued upon theexercise of the stock options
Grant date

Vesting conditions

Vesting period
Exercise period

Employees of the Company

Directors of the Company

73

Same as on the left

Same as on the left
From March 31, 2019 to March 30, 2026
The 41st Series

6

Employees of the Company

Common stock 280,000 shares

Common stock 451,200 shares

April 24, 2017
No specific conditions are prescribed in
the allotment agreement for stockacquisition rights entered into between the
Company and the Person Granted, except
for certain vesting conditions stipulated in
the exercise conditions. The exercise
conditions are described in *(1), (3), (4),(7) and (8).
The period that fulfills the requirement of
the exercise condition *(3).
From March 30, 2020 to March 29, 2027

April 24, 201771

Same as on the left

Same as on the left
From March 30, 2020 to March 29, 2027*(1) Fractions less than one unit of a stock acquisition right shall be unexercisable.
(2) The Person Granted may exercise all or part of the rights in accordance with the following classifications:＜The 26th Series and the 27th Series stock option＞(a) Those who were granted the stock acquisition rights may exercise the rights within the limit of one-fourth (1/4) from
April 18, 2014 to April 17, 2015.
(b) Those who were granted the stock acquisition rights may exercise the rights within the limit of one-half (1/2) from April
18, 2015 to April 17, 2016.
(c) Those who were granted the stock acquisition rights may exercise the rights within the limit of three-fourths (3/4) from
April 18, 2016 to April 17, 2017.
(d) Those who were granted the stock acquisition rights may exercise all the rights from April 18, 2017 to April 17, 2022.

- 44 -

＜The 30th and the 31st Series stock option＞(a) Those who were granted the stock acquisition rights may exercise the rights within the limit of one-fourth (1/4) from May
15, 2015 to May 14, 2016.
(b) Those who were granted the stock acquisition rights may exercise the rights within the limit of one-half (1/2) from May
15, 2016 to May 14, 2017.
(c) Those who were granted the stock acquisition rights may exercise the rights within the limit of three-fourths (3/4) fromMay 15, 2017 to May 14, 2018.
(d) Those who were granted the stock acquisition rights may exercise all the rights from May 15, 2018 to May 14, 2023.
(3) The Person Granted shall exercise the rights starting from the date of resolution by the below-mentioned shareholders’meeting or the Board of Directors’ meeting until one day before the effective date of the Organizational Restructuring asfollowed, regardless of the conditions of the exercise period originally stipulated, when the Organizational Restructuring isapproved by the resolution of the Company’s shareholders’ meeting (including the case where resolution of a shareholders’meeting is deemed to exist pursuant to the provision of Article 319 of the Companies Act) or the Board of Directors’ meeting(limited to the case where no shareholders’ meeting is required for the said Organizational Restructuring) before the exercise
period of the stock acquisition rights comes into effect: an absorption-type merger or an incorporation-type merger where theCompany becomes a dissolving company and an absorption-type split or an incorporation-type company split where theCompany becomes a split company or a share exchange or a share transfer where the Company becomes a wholly-owned
subsidiary (collectively, “Organizational Restructuring” as mentioned above).
(4) The stock acquisition rights shall not be offered for pledge or disposed of in any other way.
(5) The Person Granted must have the status as the Company’s director, auditor, or employee of the Company or its affiliates at
the time of exercise. However, this is not necessarily the case where:(a) The Person Granted is a director, auditor, or employee of the Company or its affiliates and retires due to the expiry ofher/his term.
(b) The Person Granted is an employee of the Company or its affiliates and retires due to compulsory retirement.
(c) The Person Granted is a director, auditor, or employee of the Company or its affiliates and the Board of Directors
resolves that he/she has resigned or retired with honorable recognition.
(6) In the event that:(a) The Person Granted dies before the exercise period comes into effect, the beneficiary/ies shall exercise the rights of up to
one-half (1/2) within six (6) months from the date of inheritance, or(b) The Person Granted dies during the exercise period, the beneficiary/ies shall exercise all the rights within six (6) months
from the date of inheritance.
However, in the event that the beneficiary/ies dies, the rights shall be discarded and shall not be exercised by his/her
beneficiary/ies.
(7) The Person Granted must have the status as a director, auditor, 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 the Company 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.
(c) The Person Granted is a director or employee of the Company or its affiliates and the Board of Directors resolves thathe/she has resigned or retired with honorable recognition.
(8) In the event that the Person Granted dies, the beneficiary/ies shall be able to succeed and exercise the stock acquisition rights
as prescribed in the allotment agreement for stock acquisition rights entered into between the Company and the Person
Granted. However, in the event that the beneficiary/ies dies, the rights shall be discarded and shall not be exercised by his/her
beneficiary/ies.

