Fuji Pharma Co., Ltd.

CORPORATE REPORT
Fuji Pharma Co., Ltd.
For IR inquiries, please contact
Corporate Planning Section, Corporate Planning Department, Head Office
6th Floor, 5-7 Sanban-Cho, Chiyoda-Ku, Tokyo, 102-0075, Japan Tel.03-3556-3344

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Year ended
September 30, 2023

Corporate Philosophy

We help people lead healthy lives byoffering excellent pharmaceuticals.
Aspiring to offer significant value in medical care, our key mission is to work together tocontinuously address challenges and achieve what only we can do in order to gainstrong trust and support from medical professionals, and to make greater contributions.

Our corporate growth is proportional
to our personal growth.
We value bringing happiness to society. The top priority in our corporate management isContents
Introduction

Sustainability

1

Corporate Philosophies

31

Sustainability Management

3

Health Issues Surrounding Women

32

Materiality

5

At a Glance

34

Environmental Initiatives

7

Our Journey to Date and CultivatedStrength

36

Social Initiatives

39

Dialogue: Chairman Imai and Outside
Director Kiyama

Value Creation Story

9

Fuji Pharma’s Value Creation Process

Governance11

Message from the President

43

Corporate Governance

15

Vision for 2030 and Mid-TermBusiness Plan

47

Officers

16

Progress of Mid-Term Business Plan

49

Compliance/Risk Management

21

Financial Report

Data

22

Strengthening Human Resource
Initiatives

51

Financial and Non-Financial Highlights

25

Fuji Pharma’s Value Chain

53

Principal Financial Data for the Past
11 Years

27

People and Things Supporting
Research, Development andProduction

55

Declaration of Authenticity

56

Company Information/ShareInformation

to continue creating opportunities and situations for further growth by working together
to make drugs for medical care.

“Virtues” to Be Valued in Our
Corporate Management
Concept of Virtues originating from Chinese classics
We interpret Virtues as doing one’s best for the sake of others. To foster aperson of Virtue, we have defined 7 Virtues and 19 indicators of Virtues andadopted them for personnel evaluation.

29

For Stable Supply of High-Quality
Pharmaceuticals

Editorial policy
This corporate report is published to make Fuji Pharma’s business activities, management and values for the contribution tosociety and the environment better and more understandable by all stakeholders.

Propriety
Sincerity

Righteousness

Scope of report
Fuji pharma co., ltd. And one subsidiary

Disclaimer

Moderation

Virtues

Benevolence

1This corporate report includes information on pharmaceuticals, including those under development. However, this information is
not intended for advertising or medical advisory purposes.
The financial forecasts and other projections provided in this Report are based on information available at the time of its
compilation and it therefore contains an element of uncertainty and potential risks.

Determination

Reporting period

The information herein is based on the fiscal year ended September 30, 2023 (from October 1, 2022 to September 30, 2023).
(However, it contains some information after October 2023.)

WisdomFuji Pharma Corporate Report 20242

Introduction

Value Creation Story

Sustainability

Governance

Data

Introduction

Health Issues Surrounding Women

Women face female-specific health issues throughout their life stages.
Our mission is to deliver excellent pharmaceuticals in order for all women to thrive and to be themselves.
Women experience significant changes in their physical and mental state as well as in theirlifestyle and environment as they go through life events such as menstruation, marriage,
pregnancy, and childcare, and hormonal fluctuations depending on their life stage: i.e. puberty,
reproductive period, menopause, and postmenopause.

In today’s Japan, where promoting women’s participation and advancement is a major social
challenge and women are expected to play more active roles in various fields than ever before, itis essential to solve female-specific health issues for them to be themselves, healthy both
physically and mentally.

Menopausal symptoms
Menstrual symptoms

Estimated number of
untreated people*1

13.0

3.0

Estimated number of untreated people*1

Approx.

Ratio of couples undergoinginfertility testing or treatment*3

Uterine fibroid
Estimated number of patients*2

Endometriosis

0.19

Estimated number of patients*2

0.17

Approx.

Infertility

millionApprox.

millionPuberty

600.0

billion*4

Reproductive period*1 Estimated by Fuji Pharma Co., Ltd. based on “Estimated Economic Loss due to Women-specific Health Issues and the Necessity of Health and Productivity Management” published by the
Healthcare Industries Division, Ministry of Economy, Trade and Industry, and “Vital Statistics” published by the Ministry of Health, Labour and Welfare*2 “2020 Patient Survey” published by the Ministry of Health, Labour and Welfare*3 “Support Handbook for Balancing Infertility Treatment and Work,” published by the Ministry of Health, Labour and Welfare*4 “Estimated Economic Loss due to Women-specific Health Issues and the Necessity of Health and Productivity Management” published by the Healthcare Industries Division, Ministry of
Economy, Trade and Industry

Gynecologic cancer
Number of patients between
15 and 64 years of age*2

0.57

couples

Approx.

Reproductive period

Approx. JPY

3

inmillionmillionEconomic loss due to menstrual symptoms

Puberty

1 4.4

Approx.

Approx.

millionMenopause/Postmenopause

Economic loss due to menopausal symptoms

1.9

Approx. JPY

trillion*4

Menopause/Postmenopause

Fuji Pharma Corporate Report 2024

4

Introduction

Value Creation Story

Sustainability

Governance

Data

Introduction

At a glance
Fuji Pharma is a specialty pharmaceutical company that provides
products aligned with women’s life stages with a core focus on the field of
women’s healthcare
Women’s
Healthcare

We have built a broad portfolio of new drugs, biosimilars and generic drugs with a focus on women’s healthcare and acutemedical care, and have responded flexibly to the ever diversifying and evolving medical needs. Aspiring to contribute to thehealthy lives of people around the world, Fuji Pharma will work together to continuously address challenges and achieve what
only we can do.

Others

8.4%

44.0%

Infertility
treatment drugs

Dysmenorrhea
treatment drugs

26.5%

4.6%
Anti-cancer
AgentsSales breakdownby therapeutic category
FY202344

AcuteMedical Care

37.6%

Share

47

%

Fuji Pharma

18.0 billion

13.6%

Top share in vaginal progestational
hormone agents in Japan%Net sales
JPY

Endometriosis
treatment drugs

40.9 billion

Share

Sales breakdown of
women’s healthcare
FY2023

7.3%

Net sales
JPY

Top share in the oral contraceptives
market in Japan

Menopausal
treatment drugs

Oralcontraceptives

18.2%

21.4%

Fuji Pharma

Copyright© 2024 IQVIA. Analysis by Fuji Pharma Co., Ltd. based on IQVIA MIDAS September 2023 MAT; unauthorized reproduction prohibited

Major Products
Puberty

Reproductive period

Menopause/Postmenopause

Women’shealthcare
2008

Dysmenorrhea treatment drugs

Dysmenorrhea
New
drugs
treatment drug
LUNABELL® Tablets ULD/LD

2012

Oral contraceptives

Oral contraceptive
Labellefille® tablets

Puberty

5

1996

Contrast Media

Oral contraceptives

2019

Oral contraceptives

Emergency contraceptive
LEVONORGESTREL
tablets F

Economic loss due to menstrual symptoms

Approx. JPY
AcuteMedicalCare

2011

Oral contraceptive
Favoir® tablets

2001

Non-ionic contrast media for Non-ionic contrast media
urography and angiography IOHEXOL injection F
IOPAMIDOL injection F

Infertility treatment drugs

600.0

2021

Others

Cervical ripening agent
PROPESS®
vaginal inserts

2017

Endometriosis treatment drugs

2024

Anti-cancer agents

Antihematopoietic
malignancy agent
LENALIDOMIDE capsules F

2024

OthersShort-acting 1 selective blocker
LANDIOLOL HYDROCHLORIDE
intravenous for drip use F

2022

Anti-cancer agents

2024

Others

1.9

Reversal agent for recovery
from muscle relaxation
SUGAMMADEX intravenous solution

2013

Menopausal treatment drugs

2007

Menopausal treatment drugs

Natural progestational New Transdermal estradiol gel
drugs l’estrogel®
hormone agent
F-meno® capsules

Economic loss due to menopausal symptoms

Approx. JPY
Biosimilars(BS) and
Other Fields

2021

Pain treatment for
Antineoplastic
Acquisition
endometriosis and adenomyosis agent
DOXIL® injection
DIENOGEST tablets Fbillion*4

Reproductive period

Contrast Media

2016

Natural progestational New
drugs
hormone agent
UTROGESTAN® vaginal capsules

Biosimilars

G-CSF
Filgrastim BS Injection
Syringe F

2024

Biosimilars

Human anti-human IL12/23p40
monoclonal antibody drug
USTEKINUMAB BS
Syringe for S.C. Injection F

trillion*4
Overseasbusiness

2023
Oral contraceptives
Menopause/Postmenopause

2022

Oral bowelcleansing agent
SULPREP®

OthersAcquisition

Oral contraceptive
Nextstellis™

Fuji Pharma Corporate Report 2024

6

Introduction

Value Creation Story

Sustainability

Governance

Data

Introduction(Billions of yen)

Our Journey to Date and Cultivated Strength

JPY 46.1 billion(forecast)Contribution and growth achieved by taking
on challenges, and toward the future

50

40

We have taken on various hurdles, cherishing the joy and gratitude gained by serving people. Based on the cycle ofcontribution and growth achieved through these challenges, we will continue to take on even more difficult challenges bythinking outside the box.

30

20

10

Net sales trends= Women’s healthcare

1973

1965

1996

2005

2010

2024 (FY)2020

Taking on the new field of generic contrast
media and new drugs

Advancing overseas and taking on
the development of biosimilars (BS)Strengthening partnerships
including the BS pipeline

Toward a
new future

1965

1995

2004

2011

2018

2022

1996

2006

2012

2019

2000

2008

Fuji Pharma over-the-counter registration with theJapan Securities Dealers Association canceled;
Listed on the JASDAQ Stock Exchange

Shares of Fuji Pharma registered forover-the-counter trading by the Japan
Securities Dealers Association

1973

Fuji Pharma plant and research building built
in Toyama as its principal manufacturing andresearch base

Plant for tablet (fourth drug production building)establishedFuji Pharma launched generic contrast media

1974

Fuji Pharma launched women’s healthcare
pharmaceuticals

OLIC (Thailand) Limited commissioned by
Fuji Pharma to manufacture an external use
drug (ointment)

1974 ESTRIOL tablets

Launched new drugs for women’s healthcare—transformed into a specialty pharmaceuticalcompany—

2007 l’estrogel2008 LUNABELL® Tablets®

1996 HMG injection F

Women’s
Healthcare

1996 IOPAMIDOL injection F

Acute
Medical Care

Plant for parenteral injections (fifth drug productionbuilding) established
OLIC (Thailand) Limited became a subsidiary of Fuji
Pharma and transitioned to consolidated financial
statements

Taking on genericcontrast media

2

Fuji Pharma concluded an agreement topartner with Alvotech group within Japan0

Shift to Prime section due to thereorganization Tokyo Stock Exchange
marketFuji Pharma concluded a capital andbusiness alliance agreement with Lotus
Pharmaceutical Co., Ltd.

Fuji Pharma listed on the first section of the Tokyo
Stock Exchange

2011 Favoir® tablets
2012 Labellefille® tablets
2013 LUNABELL® Tablets ULD
2016 UTROGESTAN® vaginal capsules2017 DIENOGEST tablets F2019 LEVONORGESTREL tablets F

2021 F-meno® capsules2021 PROPESS® vaginal inserts
2022 DOXIL® injection

2024 LENALIDOMIDE capsules F
2024 LANDIOLOL HYDROCHLORIDE

2001 IOHEXOL injection F

intravenous for drip use F

2024 SUGAMMADEX intravenous solution

Products that marked a turning point for Fuji Pharma
1

2015

Since its founding, Fuji Pharma hastaken on the challenge of producing
hormone drugs that involve difficult
manufacturing control

Fuji Pharma Co., Ltd. established

History

2000

3

Taking on new drugs

Taking on biosimilars, whichhave a high barrier to entry

Biosimilars (BS)and Other Fields

2013 Filgrastim BS Injection Syringe F

2022 SULPREP®
2024 USTEKINUMAB BS

Syringe for S.C. Injection F

2023 Nextstellis™
1996

Contrast media

Non-ionic contrast media forurography and angiography
IOPAMIDOL injection F

7

2008

Dysmenorrhea treatment drugs

2016

Infertility treatment drugs

2021

Menopausal treatment drugs

Dysmenorrhea treatment drug Natural progestational
Natural progestational
hormone agent
hormone agent
LUNABELL® Tablets
ULD/LDUTROGESTAN® vaginal capsules F-meno® capsules

2013

Biosimilars

Overseas
Business

G-CSF
Filgrastim BS Injection
Syringe F
Fuji Pharma Corporate Report 2024

8

Introduction

Value Creation Story

Sustainability

Governance

Data

Value Creation Story

Fuji Pharma’s Value Creation Process
Value creation at Fuji Pharma is based on the cycle of “contribution” and “growth.” Our two corporate philosophies, “We help
people lead healthy lives by offering excellent pharmaceuticals” and “Our corporate growth is proportional to our personal
growth,” are the foundation of Fuji Pharma’s value creation, expressing our belief that “Contribution leads to further growth,and further growth leads to greater contribution.”
Our philosophy, “Our corporate growth is proportional to our personal growth,” represents the positive and mutualinteraction that exists between the company’s growth and the growth of individual employees. At Fuji Pharma, we place greatvalue on the concept of “Virtues” in our corporate management. Each of our employees strives for personal growth under thisconcept, directly leading to our further growth as a company.
We will repeat this cycle in perpetuity, providing greater value to all our patients, medical professionals, and otherstakeholders in a way that only we can, and expanding the circle of happiness for all.

Impact on Stakeholders

Medium- and Long-term
Environmental Awareness

Demand forstable supply ofpharmaceuticals

Improvement inmedical carequality

Achieving “happiness for all”

Contribution
Invested Capital

Products and Services

Financial capital

Women’s healthcare

Total assets

85.3

JPY
billion
As of September 30, 2023

Research and development expenses

Reduction of
medicalexpensesJPY

3.2

billionFY202318.0

Patients

We help people lead healthy lives byoffering excellent pharmaceuticals.

4.0

Doing our best for thesake of others.

32.0

billionJPY
Cumulative total for the current
Mid-Term Business Plan period(FY9/2020-9/2024)

Consolidated:

Intensifying
climate change

Intensifying
human rights
issues9

F u j iP h a r m a ’ s

V a l u e s

1,621

Menopausal treatment drugs

Contribution to
women’s healthissues

Production base for drug
products with high barriers
to market entry

Experience in diverse
research and development
and production

 nhanced corporateEvalue through mediumand long-term growthReturn of profits

App to support women’s
health, “LiLuLa”

Management thatvalues people first andforemost

Acute medical care

Society

Human capital

Number of employeesImprovement in quality of life
Reduction of economic
burden for treatment
Improved knowledge of
diseases, etc.

Shareholders
and investors

billionFY2023

Promotion of
women’s
participation
andadvancement

Oral contraceptives“Virtues”

Our corporate growth is proportional
to our personal growth.

Investments
JPY

Improvement in medical carequality through high-quality
pharmaceuticals
Providing accurate and highly
specialized information
Providing a wide range oftreatment options

Fuji Pharma’s values

Corporate Philosophies

billionJPY
Cumulative total for the current
Mid-Term Business Plan period(FY9/2020-9/2024)

Extension ofhealthy life
expectancy

Medicalprofessionals

Vision for 2030 and
Mid-Term Business Plan

Human Resources
Initiatives

Value Chain

Materiality andSDGs

P15~20

P22~24

P25~26

P32~33

Non-ionic contrast media forurography and angiography ontribution to theCempowerment of womenin societyMeans to curb national
medical expenditure

Employees(866 at Fuji Pharma,
755 at OLIC)
As of September 30, 2023

Biosimilars

Growth rovision of growthP
opportunities through work
and Virtue indicators
Management with strong
will to make employees andtheir families the happiest
people in the world

Fuji Pharma Corporate Report 2024

10

Introduction

Value Creation Story

Sustainability

Governance

Data

Value Creation Story

Message from the President

We will strengthen our presence as a specialty
pharmaceutical company and pursue the creation ofvalue that meets patient needs
President & CEO

Transforming into a specialty
pharmaceutical company
In recent years, Japan’s declining birthrate, aging
population, and population decline have been rapidly
progressing, resulting in national measures being
carried out to address this urgent social issue. As formeasures involving the healthcare system, in April
2022 the Japanese government extended publichealth insurance coverage for infertility treatment toinclude artificial insemination, in vitro fertilization, andintracytoplasmic sperm injection, which had previously
not been covered. As a result, the number of newpatients starting infertility treatment is increasing, andthe ethical pharmaceutical market in the infertility
treatment field is expanding on the whole.
Meanwhile, there has been an increase inemployment opportunities for women and an increasein the hours and years they work, spurred by moves topromote women’s active participation in society.
Against this backdrop, health issues specific towomen, such as symptoms related to menstruationand menopause, have come to the fore as medical
needs. In other words, there is a growing trend toward
solving women’s health issues with the power of
medicine in order to realize a society in which womencan play a more active role and make their own life
choices independently.
Fuji Pharma started selling women’s healthcare
pharmaceuticals in 1974 and built the foundations
required to develop Fuji Pharma’s current businessstructure. In 1996, we began selling generic contrast
media and have developed into a cornerstone
manufacturer in the generic drug market. In the field of
women’s healthcare, we have provided hormone
drugs and other generic drugs, and in 2008 welaunched LUNABELL® tablets for the treatment ofdysmenorrhea. Since then, by continuously introducing
own brand-name drugs, we have been working totransform ourselves into a specialty pharmaceutical
11

Takayuki Iwai

company focused on women’s healthcare. We havemade considerable progress on this front, launching
UTROGESTAN® vaginal capsules for infertility
treatment in 2016 as our first in-house developed new
drug, and releasing F-meno® capsules as our second
in-house developed new drug for menopause in 2021.
Going forward, in order to further strengthen ourpresence as a specialty pharmaceutical company, we
intend to respond to patient needs by pursuing thecreation of value that can only be offered by Fuji
Pharma in women’s healthcare. We will continue toexpand our value provision worldwide and contributeto the well-being of even more women.

