Financial Results
Ended March 2024

May 13 , 2024
KYORIN Pharmaceutical Co., Ltd.
Representative Director, President and CEO

Yutaka Ogihara

Outline of Consolidated Financial Results
Trends of Mainstay Products, Generic ProductConsolidated Financial Forecast

Status of R&D Pipeline
Initiatives toward Realization of Vision110 –Stage1–2Outline of Consolidated Financial Results3

Breakdown of Gain and Loss for FY2023（Units: JPY billions）

Vs forecast

Year-on-year
FY2022Net Sales(announced on May 11, 2023)

FY2023
ChangeChange (%)

Change

113.3

119.5

+6.2

+5.5

+3.3

New drugs, etc.
(Japan)

74.8

82.6

+7.8

+10.4

+3.5

New drugs (Overseas)

0.3

0.4

+0.1

+25.1

0

Generic drugs

38.2

36.6

－1.6

－4.3

0

Cost of sales

63.1

68.1

+5.0

+8.0

－

SG&A
(R&D)

45.0

45.4

+0.4

+0.8

－

(10.9)(8.0)(－2.9)(－26.5)(－1.6)

5.1

6.0

+0.9

+17.4

0

5.8

6.6

+0.8

+13.3

+0.1

4.7

5.3

+0.6

+12.7

+0.4

Operating profit
Ordinary profit
Profit attributable to owners ofparent4

Highlights of Business Performance (1/3) YoY: Net Sales（Units: JPY billions）

119.5

113.3

[ Net Sales +6.2]
36.6
38.2

+7.8

Factor of increase

0.4⚫ New drugs grew (Beova, Lasvic, Flutiform etc.)⚫ Increase in sales long-listed products (Kipres, Mucodyne)

0.3

82.6

74.8

FY2022

New drugs, etc. (Japan)

New drugs (Overseas)－0.1

Generic drugs+1.6● Items launched in FY2023 contribute to sales● Decrease sales in AG products● Decrease sales in supplies to other companies

FY2023

5

Highlights of Business Performance (2/3) YoY: Operating Profit（Units: JPY billions）

10.0[ Operating Profit + 0.9]

SG&A
R&D expenses (excluding R&D)

Net Sales－
Gross profit

5.0

5.1

+1.2

2.9

+1.2

Gross profit+3.3

Cost of sales ratio

6.0

+ 6.2
+ 1.3 %pt

Factor of Increase in sales of new drugs (Beova, Lasvic etc)
Decrease Increase in ratio of new drugs
Factor of
Increase

Impact of NHI drug price revisions (Kyorin Pharmaceutical: 7% range)
Loss on disposal in generic drugs
Effect of exchange rate

R&D expenses－2.9

10.9 (FY2022) ⇒ 8.0 (FY2023)
Upfront payment recorded in FY2023
Decline of expenses regarding of ActivX

SG&A (excluding R&D)
0
Operating profit
FY2022

Operating profit
FY2023+3.3

34.1 (FY2022) ⇒ 37.4 (FY2023)
Increase in selling expenses, personnel expenses,
depreciation expenses and license fees etc.

6Highlights of Business Performance (3/3) : Vs Forecast（Units: JPY billions）

FY2022Net Sales

Vs forecast

Year-on-year

FY2023(announced on May 11, 2023)

ChangeChange (%)

Change

113.3

119.5

+6.2

+5.5

+3.3

New drugs, etc. (Japan)

74.8

82.6

+7.8

+10.4

+3.5

New drugs (Overseas)

0.3

0.4

+0.1

+25.1

0

Generic drugs

38.2

36.6

－1.6

－4.3

0

63.1

68.1

+5.0

+8.0

－

45.0

45.4

+0.4

+0.8

－

(10.9)(8.0)(－2.9)(－26.5)(－1.6)

5.1

6.0

+0.9

+17.4

0

5.8

6.6

+0.8

+13.3

+0.1

4.7

5.3

+0.6

+12.7

+0.4

Cost of sales
SG&A
(R&D)
Operating profit
Ordinary profit
Profit attributable to owners ofparentDifference from the Forecast (Announced on May 11, 2023)】
Net sales: Net sales exceed the forecast due to increase in sales of new drugs (Lasvic, Flutiform), long-listed products (Kipres, Mucodyne) and AG.
Operating profit: Cost of sales ratio was increased and SG&A expenses (R&D expenses) were lower than the forecast. As a result, operating profit was in line.
R&D: －1.6 billion (Forecast 9.6 billion)
Extraordinary profit: 1,404 mil, gain on sale of investment securities etc.
Extraordinary loss: 987 mil, expenses regarding voluntary retirement program, etc.
7