- 45 -

(2) Change in the size of stock options
The number of shares which may arise upon exercise of stock options as of December 31, 2017 is as follows.
(a) Number of stock options(Unit: number of shares)
The 9th Series
The 11th Series
The 12th Series
The 13th Series
Grant dateFebruary 1, 2007
March 15, 2007
August 29, 2007
August 29, 2007
Non-vested shares:
At the beginning of the year－－－－
Granted－－－－Expired－－－－
Vested－－－－At the end of the year－－－－
Vested shares:
At the beginning of the year
3,000
7,000
23,00061,000
Vested－－－－Exercised－－－－
Expired
3,000
7,000
23,00061,000At the end of the year－－－－

Grant dateNon-vested shares:
At the beginning of the year
GrantedExpired
VestedAt the end of the year
Vested shares:
At the beginning of the year
VestedExercised
ExpiredAt the end of the year

Grant dateNon-vested shares:
At the beginning of the year
GrantedExpired
VestedAt the end of the year
Vested shares:
At the beginning of the year
VestedExercised
ExpiredAt the end of the year

(Unit: number of shares)
The 17th Series
The 19th Series
March 18, 2009
March 18, 2009

The 14th Series
October 1, 2008

The 16th Series
October 1, 2008

－
－
－
－
－

－
－
－
－
－

－
－
－
－
－

－
－
－
－
－

28,000－－－28,00070,000－－－70,000

4,000
－
－
－
4,000

2,500
－
－
－
2,500

The 20th Series
March 31, 2010

The 21st Series
March 31, 2010

－
－
－
－
－

－
－
－
－
－

－
－
－
－
－

－
－
－
－
－

344,500－－－
344,500

170,500－－
29,000141,500

153,000－－－
153,000

10,000－－－10,000- 46 -(Unit: number of shares)
The 22nd Series
The 23rd Series
March 31, 2010
October 15, 2010

Grant dateNon-vested shares:
At the beginning of the year
GrantedExpired
VestedAt the end of the year
Vested shares:
At the beginning of the year
VestedExercised
ExpiredAt the end of the year

Grant dateNon-vested shares:
At the beginning of the year
GrantedExpired
VestedAt the end of the year
Vested shares:
At the beginning of the year
VestedExercised
ExpiredAt the end of the year

Grant dateNon-vested shares:
At the beginning of the year
GrantedExpired
VestedAt the end of the year
Vested shares:
At the beginning of the year
VestedExercised
ExpiredAt the end of the year

(Unit: number of shares)
The 26th Series
The 27th Series
May 2, 2012
May 2, 2012

The 24th Series
March 31, 2011

The 25th Series
March 31, 2011

－
－
－
－
－

－
－
－
－
－

80,625－－80,625－46,425－
1,275
45,150－

192,000－－－
192,000

104,000－－
15,00089,000281,875
80,625－－362,500

206,975
45,150－39,925212,200(Unit: number of shares)
The 31st Series
The 32nd Series
May 29, 2013
April 30, 2014

The 28th Series
September 28, 2012

The 30th Series
May 29, 2013

2,500
－
2,500
－
－

47,500－－26,25021,25029,100－4,300
13,875
10,925

252,000－－
252,000
－

7,500
－
－
7,500
－

68,50026,250－－94,75042,30013,875－8,200
47,975－
252,000－－
252,000

The 33rd Series
April 30, 2014

The 35th Series
April 10, 2015

172,900－
8,300
164,600－

193,900－－
20,600173,300

213,500－
56,0004,000
153,500

236,500－－
33,000203,500

21,900164,600
49,900－136,600

10,30020,600－－30,90025,5004,000－－
29,500－33,000－－33,000- 47 -(Unit: number of shares)
The 36th Series
The 37th Series
April 10, 2015
April 14, 2016

Grant dateNon-vested shares:
At the beginning of the year
GrantedExpired
VestedAt the end of the year
Vested shares:
At the beginning of the year
VestedExercised
ExpiredAt the end of the year

The 38th Series
April 14, 2016

(Unit: number of shares)
The 40th Series
The 41st Series
April 24, 2017
April 24, 2017

333,000－
62,4002,500
268,100－
280,000－－
280,000－
451,200
60,100－391,100

12,5002,500－－
15,000

－
－
－
－
－

－
－
－
－
－

- 48 -

(b) Per share prices
Grant date
Exercise price (yen) (Note 1)
Average stock price at thetime of exercise (yen)Fair value price at grant date(yen)

Grant date
Exercise price (yen) (Note 1)
Average stock price at thetime of exercise (yen)Fair value price at grant date(yen)

Grant date
Exercise price (yen) (Note 1)
Average stock price at thetime of exercise (yen)Fair value price at grant date(yen)

Grant date
Exercise price (yen) (Note 1)
Average stock price at thetime of exercise (yen)Fair value price at grant date(yen) (Note 2)