Sales and profit increased, and muchprogress was made in development efforts
In the Japanese ethical pharmaceutical industry, NHI
drug price revisions have been implemented every
year since April 2021 as a policy to control NHI drug
prices in order to tackle growing social welfare costs.
In 2023, repricing rules were applied to drugs deemed
to be unprofitable amid problems with the stablesupply of pharmaceuticals and a sharp rise in raw
material prices, resulting in a drug price increase of
3.6% for Fuji Pharma products.
Looking back at operating conditions in the fiscal
year ended September 30, 2023, F-meno® capsules,
launched as a new in-house drug developed in theprevious fiscal year, has been steadily adopted byuniversity hospitals, and sales volume of our existing
UTROGESTAN® vaginal capsules increased thanks tothe expansion of insurance coverage for infertility
treatment. In addition to these, the antineoplastic
agent DOXIL® injection, launched in January 2023
under an exclusive domestic sales agreement
concluded with Baxter Limited, performed well, andsales for the contract manufacturing organization(CMO) business undertaken by OLIC, our subsidiary inThailand, also increased.
Fuji Pharma Corporate Report 2024

12

Introduction

Value Creation Story

Sustainability

Governance

Data

Value Creation Story
Message from the President

As a result of the above, in the fiscal year ended
September 30, 2023, consolidated net sales reacheda record high of 40,889 million yen (+15.4% year onyear), and operating profit increased to 3,858 million
yen (+2.1%). However, net sales and operating profit
missed our initial forecasts, due to sales shortfalls for
key products such as F-meno® capsules, PROPESS®
vaginal inserts, a product indicated for cervicalripening, launched in the previous fiscal year, and the
SULPREP®, an oral bowel-cleansing agent, launchedin October 2022 after acquiring it from Nihon
Pharmaceutical Co., Ltd. Meanwhile, due to therecording of gains on valuation of derivatives andforeign exchange gains under non-operating income,ordinary profit came to 4,519 million yen (+21.3% year
on year) and profit attributable to owners of parent
was 3,435 million yen (+27.4%), surpassing our initial
forecasts.
Turning to shareholder returns, we paid an annual
dividend of 37 yen per share (an increase of 2 yen year
on year), made up of an interim dividend of 17 yen per
share and a year-end dividend of 20 yen per share.
Over the past year, we have made a great deal ofprogress on the R&D front, which has enabled us tofirmly lay the foundations for future growth. In October
2023, we filed an application for the manufacturingand marketing approval of FSN-013, a dysmenorrhea
treatment drug, after completing Phase III clinical trials
within the fiscal year. Also, OLIC launched FSN-013 inThailand in April the same year as oral contraceptive
agent NextstellisTM. During the fiscal year, inbiosimilars, we received manufacturing and distribution
approval for our USTEKINUMAB BS Syringe for S.C.
Injection, a psoriasis treatment. In generics, we
received the same approval for LANDIOLOL, a shortacting 1 selective blocker, and LENALIDOMIDE
capsules, an antihematopoietic malignancy agent.

Achieving faster-than-expected growth inwomen’s healthcare
The Company formulated its Vision for 2030, which
illustrates “Where we want to be” by the end of the
fiscal year ending September 30, 2029. It outlines thefollowing targets: “Net sales of over 100 billion yen,”“Operating profit of over 20 billion yen,” “Contributing
to well-being of women in the world,” “Expanding ourbusiness to Global Market from Toyama,” and“Integrating the world’s happiest company and social
contribution.”
The current five-year Mid-Term Business Plan
(FY9/2020-9/2024) takes us up to the halfway point toachieving this Vision. We have envisioned growthscenarios Becoming No.1 in women’s healthcare;
Evolving into sustainable contrast media business;
13

Establish biosimilar business; and Strengthen overseas
business. Our strategies for these scenarios havebeen taking shape as we steadily carry out initiatives
one by one.
Four years have passed since the start of the Plan,
and although there has been delays with strengthening
our overseas business, we have generally been making
smooth progress with the other growth scenarios.
In particular, our efforts to become No. 1 inwomen’s healthcare are progressing at faster-thananticipated pace. As mentioned above, we havecomprehensively strengthened our product portfolio
for solving women’s health issues and expanded thescope of products to include women from young tomenopausal ages, by launching F-meno® capsules,
filing for approval of FSN-013, adding PROPESS®
vaginal inserts and DOXIL® injection to our productlineup, and launching supplement brand LAFILL. In
December 2023, we moved ahead with preparations
for full-scale operation following the completion of
construction of our sixth drug production building at
the Toyama Plant. This should approximately triple
annual hormone tablet production capacity, thereby
enabling us to meet the growing demand for women’s
healthcare products. Net sales in women’s healthcare
reached 18 billion yen in the fiscal year ended
September 30, 2023. As such, in the fiscal year ending
September 30, 2024, the final year of the Plan, we
expect to exceed our net sales target of 20 billion yen.
In the biosimilars business, by launching SULPREP®
for internal use, a product acquired from Nihon
Pharmaceutical Co., Ltd., and obtaining approval for the
manufacture and distribution of the USTEKINUMAB BS
Syringe for S.C. Injection in-licensed from Iceland-based
biosimilars manufacturer Alvotech, we are preparing for
full-scale deployment of the business during the next
Mid-Term Business Plan. Fuji Pharma reachedconditional agreements with Alvotech on the in-licensingof a total of seven products, and plans to submit
applications for approval of three of these products inthe fiscal year ending September 2024 to follow on fromUSTEKINUMAB BS Syringe for S.C. Injection. We
expect our efforts in the biosimilars business to lead tothe development of drugs in new disease areas, suchas the treatment of lower gastrointestinal tract disorders
and psoriasis. In addition, many biopharmaceuticals,
the predecessors of biosimilars, are expensive. Throughthe spread of biosimilars, we are aiming to not only
contribute to health economics, but also to increase thenumber of healthcare treatment options, thereby
supporting even more patients.
With the business environment for the contrast
media business becoming increasingly harsh due toannual NHI drug price revisions, we face the challengeof strengthening and evolving the sustainability of thebusiness in order to maintain a stable product supply.
We switched to European drug ingredient suppliers in
the fiscal year ended September 30, 2022. This has
enabled us to reduce costs and build an even morestable supply system. We will continue our efforts toimprove the capacity utilization of our production lines
and maintain production volumes by expanding ourcontract manufacturing operations.
In the overseas business, we are focusing on
expanding the CMO business of OLIC, our subsidiaryin Thailand, and expanding into other parts of Asia bytransforming OLIC into a pharmaceutical company that
manufactures and sells a full lineup of pharmaceuticalproducts. OLIC’s launch of FSN-013 as contraceptive
Nextstellis™ in Thailand has been progressing asplanned, and has been selling well. However, thesubsequent sublicensing of Nextstellis™ in other
ASEAN countries and expansion of our lineup of
women’s ethical drugs is taking time, causing delays
with expansion in the Asian region. We are currently
negotiating the terms for sublicensing Nextstellis™ inseveral countries. In addition, we are aiming to enter
the North American market as another area of focus in
the overseas business, and will accelerate efforts to
deploy operations in North America through OLIC’s
contract manufacturing for injections and products
manufactured at the Toyama Plant.

The results of these five years will drive
future growth
For the fiscal year ending September 30, 2024, thefinal year of the current Mid-Term Business Plan, we
expect further sales growth in women’s healthcare,particularly for F-meno® capsules and
UTROGESTAN® vaginal capsules, and also plan tolaunch the USTEKINUMAB BS Syringe for S.C.
Injection. In light of such factors, we forecast
consolidated net sales of 46,060 million yen (+12.6%
year on year), operating profit of 3,990 million yen(+3.4%), ordinary profit of 4,602 million yen (+1.8%),
and profit attributable to owners of the parent of
6,185 million yen (+80.1%). We anticipate both net
sales and profit to reach record highs.
Over the next year, we will further step up our efforts
in women’s healthcare, where we are achieving
sharper-than-expected growth. At the same time, wewill make sure our biosimilars business will become
established in the next Mid-Term Business Plan, andstrive to achieve the growth scenarios so that
expansion of the overseas business generates results.
In order to further evolve as a specialty pharmaceuticalcompany, we will establish a second core field tofollow on from women’s healthcare and carve out aposition that only Fuji Pharma can achieve.

Promoting the active participation and growthof human capital to enhance corporate value
In recent years, the importance of human capital inmanagement has been attracting renewed attention,
resulting in expectations toward the development of
human capital that contribute to the enhancement ofcorporate value and people-oriented growthstrategies. The phrase “Our corporate growth is
proportional to our personal growth,” one of Fuji
Pharma’s corporate philosophies, can be said torepresent a part of our approach to human capitalmanagement.
Fuji Pharma employees are kind to people, serious,and humble. In the current Mid-Term Business Plan,
we set the slogan of “Fuji-rashiku wo Atarashiku(Evolving Fuji)” in order to take these strengths one
step further.
Reaffirming our founding spirit and taking each andevery person seriously, we value not only being serious
and humble but also taking responsibility through asense of commitment.
As we aim for global growth as a specialty
pharmaceutical company, we need to take on many
new initiatives going forward. To do so, we will needhuman capital with more advanced expertise andskills. In developing such human capital, we aim to not
only expand education and training, but also create aworkplace in which employees are committed to
evolving further, and can grow together with thecompany by engaging in friendly rivalry with theircolleagues through their work while sharing the samephilosophies and sense of accomplishment.
Going forward, Fuji Pharma will focus on promoting
diversity and improving employee engagement toencourage our human capital to play a more activerole and grow even further, while also working together
with all of our stakeholders to realize a prosperous
future. We sincerely appreciate your continued support
in these endeavors.
Fuji Pharma Corporate Report 2024

14

Introduction

Value Creation Story

Sustainability

Governance

Data

Value Creation Story

Vision for 2030 and Mid-Term Business Plan
Vision for 2030

Progress of Mid-Term Business Plan (FY9/2020-9/2024)

Vision for 2030 is the roadmap that, through our management philosophy, explain “What we wantto achieve” and “Where we want to be” by the end of the fiscal year ending September 30, 2029.

Contributing to well-being of
women in the world

Expanding our business to Global
Market from Toyama

Integrating the world’s happiest
company and social contribution

Will further deepen the management
philosophy, “We help people leadhealthy lives by offering excellent
pharmaceuticals.” While still focusing
on pharmaceuticals, we plan to movebeyond the boundaries to proactively
contribute so that women across theworld, are physically, mentally andsocially fulfilled. And we are committed
to make this happen.

With our roots in Toyama, known as thecradle of medicines in Japan, we arecommitted to contributing to thehealthy lives of people across theworld, by researching and developing
better drugs, and leverage ourmanufacturing technology to supply
high quality pharmaceuticals.

“The world’s happiest company,” inwhich every employee of the Fuji
Pharma Group feels a sense offulfillment in their work, which leads tocontributions to the society, and theappreciation from the society leads to
the growth and joy of each employee,creating a virtuous circle that further
contributes to the society.

Mid-Term
Business Plan

The Mid-Term Business Plan is the concrete embodiment of its strategy for the first 5 years of
the Vision for 2030, “where we are in 10 Years from Now.”

Theme

Four growth scenarios

2. Establish Biosimilars businessBusiness Plan based on Vision for 2030
Positioning

Roadmap to achieve Vision for 2030

Executive Message

Director,
Executive Corporate Officer

Shuhei Morita

To Achieve

1. No.1 in women’s Healthcare

Goal

Women’s Healthcare

Execution throughstrategic andfunctional initiatives
Continuous monitoring
review semi annually

3. Evolving into sustainable
Contrast Media businessFuji Pharma is a specialty pharmaceutical company in women’s healthcare, and we aim tobecome No.1 in women’s healthcare within the current Mid-Term Business Plan.
Over the past four years, we have steadily implemented initiatives to become a leading
player in women’s healthcare by launching new products, acquiring products from othercompanies, and investing in the construction of new drug production buildings. When thecurrent Mid-Term Management Plan was initially formulated, we set an initial sales target of 20
billion yen for women’s healthcare for the fiscal year ending September 30, 2024. Thanks to
growing sales of our new F-meno® capsules, steady expansion of existing products, andacquisition of sales rights, we are now certain to achieve the planned target, with sales inwomen’s healthcare reaching 18 billion yen in the fiscal year ended September 30, 2023. As aresult, the share of women’s healthcare product in the Company’s total sales grew to 44% in
the fiscal year ended September 30, 2023, which is a significant achievement for our efforts
focused on women’s healthcare over the past four years.
In addition, the women’s healthcare market itself continues to expand, mainly due to theincreased social participation of women, heightened awareness of solving women’s healthissues throughout society leading to improved disease recognition and increased opportunities
to visit medical institutions, and theProgress against Sales Targets
increase in the number of patients receiving(Millions of yen)infertility treatment due to expansion of(Vision for 2030 target)
Net Sales in Women’s Healthcare
insurance coverage from April 2022.
35,000We are committed as a specialty
pharmaceutical company for women’s
20,80018,004
healthcare to help solve women’s health
13,683
10,836 12,138
issues and achieve greater well-being, sothat all women can feel fulfilled physically,
mentally, and socially.
2020/94. Strengthen Overseas business

2021/92022/92023/92024/9(plan)

2029/9Rolled over every year

Specific Initiatives

No.1 in Women’s Healthcare (Mid-Term Business Plan Growth Scenario 1)
Business scale when we achieve “Where we want to be”
Net sales (billions of yen)
Women’s Healthcare
Overseas business

Acute medical care (BS, contrast media, etc.)
OthersVision for 2030

Mid-Term Business Plan

15

34.0

35.4

2021/92022/940.92023/92024/9(plan)

2029/9New drugs
In November 2021, we launched our second in-housedeveloped new product, F-meno® capsules 100mg. This
product is the first progesterone drug in Japan with anindication for preventing the development of endometrial
hyperplasia when taking estrogen drugs for menopausal
disorders or ovarian deficiency symptoms. Naturalprogesterone is usually hard to absorb through oral
administration, but the product uses micronizedprogesterone to make it easily absorbable orally. Sales forthe fiscal year ended September 30, 2023 grew toapproximately 2.7 billion yen, and although it has been two
years since the launch, we expect to see further growth inprescriptions in the future. For the
fiscal year ending September 30,
2024, we expect sales of 3.3
billion yen, which will significantly
contribute to our growth in thearea of women’s healthcare.

Products Under Development (1)In October 2023, we filed an application for approval of
FSN-013 as a new dysmenorrhea treatment drug
containing a novel active ingredient, Estetrol (E4). This
product, introduced from Belgium’s Mithra
Pharmaceuticals, has already been approved andmarketed by Mithra and its partners in the US and Europe
for the indication of contraception and has been sold as
Nextstellis™ in Thailand by OLIC since April 2023.
Estetrol (E4) is a type of estrogen that has been shownto act selectively on estrogen receptors, and this selectivity
is expected to provide a variety of benefits, including lesseffect on the blood coagulation system compared toexisting drugs. We will steadily prepare for the launch of
FSN-013 in 2024 so that we can take advantage of thesefeatures to make it our next top product.

F-meno® capsules 100mg
Fuji Pharma Corporate Report 2024

16

Introduction

Value Creation Story

Sustainability

Governance

Data

Value Creation Story
Progress of Mid-Term Business Plan (FY9/2020-9/2024)

Products Under Development (2)We have obtained exclusive negotiation rights for thedevelopment and commercialization of the neuroactive
nasal spray PH80, being developed by the US company
Vistagen Therapeutics, in Japan as a new option for thetreatment of menopausal disorder.
PH80 is a formulation potentially applicable to moderate
to severe vasomotor symptoms (hot flushes) and otherindications during menopause. As a nasal spray, we
believe it has an excellent safety profile, requiring nosystemic exposure, and we expect that it will provide a
new treatment option that can improve the quality of life ofpatients.

Supplements
We launched our first medical supplement brand LAFILL,
and released the brand’s first product, LAFILL® Folic Acid +Kestose, in June 2023.
This product is targeted at women from the
preparation period for pregnancy to the lactation period,and contains folic acid and kestose, along with 17 typesof vitamins and minerals. Because the main ingredient,
folic acid, is a type of vitamin B that plays an importantrole in the proper development of the fetus, its intake
from the preparation period for pregnancy isrecommended by the Ministry of Health, Labour andWelfare. Kestose, a type of oligosaccharide that serves asa prebiotic, is a nutrient for beneficial bacteria such asbifidobacteria and lactic acid bacteria, and is attracting
attention for its effects on bowel habits.

By providing the value of this product through medical
institutions, we hope to not only support essential
nutritional supplementation during the important periods
before and after pregnancy, butalso contribute to building trustwith obstetricians andgynecologists who can provide
continuous consultations
throughout life.
We will continue to consider
the development of supplements
to offer a wide range of options
other than hormone formulations
that meet the needs of patients.

Around age 8-9

Dysmenorrhea

Executive Message

Executive Corporate Officer

Atsuya Mitsuhashi

LAFILL®

Around age 19

Around age 45

PubertyAcute Medical Care

Reproductive period

MenopauseAround age 55

Postmenopause

In acute medical care, we are working on biosimilars, contrast media, and generic drugs.
In particular, the share of biopharmaceuticals in domestic pharmaceutical sales has been
growing year by year, and national healthcare expenditure is also increasing. Although at least
15 years have passed since biosimilars were launched in Japan and replacement from original
products to biosimilars has progressed, only three components have a replacement rate
exceeding 80%. The reasons for the slow adoption include the existence of biosames, theso-called “skinny labeling” due to differences in indications, the existence of a High-cost
Medical Expense Benefit system and a patient cost reduction under the medical cost subsidy
system for designated intractable disease, and the issue of stable supply due to the large
number of products introduced from overseas.
Against this backdrop, in an aim to become the No. 1 biosimilar manufacturer in Japan by
the end of the fiscal year ending September 30, 2029, we have positioned biosimilars as thenext pillar of our business following the contrast media business that has supported our
growth and have been strengthening collaboration with Alvotech and acquiring manufacturing
and sales approvals in anticipation of future synergies.
Although easier access to biosimilars will help expand the range of treatment options
available to patients and cap the nation’s rising medical expenditure, biosimilars have strong
barriers to entry due to its high level of difficulty and cost of development. In 2012, Fuji Pharma
obtained manufacturing and sales approval of the biosimilar agent Filgrastim BS Injection
Syringe F, and we have been manufacturing and marketing this product for more than 10
years. The FY2024 revision of medical fees established premiums for constructing biosimilaruse systems and expanded the scope of premiums for initial biosimilar introduction to
encourage the adoption of biosimilars in Japan. By leveraging the development,
manufacturing, and sales experience we have cultivated up until now, we will take on thechallenge of contributing more than ever to not only the patients, but also the medical field andthe healthcare economy through the provision of higher value-added products.