Mainstay Product Sales Update（Units: JPY billions）

Beova (KYORIN)(β3 adrenergic receptor agonist overactive bladder therapeutics )Lasvic(New quinolone synthetic antibacterial agent)

Lyfnua(Selective P2X3 receptor antagonist / chronic cough)Desalex(Antiallergic Agent)

Flutiform(Combination drug for asthma treatment)

Pentasa(Ulcerative colitis and Crohn’s disease treatment)

New drugs,
etc. (Japan)

Kipres(Leukotriene Receptor Antagonist)

Mucodyne(Mucoregulator)

Nasonex(Spray type allergic rhinitis remedy)

Uritos (KYORIN)(Therapeutic agent for overactive bladder)

Milton(Disinfectant)

Rubysta(Disinfectant)Montelukast tablets “KM”
(Leukotriene Receptor Antagonist)

Generic
drugs

Mometasone Nasal 50mg “KYORIN”(Spray type allergic rhinitis remedy)

Imidafenacin tablets & OD“KYORIN”(Therapeutic agent for overactive bladder)

FY2022

FY2023

12.9

vs Forecast

Year-on-year(announced on May 11, 2023)

ChangeChange (%)

Change

18.1

＋5.2

＋40.3

－0.8

2.5

4.9

＋2.4

＋99.5

＋1.7

0.2

0.8

＋0.6

＋323.9

－0.5

8.5

8.9

＋0.4

＋3.7

0

12.0

12.9

＋0.9

＋7.1

＋1.5

12.8

12.3

－0.5

－4.0

＋0.5

6.6

7.0

＋0.4

＋5.9

＋1.7

3.5

4.2

＋0.7

＋20.6

＋1.2

2.5

2.0

－0.5

－20.1

＋0.8

0.7

0.5

－0.2

－26.4

＋0.3

2.0

1.9

－0.1

－6.7

0

2.1

1.5

－0.6

－25.8

－0.6

13.3

12.3

＋1.0

－7.7

＋1.3

4.7

4.5

－0.2

－2.7

＋1.1

0.7

0.6

－0.1

－14.0

＋0.2

Trends of Mainstay Products and Generic Drugs

9[Mainstay products] Beova (Therapeutic agent for OAB)
OAB market

b3 receptor antagonist（Units: JPY billions）

100

96.3

97.7

Anticholinergic agents（Units: %)

93.0

89.0
20.9

30.6

40.3

48.1

Sales

Beova (KYORIN) share

25

92.3

（Units: JPY billions）

20

Forecast

18.9

22.3
17.3

20

16.7

15
50

57.4
48.2

18.1

10.2

8.6

68.1

75.0

10

12.9

62.4

5.0

7.3

5

0

22.0

10

20/3

21/3

22/3

23/3

24/3

0

0

21/3

8.6

22/3

23/3

24/3

25/3
(Forecast)

Copyright © 2024 IQVIA. Calculated based on JPM 2 0 2 0 / 3 M A T-2024/3 MAT. Reprinted with permission

MarketResult in FY2023

OAB market: +3.8%*
Market expansion of β3 adrenergic receptor

No.1 market share in OAB market (as Beova)
No.1 share of OAB patients and rate of new patients acquisition (as Beova)[NHI drug price revision: Beova －4.6% (Apr 2023)]

Medium to long-term market outlook

The number of OAB patients tend to increase
Market is forecast to remain flat due to NHI drug price revision and launch
generic drugMarket expansion for β3 adrenergic receptor.
*Copyright © 2024 IQVIA. Calculated based on JPM 2023/3 MAT, 2024/3 MAT Reprinted with permission

10

[Mainstay products] Lasvic (New quinolone synthetic antibacterial agent)
Oral antimicrobial market

Sales

Lasvic share

Market

6.4（Units: JPY billions）（Units: %)100

6（Units: JPY billions）

6.0

96.2

Forecast

3.2
4.0

63.3

62.3

50

77.1

4

60.5

6.4

3.0

2.9

4.9

1.9

2

0.9

1.8

2.5

0.9
0

20/3

21/3

22/3

23/3

24/3

0

0

21/3

22/3

23/3

24/3

25/3
(Forecast)

Copyright © 2024 IQVIA. Calculated based on JPM 2 0 2 0 / 3 M A T-2024/3 MAT. Reprinted with permission