Grant date
Exercise price (yen)Average stock price at thetime of exercise (yen)Fair value price at grant date(yen) (Note 2)

The 9th Series
February 1, 2007
1,461

The 11th Series
March 15, 2007
1,461

The 12th Series
August 29, 2007
1,461

The 13th Series
August 29, 2007
1,461

－

－

－

－

0

0

0

0

The 14th Series
October 1, 2008
1,169

The 16th Series
October 1, 2008
1,169

The 17th Series
March 18, 2009
1,169

The 19th Series
March 18, 2009
1,169

－

－

－

－

0

0

0

0

The 20th Series
March 31, 2010
585

The 21st Series
March 31, 2010
585

The 22nd Series
March 31, 2010
585

The 23rd Series
October 15, 2010
585

－

－

－

－

0

0

0

0

The 24th Series
March 31, 2011
682

The 25th Series
March 31, 2011
682

The 26th Series
May 2, 2012
555

The 27th Series
May 2, 2012
555

－

－

－

－

0

0

(a) 179(b) 187(c) 195(d) 202(a) 179(b) 187(c) 195(d) 202

The 28th Series
September 28, 2012
(Note 1) 555

The 30th Series
May 29, 2013
(Note 1) 799

The 31st Series
May 29, 2013
(Note 1) 799

－

－

－

－

(a) 203(b) 208(c) 213(d) 217(a) 586(b) 602(c) 617(d) 631(a) 586(b) 602(c) 617(d) 631229- 49 -The 32nd Series
April 30, 20141

Grant date
Exercise price (yen)Average stock price at thetime of exercise (yen)Fair value price at grant date(yen)

Grant date
Exercise price (yen)Average stock price at thetime of exercise (yen)Fair value price at grant date(yen)

The 33rd Series
April 30, 2014

The 35th Series
April 10, 2015

The 36th Series
April 10, 2015

The 37th Series
April 14, 2016

1

1

1

1

228

－

－

－

229

306

306

272

The 38th Series
April 14, 2016

The 40th Series
April 24, 2017

The 41st Series
April 24, 2017

1

1

1

－

－

－

272

203

203

(Notes) 1. The Company increased its capital through the public offering on December 4, 2013 and through the third-party allotment
on December 25, 2013, at the per share amount less than the exercise price of options. Thus, the exercise amounts above
are stated after the price adjustments clause.
2. (a), (b), (c) and (d) above correspond to each of (a), (b), (c) and (d) of the exercise periods as previously described in
3. (1) * (2).

4. Method for estimating the fair value of the stock options
The fair value of the stock options that were granted during this fiscal year is estimated based on the following
method.
(1) Estimate technique used: Black-Scholes Option Pricing Model(2) Major assumptions and estimate method
The 40th Series
The 41st Series
Volatility of stock price (Note 1)
62.28%
62.28%
Estimated remaining outstanding
3.0 years
3.0 years
period (Note 2)
Estimated dividend (Note 3)
0 yen per share
0 yen per share
Risk free interest rate (Note 4)(0.19)%(0.19)%(Notes) 1. The volatility was calculated based on the actual stock prices from April 29, 2013 to April 24, 2017.
2. The period from the allotment date to the start date of the exercise period is used.
3. The Company estimates dividends to be zero since no dividends have been paid in the past.
4. This represents yields of Japanese government bonds corresponding to the estimated remaining outstanding period.

5. Estimate of the number of stock options vested
The number of expired shares is estimated based on the historical turnover ratio.

- 50 -

(Deferred tax accounting)
1. Significant components of deferred tax assets and liabilities(Unit: thousands of yen)
FY 2016
FY 2017(as of December 31, 2016) (as of December 31, 2017)
Deferred tax assets:
Excess depreciation for lump-sum depreciable
assetsExcess amortization for deferred assets
Research and development expenses
Accounts payable-other
Provision for retirement benefits
Enterprise tax payable
Asset retirement obligation
Share-based compensation expenses
Impairment loss
Loss carried forward
Subtotal
Valuation allowance
Total deferred tax assets

2,192

2,125

871,030
854,810243
427
10,704967
95,125－
1,881,788
3,717,291(3,717,291)－

1,080,219
735,170
1,189
426
16,329933
127,971
3,653
2,925,912
4,893,931(4,893,931)－

2. The reconciliation between the effective tax rates reflected in the financial statements and the statutory tax rate isomitted since the Company reported loss before income taxes for the years ended December 31, 2016 and 2017.
(Asset retirement obligations)
The Company has future restoration obligations related to leasehold contracts for office premises.
Carrying the balance of lease and guarantee deposits as an asset, the Company reasonably estimates non-recoverable
amounts of lease and guarantee deposits under lease contracts and records the amount attributable to the respective
fiscal year as expenses, instead of accounting for asset retirement obligations by recognizing a liability and an
associated asset.

