ESG Round Table - Efforts toward Creating Sustainable Corporate Value
DyDo Group Holdings, Inc.
(1st Section of the Tokyo Stock Exchange: 2590)

September 10, 2021

Table of Contents

1. Efforts toward Group Mission 2030

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2. Efforts toward Creating Sustainable Corporate Value

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21. Efforts toward Group Mission 2030

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The DyDo Group’s purpose for existing
Offering delicious products for sound mind and body

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4

Group Mission 2030

For DyDo Group to create enjoyable,healthy lifestyles for people around the world
Together with our customers.
Nurturing our customers’ health
We will deliver products and services that
help improve health and quality of life forour customers around the world, in a tirelessquest for delicious taste.

Together with the next generation.
Creating new value for future
generations
We will take advantage of innovativetechnologies, bringing surprise and delightto all of our stakeholders.

Copyright (C) DyDo Group Holdings. All Rights Reserved.

Together with society.
Taking the lead in social reform
We will take the lead in social reform,
going beyond conventional wisdom toadopt new perspectives for achieving asustainable society.

Together with our people.
Connecting people to people
We will seek out new ways to form mutually
beneficial relationships with stakeholders,both old and new, within and outside thecompany, working flexibly with them andrespecting the diversity of their values andabilities.
5Group Mission 2030 Roadmap
Although revenue will fall temporarily, we will make advance investments to achieve sustained growth.
2019

2022

[Profit image]

2026

2030

Decline in profit due toinvestment strategy
Plan[Corporate activities at each stage]
Mid-term Business Plan 2021
Platform-strengthening
and investment stage
 Carrying out measures to boost
profitability in individual businesses Studying and implementing a
selection and consolidation process
in the International Beverage
Business
 Making growth-oriented
investments (strategic investments
in existing businesses, M&As in
new businesses, etc.)

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Business as usual

Growth stage
 Building and developing a newbusiness model for the vending
machine business Rebuilding the strategies that guideour business activities overseas
 Developing the orphan drug
business and other new businesses
in the health care domain

Achievement stage
 Achieving innovation in theDomestic Beverage Business Boosting overseas sales to 20% of
total sales
 Transforming our healthcare
domain businesses into a second
major source of revenue

Announced January 20196

Group Mission 2030 Basic Policies

Sales

Strive to develop a business portfolio characterized by high growth, profitability, and efficiency
Innovation in the Domestic
Beverage BusinessThis segment will continue to be the
DyDo Group’s core business.

Development of a second major
source of revenue in non-drink
businesses
Build our businesses in the health caredomain as a second major source of revenue
that integrates well with existing businesses.

Expansion of our businessoverseas
Earn at least 20% of the Group’s overallsales overseas.

Operating profit ratio

0%

5%

6%

*Figure intended as a general illustration. The size of each circle represents operating income,with FY2018 and FY2030 indicated by light and dark colors, respectively.
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10%Announced January 20197Creating a Sustainable Business Portfolio
Main points regarding the creation of a sustainable business portfolio aimed at groupwide sustainable growthInnovation in theDomestic BeverageBusiness

２Development of asecond major sourceof revenue in nondrink businesses

Expansion of ourbusiness overseas

0%" Multifaceted management” togrow our business sustainably

１５％ ６％10％１２

Further develop
existing businesses

Cultivate
growth fields

Operating profit

Announced January 2019
*Figure intended as a general illustration.
The size of each circle represents operating income, with FY2018 and FY2030 indicated by light and darkcolors, respectively.

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8Business Segment and Group Material Issues
Forming a sustainable business portfolio and selecting material issues with the aim of spurring renewed growth inexisting businesses
A set of values that have remained constant since our(1) Corporate Philosophy

founding, unswayed by changes in our external
environment

Holding company

Group philosophy
and vision

Our strengths built on our philosophy

Our idealstanceOur raison d’être (mission) as a company that focuses(3) Vision

on delivering value to society

our philosophy and vision and aid the futuresustainability of our businesses (competitiveand vision

Group Mission 2030

Bringing about thegoals of Group Mission
2030

2030 Portfolio

2030 Business Model

The structure that will help us to achieve the goals of(4) Business Model

IndividualGroupsegments
philosophyadvantage)
To continue to demonstrate our strengths, these are the(5) Material
issuespriority issues (management issues thrown up by societal
change) that we must tackle in particular to reach our idealstance(5) Business strategy(management plans)(2) Core
competencies