MarketResult in FY2023

Oral antimicrobial market: +27.5%*
Increase to seek treatment after Covid-19 classified to the Category V⚫ Listed in guidelines as a recommended drug
⚫ No.1 market share in oral antimicrobial market[NHI drug price revision: －5.3% (oral), 0% (iv) (Apr 2023)]
Medium to long-term market outlook

Expect to tend to decrease in oral antimicrobial market due to prevent
infection/appropriate use against AMR*Copyright © 2024 IQVIA. Calculated based on JPM 2023/3 MAT, 2024/3 MAT Reprinted with permission

11

[Mainstay products] Lyfnua (Cough treatment)
The number of estimated patients

Sales（Units: JPY billions）

1.5

Chronic chough patients

1.0(Forecast)1.3

2,500K

1.5

0.5

0.8
0.2
0

23/3

24/3

25/3
(Forecast)

RCC/UCC patients

400～500K

Result in FY2023⚫ Number of customers : Target was not achieved⚫ Period of taking drug was shorter than expected[NHI drug price revision: 0% (Apr 2023), by cost-effectiveness evaluation: －7.7%]12

[Mainstay products] Desalex (Antiallergic Agent)
New drugs
Long-listed and generic drugs

Antihistamine market（Units: JPY billions）

160

Sales

Desalex share（Units: %)（Units: JPY billions）

156.2

15

137.0

Forecast

8.9

125.6

122.0

85.2

116.5
9.0

98.6
80

100

83.7

10

8.1

67.8

6.6

50

74.5

4.9

5

5.7

71.0
710
1.7

0

20/3

38.3
383

41.9
419

475
47.5

48.7
487

21/3

22/3

23/3

24/3

0

0

21/3

7.4

22/3

8.5

8.9

23/3

24/3

9.6

25/3
(Forecast)

Copyright © 2024 IQVIA. Calculated based on JPM 2 0 2 0 / 3 M A T-2024/3 MAT. Reprinted with permission

MarketAntihistamine Market: －4.5%*
Medium to long-term market outlook

Result in FY2023⚫ Prescription in otolaryngology: No.2
⚫ Focus on acquiring prescriptions in otolaryngology and internal medicine[NHI drug price revision: －9.1% (Apr 2023)]

Number of patients tend to increase
Shrinking market due to NHI drug price revision and launch generic drug

*Copyright © 2024 IQVIA. Calculated based on JPM 2023/3 MAT, 2024/3 MAT Reprinted with permission

13

[Mainstay products] Flutiform（Anti-asthmatic）
ICS/LABA market

MarketSales

Flutiform share（Units: JPY billions）（Units: %)（Units: JPY billions）

140

Forecast

20

14.0

10

7.0

11.4

16.9
15.5

15.9

16.0

13.2

70

123.2
101.3

0

20/3

21/3

90.4

85.6

86.0

22/3

23/3

24/3

0

0

13.3

21/3

12.6

12.0

22/3

23/3

12.9

24/3

12.5

25/3
(Forecast)

Copyright © 2024 IQVIA. Calculated based on JPM 2 0 2 0 / 3 M A T-2024/3 MAT. Reprinted with permission

MarketResult in FY2023

ICS/LABA market: remain flat
Increase to seek treatment after Covid-19 classified to the Category V

Expansion market share in terms of volume (17.5% FY2022 ⇒ 18.2% FY2023)
Synergy effects with Lyfnua promotion[NHI drug price revision: －6.1% (Apr 2023)]

Medium to long-term market outlook

Market remained flat due to impact of NHI drug price revision etc.
*Copyright © 2024 IQVIA. Calculated based on JPM 2023/3 MAT, 2024/3 MAT Reprinted with permission

14

Status of Generic Drugs
Sales in AG (three products) among with the sales at left

Sales
Forecast

40

20

36.6

20

32.2

0

21/3

34.8

22/3

38.2

Forecast

14.8

38.2

36.6

10

15.4

23/3

25/3

24/3

0

21/3

16.6

22/3

(Forecast)

18.7

23/3

17.4

24/3

16.6

25/3
(Forecast)）

Copyright © 2024 IQVIA. Calculated based on JPM 2 0 2 0 / 3 M A T-2024/3 MAT. Reprinted with permission

Result in FY2023 (Generic drug)

Sales decreased
New products launched in June 2023
Eplerenone tablets 25mg/50mg/100mg
Fluticasone FR Nasal Solution 27.5mg 56/120 puffs
Azilsartan OD tablets 10mg/20mg/40mg

