July 30, 2021

SEIKAGAKU CORPORATION
Consolidated Financial Results (Japan GAAP) (Summary)for the First Three Months of Fiscal 2021
(Three-Month Period Ended June 30, 2021)
Listed exchanges: Tokyo Stock Exchange (First Section)
Stock code number: 4548
URL: https://www.seikagaku.co.jp/en/(All amounts have been rounded down to the nearest million yen)

1. Consolidated Financial Results for the First Three Months of Fiscal 2021
(from April 1, 2021 to June 30, 2021)(1) Consolidated Financial Results(Percentages indicate changes from the same period in the previous fiscal year)
Net sales

Operating income

Millions ofYen%Millions ofYen%

Millions ofYen-

4,613

655.8

610(51.2)

First three months of fiscal 2021

11,784

71.6

4,446

First three months of fiscal 2020

6,865(5.6)

396

Net income attributable toowners of parent
Millions of%YenFirst three months of fiscal 2021
First three months of fiscal 2020

3,652529(58.9)%

Net income per share

Diluted net income
per share

Yen

Yen

589.3

64.73

-

9.39-

(46.0)(Note) Comprehensive income:First three months of fiscal 2021:
First three months of fiscal 2020:

Ordinary income

4,772 million yen [398.2%]
957 million yen [21.8%](2) Consolidated Financial Position
Total assets

Total equity

Equity ratio

Millions of Yen

Millions of Yen%

As of June 30, 2021

75,442

67,586

89.6

As of March 31, 2021

69,91563,604

91.0(Reference) Shareholders’ equity:
As of June 30, 2021: 67,586 million yen
As of March 31, 2021: 63,604 million yen

2. Dividends

Fiscal 2020
Fiscal 2021
Fiscal 2021
(Forecast)

1st QuarterYen-

2nd Quarter
Yen
10.00

Dividends per share
3rd QuarterYen-15.00-(Note) Revision of the forecasts most recently announced: No1Year-end

AnnualYen
14.00

Yen
24.00

15.00

30.00

3. Forecast of Consolidated Financial Results for Fiscal 2021 (from April 1, 2021 to March 31, 2022)
Net sales

Fiscal 2021

Operating income

Millionsof Yen%32,200

16.1

Millionsof Yen4,550(Percentages indicate changes from the prior fiscal year)
Net income
Net income
Ordinary income
attributable toper shareowners of parent
Millionsof Yen%102.3

4,650%

Millionsof Yen53.7

3,650%(14.4)

Yen

64.83* Notes(1) Changes in the status of material subsidiaries during the period: No(2) Application of specific accounting methods for preparing the quarterly consolidated financialstatements: Yes(3) Changes in accounting policies, changes in accounting estimates, and retrospective restatements(a) Changes in accounting policies accompanying revisions in accounting standards: Yes(b) Changes other than those in (a) above: No(c) Changes in accounting estimates: No(d) Retrospective restatements: No(4) Number of shares issued (common stock):(a)Number of shares at the end of the period(including treasury stock)

As of June 30,2021

56,814,093 shares

As of March 31,2021

56,814,093 shares(b) Number of treasury stock at the end of
the period

As of June 30,2021

384,458 shares

As of March 31,
2021

384,421 shares(c) Average number of shares issued during
the period (three months)

First three monthsof fiscal 2021

56,429,665 sharesFirst three monthsof fiscal 2020

56,416,326 shares*This financial reports are not subject to the quarterly review procedures of the certified public accountant and audit
firm.
* Disclaimer regarding forward-looking information including appropriate use of forecasted financial results
At this time it would be difficult to reasonably assess a forecast of consolidated financial results for the fiscal year ending
March 31, 2022.