LUNABELL® tablets LD/ULD
Application for approval filed

FSN-013

Favoir tablets®

Oral contraceptives

Labellefille® tablets

Specific Initiatives

Emergency contraception

LEVONORGESTREL tabletsEndometriosis

DIENOGEST tablets/DIENOGEST OD tablets

Establish Biosimilar Business (Mid-Term Business Plan Growth Scenario 2)
l’estrogel®

ESTRADIOL tablets

Menopausal disorder

F-meno® capsules
Luteal support in ART*UTROGESTAN® vaginal capsules
HMG injection

Ovulation induction

Folyrmon®-P injection
Clomid® tablets

GnRH Analogue

BUSERELIN nasal solution
PROPESS® vaginal inserts

Perinatal period

OXYTOCIN injection
LAFILL® medical supplements

Folic acid deficiency disease
Cancer in women

FOLIAMIN® tablets
LETROZOLE tablets
DOXIL® injection

USTEKINUMAB BS for S.C. Injection F approved for
manufacturing and sales
In September 2023, we obtained manufacturing and sales
approval for USTEKINUMAB BS 45mg Syringe for S.C.
Injection F for psoriasis vulgaris and psoriatic arthritis withinadequate response to existing treatments. The productmarks the first manufacturing and sales approval obtained
from the biosimilar pipeline conditionally agreed upon
between Fuji Pharma and Alvotech. We are steadily
preparing for launch in May 2024, and we aim to obtain
indications for Crohn’s disease and ulcerative colitis going
forward.
We have also established an internal system for thelaunch of this biosimilar, and we have assigned area
strategy managers nationwide to gather information on
biosimilar adoption in the medical field since June 2023. In

October 2023, we organized a new Psoriasis DedicatedGroup as one of the marketing departments at the Head
Office and assigned area marketing managers experienced
in the psoriasis field to each of the five branches
nationwide. Although psoriasis treatment is a new area of
medical specialty (dermatology) for Fuji Pharma, we plan toproceed with information provision in cooperation with area
marketing managers and MRs.
At the Toyama Plant, the expansion of a multi-syringe
line for high-potency active ingredients in the fifth drug
production building (injection production building) has been
completed, and we plan to strengthen the stable supply
system by importing biosimilar drug ingredients from
Alvotech and performing subsequent manufacturing
processes on this production line in the future.

*ART: Assisted Reproductive Technology

17

Fuji Pharma Corporate Report 2024

18

Introduction

Value Creation Story

Sustainability

Governance

Data

Value Creation Story
Progress of Mid-Term Business Plan (FY9/2020-9/2024)

Future Biosimilar Pipeline
As of March 2024, we have reached a conditional agreement with Alvotech for a total of seven products, with a total market
size of 450 billion yen in Japan. We plan to apply for approval of three new products during the fiscal year ending September
30, 2024 and we will continue to expand the biosimilar lineup to become the No. 1 biosimilar manufacturer in Japan by thefiscal year ending September 30, 2029 in order to quickly deliver high-quality biosimilars to patients in Japan. We will continue
to work to contribute more than ever to the medical field and medical economy.

Overseas Business
Executive Message

Mid-Term Business Plan period
2020
USTEKINUMAB

2021

2022

2023

2024

2025

2026

2027

Scheduled for drug price listing and market launch in May 2024

Product B

Scheduled for drug price listing and market launch during the fiscal year ending September 30, 2024

Product C

Scheduled for drug price listing and market launch during the fiscal year ending September 30, 2024

Product D

Scheduled for drug price listing and market launch during the fiscal year ending September 30, 2024

Product E

Corporate Officer
and Managing Director of OLIC
(Thailand) Limited

Product G
Product H* Time frame is the Company’s target period* Discontinuation of Product F development

Yoshihiro Takada

Evolving Into Sustainable Contrast Media BusinessIn the overseas business plans we made progress in the business for ASEAN and the US in
the fiscal year ended September 30, 2023.
In ASEAN, market expansion led to OLIC’s growth in CDMO business, which, combinedwith the effect of depreciation of Japanese Yen, resulted in a 21% increase year on year. In
pharmaceutical business of OLIC, the new drug Nextstellis™ was launched in Thailand as anoral contraceptive in April 2023, and achieved its sales far exceeding the original plan. This
product is currently under development in Japan under the code name of FSN-013 for thepatients with dysmenorrhea.
OLIC and Fuji Pharma are just beginning to make progress on
specific projects for the US market. OLIC successfully completed a pre-approval inspection
by the US FDA in March 2023. Fuji Pharma has been working with a US-based partnercompany to start developing new drugs of women’s healthcare. Although progress in overseas
business is slightly behind the current Mid-Term Business Plan, specific projects are moving
forward for both sides.
In ASEAN, we plan to position Nextstellis™ as the core of our product portfolio and further
increase the number of products to the markets. OLIC will grow by accelerating thepharmaceutical business plans and transforming into hybrid management company with
CDMO and pharmaceuticals.
For the US market, we aim to further materialize the projects currently underway.

(Mid-Term Business Plan Growth Scenario 3)
We became the first company in Japan to sell generic
iodine contrast media in 1996. Since then, in addition to
the stable supply of contrast media manufactured at the
Toyama Plant under high-quality standards andmanagement and advanced manufacturing technologies,
we have continued timely and appropriate information
provision and collection in pharmaceutical sales, and thishas earned us the trust of the medical community andremains one of our core businesses.
In the face of a generally severe business environment
due to annual drug price revisions, to develop asustainable contrast media business and ensure thecontinuation of a stable supply, we have introduced adual-base system that provides syringe formulations fromthe Toyama Plant in Japan and vial formulations from OLIC
overseas, and recently implemented cost reduction
measures by switching to or adding new suppliers of drug
ingredients and raw materials.
In addition, our long experience and know-how inmanufacturing have been recognized internationally, which
has led to receiving manufacturing contracts from overseas
companies.
Through these various cost reduction measures andstrategies to maintain and increase sales, we aim to makethe contrast media business sustainable and further
enhance our presence in contrast media-based
diagnostics and treatments in Japan.

Generic drugs
We launched two components and four products,“LEONALIDOMIDE Capsules 2.5mg/5mg F”, as genericdrugs in January 2024, and “LANDIOLOLHYDROCHLORIDE intravenous for drip use
50mg/150mg F” in February 2024.
“LEONALIDOMIDE Capsules” is a drug with indications
including multiple myeloma. As this drug may cause fetal
damage, we will handle this drug under strict distribution
management to contribute to patient treatment.
“LANDIOLOL HYDROCHLORIDE intravenous for dripuse” is an injection indicated for the treatment oftachyarrhythmia such as atrial fibrillation and atrial flutter inpatients with reduced cardiac function.
In addition to new drugs, we will continue to develop
and manufacture generic drugs that meet the needs ofpatients.

Strengthen Overseas Business (Mid-Term Business Plan: Growth Scenario 4)
Start of sales of Nextstellis™
Nextstellis™ is a product name in Thailand for a medicine
containing Estetrol (E4) in-licensed from Mithra
Pharmaceuticals. While it has been one year since the startof sales in Thailand, sales have been growing steadily, and
it is being used in many medical institutions.
In addition, we have been actively holding lectures andsymposiums on Nextstellis™ at major obstetrics andgynecology-related academic conferences in Thailand, andthe recognition of Nextstellis™ in Thailand is growing
further.
We will steadily prepare for its launch in multiple ASEAN
countries outside of Thailand.

Export to the United States
To enable us to provide products not only within Japan,
but also to export products to the United States, we arecontinuing to build internal structures that comply with
global Good Manufacturing Practice (GMP) standards. As
part of the current Mid-Term Business Plan, we areinvesting capital to build production lines for globallycompetitive injectable drugs, including the aforementioned
multi-syringe line and an ampule/vial line that meets theinternational PIC/S Guide to good manufacturing practice.
In addition, we aim to become an even more reliable
pharmaceutical manufacturing company by bringing our
Toyama Plant and OLIC up to world-class technicalstandards and working environment, and fostering aquality-focused culture.

In 2023, OLIC was selected for the first time for the “Thailand Labour Management Excellence Award 2023,”
awarded by the Ministry of Labor, Department of Labor Protection and Welfare of Thailand, for its excellent labor
management system. We are determined to strengthen our efforts to deliver high-quality products to patientsaround the world through the combined efforts of OLIC and Fuji Pharma.

LEONALIDOMIDE

19

Specific Initiatives

LANDIOLOL
Fuji Pharma Corporate Report 2024

20

Introduction

Value Creation Story

Sustainability

Governance

Data

Value Creation Story

Financial Report
Financial Report

An Appropriate Balance with Our Growth Strategy

Strengthening Human Resource Initiatives
ROE/ROA (%)
ROE

ROA

8.9

7.9

8.0

Fuji Pharma has set the financial targets of ROE 8.0% and ROA 6.0% as
6.0
5.6
5.3
indicators of financial efficiency in the Mid-Term Business Plan. ROE for the
fiscal year ended September 30, 2023 was 8.9% (up 1.0 points YoY), and2022/92023/92024/9
ROA was 5.6% (up 0.3 points YoY). Total assets increased due to an(actual)(actual)(target)increase in inventories, an increase in invested capital in the Toyama Plant,
and an increase in the market value of investment securities. In terms ofliabilities, while we issued corporate bonds and borrowings have increased, the increase in profits and the valuation difference
in securities have increased the equity ratio to 48.3% (up 0.9 points YoY), and there has been no significant change infinancial stability.

Strategic Investments for Growth

Implementing Strategic Investments to Achieve the
Mid-Term Business Plan

Toward Increased Dividends for the Third Consecutive
Fiscal Year

Amount of capital investments

Intangible asset investments (licenses/acquisition)

14.1(total)10.9(accumulated total)

Dividend per share (JPY)/Dividend payout ratio (%)
2nd quarter-end

33.5%

Year-end

Dividend payout ratio(on an after-tax operating profit basis)

32.4%

33.6%

20

20

37.3%
22.5

15
Our corporate philosophy says “We help people lead healthy lives by
20
17
15
14
offering excellent pharmaceuticals” and “Our corporate growth is
proportional to our personal growth.” We aspire to deliver contribution and
2021/92022/92023/92024/9(actual)(actual)(actual)(forecast)
growth to the shareholders who support us.
Contribution and growth for shareholders can be translated as
improvement in total shareholder return, in other words, an increase in the share price and returns to shareholders. The total
shareholder return was approximately 116% for the fiscal year ended September 30, 2023. Our share price was weak,marking JPY 1,166 at the end of the fiscal year ended September 30, 2023 compared to JPY 1,034 at the end of theprevious fiscal year. We will take the market evaluation seriously and work to improve our share price by steadily progressing
toward achievement of the Mid-Term Business Plan while communicating with our shareholders. As for shareholder returns,
considering a dividend payout ratio of 30%, we determined a dividend of JPY 37 for the fiscal year ended September 30,
2023 (compared to JPY 35 for the previous fiscal year), an increase for the third consecutive fiscal year. For the fiscal year
ending September 30, 2024, we are planning an annual dividend of JPY 42.50.
Fuji Pharma considers it essential to maintain and further enhance shareholder returns. Profit allocation is decided basedon the profit of the current term, but also comprehensively taking into future business outlook and internal reserves for futurebusiness development, among other things. While continuing to invest to provide values unique to Fuji Pharma, we will aim atachieving 30% payout ratio to maintain a stable dividend level.
In addition to dividends, we will consider purchasing treasury shares as another shareholder return option, in light of ourbusiness performance and financial status. However, we intend to allocate funds for strategic investments necessary to
execute our growth strategy, for the time being.

21

Executive Message

Investments (billions of yen)

4.0
3.4
3.3
We have established an investment framework of JPY 32.0 billion over the(total)(total)(total)five-year period to achieve the Mid-Term Business Plan. Of this,2024/92020/92021/92022/92023/9approximately 60% is used to fund the acquisition of products and(planned)(actual)(actual)(actual)(actual)businesses, and approximately 40% for capital investments. The amount of
capital investments for the fiscal year ended September 30, 2023 wasapproximately JPY 3.7 billion as we have made a progress in capital investments in the Toyama Plant, including a new
injection drug manufacturing facility being constructed in the fifth drug production building. The amount of investments madeover the past four fiscal years has added up to approximately JPY 24.8 billion, which were invested mainly for the following
three purposes: to acquire the manufacture and marketing rights of women’s healthcare pharmaceuticals, biosimilars andother pharmaceuticals; projects to improve the manufacturing capability with technical features; and to invest in digitaltransformation in the Toyama area.
We will continue to make investments for the purposes such as further strengthening of women’s healthcare, and further
improvement of manufacturing capability and productivity.

Shareholder Return Policy

Valuing Growth as a Person

Corporate Officer and General
Manager of Corporate Business
Management Department

Hiroshi Uji

Since our founding, we have valued the idea that “each employee grows through his or her
contribution to society, and through that growth makes an even greater contribution tosociety,” based on our corporate philosophy of contribution and growth. To put this corporate
philosophy into practice, management has continuously provided “opportunities for each
employee to grow” and “to think for themselves and contribute to society,” and sought
employees who continue to think and take on challenges themselves.
Employee growth is not only about the acquisition of skills but also about personal growth.
We hope that our employees will enhance their individual personal appeal by practicing the“virtues” that we have incorporated into our human resources systems, and that this will also
lead to improved corporate value. In order to pursue the “virtues” of “doing our best for thesake of others,” and to value a corporate culture that does not give up on difficult challenges,
opens itself up to challenges, and continues to take on new challenges, we believe it isnecessary for colleagues to be able to say anything to each other. In order to build such a
relationship, mutual trust is essential and to enhance the trust among employees, we haveintroduced a service called Unipos, which enables visualization of appreciation, praise, andhidden contributions to the company and helps to improve organizational engagement.
In order to further support individual growth, we are enhancing various in-house training
systems and working to ensure that employees recognize each other as colleagues throughwork, that everyone actively takes on new challenges, and that they share a more fulfillingsense of accomplishment.

1 Human Capital Management
Our employees have continued to strive for self-growth by taking on various challenges as a practical application of“corporate growth is proportional to our personal growth,” which has been our corporate philosophy since our founding,through the opportunities for growth provided by management since our foundation. This is the foundation of our humancapital management, and we believe that the growth of each employee and the improvement of corporate value are linked asa result.
In order for each and every employee to embody further contribution and growth, we have conducted employee
engagement surveys on the following items
Items
FY2023from the fiscal year ended September 30,
I feel that the organizational culture is changing
27. 4%
2023 to gain an understanding on the
I would recommend working in my current workplace to close friends or acquaintances 27. 8%thoughts of employees, confirm the current
I am proud to work at my company
49. 3%
situation, and use the results to improve
Turnoverrate(excluding
mandatory
retirement)
3. 0%
engagement in the future.

2 Multiple Training Frameworks to Promote Employee Growth
Fueled by our corporate philosophy of contribution and growth, we task senior management and managers with the vital jobof creating opportunities and venues for employees to play an active role in the company. We have created various training
programs for all employees from new hires through to corporate executives to help support employee growth.

Main Training Opportunities
Developing Next-generation Leaders
As part of the succession planning incorporated into the current Mid-Term Business Plan, we have introduced various
training programs to help nurture future candidates for management and executive positions. These initiatives include nextgeneration management training directed primarily at relatively young employees, as well as next-generation senior
management training directed primarily at the company’s current managers and team leaders and participated by future
management candidates.
Fuji Pharma Corporate Report 2024

22

Introduction

Value Creation Story

Sustainability

Governance

Data

Value Creation Story
Strengthening Human Resource Initiatives

Manager Training Opportunities
We regularly survey our managers and devise management training programs based on the survey results. We have provided
different selective training sessions based on individual requests, including unconscious bias training sessions designed tohelp people recognize incidents of unconscious bias and deepen their self-awareness in order to reduce preconceptions,
groundless assumptions, and obtrusion and facilitate smooth communication, as well as training sessions designed toencourage greater critical thinking.

Next Generation Management Training: Quest Education

Feedback from a training participant
Corporate Planning Department, Corporate Strategy Division

The Research and Development Center conducted a pregnancy experience in order to create acomfortable work environment for pregnant women. With the cooperation of the Toyama Midwives
Association, male employees wore pregnancy experience jackets and experienced various movements,
which led to a big improvement in awareness and a lively exchange of ideas on how to improve building
facilities. We hope to create a better working environment through these and other initiatives.

Pregnancy experience

Subsidies for Low-dose estrogen-progestin (LEP/LOC) and Menopausal Treatment Drugs

In the fiscal year ended September 30, 2023, as part of our next-generation management training, we participatedin the Quest Education corporate access program provided by Educa & Quest Inc. The aim is to acquire thequalities, character, knowledge, and abilities expected of managers through a career education program wheretraining members visit schools and learn together with junior and senior high school students.

Ryota Kishimoto

I participated as a company employee in a program in which students wereasked to identify problems and come up with solutions on their own to themissions presented by the company. I experienced joy and fulfillment when mycomment prompted a student to realize something, and frustration and regret
when I couldn’t contribute well to helping students with their problems andconcerns, which were experiences that could not be gained from classroombased training. I will apply this experience and the insights gained to my work.

Pregnancy Experience at Research and Development Center

We provide subsidies for low-dose estorogen-progestin (LEP/LOC) and menopausal treatment drugs for all female
employees in Fuji Pharma. Up to 3,000 yen (including tax) is provided per month.

4 Engagement Improvement Initiatives
F-Tube, an internal newsletter video

School visit

We began distributing F-Tube, an internal newsletter video, in 2021 with the aim of helping employees to get to know eachother and fostering a sense of unity within the company. We have produced over 50 videos up until now, featuring employee
introductions from each department and covering internal and external events related to the company. We will continue to
use videos to promote internal engagement efforts to create a workplace environment where employees respect andrecognize each other.

Establishment of the Well-being & Engagement Team
3 Promoting the Advancement of Women
We have set a goal to increase the percentage of female employees in management positions to 30% or more by March 31,
2024 by working to create a workplace environment where all employees can thrive and enhancing the work-life balance.