Result in FY2023 (AG)⚫ Restrictions on Shipment due to impact of restrictions in other company: Mometasone, Montelukast⚫ Effects of lower volume of airborne pollen than previous year
⚫ Keep market share of 50% in AG

Effort in FY2024 (Generic drug)

Sales expansion of new products launched in FY2024
Products succession from other companies
Sales increase in supplies to other companies*Copyright © 2024 IQVIA. Calculated based on JPM 2023/3 MAT, 2024/3 MAT Reprinted with permission

15

Consolidated Financial Forecast

16Consolidated Financial Forecast
FY2023

FY2024

119.5
New drugs, etc.
(Japan)Year-on-year
ChangeChange (%)

123.4

+ 3.9

+ 3.2

82.6

84.7

+ 2.1

+ 2.6

New drugs(Overseas)

0.4

0.4

0

+ 3.6

Generic drugs

36.6

38.2

+ 1.6

+ 4.5

Cost of sales

68.1

-

-

-

SG&A (R&D)

45.4

-

-

-

(8.0)

(8.5)

(+ 0.5)(+ 6.0)Operating profit

6.0

6.5

+ 0.5

+ 8.1

Ordinary profit

6.6

6.9

+ 0.3

+ 4.5

5.3

5.0

－ 0.3

－ 6.1

Net Sales

Profit attributable to ownersof parent[Key factors for increase / decrease (Year-on-year)】Net sales: The sales of new drugs (Beova, Lasvic etc.) and generic drugs are expected to increased.
Operating profit: Gross profit are expected to increased due to sales increased in mainstay products, although cost of sales ratio increase.
SG&A expenses (including R&D) are expected in flat.
Cost of sales ratio: +0.5 %pt
SG&A expenses (excluding R&D): －1%pt
R&D expenses: +0.5 billion (8.0 to 8.5)

17

Forecast of Mainstay Products Sales（Units: JPY billions）

Beova (KYORIN)(β3 adrenergic receptor agonist overactive bladder therapeutics )Lasvic(New quinolone synthetic antibacterial agent)

Lyfnua(Selective P2X3 receptor antagonist / chronic cough)Desalex(Antiallergic Agent)

Flutiform(Combination drug for asthma treatment)

New drugs,
etc. (Japan)

Pentasa(Ulcerative colitis and Crohn’s disease treatment)

Kipres(Leukotriene Receptor Antagonist)

Mucodyne(Mucoregulator)

Uritos (KYORIN)(Therapeutic agent for overactive bladder)

Milton(Disinfectant)

Rubysta(Disinfectant)Montelukast tablets “KM”
(Leukotriene Receptor Antagonist)

Generic
drugs

Mometasone Nasal 50mg “KYORIN”(Spray type allergic rhinitis remedy)

Imidafenacin tablets & OD“KYORIN”(Therapeutic agent for overactive bladder)

FY2022

FY2023

18.1

Year-on-year
ChangeChange (%)

22.0

＋3.9

＋21.6

4.9

6.4

＋1.4

＋29.8

0.8

1.5

＋0.7

＋86.3

8.9

9.6

＋0.7

＋8.5

12.9

12.5

－0.4

－2.6

12.3

11.6

－0.7

－5.0

7.0

5.3

－1.7

－23.5

4.2

4.3

＋0.1

＋2.6

0.5

0.3

－0.2

－34.7

1.9

1.9

0

＋2.1

1.5

1.5

0

＋1.8

12.3

11.8

－0.5

－3.9

4.5

4.3

－0.2

－3.4

0.6

0.5

－0.1

－12.5

Shareholders Returns

Capital
Policy● Increase capital efficiency through investment for growth and shareholder returns,
with a constant awareness of the cost of capital and return on capital, while maintaining a sound financial base● Maintain stable dividends taking DOE (Dividend on Equity ratio) into account

Dividend

FY2021

FY2022

FY2023*

FY2024(Forecast)

Dividend
per share (Yen)¥75(Year end ¥45)

¥52
(Year end ¥32)

¥52
(Year end ¥32)

¥52
(Year end ¥32)

Consolidated
payout ratio

76 . 9 %64 . 0 %56 . 8 %60. 5%*The year-end dividend of 32 yen have been decided at in the Board Meeting scheduled in May 24, 2024