- 51 -

(Segment information)【Segment information】
FY 2016 (from January 1, 2016 to December 31, 2016) and FY 2017 (from January 1, 2017 to December 31, 2017)
Segment information is omitted since the Company operates within a single segment of the pharmaceutical industry
including research and development of pharmaceutical drugs as well as manufacturing and marketing and otherrelated activities.

【Related information】
FY 2016 (from January 1, 2016 to December 31, 2016)
1. Information by product and service
Information by product and service is omitted since external sales of a single service category account for morethan 90% of total net sales stated in the statement of income.
2. Information about geographical areas(1) Net sales
Net sales information about geographical areas is omitted since external sales to Japanese customers accountfor more than 90% of total net sales stated in the statement of income.
(2) Property, plant and equipment
All property, plant and equipment are located in Japan.
3. Information by the major customer(Unit: thousands of yen)
Name of customer

Net sales

Eisai Co., Ltd.

2,264,541

Name of related segment
Pharmaceutical businesses including research and developmentof pharmaceutical drugs as well as manufacturing andmarketing and other related activities.

FY 2017 (from January 1, 2017 to December 31, 2017)
1. Information by product and service
Information by product and service is omitted since external sales of a single service category account for morethan 90% of total net sales stated in the statement of income.
2. Information about geographical areas(1) Net sales
Net sales information about geographical areas is omitted since external sales to Japanese customers accountfor more than 90% of total net sales stated in the statement of income.
(2) Property, plant and equipment
All property, plant and equipment are located in Japan.
3. Information by the major customer(Unit: thousands of yen)
Name of customer

Net sales

Eisai Co., Ltd.

3,382,484

Name of related segment
Pharmaceutical businesses including research and developmentof pharmaceutical drugs as well as manufacturing andmarketing and other related activities.

- 52 -

【Information about impairment loss on long-lived assets by reportable segment】
FY 2016 (from January 1, 2016 to December 31, 2016)
None to be reported.
FY 2017 (from January 1, 2017 to December 31, 2017)
Information by segment is omitted since the Company operates within a single segment of the pharmaceuticalindustry.
【Information about the amortization and unamortized balance of goodwill by reportable segment】
FY 2016 (from January 1, 2016 to December 31, 2016) and FY 2017 (from January 1, 2017 to December 31, 2017)
None to be reported.
【Information about the gain recognized on negative goodwill by reportable segment】
FY 2016 (from January 1, 2016 to December 31, 2016) and FY 2017 (from January 1, 2017 to December 31, 2017)
None to be reported.

(Related party information)
Transactions with related parties
Director(s) and major individual shareholder(s) of the Company
FY 2016 (from January 1, 2016 to December 31, 2016)
None to be reported.
FY 2017 (from January 1, 2017 to December 31, 2017)
None to be reported.

- 53 -

(Per share information)
FY 2016(from January 1, 2016
to December 31, 2016)

FY 2017(from January 1, 2017
to December 31, 2017)

Net assets per share
108.61 yen
Net assets per share
50.00 yen
Net loss per share(58.82) yen
Net loss per share(79.78) yen(Notes) 1. While having potential dilutive stocks, diluted net income per share is not provided since the Company
reported net loss per share.
2. The basis for calculating net loss per share is as follows:
FY 2016(from January 1, 2016
to December 31, 2016)
Net loss (thousand yen)
(2,313,233)
Amount not attributable to the shareholders of－common stock (thousand yen)
Net loss attributable to the shareholders of common(2,313,233)
stock (thousand yen)
Average number of shares outstanding during the39,329,706
year (shares)
Description of potential dilutive stocks not included 28 types of stock acquisitionin the earning-per-share calculation due to antirights (11,038,308 units) in
dilution
accordance with theCommercial Code of 1890
Article 280 (20) and (21), andthe Companies Act Article 236,
238, and 239.

FY 2017(from January 1, 2017
to December 31, 2017)(3,977,862)－(3,977,862)
49,857,917
28 types of stock acquisitionrights (11,686,800 units) inaccordance with theCommercial Code of 1890
Article 280 (20) and (21), andthe Companies Act Article 236,
238, and 239.

3. The basis for calculating net assets per share is as follows:
FY 2016(as of December 31, 2016)
Net assets (thousand yen)Amount to be deducted from net assets (thousandyen)[Of which, stock acquisition rights herein(thousand yen)]
Net assets attributable to the shareholders ofcommon stock (thousand yen)
Number of shares used in the calculation of net
assets per share (shares)- 54 -FY 2017(as of December 31, 2017)

5,484,870

3,239,402

431,135

536,772[431,135][536,772]

5,053,735

2,702,629

46,530,749

54,049,149

(Significant subsequent events)
None to be reported.

6. Other(1) Change in officers
None to be reported.
(2) Other
None to be reported.

- 55 -