The Fuji Well-being Project, which was launched to create a better working environment for female employees, hasbeen dissolved and evolved to become a new Well-being & Engagement Improvement Team.
It is necessary to more effectively promote the numerous measures gathered from the Fuji Well-being Project,and so we will promote initiatives aimed at not only improving work environment for female employees, but also
improving the work comfort and job satisfaction of all employees.

Special Paid Leave System for Infertility Treatment(update: used by seven female and one male employees in fiscal year ended September 30, 2023)
We want colleagues who want children to be equally blessed with the joy of raising children. That is why we introduced a
special paid leave system for employees undergoing fertility treatment. We are striving to improve in-house well-being as acompany that supports the birth of life and women’s healthcare.

Promotion of Male Childcare Leave
We have established an action plan to enable all employees to fully demonstrate their abilities by creating a comfortableworking environment where employees can achieve a balance between work and childcare. As part of this plan, we have set
a target to increase the childcare leave acquisition rate to 30% or more by March 31, 2024, and the acquisition rate
exceeded 50% as of September 30, 2023.

Female Employee Training
We conducted health-related training for female employees in clerical positions working
at the Toyama Plant, and in-house lectures by obstetricians and gynecologists were
held for all female employees to improve their health literacy from the perspective ofworking women. In addition, female employees volunteered to be interviewed about
their experiences during obstetrics and gynecology examinations, and by sharing thecontents of these interviews, the understanding of women’s health issues in-house wasdeepened, providing an opportunity for employees to learn from each other about
solutions for proactive work engagement.
23

5 Revision of the Personnel Evaluation System
In order to achieve our corporate philosophy of contribution and growth, we have revised the personnel evaluation system
to better reward employees for their hard work. We simplified the previously complex system and changed the salarystructure to emphasize individual roles and contributions. In addition, by indicating the expected roles and key
responsibilities for each position, the system is designed to clarify the role of management positions and make employees
more eager to become managers.

6 Health & Productivity Management Initiatives
Certified as “2024 Health & Productivity Management Outstanding Organization”
We are committed to health and productivity management because we believe that creating aworkplace environment in which every employee is physically and mentally fit and can work
energetically is essential to realizing our corporate philosophy. In October 2020, we set up the Health& Productivity Management Promotion Committee, and, since 2022, we have been certified as a
Health & Productivity Management Outstanding Organization (Large Enterprise Category) by the
Ministry of Economy, Trade and Industry in recognition of our good health and productivity
management practices. We have been certified for three consecutive years up to now.

Cafeteria of Toyama Plant
Fuji Pharma Corporate Report 2024

24

Introduction

Value Creation Story

Sustainability

Governance

Data

Value Creation Story

Fuji Pharma’s Value Chain

We help people lead healthy lives by offering
excellent pharmaceuticals.
To meet the needs of as many patients and medical professionals as possible, Fuji Pharma has established a seamlesssystem that extends from subject selection and research and development to sales. Aspiring to provide significant value in thefield of medical care, we will help people lead healthy lives by offering excellent pharmaceuticals.

Subject Selection

Research & Development

Production

Sales

We are building a product portfolio strategy thatmaximizes our business activities. We make andmanage timely and appropriate decisions from theselection of what to develop in-house and what
products to in-license from domestic and overseas
companies to the lifecycle of our products.

Toyama Research & Development Center and Head
Office in Tokyo are our major bases for research anddevelopment of pharmaceutical products. In pursuitof pharmaceuticals that are required in the medical
field, we produce high-quality and high value-added
pharmaceuticals.

Our pharmaceutical products are mainly
manufactured at two sites: Toyama Plant and OLIC.
We provide a stable supply of high-quality
pharmaceuticals leveraging our advanced production
capabilities for manufacturing pharmaceuticals thatare difficult to handle.

Through information provision activities by medical
representatives (MRs), we deliver ourpharmaceuticals to medical facilities nationwide. We
conduct high-quality and efficient information
provision by concentrating our sales resources.

Challenges

Challenges

Challenges

Challenges

Strengthening of product portfolio that leads to greater
contribution
Product management to maximize the value of eachproduct

Steady progress in research and development of a wide
range of new drugs, biosimilars, and generic drugs
Drug research to meet the needs of patients and medical
professionals

Initiatives

Initiatives

Improvement of manufacturing capability that meetspatients’ needs
Fostering of a quality-focused culture trusted by all
people involved in Fuji Pharma
Establishment of a worldwide GMP compliance structure
to export products for the United States and Europe

Product portfolio established through diverse
approaches, including in-house development, acquisition
from other companies, and sales transfer
Organizational structure that enables us to perform
across department product management and further
optimize the product portfolio
Management of product life cycles throughout the supplyof pharmaceuticals

Research and development in close cooperation withdomestic and overseas partners for all products underdevelopment
Understanding of diverse needs to improve dosage
forms and develop new formulation technologies

Subject Selection

Initiatives
Implementation of capital investments, including forsixth drug production building (for manufacturing highly
active solid formulation products) and multi-syringe
production line
Promotion of digital transformation projects such assystemization and automation to ensure data integrity

Improvement of MRs’ level of knowledge on products
and diseases
Development of strategies to optimize product value

Initiatives
Establishment of the internal “Menopause Expert”
system to increase the overall level of knowledge
Setup of dedicated teams for each field to improve thequality of information provision
Establishment of Medical Affairs Department (MADepartment) to formulate and execute strategies tooptimize the value of our pharmaceuticals, and tostrengthen our information provision system
Information provision utilizing digital promotion services
provided by M3, Inc.

Production

Research & Development

Sales

Reliability Assurance

Reliability Assurance
We monitor the quality, safety, and efficacy of thepharmaceuticals we supply to the market so thatpatients and medical professionals can use ourpharmaceuticals with more confidence.

25

Challenges
Streamlining of work collaboration and visualization of work progress management
Various measures related to amendments to the Act on Securing Quality, Efficacy
and Safety of Products Including Pharmaceutical and Medical Devices

Initiatives
Increased outsourcing and introduction of new systems
Adaptation to the online shift for the submission of notifications and approval
applications
Enhancement of in-house training
Fuji Pharma Corporate Report 2024

26

Introduction

Value Creation Story

Sustainability

Governance

Data

Value Creation Story

People and Things Supporting Research, Development and Production
Research & Development

Production

Facilities that support the
future of manufacturing

Expanding the scope of
research & development totake on challenge ofdeveloping drugs that meetvarious needs

Construction of a manufacturing base inJapan to provide a stable supply ofbiopharmaceuticals and anti-cancer agents

Employees that tackle and overcome drug
development challenges

In April 2021, we started operation of a production line for ampule/vial
injections capable of handling highly potent injections at the parenteral
injection plant (the fifth drug production building) in the Toyama Plant. We
have also expanded and started full-scale operation of a multi-syringe
production line. On this line, we plan to manufacture biosimilars and otherdrugs to be developed and marketed by Fuji Pharma. It will also produce
highly potent pre-filled syringe formulations that have extremely strong
effects on the human body at small doses, such as biopharmaceuticals andanti-cancer agents.

Fuji Pharma has been conducting research aimed at improving efficacy andsafety over many years. Having made its start in the field of generic drugs, Fuji
Pharma further deepened and expanded the scope of its research into new drugs
and biosimilars by collaborating with domestic and overseas partners, and hastaken on the challenge of developing drugs that meet the needs of patients andmedical professionals.

Toyama Plant

Research and Development Center

Development of products that are easy for medical professionals
and patients to use
Fuji Pharma collects development information on new modalities andrepurposing drugs in Japan and overseas for women’s healthcare and acutemedical care. In addition, MRs provide information to medical professionals
on a daily basis, and research and development departments conduct
questionnaires and interviews with medical professionals. Through these
efforts, we identify needs as well as issues with the current treatment drugs,
leading to the development of new treatment drugs, as well as of biosimilars
and generic drugs that contribute to reducing the burden of patients andmedical costs. We are working to develop various products. Examples
include the development of new drugs (UTROGESTAN® vaginal capsulesand F-meno® capsules) to provide new treatment options where there areexisting but unsatisfactory treatments and despite being generic, drugs(DEXART® Injection, IOPAMIDOL 300/150, etc.) that solve issues faced bypatients and medical professionals. We will continue to take on thechallenge of developing products that provide new value for medical
professionals and patients.

Fulfillment of being an employee engaged in research & development
In research and development, I believe it is important to accumulate each and every piece of dataand evidence. When a problem arises, even if it seems difficult to overcome at first glance, it may
be possible to do so by accumulating data, exploring it, and considering solutions while
consulting with stakeholders.
In fact, we encountered difficult obstacles during the development of a generic parenteral
injection. In order to provide products that are easier for medical professionals to use, we weredeveloping a new dosage form different to that of the original drug. However, due to thecharacteristics of the drug, we needed to attach a graduated label sticker with an accuracy errorof 1mm or less to enable the dosage to be adjusted in units of 0.1 mL. At first, there was concern
over whether this was really feasible, it felt like an insuperable obstacle. Even so, we continued
our relentless efforts, and were able to achieve this with the cooperation of many people both
inside and outside the company.
Of course, there are also times when our efforts prove unsuccessful. However, I believe that it
is important to look back and reflect on what went wrong and use what you have learned totackle the next challenge.
Even through such trial and error, I find it rewarding to be able to accumulate data andevidence, examine it, and cooperate with the people around me to provide even better value.
27

Domestic manufacturing site aimed at providing a stable supplyof biosimilars
Biosimilars are generic versions of biopharmaceuticals
developed by other pharmaceutical companies after thepatent for the preceding biopharmaceutical expires.
Biopharmaceuticals are made using biosynthetic
processes by living organisms, and have a complex
structure with an extremely large molecular weight, such as
hormones and antibodies. Biosimilars are comparable interms of quality, safety, and efficacy to thesebiopharmaceuticals yet have the potential to reduce
healthcare costs in Japan and lowering the economic costburden of patients, as they are cheaper than the originals.
However, the high cost of developing biosimilars is said
to work as a barrier to entry. It is also difficult to secure
manufacturing facilities and technologies that can copewith the complex structure of biopharmaceuticals. As
such, very few biosimilars are currently being produced inJapan. Due to dependence on imports from overseas
manufacturers, there appear to be issues with maintaining
a stable supply due to import delays and other factors.

In order to ensure a stable supply of biosimilars in Japan,
we have been focusing our efforts on the launch of amulti-syringe production line. We have already started
operation of the line, and are making preparations to start
production of biosimilars in 2025 onward. Over the
medium term, we also plan to utilize the advanced
formulation technologies cultivated over the years and theunique characteristics of the multi-syringe production line
at the Toyama Plant. In doing so, in addition to
manufacturing our own biosimilars, we aim to provide
contract manufacturing services for other companies’
products and preceding biopharmaceuticals, andmanufacture biopharmaceutical as well.
We will strive to manufacture pharmaceuticals in a safe
and stable manner, with a focus on drugs of high quality andefficacy that can be used safely and securely by medical
professionals. Through such efforts, we will continue toaccelerate our transition to a specialty pharmaceuticalcompany, thereby contributing further value.

Challenges in biosimilar manufacturing
Responses from companies engaged in biosimilar operations and development that are members of the Japan
Generic Medicines Association and the Japan Biosimilar Association(N=20)The domestic industry as a whole isunderdeveloped, and as such relies onoverseas technology for mostmanufacturing and research

75

Investment and running costs aresubstantial, resulting in poor profitability

65

Manpower and know-how for
manufacturing is insufficient across Japan

60

Domestic CMOs/CDMOs etc.
are underdeveloped

60

Insufficient regulations
in place

Research Department, Research &Development Division

Hiromasa Tomida

25
0

10

20

30

40

50

60

70

80(%)

Source: “Research on Improving the Research and Development Environment Aimed at Creating Innovative Biopharmaceuticals, etc.,”
2018 Health, Labour and Welfare Policy Research Project (lead researcher: Hiroyuki Sakamaki); Cooperative research report “A Survey
on the Initiatives of Companies Involved in Biosimilars and the Attitudes of Medical Professionals” (Ministry of Health, Labour andWelfare Grants System)

Multi-syringe line for producing highly potent drugs

Fuji Pharma Corporate Report 2024

28

Introduction

Value Creation Story

Sustainability

Governance

Data

Value Creation StoryFor Stable Supply of High-Quality Pharmaceuticals
Three Lines of Defense for Risk Management

Quality Policy
We establish the quality policy and provides high-quality drugs that can be used safely and meet the expectations of patients,
healthcare professionals, and stakeholders through the implementation of Fuji Pharma’s Corporate Philosophy: “We help people
lead healthy lives by offering excellent pharmaceuticals.” and “Our corporate growth is proportional to our personal growth.”1

We are always aware of the high ethical standards based on the Corporate Philosophy andWe thoroughly comply
thoroughly comply with not only the laws and regulations of each country applicable to our productswith laws and regulations. but also the contracts concluded with all parties concerned.

2

We ensure high quality
and reliability.

3

Based on the technologies for sterile products, clean hormone preparations and hazard products,
We pursue the latest
we pursue the latest manufacturing technology that becomes a model of sophisticated GMP further
manufacturing technology. changing over time.

4

We focus on improving
the quality of drugs.

We sincerely face opinions, proposals, and requests of patients, healthcare professionals, andstakeholders and focus on improving the quality of drugs so that people can always use them safely.

5

We develop humanresources.

We are always aware of high ethical standards based on the Corporate Philosophy and develop
global human resources whose mission is to contribute to the healthy life of people around theworld.

At all manufacturing sites associated with our products, we ensure high quality and reliability by
establishing the robust quality assurance system based on the Management Standards according
to risks.

Reliability Assurance System
Fuji Pharma has established a reliability assurance system to supply pharmaceutical products that patients and medical
professionals can use safely and reliably.
Ensuring the quality, efficacy, and safety of pharmaceuticals is an extremely important responsibility for pharmaceuticalcompanies. We are committed to further ensuring the quality, efficacy, and safety of our products by strengthening ourgovernance system through legal compliance, as well as strengthening collaboration among components of the
manufacturing and sales structure including the 3 Officers as Marketing Authorization Holder and the three lines of defense
for risk management, so that medical professionals and patients can use our products without any concerns.

We have three lines of defense in place for risk management. The first line is comprised of frontline departments, which
consist of the Pharmaceutical Tablets Production Department and Injection Production Department responsible for
manufacturing and the Quality Control Department responsible for quality tests and other matters. The second line iscomprised of back-office departments, including the GMP Compliance Administration Department and Regulatory
Compliance Department responsible for management and supervision of frontline departments and the Corporate Business
Management Department responsible for management and supervision of legal compliance. The Internal Auditing Group
responsible for auditing the overall company serves as the third line. With the triple check system in place and functioning, we
strive not to overlook any human errors.
Internal Audit Group: Audits the management, supervision, and checking functions of the overall company
Auditing

Manufacturing and SalesFirst Line
(Frontline
Departments)
GQP/GVP(Responsible for overall quality control, as well as overall safety control after manufacturing and sales)

Quality Assurance Manager(Primarily responsible for quality control operations)Manages delivery to the market
Makes arrangements with manufacturers, etc.
Ensures appropriate manufacturing management andquality control (auditing of manufacturing sites)
Deals with quality defects, etc. and information related toquality and other relevant topics

Instructs the quality control manager, etc. to takeaction as decided
If necessary, states opinions to manufacturers anddistributors
Instruction

Mutualcooperation

Auditing
ReportStatementof opinions

First Line (Frontline Departments)
Manufacturing: Injection Production
Department and Pharmaceutical Tablets
Production Department
Testing: Quality Control Department
Take ownership of risks and comply withlaws and regulations and work procedures
Offers necessary education and training

Second Line (Back-Office Departments)
Supervision

GMP Compliance Administration
Department
 onitors, manages, and supervises
M
frontline departments’ activities
Offers necessary educational andtraining opportunities

Direction andsupervision
Respect for
opinions
ActionResponsible
Officers

ReportStatement of
opinions

Specific Initiatives
To provide safe and secure pharmaceuticals

General Marketing Authorization Officer

Instruction

Second Line (Back-Office Departments)
Regulatory Compliance Department: Manages and supervises
Corporate Business Management Department: Manages andsupervises company-wide legal compliance

Manufacturing Sites

The 3 Officers as Marketing Authorization Holder denotes the Chief Pharmaceutical Officer, Quality Assurance Manager, andSafety Control Manager who are required to be appointed by law*. The Quality Assurance Manager engages in management
and supervision to ensure legal compliance in the manufacturing of marketed pharmaceuticals. The Safety Control Manager
collects information on safety control, including the occurrence of unexpected adverse drug reactions, after pharmaceuticals
are sold. The Chief Pharmaceutical Officer supervises the overall structure.

Report on proposed action

Supervision

Audit &
Supervisory
Board Members

Supervision

3 Officers as Marketing Authorization Holder

Supervises the Quality Assurance Manager and Safety Control Manager
Decides what action to be taken based on reports from the Quality
Assurance Manager and Safety Control Manager

ReportThird Line (Internal Audit Department)

Report on proposed action

Safety Control Manager(Responsible for safety control operations after
manufacturing and sales)
Collects and reviews information on safety control
Formulates and implements measures to ensure safety
Carries out education, training, and self-inspection
Keeps records of operations and stores the records

Establishment of a high-level quality assurance system

Corporate Officer
General Managerof the Regulatory
ComplianceDepartment

Kazuhisa
Sakurai

We have established a high-level quality assurance system to ensure the stable delivery ofpharmaceuticals with high quality, efficacy, and safety to patients and medical professionals.
Specifically, in order to continuously ensure that there are no discrepancies between the approved
details and the actual manufacturing conditions, we systematically conduct consistency checks andcarry out the necessary responses to ensure legal compliance when any changes are made. We
also conduct thorough manufacturing site management and quality control at associated domestic
and overseas plants, including the Toyama Plant, and directly inspect the manufacturing facilities asnecessary to ensure the quality of our products. Last year, we conducted on-site inspections of 45
manufacturing sites. We will continue to strengthen these efforts not only at Fuji Pharma, but also incooperation with associate manufacturing facilities.