19

Status of R&D Pipeline20

Status of R&D Pipeline
Clinical trials are making steady progress
Ph1

Development code

Respiratory

KRP-R120

Infection

KRP-A218

Urology

Ph2

Ph3

Application

Approval/Launch

MRCT*1(Sept. 2022)(Apr. 2021)
Completedby ASKA

AKP-009*2
KRP-114VP(Aug. 2022)*1 MRCT: Multi-Regional Clinical Trials*2 Ph1 trial is being conducted again (ASKA Pharmaceutical)
Development of GMAC for Fabry disease is terminated［Licensed Compound］
Compound/CodeKRP-203

LicenseeStage

Priothera

Ph3

Features⚫Sphingosine-1-Phosphate receptor Agonist⚫Target: AML patients undergoing HSCT
⚫Assignment of IP and drug substances (Sep. 2020)［DTx development］
Compound/Code

Proposed Indication

KRP-DT123

Tinnitus

Features⚫ Specified clinical trial (Sept 2023)

21

Initiatives toward Realization of Vision110 –Stage1–

22

Initiatives toward Realization of Vision110 –Stage1–

Stage 1
Strengthening drug discovery capability to create highvalue new drugs that meet medical needs
Expansion of development pipeline through in-licensing
Maximization of the ratio of new drugs
Promoting healthcare-related businesses that havesynergies with the new drugs business
Building a sustainable corporate foundation
23

Initiatives toward realization of Vision110 –Stage1–

Strengthening drug discovery capability to create high-value new drugs that meet medical needs

Try for drug innovation through new drug discovery strategies
Development of new
research themes

Strengthen
basic technology
Small molecule drugs

New targets

Nucleic acid medicines
Known targets

New technology(Open innovation)

Drug discovery capability to create high-value new drugs
that meet medical needs
FY2023ResultFY2024

Initiatives

Focus on 3 research areas that utilize Kyorin’s skills and knowledge and meet medical needs,
and concentrate management resource
Research areas

Fibrosis

Pain

Autoimmune disorder

Strive to enrich the drug discovery pipeline by promotion of
in-house research activities and utilized external technology
24Initiatives toward realization of Vision110 –Stage1–

Expansion of development pipeline through in-licensing

Strengthen the foundation of new drug business by enhancement of in-licensing
and alliance function and expansion of development pipeline
Expand the scope of modality and therapeutic area
Increase ofinvestment

Speedy assessment and acquisition of in-licensing

Organizational reform
Human resource

Promote and expand DTx development

Stage 1
TargetAt least 6 in-licensing items

2023 年度

結果
2024 年度

取り組み

Human resources

Double(vs FY2022)

Number ofevaluation item

Tree times

In-licensed

0 item

(vs FY2022)

Strive to acquire in-licensed products expected to make early
contribution to business performance25

Initiatives toward realization of Vision110 –Stage1–

Maximization of the ratio of new drugs

Sales

Ratio of new drugs(unit: billion yen)

56.0

Target in FY2025: over 50％

52.0
45.6

Forecast 43.7

51. 0%
50 %

6.4

4.9
2.5

5.0

Lasvic®

4.5

Lyfnua®

18.1

12.9

47. 4%

Beova®

22.0

36.1

Forecast

25.0

1.5

0.8

0.2

8.5

8.9

9.6

10.0

Dezalex®

12.0

12.9

12.5

11.5

Fultiform®

FY2022

FY2023

FY2024FY2025(Forecast)(Target)42. 0%FY2022

FY2023

FY2024FY202526

Initiatives toward realization of Vision110 –Stage1–

Maximization of the ratio of new drugs

Beova®
⚫ No.1* in OAB market⚫ No.1 of OAB patients’ share

Status(FY2023: 34%*, as Beova)

FY2024
Initiatives

Aimed status
By FY2025

Goal● New patients acquisition rate : 50%●D T C→ Aim to achieve a 45% the patients' shareFirst-line treatment for OAB●No.1 in OAB market as Beova in FY2023 Achievement●50% of patients' share of OAB market*Copyright © 2024 IQVIA. Calculated based on JPM 2024/3 MAT Reprinted with permission

27

Initiatives toward realization of Vision110 –Stage1–

Maximization of the ratio of new drugs

Lasvic®
Status⚫ Classified Covid-19 to the Category V caused market expansion⚫ Listed in guidelines as a recommended drug
⚫ Growth rate of No.1 (25%*) in expansion of oral NQ market
FY2024
Initiatives

