COVID-19 Response andMid- to Long-term Indications

May 18, 2020

Shinjiro Sato
President and CEOTerumo Corporation

Basic Policy for COVID-19 Response

1. Secure associates health and safety

2. Stable supply to sustain healthcare

3. Proactive contribution to infection prevention and treatment©TERUMO CORPORATION

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Current Circumstance and Operating State
Postponement of elective procedures related to Cardiac and Vascular
DemandCustomer
Access
Production/Logistics

R&D

Finance©TERUMO CORPORATION

Limited decrease in demand for General Hospital andBlood and Cell Technologies
Access to hospitals restricted for manufacturers

Impact on local operation due to lockdown in some emerging countries
Operations of the group as a whole largely uninterrupted

Slowdown in some clinical trials

Maintaining healthy profitability and liquidity

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Risk Management
Careful management to prepare for two recovery scenarios••

Base scenario: Recovery in the 2nd half of FY20
Later recovery scenario: Recovery in the 1st half of FY21

Keep in mind the possibility of additional downward swings:
Demand stagnation, price erosion, supply chain interruption, etc.

In a group-wide Crisis Mode since April 1, 2020
1. Have secured financial health (liquidity)
2. Assessing performance and forecasts in a faster cycle, detailed expenditure
management and discipline
3. Maintaining flexible operations in preparation for contingencies

Measures in place for the contingency of “Later recovery scenario”;
ready to take action as necessary©TERUMO CORPORATION

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Strong Portfolio against COVID-19 Impact
General Hospital and Blood and Cell

Ratio of revenue from less-impacted Japan,

Technologies are less impacted, andAsia, China is higher than global competitors

half our businessaverage, approx. 30%China
8%

TBCT
17%

Asia andOthers

Americas
30%

12%

GH27%

©TERUMO CORPORATIONFY19Revenue

FY19
Revenue

C&V
56%

Japan
31%

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Europe19%

Maintained Financial Solidity for Sustainable Growth
Equity ratio

Cash on hand
3.2 months

63%

of sales

2.2 months

45%

Terumoof sales

TerumoGlobal med-techaverage *Global med-techaverage *Also having secured necessary credit availability while maintaining “AA-” rating* Source: Terumo analysis based on the financials of major med-tech companies©TERUMO CORPORATION

6 /11Our Progress to Strengthen Operations
Based on our experience of Great East Japan Earthquake,
Hurricane Maria, and Shipping delays at Ashitaka factory
Actions taken amid the COVID-19 crisis
Maximum effort for stable

Globaloptimization

Easing of overconcentration

BCP
enhancement

Secure appropriate inventory

Temporary preemptive factory

Inter-factory capacity utilization

shutdowns to prevent infection

Organizational
enhancement

CMO leadership tocoordinate all 31 factories©TERUMO CORPORATION

Capacity expansion, efficiency improvement

supply of essential products
via global collaboration

Quick covering for factories inlocked-down locations via prompt
coordination with other factories
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Mid- to Long-term Thought-provoking on COVID-19
Cardiac and Vascular• Quicker and simpler procedures

Acceleration of less-invasive therapy• Shortened hospital stays

Increase of outpatient procedure

General Hospital• Infection prevention measures

Strict hospital infection prevention• Precise, remote vital sign mgmt.

Advanced transfusion, monitoring

Blood and Cell Technologies• Convalescent plasma therapy,
cytokine reduction• Coronavirus reduction in blood product• Remote customer support,
product introduction©TERUMO CORPORATION

current Midto Long-term
Strategy• Further

Expansion of blood therapies

enhance inImprovement of blood transfusion safety

next Mid- toTerumo Group• Maintain supply, financial mgmt.

• Confident inStability and flexibility as competitive
advantages
Work style reform, diversification ofcustomer approach
8 /11Long-term
PeriodTransformation Toward a New Normal
The awareness of customers and patients will fundamentallychange. Society itself will change
Paradigm shift acceleration

Business model innovation in addition

Healthcare expenditure control,

to traditional product innovation

digitalization, remote care,

Promote implementation of digital

simplification, others

transformation and robotics technology

Safety, peace of mind

Start of “Infection prevention initiative”

Enhancement of healthcare

Provide solutions including assessment,

infrastructure

consulting, workshops, and training in addition

Reordering of priorities

to diverse product lineups©TERUMO CORPORATION

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The Terumo Purpose Is Even Clearer
In the COVID-19 crisis, society is questioning the “purpose” of companies.
The Terumo purpose is clear. Terumo has always been faithful to its group missionof“Contributing to Society through Healthcare.” Inheriting the DNA of Dr. Kitasato, the group hasa long history of fulfilling important needs: Building public health, infection prevention in
medical settings, patient-friendly healthcare, and many others.
Contributing to support medical professionals in the fight against COVID-19 fulfills our originalrole exactly.
By constantly revitalizing the organization and transforming itself, Terumo will continue to be acompany truly needed by medicine, in the post-COVID world as well. This will maximize its
long-term enterprise value.
Achievements of Dr. Shibasaburo Kitasato,
one of the founding members of Terumo:
Discovered the immune antibody anddeveloped serum therapy for the tetanus disease
Discovered the plague bacteria, worked
tirelessly to prevent its spread
Courtesy of the Kitasato Institute archives©TERUMO CORPORATION

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IR Contact
Terumo Corporation
Investor Relations Dept.
E-mail: kouhou_terumo01@terumo.co.jp
Among the information that Terumo discloses, the forward-looking statements including
financial projections are based upon our assumptions using information available to us at thetime and are not intended to be guarantees of future events or performance. Accordingly, it
should be noted that actual results may differ from those forecasts or projections due to variousfactors. Factors affecting to actual results include, but are not limited to, changes in economic
conditions surrounding Terumo, fluctuations of foreign exchange rates, and state ofcompetition.
The market share information in this presentation is partly derived from our own independentresearch.

©TERUMO CORPORATION

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