Timely and appropriate information management
We collect safety information and quality-related reports in a timely and appropriate manner so thatpatients and medical professionals can use our pharmaceuticals properly and safely. The safety
information and quality-related reports are centrally managed in-house and evaluated and examinedby the Safety Management and Quality Control Groups with regards to collected safety information,
we revise package inserts as necessary and communicate this to medical professionals as
information on proper use. As for collected quality-related reports, we investigate the cause of thereported problems and take measures to enable the implementation of higher-level quality control
and manufacturing management.
Going forward, we will continue our efforts to deliver high-quality, safe and secure pharmaceuticals
by practicing our corporate philosophy of “We help people lead healthy lives by offering excellent
pharmaceuticals.” To this end, we will work to ensure that each and every employee fully
understands their mission and responsibilities, thereby enabling the entire company to work as one
to provide safe and secure products in a stable manner.

*Act Partially Amending the Act on Securing Quality, Efficacy and Safety of Products Including Pharmaceuticals and Medical Devices (Act No. 63 of 2019)29

Fuji Pharma Corporate Report 2024

30

Introduction

Value Creation Story

Sustainability

Governance

Data

Sustainability

Sustainability Management

Materiality

Fuji Pharma aims to achieve its goal, “Integrating the world’s happiest company with social contribution” by implementing
company-wide sustainability activities.

Identifying Materiality

Basic Perspective on Sustainability Activities
Fuji Pharma has the corporate philosophy: “We help people lead healthy lives by offering excellent pharmaceuticals.” and “Ourcorporate growth is proportional to our personal growth.” We believe that the core of our sustainability activities lies in serving
society by practicing our corporate philosophy and, in doing so, attaining continued growth.
We are committed to fulfilling our social responsibilities and helping solve social issues, including the improvement ofpeople’s lives through our business activities while considering protection of the environment, the economy and other social
sustainability issues.

Basic Policy on Sustainability
Contribution

2

GrowthWe will keep in mind that growth of individual employees leads to the growth of Fuji Pharma
Group and that striving for constant growth helps make greater contribution possible.

3

Compliance

We will each observe the Compliance Policy and always think about the right action to take,with the awareness that we are part of society in all aspects of our business activities.

4

Respect for
Human Rights

We dignify and respect human rights and individualities of all people.

5

Environmental
Conservation andProtection

We always keep in mind that environmental resources are limited and proactively work toconserve the global environment.

In consideration of the impacts of our business activities on the environment, society, and economy, and to solve challenges
for achieving a sustainable society, we have established the “Sustainability Committee” chaired by the President and CEO
and the “Sustainability Section,” a unit devoted to the theme to promote our sustainability initiatives across the company.

President and CEO

Corporate Officers

Coordination

Environmental Committee
Compliance Committee

Executive Officer Meeting

Health and Productivity Management
Promotion Committee

Business Divisions
Regulatory Compliance Department, Research & Development Division, Sales Division, Toyama Plant,
Supply Chain Management Department, Corporate Business Management Department, Corporate Strategy Division

31

2

Step

Identified and defined ourmateriality issues as part of
the Sustainability Strategy,
which is the ninth strategyof the Mid-Term Business
Plan (FY9/2020-9/2024)

Narrowed down theissues to 18 items basedon international
standards, guidelines*,
etc.

3

Step

Establishingpriority

4

Hereafter

Discussion andapproval

Established priority
through surveys tostakeholders andinterviews with corporate
executives

Reported to the Board of
Directors and sought
input from members

Connect to further
contributions and growththrough dialogue withstakeholders*ISO26000, SDGs, the SASB Standards Materiality Map for the Healthcare Industry, etc.

Women’s health support
Information provision activity
Diversity & Inclusion
Production management

Quality assurance & Safety
management
Research & Development
Stable supply
Human resource development
Employee’s health management
Compliance
Work-life balance

Risk management
Information security
Corporate governanceSupply chain management
Climate change & Energy reduction

Committees
Risk Management Committee

General Managers ofbusiness divisions

Step

Narrowing down
the issues

Human rights
Workers’ safety & health

Board of Directors

Sustainability Committee
Chairperson: President and CEO
Secretariat: Sustainability Section

1

Materiality Map

Sustainability Promotion Structure

Sustainability Promotion Structure

Step

Identifying theissuesPriority to stakeholders

1

Every one of us will practice our corporate philosophy by providing the value unique to Fuji
Pharma Group and behaving with constant awareness of contributing to continued
development of society.

To ensure that all employees recognize the social roles of Fuji Pharma, actively engage in solving social issues and enhancing
corporate value, and steadily put into practice the corporate philosophy of “We help people lead healthy lives by offering
excellent pharmaceuticals” and “Our corporate growth is proportional to our personal growth,” we have identified ourmateriality, which are important issues that need to be addressed in order to sustain our business model toward achieving
sustainable growth and enhancing corporate value in the medium and long term.
Going forward, we would like to actively engage in dialog with the stakeholders using materiality as a basis for discussion
and exchange opinions on the significance of the issues as each of us understand. Through active dialogue regarding issues
recognized by stakeholders but Fuji Pharma has yet to perceive, or conversely issues that Fuji Pharma is strongly aware of
but has not been shared with stakeholders, we will be able to further contribute to resolving social issues and further enhance
our corporate value.

Priority to Fuji Pharma

Earned a Silver Medal in the EcoVadis Sustainability Assessment for thesecond consecutive year
EcoVadis in France provides assessment data on sustainability and supply chain initiatives ofmore than 100 thousand companies worldwide, available via a global cloud-based platform.
EcoVadis’s comprehensive sustainability assessment covers four themes: environment, labor& human rights, ethics, and sustainable procurement. In fiscal year 2023, we earned a Silver
Medal for the second consecutive year, which means we were among the top 25% of theassessed companies.
The Group company OLIC also earned a Bronze Medal. (Based on the 2023 score card criteria)

Fuji Pharma Corporate Report 2024

32

Introduction

Sustainability
Materiality

Materiality

Specific Initiatives
Thorough quality and safety management based on Quality Policy
Establishment of a culture of product quality and a system of legal/regulatory compliance based on Quality PolicySecurement of high-quality standards through consistency inspection meetings and quality management
review meetings• 
Audit and verification by a specialized unit within the Regulatory Compliance Department regarding potential
quality problems•••

 esearch and development of pharmaceuticals such as hormone agents, anti-cancer agents, andR
biosimilars and new generation technologies that meet the needs of society• Suppression of the rising national medical expenses and reduction of personal economic burden through thedevelopment of pharmaceuticals affordable to patients• 
Improvement of productivity and effectiveness of research and development by securing and developing
R&D human resources• 
Enhancement of R&D capability and manufacturing technologies through partnership with other companies,
as well as improvement of productivity and increasing of success accurancy•

2

Research & Development

3

Stable supply•••

Stable supply of excellent pharmaceuticals
Productivity improvement through enhancement of manufacturing capability and digital transformation
Enhancement of logistics function to ensure appropriate inventory

Development of the next generation of management and female management level employees
Development of virtuous human resources through a “Virtues system” with a corporate culture that values
people at the core
• Development of diverse human resources who can actively participate globally•4

Human resource
development

5

Employee’s healthmanagement

Compliance

7

Work-life balance

8

Human rights

9

Workers’ safety & health

10

Women’s health support

11

Information provision
activity

12

Diversity & Inclusion

13

Production management

14

Risk management

15

Information security

16

Corporate governance17

Supply chain management

18

Climate change and Energy
reduction•••

Initiatives to promote employee health led by the Health and Productivity Management Promotion Committee
Efforts to encourage employees to take appropriate leaves and reduce long working hours
Establishment of a comfortable work environment and employee-friendly system nsuring thorough compliance with the Code of Conduct on Compliance and implementation of trainingE
programs to ensure compliance with laws and regulations• 
Ensuring appropriateness of corporate management and business execution based on compliance withdomestic and foreign laws and regulations, internal rules, etc.
• 
Ensuring thorough compliance with the Code of Conduct on Compliance and implementation of training
programs to prevent misconduct trengthening of initiatives to promote women’s participation and advancement and to support the balanceSof work and childcare
Establishment of a comfortable work environment and employee-friendly system• 
Efforts to encourage employees to take appropriate leaves and reduce long working hours••

 limination of discrimination and inequality through compliance with the human rights-related laws and regulations
EVisualization of the concept of human rights and our policy to respect them to raise awareness among
officers and employees• 
Development of effective harassment prevention measures, consultation service, and a report system
•
•

•

•
•

•

•

•
•

•

•

•

•

33

Data

EHS Management System
Related SDGs

To ensure consistent Environment, Health, and Safety (EHS) management and operation of Toyama Plant and Toyama
Research and Development Center, we have developed an EHS management system, as well as obtained and maintained
certification of “ISO14001” and “ISO45001,” which are respectively international standards for environmental management
systems and occupational health and safety management systems, for Toyama Plant, Toyama Research and Development
Center, and Toyama Distribution Center as a part of our efforts to develop EHS management structures.
We consider reducing the burden on the global environment to its minimum as an important management issue and wewill consistently pursue environmentally friendly business activities under unified environmental targets and management
systems. We will continue to strengthen initiatives for environmental conservation and industrial health and safety, andcontribute to resolving these social issues.

Fuji Pharma Group’s Initiatives to Achieve Carbon Neutrality
We will continue with our efforts to achieve carbon neutrality by 2050.

•

•

6

Governance

Sustainability constitutes one of the strategies of our current Mid-Term Business Plan. Under our Environmental Policy, we
conduct business activities that are considerate of the environment.

Fuji Pharma’s materiality has been established with a view to contributing to the achievementof the Sustainable Development Goals (SDGs). Through the materiality initiative, we willcontribute to the sustainable development of society and generate a virtuous cycle of growthand contribution.

1

Sustainability

Environmental Initiatives

Materiality and SDGs

Quality assurance & Safety
management

Value Creation Story•

Enhancement and thorough implementation of an workers’ safety and health management structure basedon our Workers’ Safety and Health Policy rovision of women’s healthcare pharmaceuticals that contribute to the enhancement of women’s well-beingPEducational activities to support women’s health and to promote their participation and advancement
Establishment of an appropriate system for gathering safety management information and responding tosuch information to supply appropriate information to medical institutions
Development and promotion of diverse human resources to build a workplace comfortable for all employees table supply of excellent pharmaceuticals
S
Establishment of a production management structure through appropriate capital investment

Fuji Pharma aims to shift 50% of the electricity used in Toyama Plant to renewableenergy by 2030.
In November 2022, we signed an offsite solar power purchase agreement(PPA) with the Hokuriku Electric Power Group, with an eye to move toward
carbon neutrality. An offsite PPA allows us to purchase power generated atremote (offsite) power generation facilities outside our premises. Based on theagreement, a new solar power generation facility will be set up, and, for 20 years,
part of electricity supplied to Toyama Plant will be replaced with renewable energy
generated by solar power. We began receiving electricity from the solar power
plant in Hakui City, Ishikawa Prefecture since October 2023, and all solar panelsin the five locations in the Hokuriku area are expected to be operational by 2025.

Solar power plant in Hakui City, Ishikawa Prefecture

Second phase of solar power generation at OLIC
As part of initiatives to move toward carbon neutrality as the entire Fuji Pharma Group, we have set up a solar power
generation facility on the roof of OLIC’s plant in Ayutthaya, Thailand. It is expected to generate 1,200 MWh annually, which
reduces not only CO2 emissions but also the plant’s spending on rising local electricity costs.

 ecurement of a business continuity management (BCM) structure through the Risk Management
S
Committee and periodical review of the Business Continuity Plan (BCP) trengthening of the information management structure and enhancement of literacy on information security
Sbased on our Basic Policy on Information Security
Continuous improvement of the management foundation through periodical review of the corporate
governance structureImplementation of CSR procurement based on our Supply Chain Procurement Policy
Continuous implementation of cost reduction measures by improving procurement and productivity throughappropriate management of the supply chain stablishment of the Environmental Committee and an environmental management promotion system
EPlanning and execution of measures for utilizing environment friendly energy and resources• 
Launch of internal projects for responding to climate change•

Introduction of Offsite Solar PPA at Fuji Pharma

Environmental Initiatives at Toyama Research and Development Center
After receiving a CO2 reduction potential assessment, the Toyama Research and Development Center worked on measures for
air conditioning, which had the highest electricity usage, and reduced contracted power by 15% through demand control*.
In addition, we encourage the reuse of physical and chemical equipment. When replacing analytical instruments or otherequipment, we try to reduce waste by reusing the old equipment.
*Demand control is a system for planning and controlling energy consumption by monitoring and adjusting the amount of electricity used in a business•Fuji Pharma Corporate Report 2024

34

Introduction

Sustainability
Environmental Initiatives

We position sustainability as one of the strategies of the Mid-Term Business Plan and consider addressing
climate change and the environment as an important issue in management. The TCFD Promotion Secretariat
collaborates with the Risk Management Committee, the Sustainability Committee, and the Environmental
Committee to work on relevant issues. Climate-related risks and opportunities and how they affect businessexecution are discussed in accordance with each Committee’s scope of duties and reported to the President &CEO. In principle, the Board of Directors receives reports from the President & CEO on how climate risks aremanaged and addressed, and resolves and supervises company-wide managerial policies.
In accordance with the TCFD recommendations, we started a scenario analysis in reference to scientificevidence, etc. presented by the International Energy Agency and other bodies. In the scenario analysis, we
assessed the significance of climate-related risks and opportunities that may affect our business as of 2030. We
made a list of such risks and opportunities with the cooperation of relevant departments. Items with an expected
impact of “medium” or larger are disclosed on our website. In addition, we have already started to address therisks considered especially significant in the impact assessment.
*Scope of analysis: Major businesses in Japan (women’s healthcare, biosimilars, and contrast media)

Indicators andtargets

The TCFD Promotion Secretariat identifies climate-related risks in collaboration with relevant committees andbusiness divisions. The Risk Management Committee assesses the risks and discusses countermeasures before
relevant departments and affiliated companies address the risks. How climate risks are addressed is collated in atimely manner and reported to the President & CEO. The Board of Directors receives reports from the President& CEO and supervises the risk management operations.
We calculate greenhouse gas emissions as an indicator for assessing climate-related risks and opportunities. We
calculated CO2 emissions from fuel use, or Scope 1 emissions, and CO2 emissions from the use of electricity
supplied by other companies, or Scope 2 emissions, in fiscal year 2021, and other indirect CO2 emissions, or
Scope 3 emissions, in fiscal year 2022.
With the aim of switching 50% of electricity used in Toyama Plant to renewable energy by 2030 andachieving carbon neutrality by 2050, we will keep track of greenhouse gas emissions, introduce energy savingand solar power generation systems in Toyama Plant, and take other measures to reduce emissions.
Greenhouse gas emissions (FY2022)(t-CO2)(FY2021)(FY2022)

Scope 1
Scope 2

5,261

6,044

7,253

8,153

Scope 3–292,361

12,514

306,558

Total
Calculation period:

FY2021: October 2020 to September 2021
FY2022: October 2021 to September 2022
Scope of disclosure:All businesses in Japan
Emission coefficients used for Scope 1 and 2: We have adopted the market-based emissions, which is a calculation method using emission coefficientsfor each power company and menu.

Future initiatives

35

Data

Support for the 2024 Noto Peninsula Earthquake*Task Force on Climate-related Financial Disclosures: An international initiative established in 2015 by the Financial Stability Board (FSB). Corporations are encouraged to disclose information about thefinancial impact of risks and opportunities caused by climate change.

Riskmanagement

GovernanceWe aim to extensively contribute to each community by promoting communication with all stakeholders.
To ensure that we will continue to grow alongside local communities, we will carry out various social contribution activities
such as educational activities related to women’s health and actively engage with Toyama and other local communities.

We have endorsed the recommendations of the Task Force on Climate-related
Financial Disclosures (TCFD)*. We will take climate change seriously, deepen our
understanding on business risks and opportunities, and strive to proactively disclose
climate-related information based on the TCFD recommendations.
For details of information disclosure related to TCFD, please visit our website(https://www.fujipharma.jp/sustainability/core_subject/04-tcfd.php (in Japanese only)).

Strategy

Sustainability

Social Initiatives

Information Disclosure Based on TCFD Recommendations

GovernanceValue Creation Story

Going forward, we intend to discuss more specific measures to address climate-related risks and opportunities
and matters that are not on the list at the moment. The progress of such activities will be disclosed in a timely
and appropriate manner. By engaging in such activities and dialogue with our stakeholders through thedisclosure, we will strive to reduce climate-related risks and seize business opportunities in accordance withchanges in the market, and achieve sustainable growth as a company.

To support people affected by the 2024 Noto Peninsula Earthquake that occurred in January 2024 and assist in the recoveryof the affected areas, we donated 10 million yen through the Japanese Red Cross Society.
In addition, some local residents took refuge in our Research and Development Center hastily at the time of theearthquake, and it was also used as an evacuation site.

Human rights initiatives
We formulated the Fuji Pharma Group Human Rights Policy based on our commitment to management that values people
first and foremost. We strive to build a better society and workplaces that are free of unjust discrimination and harassment
and where the human rights, personality, and individuality of others are respected. In the fiscal year ended September 30,
2023, we revised our Human Rights Policy to further advance initiatives to respect human rights.
We also conduct human rights due diligence in accordance with the Guiding Principles on Business and Human Rights. In
the fiscal year ended September 30, 2023, we conducted a desk analysis throughout the value chain, carried out acomprehensive risk survey targeting not only our employees but also our suppliers and local residents, and identified themost prioritized human rights risk items and areas to assess.
As the next step in the human rights due diligence process, we will proceed with surveys to ascertain the actual situation,
including questionnaires and interviews. We plan to conduct risk assessments on a regular basis.

Educational Activities Related to Women’s Health
We offer education to help women independently choose their life plans and gain accurate knowledge about their bodies anddiseases peculiar to women before they consult medical institutions and address symptoms, amid the recent changes anddiversification of workstyles and lifestyle. We feel this an important mission for Fuji Pharma as a champion of the well-being of
women. Based on this view, Fuji Pharma has been implementing the following initiatives.