Aimed status⚫ First choice for the elderly/patients with respiratory infection⚫ Growth in number of medical institution with prescription of Lasvic(internal medicine/otorhinolaryngology)First-line antibacterial agent for elderly or patients with
underlying disease in respiratory infection

By FY2025●No.1 sales in oral NQ market by FY2023 Achievement

Goal●40% share of NQ market as Lasvic*Copyright © 2024 IQVIA. Calculated based on JPM 2024/3 MAT Reprinted with permission

28

Initiatives toward realization of Vision110 –Stage1–

Maximization of the ratio of new drugs

Lyfnua®
Status⚫ Sales target was
not achieved
FY2024
Initiatives⚫ FY2023(second half) GP: 6,300, HP: 1,300⚫ Period of taking drug was shorter than expected⚫ Enhancement of better understanding for productcharacteristic (adverse event on target)⚫ Initiative to extend the patient’s period of taking drug
(appealing effectiveness/safety including long-term data)⚫ FY2024(second half) GP: 9,700, HP: 1,700

Only one treatment for chronic coughBy FY2025

Goal⚫ Number of customers in FY2025

GP
HP

Approx. 10,000
Approx. 2,000

Aim to being a first-line treatment for the patients with chronic cough despite treatment

29

Initiatives toward realization of Vision110 –Stage1–

Promoting healthcare-related businesses that have synergies with the new drugs businessTakaoka New Plant
Operation Started
PurposeStrengthen supply capacity with increase in
manufacturing volume of drugs■ of the Takaoka Plant
OutlineLocation

IC Park 8, Takaoka-City, Toyama

Site Area

42,457 m2

Building

Three floors, Building area about 7,262 m2,
Total floor area about 21,091 m2

Product capacity two billion tablets/year

Increase in manufacturing volume of generic drugs⚫Production function of Inami plant are transferred to Takaoka⚫In-house manufacturing of outsourcing products

Manufacturing of new drugs⚫Increase production of Mucodyne

Significantly reduce CO2 emissions, actively utilize
LNG and renewable energy

Aim to achieve cost reduction by increase in manufacturing volume of generic drugs
and shift to in-house manufacturing of outsourcing products

30Initiatives toward realization of Vision110 –Stage1–

Stage 1
Strengthening drug discovery
capability to create high-value
new drugs that meet medical
needs
Expansion of development pipeline
through in-licensing

Result in FY2023

Initiatives in FY2024

Focus on research area
Steady progress in clinical trials

Promote in-house research activities andutilize external technology
Enrich drug discovery pipeline

No in-licensed productAcquire in-licensed products

Sale increased in new drugs

Maximization of theratio of new drugs
Promoting healthcare-related
businesses that have synergies
with the new drugs business
Building a sustainablecorporate foundation(36.1 to 45.6 billion yen)

Ratio of new drugs improved

Emphasize proliferation of new drugs(42% to 47.4%)

Solution-based marketing activities
Sales in infection-related products
FY2023
9.5 billion yen

Promote solution-based marketing activities
Sales in infection-related products
FY202411.2 billion yen

Starting operation of Takaoka plant

Full-operation of Takaoka plant
Establish production increase structure of Mucodyne

Relocation of head office etc.
Promote Health Management
Implement voluntary retirement program
Support TCFD

Operational efficiency and cost
reduction

31

Initiatives toward realization of Vision110 –Stage1–

Performance target

Performance targets (consolidated basis)

Performance target(FY2025)

FY2023(Actual)

FY2024(Forecast)

Growth potential

At least 2%

5.5%

4%

At least 16%

12%

12%

Profitability“Net sales” CAGR

Operating profit before
deduction of R&D expenses(operating profit + R&D
expenses)Capital policy and shareholder returns
Increase capital efficiency through investment for growth and shareholder returns, with a constant awarenessof the cost of capital and return on capital, while maintaining a sound financial base
Maintain stable dividends taking DOE (Dividend on Equity ratio) into account32

FY2024 Management policy

Accomplish reform of drug discovery

Expand of development pipeline

Maximize the expansion of sales
growth in new drugs
Improve cost competitiveness33

Disclaimer

This material contains performance forecasts, goals and plans, and other forward-looking statements
related to the Group. These statements are based on the judgment of the Group’s assumptions andoutlooks based on the information and forecasts available at the time of preparation of this material,and contain known or unknown risks and uncertainties. Therefore, due to various factors that may occur,
the actual performance, progress / success / failure of the development and other insights may differ
significantly from the description. It also contains information about medicines (including those underdevelopment), but the description is not for the purpose of advertising or medical advice.

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