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1. Results of Operations for the First Quarter of Fiscal 2021 (Three-Month Period Ended June 30, 2021)(1) Qualitative explanation on quarterly financial results
In the first three months (April 1 to June 30, 2021) of the fiscal year ending March 31, 2022 (fiscal 2021), netsales were ¥11,784 million, up 71.6% year on year. The result is attributable to a rebound from the substantial
impact of the spread of COVID-19 infection in Japan and abroad in the first quarter of the previous fiscal year aswell as an increase in royalty income (reclassified from non-operating income to net sales beginning in fiscal2021) and the launch of the joint function improving agent JOYCLU, positive factors that offset the impact ofNational Health Insurance (NHI) drug price reductions in Japan.
Operating income rose 1,022.2% year on year to ¥4,446 million as a result of the sales increase, despite
higher SGA expenses, mainly for R&D. Ordinary income rose 655.8% year on year to ¥4,613 million on adecrease in dividend income, and net income attributable to owners of parent rose 589.3% to ¥3,652 million,
reflecting higher income taxes due to the profit increase.
1) Net sales by segment
Pharmaceutical Business- Domestic Pharmaceuticals (¥3,847 million, up 9.8% year on year)
Deliveries to medical institutions and market share for ARTZ, a joint function improving agent for knee
osteoarthritis, increased year on year due to a rebound following market contraction in the first quarter of theprevious fiscal year caused by the spread of COVID-19 infection, as well as the effect of switching fromcompeting products, thanks to the continuing effectiveness of measures to acquire new user facilities and otherfactors. The Company’s sales decreased, reflecting the impact of NHI drug price reductions and a decrease inshipments from a high level in the first three months of fiscal 2020.
Sales Partner Ono Pharmaceutical Co., Ltd. commenced sales of the joint function improving agent
JOYCLU on May 19, 2021. Although the Company called attention to the risk of anaphylaxis in the Important
Side Effects section of the JOYCLU package insert, in response to multiple reports of shock or anaphylaxis
occurring in patients following administration of JOYCLU, the Company issued a Dear Healthcare Professionals
Letter of Rapid Safety Communication (Blue Letter) on June 1 to alert healthcare professionals to the risk.
Seikagaku will continue efforts to proactively gather side effects information on the basis of collaboration withsales partner Ono Pharmaceutical Co., Ltd. and make ongoing efforts to provide safety and effectivenessinformation to promote the appropriate use of JOYCLU.
Deliveries to medical institutions of the OPEGAN series of ophthalmic viscoelastic devices increased year
on year, reflecting a rebound following market contraction in the first quarter of the previous fiscal year due tothe spread of COVID-19 infection as well as growth in the number of new user facilities. The Company’s sales
fell due to NHI drug price reductions and a decline in shipments from a high level in the first three months offiscal 2020.
The Company’s sales of MucoUp, a submucosal injection agent for endoscopic surgery, rose slightly,
reflecting the impact of shipment timing.
Deliveries to medical institutions of HERNICORE, a treatment for lumbar disc herniation, increased thanks
to a rebound in outpatient services following a decline in the first quarter of the previous fiscal year
accompanying the spread of COVID-19 infection and steady growth in the number of new user facilities. TheCompany’s sales fell, reflecting the impact of shipment timing.
- Overseas Pharmaceuticals (¥1,589 million, up 40.6% year on year)
Local sales volume of Gel-One, an intra-articular single-injection viscosupplement for the treatment of knee
osteoarthritis, increased year on year, reflecting a rebound from the impact of postponement of non-urgent andnon-emergency medical procedures in the first quarter of the previous fiscal year in connection with the spreadof COVID-19 infection as well as successful measures to promote switching from competing products. Local
sales volume in the U.S. and the Company’s sales both increased.
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Local sales volume in the U.S. and the Company’s sales of SUPARTZ FX, an intra-articular 5-injection
viscosupplement for the treatment of knee osteoarthritis, increased in the absence of the powerful impact of thespread of COVID-19 infection experienced in the first quarter of the previous fiscal year, despite continuation of
the trend in the U.S. market toward preference for products that require a low number of injections.
Local sales in China and the Company’s sales of ARTZ increased, reflecting aggressive sales promotionactivities.
- Bulk Products and Contract Development and Manufacturing Organization＊1 (¥720 million, up 144.0%
year on year)
Although sales of bulk products declined, overall sales increased due to the addition of sales from contractdevelopment and manufacturing at overseas subsidiary Dalton Chemical Laboratories, Inc.
As a result of these developments and the addition of royalty income*2 (¥3,550 million, up 3,818.3% year onyear), sales from the pharmaceuticals business segment rose 93.3% year on year to ¥9,707 million.
*1 Starting from the second quarter of fiscal 2020, the sales of Dalton Chemical Laboratories, Inc., whichbecame a subsidiary in March 2020, are included in the pharmaceuticals business segment.
*2 Beginning in fiscal 2021, royalty income has been reclassified from non-operating income to net sales.
LAL Business
Sales from the LAL business segment increased 12.6% year on year to ¥2,076 million due to an increase in salesof Bacterial Endotoxin Testing (BET) reagents and Clinical Diagnostic (Fungitell) reagents. This rise was a
result of increases in BET contract services and clinical diagnostic product demand as well as effects ofreinforcement of sales activities at overseas subsidiary Associates of Cape Cod, Inc., coupled with steady sales inJapan. In April 2021, Associates of Cape Cod, Inc. launched a new class of BET reagent—PyroSmart
NextGen™ recombinant cascade reagent (rCR), and in May, Seikagaku launched it in Japan.
(2) Explanation of forward-looking information, including the forecast of consolidated financial results
Although the Company achieved the full-year forecast for net income attributable to owners of the parent
announced on May 13, 2021 in the first quarter, in light of the receipt of one-time royalty income in the firstquarter and expected concentration of R&D expenses in the second quarter and beyond, there is no change in theforecast of consolidated financial results.
The Company is currently assessing the impact on sales of JOYCLU of issuance of the Blue Letter.
Note: The above forecast has been prepared on the basis of economic circumstances, market trends, and otherassumptions made at the time of release of this document. Actual results may differ from the forecast due to avariety of factors.

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