Initiatives

1

LiLuLaSince July 2018, we have been operating a smartphone app, “LiLuLa,” aiming to support the health ofwomen of all generations. In addition, to broaden our audience, the LiLuLa website was created in
February 2020 so information delivered to the app could also be seen on the internet. LiLuLa provides
information on menstruation and related topics (such as menstruation, contraception, infertility,
gynecological examinations and menopause) that are important for women.
There is quite a lot of information available on the internet which is notsupported by evidence. LiLuLa is able to provide accurate information by
publishing articles under the supervision of obstetricians andgynecologists, and through contribution from many medical
professionals specializing in obstetrics and gynecology.
In July and August 2023, we held online seminars for LiLuLa users,
where the interactions between doctors and patients during actual visits
to an obstetrics and gynecology clinic were distributed to make people
feel more familiar with obstetrics and gynecology and encourage people
LiLuLa app screen
Website version of LiLuLa
to receive consultations.
As part of our health and productivity management, we will share
URL: https://www.lilula-web.jp/
LiLuLa’s educational materials with other companies and organizations
to further expand our awareness raising activities.
Fuji Pharma Corporate Report 2024

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Introduction

Value Creation Story

Sustainability

Governance

Data

Sustainability
Social Initiatives

Initiatives

2

Activities to raise
disease awarenessDistribution of Colorectal Cancer Awareness Posters
Activities Related to Women’s Health

Recently, we have supported women’s health-related seminars and events for the general public, which are organized by othercompanies and organizations. We believe that supporting high-impact media and events will enable provision of accurate
knowledge and understanding to a wider audience and help improve the literacy of society as a whole.
For example, since the end of 2020 we have supported the “Workstyle Reform for Women! ‘Seiri Kaiteki Project,’”
established by a consortium of companies led by NIKKEI BP INTELLIGENCE GROUP. To support the realization of a society
where women can work comfortably by encouraging accurate understanding of women’s bodies and menstruation as well as
enhancing public literacy, the Seiri Kaiteki Project publishes a series of articles on menstruation andorganizes online seminars featuring obstetrician-gynecologists and celebrities, which have beendrawing huge response from readers and viewers. In addition, we supported a seminar at theJapan Society for Occupational Health conference last year, and we are actively providing
information to healthcare professionals.
In addition, we supported a number of seminars for the public such as an online seminar on“Reproductive Health and Rights” organized by Nikkei Inc. We plan to continue to raise awarenessabout women’s health issues by supporting such activities in the future.
Projects and events for the general public supported in recent years
Date
October 2022

January 2023

February 2023

May 2023

October 2023

October 2023
andMarch 2024

March 2024

37

Organizer

Theme

OutlineMinds and bodies inmenopause

An online event where celebrities and physicians speak on thetheme of “Understanding the minds and bodies in menopause,”
as part of “Fem Care Project” by “metropolitana,” a freemagazine published by Sankei Shimbun.

Athletes andmenstruation

Support for “1252 Project,” an educational program that
addresses various menstrual issues faced by female athletes,
which aims to help them address menstrual problems using
knowledge shared by top athletes and experts in medical andeducational fields.

Japan Women
Foundation

Support for women in
need

Support for activities that encourage society to move toward
the realization of women’s well-being by helping women in need(such as those facing unintended pregnancy, abortion,
domestic violence, unemployment, poverty, and dysmenorrhea)
in a comprehensive manner.

NIKKEI BPINTELLIGENCE
GROUP

Support for women’s
health and promotionof women’s
participation andadvancement in theworkplace, focusing on
menstruation

The project entitled “Workstyle Reform for Women! ‘Seiri Kaiteki
Project’” supports the realization of a society where women canwork comfortably by promoting correct understanding of
women’s bodies and menstruation. Talk seminars were heldwith gynecologists and celebrities. In May 2023, we supported
a seminar at the Japan Society for Occupational Healthconference.

Mynavi
Corporation

Guide to managing
unstable mind and bodyduring menopause

We ran a feature section on menopause as the sole sponsor.
As part of the feature, a discussion was held among our
employees and gynecologists on menopausal experiences.

Women’s Health
Action

Women’s minds andbodiesTalk events by various speakers including media personalities
and physicians and sponsored articles were distributed online
about diverse topics related to women-specific health issues
such as menstrual pain, PMS, the genital area care, efforts toconceive, contraception, SRHR, and Femtech.

Nikkei Inc

A Society Where
Women Can Be
Healthier and More
EmpoweredHave supported “Marunouchi Career Academy” since March
2021. In March 2024, we sponsored a special seminar entitled,“For Everyone to Be Themselves: Toward a Society Where
Women Can Be Healthier and More Empowered” in March
2024, addressing themes such as working women trying toconceive and infertility treatment, menopausal disorder, andwomen’s career development.

SANKEISHIMBUN
CO., LTD.

Never Stop
Playing Sports

We distribute posters to medical institutions nationwide to raise awareness of colorectal
cancer. In March 2024, in conjunction with Blue Ribbon Campaign Colorectal Cancer
Awareness Month, we collaborated with the CancerNet Japan (CNJ) to distributeawareness posters to medical institutions nationwide.

OLIC’s Social Contribution Activities
OLIC has long conducted social contribution activities in cooperation with the local communities. Among such activities in2023 were production of calendars featuring drawings by autistic persons, donation of calendars to visually impaired persons,participation in Children’s Safety Day events, and donations to schools in Bangkok. OLIC also made donations and provided
necessary supplies to various hospitals, government agencies, and local organizations.
In addition, OLIC is promoting eco-friendly product packaging and initiatives to achieve net zero greenhouse gas
emissions.
Whether in or outside Japan, we believe ties with the local community is important for business operations and arecommitted to social contribution activities to become a company that can continue to grow together with the local community.

Certified as Toyama Women’s Participation and Advancement Corporation
In September 2022, we were certified as “Toyama Women’s Participation and Advancement
Corporation” by Toyama Prefecture where our plant is located. “Toyama Women’s Participation andAdvancement Corporation” is a program in which Toyama Prefecture certifies companies in theprefecture where women are actively participating toward the achievement of corporate growth andwell-being (true happiness). This program was introduced in 2022, and we are one of the firstcompanies that were certified under the program. This certification lasts for five years.
We will continue to promote women’s participation and advancement to achieve corporate growth
and well-being.

The Seiichi Imai Memorial Foundation
Seiichi Imai, founder of Fuji Pharma, was committed to the basic philosophy of helping people lead healthy lives by offering
excellent pharmaceuticals, with a particular focus on supporting the health of women and children. The Seiichi Imai Memorial
Foundation was established with an endowment fund from the founding family, which inherited the will of the founder. It
supports the health of women suffering from female-specific diseases, pregnancy, childbirth, childcare, etc., and of children to
be born, through grants for research in women’s and pediatric medicine. Fuji Pharma support its activities.

Sponsorship of TOYAMA GROUSESAs a company whose plant and research & development center are located in Toyama City, Toyama
Prefecture, we have been an official clothing partner of TOYAMA GROUSES, a professional
basketball team conducting community-based operations with Toyama City as its hometown since2017, to contribute to the revitalization of local sports culture.

Fuji Pharma Corporate Report 2024

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Introduction

Value Creation Story

Sustainability

Governance

Data

Sustainability

Dialogue: Chairman Imai and Outside Director Kiyama
Corporate management based on Virtues
Imai Fuji Pharma has introduced the concept of Virtues
and established it as part of our corporate culture. Virtue is
not a prevalent word in the world of business, but to put it
simply, the essence of this concept is to do one’s best forthe sake of others. The key words in our corporate
philosophy are “contribution” and “growth”. The backstory
behind introducing Virtues was my realization that if theintent behind the philosophy is to “improve your best
through personal growth, and make further contributions
by doing one’s best for the sake of others,” then our
corporate philosophy is the very essence of Virtues.
Kiyama I got to know Mr. Imai through our shared
mentor, Yoshifumi Taguchi, a scholar of Eastern
Philosophy. For a long time, I admired Fuji Pharma for its
direct approach to Virtue-based management and being afor-profit, publicly listed company with hundreds of
employees at the same time. I feel honored to have beenasked to take up the role of Outside Director at Fuji
Pharma, which I have held since December 2020. Indeed,
when interacting with Fuji Pharma’s officers andemployees, I often feel that Virtue-based management has
been properly promoted and firmly taken root within thecompany. That said, I wonder if there was any repulsing
reactions from employees when you first introduced Virtuebased management.

Hirofumi Imai

Keiko Kiyama

Chairman & Representative Director

Outside Director

Positioning “doing our best for the sake of others”
at the core of our corporate management
Fuji Pharma engages in corporate management based on “Virtues.”
Hirofumi Imai (Chairman & Representative Director) and Keiko Kiyama (Outside Director) discussed this uniqueand consistent approach and sustainability management, as well as initiatives towards our Vision for 2030 of“what we want to achieve” and “where we want to be.”39

Imai Yes. We introduced it in 2011, but a lot happened
before the concept took hold. We used to use a dual
evaluation system that consisted of performance evaluation
and behavioral evaluation. At the time, the system wascalled competence evaluation, it defined the behavioral
characteristics of high performers as the criteria for
personnel evaluation and recruitment. But we realized thesystem had some issues and it was time to review it.
However, when Virtues were incorporated into behavioral
evaluations as an alternative, we were mostly met with
confused employees who said that they did not understandneither the concept nor how Virtues are related to theirefforts to improve business performance. One of the causes
was that I was not involved in the initial introduction phaseand the HR departments had to deal with it all. So amidvarious feedback, I decided to actively voice my opinion,that we should position Virtues at the core of our corporate
management as our corporate philosophy and Virtues wereequal in essence, and that I wanted to incorporate Virtues
into behavioral evaluations. A lack of communication waspartly to blame for the large number of objections from
employees. As we continued to create opportunities todiscuss the issue and employees gained a deeper
understanding, they began to embrace the idea, that thesevalues could also be applied to their everyday lives.
We have revised the system five times so far, carefullyreflecting the feedback from many employees. In addition,a large number of employees have gained insights into
Chinese classics through Professor Taguchi’s lectures andbooks. These also helped with the successful
implementation. Data has been accumulated over morethan a dozen years now, showing a strong correlation
between people with high Virtue evaluations and highperformance evaluations. This has enabled employees torecognize the effectiveness of Virtue-based evaluations.
Since February, for several months, we had newopportunities for dialogues with employees. Many of them
have said that they were hesitant at first but that they now
value the Virtues as a basis for their work and daily life. I
feel these comments mean that the concept has firmly
taken root.
Kiyama I serve as Trustee and Secretary General ofJapan Emergency NGO (JEN). JEN provides humanitarianassistance for those refugees, displaced people andsurvivors who are in severe conditions due to armed
conflicts and natural disasters around the world. It has
been 30 years since JEN’s establishment, and to support
self-reliance has been the key-concept of our assistancesince then. There were times when people had trouble
understanding what we do, as they would demand we
provide immediate aid to those in emergency situations.
But we know that outsiders trying to forcefully giving aid
might do some harm. Because we want to hasten truerecovery, we are committed to supporting the self-relianceefforts which are lead by affected people themselves. Fromthe basic perspective of human rights, wherein every
person has the right to live their life to the fullest, we value

Keiko Kiyama

Trustee and Secretary General of Certified NPO Japan Emergency
NGO (JEN)
Joined founding Japan Emergency NGOs, JEN’s previous structure,
Japan’s first federation of NGOs in 1994. Engaged in emergency
humanitarian assistance focused on self-reliance in the former Yugoslav
countries during the conflicts. Since then, she has devoted herself toproviding emergency humanitarian assistance for those people who areseverely affected by armed conflicts and natural disasters in 25
countries and regions, including Afghanistan, Iraq, Pakistan, South
Sudan, and the Tohoku region. She has served Fuji Pharma as an
Outside Director since December 2020 (current position).
Fuji Pharma Corporate Report 2024

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Introduction

Value Creation Story

Sustainability

Governance

Data

Sustainability
Dialogue: Chairman Imai and Outside Director Kiyama

each of diverse people leading the fulfillment of their own
lives, and are strictly committed to providing support forsustainable self-reliance, from the stage of emergency.
Your Virtue-based management truly respects humanrights, valuing each and every individual. I would like toexpress my sincere respect for your commitment.

Building on our founding philosophy ofvaluing every individual
Imai Valuing every individual is a philosophy that Fuji
Pharma has valued since the time of our founder andformer chairman. I don’t want to just inherit thatphilosophy. I want our employees to feel even more
excited, find their work more rewarding, and to feel more
happiness in their job. As upper management, I am striving
to expand opportunities for employees to have a range ofdifferent experiences. I want them to overcome struggles
and take the bull by the horns, such as working on thedevelopment of new drugs and taking on new challenges.
Kiyama Fuji Pharma’s Vision for 2030 illustrates “what wewant to achieve” and “where we want to be” in 2030 byoutlining three targets: “Contributing to the well-being of
women in the world,” “Expanding our business to Global
Market from Toyama,” and “Integrating the world’s
happiest company and social contribution.” I feel that thesenior management, including you, holds these
expectations of each employee, and that is what unites
their strong ambition for Fuji Pharma to continue to be apresence needed by the world, with an eye to competingon the global stage.

Value creation based on the cycle ofcontribution and growth
Imai Fuji Pharma’s value creation is based on our twopronged corporate philosophy: “We help people leadhealthy lives by offering excellent pharmaceuticals” and“Our corporate growth is proportional to our personal
growth.” Regarding that “growth,” I sometimes get asked
how I perceive our employees’ failures. Let’s say someone
tries something new and fails. But from this experience offailure, people learn a lot, acquire skills, abilities, andknowledge, and improve their personality. I believe thatthey will eventually be able to get closer to their goals, thatis, to grow. I hope that the experience of failure is a sourceof growth. That is why I want our employees to boldly takeon challenges.

those people, and others are good at providing
constructive criticism. This is an ideal situation in which
each person is doing what they do best under thecommon purpose and vision. I also think that it would begood if, rather than being fixed, each role could be flexibly
adjusted in line with employee growth and change. Fuji
Pharma provides an environment in which employees canfreely demonstrate their strengths and play an active role intheir own way. I feel that expanding this beyond Japan to
the rest of the world will provide even more prospects forthe future.

Kiyama I strongly agree with you on the importance oflearning from mistakes and failures. In the actual field ofinternational cooperation, I met many people who arestruggling for their self-reliance, but, falling behind. They
can make their steps forward again when they can believein their own strength and are acting with dignity. If you doyour best for the sake of others without isolating yourself,
you are sure to receive support from those around you,and if you have confidence and pride that you have done
your best, you will be able to move forward and endure. I
think this lesson has deep implications and is extremely
important.

Imai With needs becoming increasingly diverse, we
recognize that continuing to respond carefully to theseneeds is a major challenge with many issues that need tobe tackled. I would like to work on these issues one by one
without compromising and achieve solid results in asustained manner.

Imai Similarly for us, we often connect and resonate with
our overseas partners on the view that acting for the sakeof others is the best approach. I see the same is true whenworking in the field in international cooperation, as you do,
Ms. Kiyama.

Working to achieve our long-term visionof “happiness for all”
Imai Fuji Pharma is a pharmaceutical company thatprovides products aligned with women’s life stages.
Through our drugs, we strive to alleviate the pain andsuffering of women, solve their health issues, and help
each person live their own lives. In other words, we
endeavor to contribute to the well-being of women. To
continue doing so is our mission which we find very
rewarding. The activities of our core business is the very
action we can take to help realize a sustainable society.
Kiyama It’s important to have a clear management
approach that represents Fuji Pharma. This long-term
vision is something that all company employees aremutually aiming for. I also consider it important toacknowledge that each individual will strive to achieve thisvision in their own way. I believe that a good company is
one where a diverse group of people can work safely andcomfortably. It is also my personal wish that Fuji Pharma
be a company that can continue to take on new
challenges. In such a company, some people might enjoy
taking on new challenges, while others like to support

41

Kiyama Managers want their employees to speak openly
to them, but I suppose there might be some employees
who have difficulty expressing their true feelings. I see that
Fuji Pharma has a culture that welcomes open
conversation, but I would like this openness to expand
even further. If everyone is committed to active
communication and welcoming opposing and differing
opinions, I think this will help improve the openness of thecompany even more.
Imai We need more occasions to listen to, understand,and respond to diverse feedback. I would also like to put
more effort into creating systems and fostering anenvironment to achieve this.
Kiyama Last year, a Board of Directors meeting was heldin Toyama, where employees made lively presentations
about the initiatives they were undertaking. This reaffirmed
to me that Fuji Pharma is a company with an open
atmosphere.

Initiatives and challenges in sustainability
management
Kiyama No matter how good of a company it is, Fuji
Pharma Co., Ltd does not exist on its own, and recognizes
the importance of being sustainable as a global citizen. I am
pleased to see the progress being made with the shift torenewable energy, aided by the considerable efforts on yourpart. In addition to that, what I would also like to see is Fuji
Pharma’s continued initiatives aimed at making societysustainable as a whole to have a larger ripple effect,
positively influencing and encouraging the people around us
to also want to take part. As a company aiming to become
the world’s happiest company, I am certain that our goal to
be a sustainable company is well within our means.

Imai At Fuji Pharma, we consider profit indispensable forthe sustainable development of both the company andsociety. It is important to continue generating earnings.
That is how we secure our sustainability as a company, bymaking sufficient profit. How we utilize that profit is the key.
Kiyama Of course, in order to carry out activities in asustained matter, it is important for Fuji Pharma to achieve
the targets set for its core business and continue toachieve solid business results.
Imai In terms of sustainability management, we arefocusing on solving women’s health issues as our corebusiness. For example, menopausal symptoms andsymptoms related to menstruation specific to women can
result in a significant economic burden, and also hinder
women’s social advancement and participation in society.
We aspire to contribute to the well-being of women by
developing and marketing drugs to alleviate these
symptoms. We also support the active participation of
women within the company, and will actively promote theappointment of women as directors, such as Ms. Kiyama,
and the appointment of women to managerial roles.
Kiyama I like Fuji Pharma’s approach to solving women’s
health issues to support their social advancement as astandard practice of a global citizen, rather than due tobeing influenced by global trends. I think management’s
consistent stance of wanting to make good medicine, be agood company, and provide a good work environment for
employees is wonderful. I hope that female directors will
also emerge from within the company in the near future. I
would also like Fuji Pharma to improve the quality of life of
the people it engages with in various ways, not only
through its products.