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These are the concrete policies that will allow us to respondto changes in business risks and opportunities and achievesustainable growth

The source of our business’ characteristic strengths andcompetitive advantages that have allowed us to grow thus far

Material issues
Issues involved informing a portfoliothat will aid oursustainable growthMaterial issues
Issues facing
renewed growthfrom a medium- tolong-term
perspective

The next mid-termbusiness plan

The next mid-termbusiness plan

DyDo Group’s corecompetencies

Core competencies
for each segment

9Selecting Material Issues to Achieve the Goals of Group Mission 2030
To help achieve sustainable growth, we are moving forward through the selection process for our material (keymanagement) issues and will incorporate them into our next mid-term business plan, which marks the “GrowthStage” of Group Mission 2030
 Material issue selection process
Employee questionnaire All employees were asked about the SDGs they feel the DyDoGroup should contribute toward and the themes it should tackle

Interviews with external stakeholders

 Individual interviews were carried out with business partners andexperts

May–June

Executive management-levels
questionnaires in each segment

 We ascertained the management issues that relate to where we want
to be in 2030 and what stands in our way

JulyInterviews with top-level
management from each segment

 Interview results were combined and these elements formed thebasis for discussions with the individual companies’ presidents,
leading to designated material issues for each company

AugustInvestigation into priority material
issues for each segment

 We are using the material issues identified by each company andassign a priority value based on our 2030 business portfolio andinvestment strategies

Second halfof the year

Determine material issues
Integrate them into our mid-termbusiness plan

FebruaryMarch(setting KPIs, investigating activities, etc.)
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 We will examine KPIs and activities to be carried out in 2030
based on the material issues, and integrate them as an important
aspect of our next mid-term business plan102. Efforts toward Creating Sustainable Corporate Value

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How the DyDo Group’s Businesses Have Changed
Since we were first founded, we have been guided by our philosophy as we adapt to changes in the times, flexibly
adjusting our businesses and expanding the business domains in which we operateGroupPhilosophy

Creating happiness and prosperity, together with people and with society.
To achieve this goal, the DyDo Group will continue to embrace new challenges in a dynamic way.

Staying close to our customers
DAIDO Yakuhin(Pharmaceutical-related Business)

To specialize in thecontract manufacturing of
drinkable preparations andthe top manufacturer
From 1956
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×Taking on challenges in specific fields
where we can show our strengths

DyDo DRINCO

Tarami(Domestic Beverage Business)(Food Business)

To improve our vending
machine business andachieve a stable position inthe market
From 1975

To specialize in fruit jellies,
and maintain the top
market share for dry jellies

Home shopping supplements(A Domestic Beverage Business segment)

Grow annual sales of“Locomo Pro” to 3 billionyenFrom 1988(entered the group in 2012) From 201312

Significance of Our Entry into the Orphan Drug BusinessEntering the orphan drug business as a way of developing a second major source of revenue in non-beverage businesses
What ourefforts mean

 We can solve societal issues through our businesses We can enter a business domain with high growth potential

 What Are Orphan Drugs?
Orphan drugs are pharmaceuticals that meet the following criteria, as
designated by the Minister of Health, Labour and Welfare, based on Article 77,
Paragraph 2, of the Law on Securing Quality, Efficacy and Safety of Products
Including Pharmaceuticals and Medical Devices
Less than 50,000 in Japan

Target patient
population•

Need for treatment• No appropriate alternative pharmaceuticals or treatment
methods• Alternatively, a disease may be designated as adifficult-to-treat disease by regulatory authorities• Alternatively, the pharmaceutical must offer potential
in the form of significantly superior efficacy or safetycompared to existing pharmaceuticals

Development
viability• There must be evidence supporting use of thepharmaceutical in question to treat the target disease,and the manufacturer’s development plan must be
reasonable

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How DyDo Pharma
Hopes to Expand First, achieve real results targeting “ultra-orphan”
diseases for which there are even fewer patients
 Widen the field to include diseases for which there
are more patients, and establish a business model Introduce and develop new pharmaceuticals that are
already part way through the development process
and are working toward approval either in Japan oroverseas

Aim to develop our business by
positioning ourselves in lesscompetitive areas of Japanesepharmaceuticals market
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DyDo Pharma’s Desired Business Model (1)Business development focused on processes in Phase III and beyond Pharmaceutical creation process
2–3 years or more
Pharmaceuticalcreation research

3–5 years

5–10 years

1–2 years

Non-clinical trials

Clinical trials

Application/approval

Creation of chemical
Research into efficacy
compounds that areand safety
candidates for use inmedicines as well as
research into their potential

Phase I

Treatment

Verification of medicine’s effectiveness and safetyon healthy adults
Phase II

Investigation of safety for patients and appropriateapplication methods and doses
Phase III

Verification of efficacy on patients

R&D process for standard pharmaceutical manufacturers
R&D by pharmaceutical development start-ups, etc.