What we want to say to our shareholders
Imai I intend to work even harder to clearly communicate
to our shareholders and investors not only our businessresults, numerical targets, and plans, but also ourphilosophy and what we consider to be important today interms of corporate management.
Kiyama “Virtues” are the source of Fuji Pharma’s value
creation, and will serve as the power to generate profits formany years to come, such as five and ten years. I think it isimportant to explain such matters and portray ourselves as
we are.
Imai I want Fuji Pharma to become a company where
many women can play an active role and become rolemodels for women’s well-being. Working hard withenthusiasm means having the vigor to do so. As such, wewill make our utmost efforts to gain external recognition as avigorous company with business results that reflect this vigor.
Fuji Pharma Corporate Report 2024

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Introduction

Value Creation Story

Sustainability

Governance

Data

GovernanceCorporate GovernanceCorporate Governance That Helps Achieve Our Corporate Philosophy

Institutional Design

Fuji Pharma’s corporate philosophy focuses on “helping people lead healthy lives by offering excellent pharmaceuticals” and“Our corporate growth is proportional to our personal growth.” In other words, we believe it is those very commitments tocontribution and growth that generate happiness for all of stakeholders.
The field of corporate governance is no different. Here too, we aim to realize the same contribution and growth. Indeed,
we seek to ensure sustainable growth and enhance our corporate value over the medium to long term by building corporate
governance frameworks and promoting flexible decision-making that ensures transparency and autonomy.

Board of Directors
The Board of Directors is composed of a total of nine Directors (of which four are outside Directors). The Board assesses anddetermines matters stipulated in management policies and laws and regulations as well as other important matters related tobusiness execution as appropriate and also supervises business execution. The term of office for Directors is set at one year
to help us swiftly adapt to changes in the management environment and further clarify the responsibility of Directors.
Meetings of the Board of Directors are attended by all Audit & Supervisory Board Members so they can audit businessexecution by Directors.

Governance Highlights
Ratio of outside officers

9 members

50%

Internal: Outside:(ratio of independent
officers 50%)

5

Audit & Supervisory Board:

3 members

Nomination andRemuneration Committee:

3 members
Internal:

Internal:1

41

Outside:2

Women

Outside:2(including 1 Chairperson)

Women

Corporate Governance Framework

Independent Officers Meeting
We hold a meeting of the Independent Officers Meeting, consisting solely of independent outside officers, once every six
months for the purpose of further improving the effectiveness of the Board of Directors through the exchange of informationand sharing of perception between outside officers.

General Meeting of Shareholders
Election andDismissal

Nomination andRemuneration Committee

Election andDismissal
Auditing

Board of Directors/
Directors
Appointment
and Dismissal

Accounting Auditor

ReportPresident and CEO

Internal Audit Group

Auditing

Compliance Committee
Risk Management
Committee

Auditing

Executive Officer Meeting

Business Divisions

Audit & Supervisory Board/Audit &Supervisory Board Members

Election andDismissal

Nomination and Remuneration Committee
We established the Nomination and Remuneration Committee as an advisory body to the Board of Directors to ensure thetransparency and fairness of the decision-making processes for the nomination of Directors and the determination of
remuneration. The committee consists of three members: Outside Directors Keiji Hirai (chairperson) and Minesaburo Miyake
and President & CEO Takayuki Iwai. The Board of Directors seeks advice from this committee before making decisions on theelection or dismissal of Directors and Corporate Officers and their remuneration as well as matters concerning the election or
dismissal of the company’s President & CEO and policies regarding the remuneration system and remuneration levels of thesenior management.

Executive Officer Meeting
We adopted the executive officer system to speed up information sharing for business execution and efforts to address
management issues. We hold Executive Officer Meetings twice a month. This meeting serves as an advisory body to the
President, and is composed of the President and the Corporate Officers from each department. It assesses businessexecution in each department and reports the status of execution to the Board of Directors as necessary.
Specialties and Experiences of Officers (Skills Matrix)
Name

Outside Independent
Management
Officer
Officer

GlobalTechnology

Finance

Legal

Sales/
Marketing

Healthcare Sustainability

Hirofumi Imai
Takayuki Iwai
Toyoyuki Kamide
Directors

Board of Directors:

Audit & Supervisory Board
The Audit & Supervisory Board is composed of a total of three members (two of which are outside Audit & Supervisory Board
Members) Each Audit & Supervisory Board Member carries out audits of business execution by Directors by attending
meetings of the Board of Directors and inspecting the overall business and financial situation in collaboration with the
Accounting Auditor and the Internal Audit Group, in accordance with the audit policies, division of duties and otherprocedures established by the Audit & Supervisory Board.

Regulatory Compliance Department, Research & Development
Division, Sales Division, Toyama Plant, Supply Chain Management
Department, Corporate Strategy Division, Corporate Business
Management Department

Satoshi Suzuki
Shuhei Morita
Keiji Hirai
Minesaburo Miyake
Keiko Kiyama

Mutual collaboration (inspection of audit reports, regular consultations, reporting and so on)

43

Audit & Supervisory
Board Members

Yukiko Araki
Daiji Ojima
Fujiaki Mimura
Miori Sagara
Fuji Pharma Corporate Report 2024

44

Introduction

Value Creation Story

Sustainability

Governance

Data

GovernanceCorporate Governance

Remuneration for Officers
Policy for Determining Remuneration for Officers
Remuneration for Directors is linked to business performance and the company’s stock price in order to function as anincentive to sustainably increase corporate value. In determining the level of remuneration, we examine the validity of theamount and review it as necessary, taking into consideration objective remuneration survey data from a considerable numberof companies of the same size as us and our financial situation, in order to ensure that the level is appropriate for each
Officer’s position and responsibility.
When determining the amount of individual remuneration, the Nomination and Remuneration Committee deliberates on
remuneration, etc. for the fiscal year under review and reports to the Board of Directors. The Board of Directors deliberates
and resolves the amount of remuneration, etc. based on the contents of the report.
Regarding the content of reports from the Nomination and Remuneration Committee, the Board of Directors examines
whether the method of determining the content of remuneration, etc. and the content of the determined remuneration, etc.
are consistent with the decision-making policy resolved by the Board of Directors, and judges whether that content
corresponds with the said decision-making policy.
In addition, remuneration for Audit & Supervisory Board Members is determined through discussions among the Audit &Supervisory Board Members within the scope of the resolution of the General Meeting of Shareholders and based on internal
regulations resolved by the Audit & Supervisory Board, taking into consideration the difference between full-time Audit &Supervisory Board Members and outside Audit & Supervisory Board Members, the division of duties, and other relevant factors.

Composition of Remuneration for Officers
The ratio of remuneration by type to the amount of remuneration by individual is not specified. When determining
remuneration, the Nomination and Remuneration Committee prepares a proposed remuneration amount for each type of
remuneration after considering objective remuneration survey data from a considerable number of companies of a similar size
to us as well as our financial situation. The Board of Directors upholds the percentage of remuneration, etc. by type includedin the report from the Nomination and Remuneration Committee.
Remuneration for Directors (excluding Outside Directors; not including the employee portion of salaries for Directors who
concurrently serve as employees) consists of base remuneration, bonuses (cash), and stock-based remuneration.
Base remuneration consists of remuneration based on the size of the role and scope of responsibility for each positionpredetermined by the Board of Directors and remuneration calculated using the same salary table as employees, and is paid
as a fixed remuneration.
Bonuses are calculated using the same calculation method as employees and are paid partly as fixed remuneration andpartly as performance-based remuneration.
We use return on assets (ROA) as the indicator for evaluating performance-based remuneration because we place greatemphasis in our company management on using assets efficiently and maximizing profitability. Performance-based
remuneration for all employees, including Directors (with the exception of the Chairman & Representative Director and outside
Directors) is calculated based on either 10% or 15% of operating profit depending on the ROA result, and the total amount of
payment is approved by the Board of Directors. The ROA target for the fiscal year under review was over 7% and the actual
ROA result was 7%. This measure of ROA is calculated based on operating profit prior to any deductions for performancebased remuneration, so it differs from the ROA figure based on operating profit in the income statement.

Classification of officers

Directors
Audit & Supervisory Board
Members
Outside Director
Outside Audit & Supervisory
Board Member

Total amount of remuneration, etc. by type
Total amount of(Millions of yen)
Number of
remuneration,
Performance- Stock-based eligible officers
etc.
Fixed
(persons)
based(Millions of yen) remuneration
remuneration remuneration

87

78

2

6

4

16

16

–

–

1

22

22

–

–

5

9

9

–

–

2

Stock-based remuneration has been introduced to provide incentives for medium- and long-term improvements in corporate
value and to align the economic value of Directors with that of shareholders, and the officer share ownership plan is utilized to
grant points according to the predetermined rank of Directors (excluding the Chairman & Representative Director) at theBoard of Directors, and providing shares and cash equivalent to one share per point.
Remuneration for Audit & Supervisory Board Member and outside officers (outside Directors and outside Audit &Supervisory Board Members) is paid as fixed remuneration in cash and determined in advance by the Board of Directors andthe Audit & Supervisory Board, and no bonus or stock-based remuneration is paid.
45

Evaluation of the Effectiveness of the Board of Directors
We conduct an analysis and self-evaluation of the effectiveness of the Board of Directors once a year through a questionnaire
for all Directors and all Audit & Supervisory Board Members to ensure and improve the effectiveness of Board of Directors.
The questionnaire is distributed to each officer at the beginning of each fiscal year in October, and the results and, dependingon the content, possible countermeasures are reported at the Board of Directors meeting in December. The self-evaluation
does not rely too much on multiple choice questions, but instead specific proposals are made through the active use of
free-comment fields. We did consider using an external organization, but after some external organizations judged our selfevaluation to be a superior method, we decided to continue using our own self-evaluation method.
In the self-evaluation conducted in the fiscal year ended September 30, 2023, issues raised included the lack of female
and foreign Directors, insufficient information and opportunities to understand the abilities of senior management candidates,
the need for more cross-functional discussions, the necessity for flexible management in response to changes in the world
after the formulation of the Mid-Term Business Plan, insufficient consideration and sharing of sustainability and materiality, andthe need for more time to share and read materials for the Board of Directors meetings. The status of implementation of
yearly countermeasures is reported in the questionnaire distributed in October the following year, as part of the year’s efforts
to address these issues.
Based on the results of the self-evaluation, we consider that the effectiveness of the Board of Directors has been ensured,
but we will work to further improve its effectiveness by focusing on the issues raised in the questionnaire.
Issues identified in the evaluation of effectiveness and initiatives to address those issues

Composition of Remuneration

Total amount of remuneration
for FY9/2023(Oct. 2022-Sep. 2023)

Matters Concerning Delegation of Authority to Determine Remuneration of Individual Director, Etc.
The Board of Directors delegates President & CEO Takayuki Iwai to determine the amount of base remuneration for each
Director and the evaluation and allocation of bonuses based on the performance of the division for which each Director,
excluding outside Directors, is responsible. The reason for this delegation is that the Board of Directors determined thatPresident & CEO is best suited to evaluate each Director’s responsible division, while also considering the company’s overall
performance and other factors. The Nomination and Remuneration Committee confirms the appropriateness of the delegateddecisions in advance.

Issues as of September 30, 2022
and initiatives for 2023
As a result of addressing the issues identified at the endof the fiscal year ended September 30, 2022,
improvements were observed in the evaluation of each
item raised as issues.

Training and selection of senior management
candidates
Improvements were observed in the evaluation regarding
the insufficient explanation of training plans and selection
methods.

Activation of discussions on corporate strategies
Improvements were observed in the evaluation of thisitem.
Issues remained regarding the involvement of officers informulating the next Mid-Term Business Plan.

Discussion on sustainability and materiality
There were increased opportunities for exchanging
opinions with the Sustainability Section, and advance
explanatory sessions were utilized. Issues remained
regarding involvement in the Sustainability Committee.

Issues as of September 30, 2023
and initiatives for the future
We will continue the following initiatives based on theevaluation results for the fiscal year ending September
30, 2023.
• Include discussion on diversity of Directors in the next
Mid-Term Business Plan
• Create opportunities for interviews between candidates
and outside officers and briefing opportunities at theBoard of Directors’ meetings to understand the abilities
of senior management candidates• Hold briefings and increase other opportunities foroutside officers to be involved in the formulation of the
Mid-Term Business Planto gather a broad range of
information. Allow for flexibility in the implementation
process to enable flexible execution in response tochanges in the world after the formulation• Include more sustainability-related agenda items,
especially those on KPIs, at the Board of Directors’
meetings

Fuji Pharma Corporate Report 2024

46

Introduction

Value Creation Story

Sustainability

Governance

Data

Governance

Officers (as of March 31, 2024)
Directors

Hirofumi Imai

Takayuki Iwai

Toyoyuki Kamide

Minesaburo Miyake

Keiko Kiyama

Yukiko Araki

Chairman & Representative Director

President & CEO, General Manager ofthe Research & Development Division

Director, Vice President, Manager of
the Toyama Plant

Outside Director

Outside Director

Outside Director

Joined Fuji Pharma in 1987. After
serving as President & CEO, he wasappointed as Chairman & Representative Director in April 2016 (current
position).

Joined Mitsui & Co., Ltd. in 1986.
Assigned on loan to Fuji Pharma in 2006.
After serving as Senior Vice President of
Mitsui & Co. (USA), Inc. and General
Manager of the Americans Business Unitof the Consumer Service Business
Goods Division, joined Fuji Pharma in
2019. Appointed as President & CEO in
December 2019 (current position).

Joined Nomura Trading Co., Ltd. in
1987. Joined Fuji Pharma in 2000. After
serving as General Manager of the
Corporate Headquarters Division and asManaging Director of OLIC (Thailand)
Limited, he was appointed as Director in
December 2017 (current position).
Appointed as Vice President in October
2021 (current position).

After serving Kewpie Corporation as
President and Representative Director,
president and other posts, he has been
serving Nakashimato as Chairman and
Director. He has served Fuji Pharma asan Outside Director since December
2017 (current position).

She co-founded Japan Emergency
NGO (JEN) in 1994 and became Trustee
and Secretary General of JEN in 2018
(current position). She has served Fuji
Pharma as an Outside Director since
December 2020 (current position).

She served as Director of the Bio-Industry Division in the Manufacturing Industries Bureau of the Ministry of Economy,
Trade and Industry, as well as a Board
Member of Hitachi, Ltd. and in otherpositions. She has served Fuji Pharma
as an Outside Director since December
2020 (current position).

Audit & Supervisory Board Members

47

Satoshi Suzuki

Shuhei Morita

Keiji Hirai

Daiji Ojima

Fujiaki Mimura

Miori Sagara

Director, Vice President, General Managerof the Corporate Strategy Division

Director, Executive Corporate Officer, General
Manager of Corporate Planning Department

Outside Director

Full-Time Audit & Supervisory Board
MemberOutside Audit & Supervisory Board
MemberOutside Audit & Supervisory Board
MemberJoined Eisai Co., Ltd. in 1989. After
serving as Senior Corporate Officer andHead of Corporate Development
Division at Santen Pharmaceutical Co.,
Ltd., he joined Fuji Pharma in 2022.
Appointed as Director, Vice President in
December 2022 (current position).

Joined the company in September
2010, after working at Sanofi K.K. andGlaxoSmithKline plc. After serving in theSales and Supply Chain Management
Departments, he was appointed General
Manager of the Corporate Planning
Department.

He served Kyorin Pharmaceutical as
Representative director, President andChief Executive Officer, and other posts.
He has served Fuji Pharma as an
Outside Director since December 2016(current position).

After joining Hokuriku Bank, Ltd., he servedin various positions including generalmanager of branch office management andsales promotion divisions. Later, he served
TOA Pharmaceuticals Co., Ltd. as generalmanager of the General Affairs Department,
Management Division, before joining Fuji
Pharma in 2023. He has served as a
Full-Time Audit & Supervisory Board Member
since December 2023 (current position).

Registered with the Tokyo Bar Association in 1987. He is a partner of Anderson, Mori & Tomotsune (current position). He has served Fuji Pharma as an
Outside Audit & Supervisory Board
Member since December 2003 (current
position).

After working for Sumitomo Corporationand others, she founded BAOBAB Inc.
in 2010 and has served as its President
and CEO (current position) since then.
She has served Fuji Pharma as an
Outside Audit & Supervisory Board
Member since December 2019 (current
position).
Fuji Pharma Corporate Report 2024

48

Introduction

Value Creation Story

Sustainability

Governance

Data

GovernanceCompliance/Risk Management
Compliance
Our business of manufacturing and selling pharmaceuticals is directly linked to the lives of people. We are therefore awarethat we must always act with a high sense of ethics. Based on this idea, the Compliance Policy has been established as a
Fuji Pharma Group policy. For the purpose of raising awareness for compliance and thorough compliance infiltration among
employees, Fuji Pharma has established the Code of Conduct on Compliance, Standards of Conduct on Compliance andCompliance Management Regulations.
The Compliance Committee consists of members elected from management level employees in each department. The
Committee formulates and implements compliance education plans, checks the operational status of the internal
whistleblowing system, and keeps track of the departmental status of compliance with laws and regulations, internal rules,
etc. through reports from each Committee member. When a questionable act is found or is likely to be found in terms of legal
compliance, the Committee will conduct a thorough investigation and implement measures to make improvements andprevent recurrence. In addition, we regularly publish the Compliance Newsletter for employees, and provide opportunities toall departments to learn about compliance using the newsletter and carry out a range of other measures to further raisecompliance awareness among individual staff members. We also conduct e-learning compliance training sessions andtraining sessions on the knowledge of the Act on Securing Quality, Efficacy and Safety of Products Including Pharmaceuticals
and Medical Devices that pharmaceutical company employees should be aware of multiple times a year for employees. We
will continue to ensure that we conduct our corporate activities with an emphasis on legal compliance constantly in mind.
We have also established internal and external contact points to consult and notify us of any conduct that is or may beconstituting a compliance
Compliance-related initiatives
violation. Under the system, allemployees can use the contact
Categories
Initiatives
points to seek advice, make a• Hold Compliance Committee meetings (4 times a year)
consultation or report on
Enhancement of compliance• Select management level employees from each department as committee
structure
violations of laws andmembers to implement effective initiatives
regulations, fraud or unethical• Provide compliance training to new graduates and mid-career hires upon
behavior committed at antheir joining the company• Publish compliance newsletters and e-mail magazinesorganizational or individual level• Conduct departmental meetings using the compliance newsletter
Employee educationin the course of business• Provide compliance training for employees on the Act on Securing Quality,
activities or at a workplace. The
Efficacy and Safety of Products Including Pharmaceuticals and Medical
Devices and e-learning
Compliance Committee reviews• Create compliance awareness posters
the internal whistleblowing• Provide consultation and respond to reports through internal and external
system and makes
Whistleblowing system
contact points
improvements to improve theCompliance awareness survey• Conduct compliance questionnaires (once a year)
system’s effectiveness.

Risk Management
We have formulated the Companywide Risk Management Regulations for the purpose of identifying, analyzing and evaluatingin advance any event that may negatively impact our business activities and taking appropriate action against it to meet theobjective of internal control. In accordance with these regulations, the Risk Management Committee, composed mainly ofheads of divisions, performs risk assessments to develop a company-wide risk management system and to identify risk
management issues, including sustainability-related risks such as climate change and human rights. Risk assessments are
conducted based on the objective evaluation items. To address any event that the assessment finds to have a high level ofrisk, a risk response plan is formulated, and related organizations are to take action in accordance with the plan. These
activities are reported to the Board of Directors at least once a year, and discussions are held to improve activities.

Business Risks, Etc. and Response
Items

1
2
3
4

Statutory Regulations

Pharmaceutical Product R&D

Industry Competition

Raw Material Procurement

5

Adverse Drug Reactions andProduct Quality

6

Delayed or Suspended
Product Supply

7

Revisions to National Health
Insurance Drug Price List

8

9

Litigation

Risks Related to IT Security
and Information Management

Relating to Attracting
10 Risks
and Retaining Human Capital

11 Risks Related to Digitalization

Rights and Upfront
12 Distribution
Payments for Such Rights

Related to Investment in
13 Risks
Partners

Response• Compliance with Pharmaceutical and Medical Device Act

and associated laws and regulations as well as various
terms and conditions necessary to acquire the licenses andapprovals• Possibility that problems with our own clinical• Minimization of risk damage through the incorporation of• Significant decline in market prices due to competition• Implementation of cross-departmental measures to ensure• Possibility that product prices rise due to soaring prices of• Establishment of Stable Supply Committee to regularly

development or issues faced by collaborative research or
business alliance partners or contractors prevent R&D
activities from proceeding as planned, causing costs torise or leading to development being delayed, suspended
or abandoned

from numerous rival manufacturers• Decline in our sales due to strategies by original drug
manufacturers in Japan to preserve market shareraw materials or that it is difficult to obtain raw materials
over an extended period of time due to fluctuation in the
raw material demand-supply balance, domestic orinternational restrictions on raw materials or quality
concerns originating from the makers of such raw
materials• Recall of products or other impacts due to unexpected

Risks Related to Exclusive

49

revocation of licenses or approvals due to violation oflaws• Possibility that amendments to laws and regulations will

impact the Group’s financial position and its businessresults

Managerial Crisis Management
We have established Managerial Crisis Management Regulations to respond calmly and promptly to management crises.
Furthermore, we have prepared the “Crisis Response Procedures Sheet” for the 17 items stipulated in the regulations to clarify
in advance the guidelines on how to respond to a crisis. In this Crisis Response Procedures Sheet, we drew up plans fordisaster drills, standards for establishing a task force, initial response and other procedures to be followed in the event ofvarious managerial crisis scenarios such as a sudden outbreak of an infectious disease like the COVID-19 pandemic, anearthquake in a given region of Japan, or other wide-area disaster or conceivable incident, and we ensure that all officers andemployees are familiar with these procedures. We have also established procedures for quickly confirming the safety of theemployees by introducing a “safety confirmation system” as a means of ensuring communication between the employees andthe company in the event of a disaster, and we utilized this system when the Noto Peninsula earthquake occurred in 2024.

Outline• Possibility of recall of regulated products in case ofadverse drug reactions after a product goes to market,
the presence of impurities in products, quality changes
associated with changes in raw materials or production
methods or changes in restrictions imposed by regulatory
authorities

solutions to issues in contracts with external partners

accumulation of sales, such as reducing costs by lowering
raw material procurement costs and reviewing production
methods
check the procurement status of raw materials and topromptly take groupwide measures when risks arise• Gradual development of multiple supply chains for important

products• Introduction of “Quality Management Review” for quality

control• Supervision and confirmation of the possibility offoreseeable quality problems arising by a dedicated section
within the Regulatory Compliance Department• Possibility of disruption in the supply of products due to• Establishment of Risk Management Committee and• Lower drug prices due to annual NHI drug price revisions• Sale at reasonable prices taking profitability into

the suspension of operations at production facilities
owing to technical or regulatory issues or natural disasters

formulation of alternative supply plans and supply recovery
procedures in the event of disasterconsideration• Continuous cost reductions• Possibility that makers of original drugs initiate legal action• Possibility of being taken to court over such issues as• Possibility of disruption to business caused by system• Delivery of regular information security training for all• Possibility that difficulties in attracting and retaining• Focus on attracting, retaining and developing human capital• Possibility of being slow to respond to digitalization,• Launch of specific initiatives in three areas Sales Division,• Possibility of recognition of an impairment loss when

• Recording of upfront payments for exclusive distribution

for infringement of process patents or other intellectual
property rights on the approval of generics• Checking of litigation risks by intellectual property
department in relation to patents and legal department inrelation to laws and regulations to lower the possibility ofrisks materializing

failure, computer viruses, cyberattacks and other security
threats• Possibility of damages, administrative disposition and lossof public trust as a result of the leakage of personal
information or other sensitive data
human capital and problems with the development of
human capital will affect the Company’s business results
and financial position
incurring more costs than competitors and lagging behindwith information security measures

impairment is judged to have arisen on exclusive
distribution rights under contracts and upfront payments
for such rights• Exclusive distribution rights under contract are recorded
as “sales rights”• Implementation of appropriate evaluation by an outside
specialist, where necessary, on the recording of longterm advance payments• Possibility of recording a loss on the valuation of

investment securities due to a fall in the reference price inthe case of listed shares and derivatives

product liability, harm to the environment, and labor issues
after product goes to market

employees of the Company

in line with a corporate culture which has always attachedimportance to human capital

Toyama Plant/Toyama Research and Development Center,and Head Office corporate functions, in line with goal of
digitalization under the current Mid-Term Business Planrights under contracts under “long-term advance payments”• Continued evaluation in an appropriate manner every period

thereafter• Implementation of evaluation and verification ofdevelopment progress and distribution plans, including
putting the Sales Division in charge of exclusive distribution
rights and the Business Development Department in chargeof advance payments, and creating opportunities fordiscussion based on regular reports• Implementation of appropriate evaluation by an outside

specialist where necessary on the recording of derivatives• Continued evaluation in an appropriate manner every period

thereafter* Forward-looking statements contained in this report reflect the Group’s judgment as of December 21, 2023.
For more details on these risks, please refer to the annual securities report (in Japanese only). https://www.fujipharma.jp/__upload/bdf8bfaa83fbb359e939488afc3fd80bc46d6c3b.pdf

Fuji Pharma Corporate Report 2024

50

Introduction

Value Creation Story

Sustainability

Governance

Data

Data

Financial and Non-Financial Highlights
Consolidated Financial Highlights
Net sales

JPY

Operating margin

Operating profit

40.9

billion

JPY(Billions of yen)

3.9

9.4

billion

%
(%)

5.0

36.3

11.5

35.4

34.0

33.8

15

4.2

40.9

30

3.8

3.3

3.1

10.7

9.9

9.3

3.9

12

9.4

20

6

10

3

FY2019FY2020

FY2021

FY20220Year ended
September 30, 2023

FY2019FY2020

FY2021

Changes in specific energy
consumption (5-year average)

7,132

95.5

FY2022

Year ended
September 30, 2023

0

%

(kL)

(%)

113.8

10,000

99.2

95.7

92.8

79.3

120

7,132

CO2 emissions (tCO2)

13,328(tCO2)

12,000

5,000

60

8,000

2,500

30

4,000

0

0

5,868

0

5,890

5,296

2018

2019

2020

6,150

2021

2022 (FY)tCO2

16,000

90

7,500

9

2.5

0

Energy consumption(kL crude oil equivalent)kL(Billions of yen)

50
40

Non-Financial Highlights

11,255

11,256

11,727

2018

2019

2020

* As of March 31 of each year

Profit attributable toowners of parent

JPY

3.4

ROE

Equity ratio

8.9

billion

Percentage of parental leaves taken

48.3

%

57.1

%

(Billions of yen)

(%)

4.0

(%)

(%)

12

100

9

75

6

50

1.0

3

25

25

0

0

0

0

100

3.4
3.0

3.0
7.9

2.4

2.1

2.0

2.7

64.8

64.5

7.9

6.7

% (Female)

100.0

100.0

100.0

47.4

48.3

72.7

%

(%)

100

65.9

69.4

2018

2019

64.9

69.2

72.7

2021

2022 (FY)

57.1

52.6

50

50

5.3

* As of March 31 of each year

75

75

50.9

2022 (FY)

85.7

83.3

8.9

2021

13,328Percentage of paid vacations taken

100.0% (Male)12,317

22.0

16.7

25

5.3
FY2019FY2020

FY2021

FY2022

Year ended
September 30, 2023

FY2019FY2020

FY2021

FY2022

Year ended
September 30, 2023

FY2019FY2020

FY2021

FY2022

Year ended
September 30, 2023

0

2020

* As of March 31 of each year

Free cash flows

JPY

R&D expenses(3.3)

billion

JPY(Billions of yen)(Billions of yen)

6.0

3.2

3.6
(11.9)

(5.0)

7.8

56.5

%

5.7
2.5

(%)

7.0

3.1
2.4

2.1

Percentage of females in management positions

43.5% (Male)

10

7.2

(3.3)

–3.0

billionMale/female ratio of employees

9.1

5.0

3.0
0

3.2

R&D expenses ratio

(%)

60

5

%

28

56.6

56.9

56.1
43.4

2.5

18.0
(%)

80

7.8
3.2

% (Female)

43.9

43.1

56.5

56.4
43.6

21.3
21

43.5

14.8

40

14

20

7

20.0

16.9

18.0

–6.0
–9.0
–12.0

FY2019FY2020

FY2021

FY2022

Year ended
September 30, 2023

0

FY2019FY2020

FY2021

FY2022

Year ended
September 30, 2023

00

FY2019FY2020

FY2021

FY2022

Year ended
September 30, 2023

0

FY2019FY2020

FY2021

FY2022

Year ended
September 30, 2023

* A two-for-one split of common shares took place on July 1, 2018.

51

Fuji Pharma Corporate Report 2024

52

Introduction

Value Creation Story

Sustainability

Governance

Data

Data

Principal Financial Data for the Past 11 Years
FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022

FY2023

Consolidated

Net sales (Millions of yen)

25,17429,21531,68034,22935,38737,90936,27933,79333,99035,42640,889Operating profit (Millions of yen)

3,261

3,173

3,251

3,568

4,314

4,391

4,173

3,139

3,349

3,777

3,858

Ordinary profit (Millions of yen)

3,376

3,198

3,099

3,251

4,628

4,472

4,169

2,983

3,250

3,725

4,519

Profit attributable to owners of parent(Millions of yen)

2,068

2,078

2,092

2,118

3,301

3,372

2,962

2,085

2,432

2,696

3,435

Capital expenditure (Millions of yen)

3,167

1,073

1,694

2,427

1,261

1,109

1,965

2,965

3,392

7,150

3,652

Depreciation (Millions of yen)

1,206

1,376

1,768

1,667

1,769

1,976

1,850

1,774

1,828

2,462

2,707

R&D expenses (Millions of yen)

1,280

1,769

1,729

1,840

1,825

1,760

2,052

3,060

2,446

2,485

3,184

Net cash provided by (used in) operating activities(Millions of yen)

3,630

2,757

589

4,509

3,238

3,773

7,035

5,770

5,993

(658)

1,917

Net cash provided by (used in) investing activities(Millions of yen)

(6,601)(1,975)

999(3,319)(1,534)(1,073)(12,024)(2,616)(2,345)(11,271)(5,240)Net cash provided by (used in) financing activities(Millions of yen)

3,743

1,293

(4,635)78(3,042)(2,001)

7,265

450

(5,435)

5,094

1,915

Net assets (Millions of yen)

24,06628,54428,59329,22632,60135,35039,36339,961

32,68135,806

41,177

Total assets (Millions of yen)

39,13849,02745,77348,14749,551

53,11760,73761,96264,23975,53885,332

Earnings per share (Yen)

146.48140.53137.55141.64220.63112.68

97.04

66.94

90.54

111.01141.37

Book value per share (Yen)

1,704.06

1,826.54

1,912.27

1,953.65

2,178.46

1,181.37

1,263.51

1,282.43

1,345.56

1,473.73

1,694.23

Operating margin (%)

13.0

10.9

10.3

10.4

12.2

11.6

11.5

9.3

9.9

10.7

9.4

Return on equity (%)

8.6

7.3

7.3

7.3

10.7

9.9

7.9

5.3

6.7

7.9

8.9

Return on assets (%)

8.6

6.5

6.5

6.9

9.5

8.7

7.3

4.9

5.2

5.3

5.6

Equity ratio (%)

61.5

58.2

62.5

60.7

65.8

66.5

64.8

64.5

50.9

47.4

48.3

Dividend per share (Yen)

40.00

44.00

44.00

45.00

48.00

28.00

29.00

29.00

29.00

35.00

37.00

Number of employees

1,450

1,469

1,469

1,455

1,480

1,511

1,527

1,550

1,532

1,560

1,621

* A two-for-one split of common shares took place on July 1, 2018.
* OLIC became a subsidiary in October 2012.
* The “Accounting Standard for Revenue Recognition,” etc. have been applied from the fiscal year ended September 30, 2022.

53

Fuji Pharma Corporate Report 2024

54

Introduction

Value Creation Story

Sustainability

Data

Data

Declaration of Authenticity

Company Information/Share Information

Company Name

Fuji Pharma Co., Ltd.

Name

Main Businesses

Development, manufacturing, andsales of pharmaceuticals used withprescriptions or guidance(parenteral injections, medicines forinternal use, external preparation, anddiagnostic drugs)

FJP Ltd.

4,307,000

17.71

Hirofumi Imai

3,052,750

12.55

The Master Trust Bank ofJapan, Ltd. (trust account)

2,218,500

9.12

On the publication of Corporate Report 2024
Director, Vice President, General Manager of the Corporate Strategy Division

Satoshi Suzuki
Head Office

Date of Establishment

5-7 Sanbancho, Chiyoda-ku, Tokyo
102-0075 Japan
April 1965(866 at Fuji Pharma and 755 at OLIC)(as of September 30, 2023)

Officers (as of March 31, 2024)

company, and how we are expanding the scope of our contributions.

President & CEO

Takayuki Iwai

Director, Vice President

Toyoyuki Kamide

Director, Vice President

Satoshi Suzuki

Director

Shuhei Morita

Outside Director

Keiji Hirai

Outside Director

Minesaburo Miyake

Outside Director

Keiko Kiyama

Outside Director

Yukiko Araki

Full-Time Audit & Supervisory
Board Member

Daiji Ojima

Outside Audit & Supervisory
Board Member

Fujiaki Mimura

Outside Audit & Supervisory
Board Member

Miori Sagara

we will continue to contribute to people’s health, and to grow and evolve as a company that
contributes to solving social issues not only in Japan but around the world.
I hope that this report provides you with a deeper understanding of Fuji Pharma’s initiatives.
Going forward, we will strive to further enrich the content of the report to assist in productive
dialogues with our stakeholders. We look forward to hearing your frank and honest opinions andrequests.

1,000,000

4.11

Custody Bank of Japan, Ltd.
(trust account)

917,235

3.77

Michiko Imai

446,000

1.83

400,000

1.64

346,380

1.42(Notes)1. Fuji Pharma holds 433,565 treasury shares (1.75% of the total issued
shares). The treasury shares are excluded in the above calculation ofshareholding ratios.
2. Apart from the shareholders mentioned above, Sumitomo Mitsui Trust
Bank, Ltd. holds 7,935 shares as trust assets in the officer shareownership plan. These shares are treated as treasury shares on the
consolidated balance sheets.

Distribution (as of March 31, 2024)

Distributionof Shares
by Shareholder
Type

Individuals and others

10,021,201
40.48 %
sharesFinancial institutions

3,769,335
15.23 %
shares ther corporations
O
based in Japan

7,441,281
30.06 %
sharesNon-Japanesenational individuals

2,684,506
10.84 %
shares inancial instruments
Fbusiness operators

403,912shares

1.63 %

 uji Pharma Co., Ltd.
F
(holder of treasury
shares)433,565
shares1.75 %

 99 shares
4and less

Distributionof Shareholders
by Number of
SharesShare Information (as of March 31, 2024)

10,114 shareholders 83.97 % 00 to 999
5shares

782 shareholders

6.49 %

 ,000 to 4,999
1
shares

902 shareholders

7.49 %

 ,000 to 9,999
5
shares89 shareholders

0.74 %

116 shareholders

0.96 %

Total number of issuable shares

56,440,000

 0,000 to
1
49,999 shares

Total number of issued shares

24,753,800

 0,000 to
5
99,999 shares

22 shareholders

0.18 %

12,045

 00,000 to1
499,999 shares

13 shareholders

0.1 % 00,000 and
5
more shares

7 shareholders

0.06 %

Number of shareholders

55

Yamhill Sciences Co., Ltd.

Fuji Pharma Employee Share
Holding Company

Hirofumi Imaiprocess and that the information contained herein is accurate. By offering excellent pharmaceuticals,

5.01

Consolidated: 1,621

Chairman & Representative
Director

responsible for the creation of this report, I attest that the report was produced through a legitimate

5.10

1,219,300

Number of Employeestransformed ourselves from a manufacturer of generic drugs into a specialty pharmaceuticalother related departments. As the General Manager of the Corporate Strategy Division who is1,240,000

Lotus Japan Holdings G.K.

3,799.10 million yen

It also showcases our characteristics by featuring the voices of our employees engaged in

The creation of this report was led by the Corporate Planning Department and supported by

Noriko Arai

Capital Stocksolving social issues.

products, where we are planning to further intensify our efforts. We have outlined how we

Number of shares Shareholding
held (shares)
ratio (%)

The Seiichi Imai Memorial
Foundation

Corporate Report 2024 provides information on the progress we have made on our Mid-Termresearch and development as well as our new production line for biopharmaceutical and other

Data

Major Shareholders (as of March 31, 2024)

Corporate Profile

Business Plan, products under development, and initiatives we are focusing on with the aim ofGovernanceFuji Pharma Corporate Report 2024

56