DyDo Pharma’s development process Contracts
January 2021

Licensing agreement for a LCAT (lecithin cholesterol acyltransferase) treatment

June 2021

Japanese licensing agreement for a treatment expected to prove effective for Lambert-Eaton myasthenic syndrome

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DyDo Pharma’s Desired Business Model (2)Virtual pharma business model free of fixed costs Recruit specialist personnel with track records within the medical industry who will be responsible for the bulk of business
management
 Use external bodies—the CRO*1 for clinical development tasks and CMO*2 for pharmaceutical manufacturing*1 Contract Research Organization*2 Contract Manufacturing Organization

 Business Model

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Corporate Culture that Allows Us to Acquire and Utilize Specialist Personnel(Characteristic Common to Home Shopping Supplements and DyDo Pharma No. 1)
We are actively seeking the specialist personnel we need to expand our new businesses from outside the company,and fostering a culture where those specialist personnel can play an active role
Recruitment
criteria

Specialist

Recruiting people who agree with the Group
Philosophy and Vision

Securing and utilizing
specialist personnel

 People who want to deliver good
health People who want to help bring abouta richer, more dynamic society

personnel

 Number of employees

After recruitment
Corporate culture that welcomes outside
Receptive attitude
personnel

Specialist
personnel

 Able to assign important work to small numberof highly specialized staff
 No distinction from general personnel, aim forintegration

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Generalpersonnel

Specialist
personnel

Specialist
personnel

Home shoppingsupplements

DyDo Pharma
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Business Cultivation from a Long-term Perspective(Characteristic Common to Home Shopping Supplements and DyDo Pharma No. 2)
By promoting outsourcing-focused management, we can cultivate new businesses
 Certain period of time required for investment to reach monetization
 Investment targets are intangible assets, primarily personnel
 Through outsourcing-focused management, we can achieve a high ROIC in the monetization phase Profit Generation
Investment Phase

Monetization Phase

The home shopping supplement business wasestablished in 2012, and in fiscal 2018 it turned asingle-year profit. Now, it is growing into a highprofit business

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Strengthening the Corporate Governance Structure
We newly appointed an outside director frompharmaceutical industry at the 46th Annual Shareholders’Meeting (dated April 16, 2021)

 We decided to appoint the person to strengthen the oversightfunction because DyDo Pharma concluded the first licensing
agreement in January 2021

We established a Nominating and Compensation
Committee, chaired by an independent outside director,
on August 30, 2021, to further strengthen our corporate
governance structure as we work toward our next midterm business plan

Michiaki Kurihara
Outside Director
DyDo Group Holdings, Inc.
 Profile
Joined Fujisawa Pharmaceutical Co., Ltd., (currently Astellas Pharma Inc.) in 1982, andworked as a Deputy Division Director of Sales Division, and a General Manager, Asia
Business Planning, Corporate Strategy Division.
Joined Santen Pharmaceutical Co., Ltd. in 2009 and worked as a Director and Vice
President, Santen Pharmaceutical Korea Co., Ltd.
Joined IMS Japan Co, Ltd., (currently IQVIA Solutions Japan K.K.) in 2013
Appointed a General Manager of Planning External Affairs Department (current position)
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Increasing Corporate Value by Contributing to the Sustainability of Society
The DyDo Group is striving to realize a sustainable society that allows offers people around the world enjoyable, healthy
lifestyles as its vision for 2030
To realize this vision, we will continue to embrace the challenge of accommodating environmental changes through mutually
beneficial relationships with stakeholders in line with our Group Philosophy

Customers

EmployeesGroupPhilosophy

Businesspartners

Realizing a sustainablesociety

Creating happiness and prosperity,
together with people and with society
Society

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Shareholders

To achieve this goal, the DyDo Group will continue
to embrace new challenges in a dynamic way.

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