Japan Lifeline Co., Ltd. Integrated Report
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2023
Integrated ReportJapan Lifeline Co., Ltd.
Tennoz Ocean Square. 25F, 2-2-20,
Higashishinagawa, Shinagawa-ku,
Tokyo 140-0002 Japan
TEL: 03-6711-5200
https://www.jll.co.jp

Contents

Management Philosophy
Contributing to the realization of a healthy society throughthe latest and optimal medical device technologies“Is it appropriate for the patient? Is it valuable for the patient?”
These questions are always at the center of our focus, and we are constantly
striving to provide excellent medical devices.

Contents■ Editorial Policy
The Japan Lifeline Group aims to enhance its corporate value and contribute to the sustainable development of society through the realization of its Management Philosophy.
The company started publishing the Integrated Report in
FY3/2023 in order to organize, integrate, and present financial and non-financial information related to those efforts.
Through this report, we will revitalize communication withvarious stakeholders and reflect their feedback in our future
initiatives.
▶ Period covered by the report he fiscal year ended March 31, 2023 (April 1, 2022 toT
March 31, 2023)
Note: Some information for the fiscal year ended March 31, 2022 and the fiscal year
ended March 31, 2024 is included in the report.

Management
Philosophy▶ Scope of the reportJapan Lifeline Co., Ltd. and its subsidiaries
Note: Some information is disclosed on a non-consolidated basis.

▶ Reference guidelines, etc.

Contributing to the realization of ahealthy society through the latest andoptimal medical device technologies• GRI (Global Reporting Initiative) Sustainability Report-

ing Standards• IIRC International Integrated Reporting Framework• Guidance for Collaborative Value Creation, Ministry of
Economy, Trade and Industry▶ Notice concerning forward-looking statement

Management Vision
Pursuing both functions of amanufacturer and a
distributor to provide the latest
and best options for medical
professionals worldwide andcreate high added value

1

Japan Lifeline Integrated Report 2023

Code of Conduct
Acting in a way to make stakeholders say,
“I am grateful that I chose Japan Lifeline.”

This Integrated Report contains forward-looking statements. This information is based on information available to the Company as of the date of issuance, as wellas assumptions and projections made at that time. Actual results and other figures may differ due to changes
in the business environment, economic trends, and other factors.
The information contained in this report includes information on medical devices. It is intended to provide
information to various stakeholders and is not intended
to promote our products or provide medical advice.

Management Philosophy,
Editorial Policy, and Tableof Contents

1

Introduction
Our Business

3

Growth History

5

Japan Lifeline’s Value Creation
Message from the President
and CEO

7

Value Creation Process

13

Six Capitals

15

Business Model

17

Japan Lifeline’s Growth Strategy
Medium-term Management
Plan

21

Priority Measures

25

Business Strategy

29

Japan Lifeline’s
Management Foundation
Sustainability Management

33

Materiality and KPIs

35

Environment

37

Social41

Governance

45

Data Section
Consolidated Financial/
Non-financial Data

53

Company Information

55

Stock Information

56

2

Our Business

Our BusinessCurrent State of the Medical Device Industry

Japanese
Manufacturers’
Global Market ShareJapanese
Manufacturers’
Global Market Share(diagnostic devices)(treatment devices)Japanese Manufacturers

Overseas Manufacturers

Source: Issues Surrounding the Medical Device Industry, Ministry of Economy, Trade and Industry

In 1981, we started in business as a distributorof cardiac pacemakers. Since 2001, we havesupported the medical field in Japan, mainlyin the cardiovascular area, while also sellingin-house products. Utilizing our two functions
as a distributor and manufacturer, we provide
medical devices that respond to the needs ofthe medical field.

Entry into new areas
2017	Gastrointestinal
area
2022	Neurovasculararea

Value Creation(billion USD)

4%

15%

Introduction

The size of the global medical device market is 606.7 billion
USD with a future CAGR (Compound Annual Growth Rate)of 5.7%. Overseas manufacturers of both diagnostic andtreatment devices are ahead of the competition in terms oftechnology and becoming larger in scale. However, medical devices designed for the US and Europe are not always
the best option for Japanese physicians or patients since
the Japanese body type differs from that of Westerners.

History of Japan Lifeline

CAGR 5.7%

800
700
600
500

Japan Lifeline’s

400Management Vision
Growth Strategy

2023
606.7 billion USD

300
200
100
0

2019

2020

2021

2022

2023
2024
2025
2026
2027
(forecast) (forecast) (forecast) (forecast) (forecast)of a manufacturer anda distributor to provide

the latest and optimal

options for medical
and create highCardiac Rhythm Management

added value

EP/Ablation
Electrode-embedded catheters used
for diagnosis and treatment ofarrhythmias

CardiovascularBusiness
in Four
We aim to further expand business by focusing on our
Gastrointestinal

4.0%

Development
Areas

Aorticnew business areas (neurovascular and gastrointestinal).

Cardiac Rhythm
Management

In-house product

24.0%

54.9%

Cardiovascular

Medical devices fortreating aortic disease▼ Main products• Vascular graft• Open stent graft• Abdominal stent graft

Gastrointestinal
Medical devices for treating
gastrointestinal diseases of the liver,colon, etc.

Data Section

Implantable devices to treat
arrhythmias

professionals worldwide

Management Foundation

Source: Medical Device Industry Trends, Medical Device Industry Vision Study Group, METI

Pursue both functions

21.3%

FY3/2023
Consolidated
Net Sales▼ Main products• Cardiac pacemakers• T-ICD (transvenous implantable cardioverter
defibrillator)•S -ICD (subcutaneous implantable cardioverter
defibrillator)

3

Japan Lifeline Integrated Report 2023

Sales
Composition
Ratio

51.7 billion yen▼ Main products• EP (Electrophysiology) catheter• Ablation catheter• Internal Atrial cardioversion catheter

EP/Ablation

50.8%

Third-party
product

45.1%

Neurovascular

Medical devices fortreating ischemic strokeor brain aneurysms▼ Main products• Embolic coil
• Aspiration catheter▼ Main products• Colonic stent• RF needle for liver cancer treatment• Bile-duct tube stent4

Growth History

Growth History
1981

Starting in the cardiac pacemaker business,
Japan Lifeline conducts business in the generalcardiovascular field and is also planning on entering
new fields. Utilizing our two functions as a distributor
and manufacturer, we provide outstanding medical
devices to the medical industry.

To support the zest for living

Started import and distribution of cardiac pacemaker

FULL-SERVICE DISTRIBUTOR
Established Research Center

2000

Established Ukima Factory

MANUFACTURER

2010

FACTORY

2019

Ichihara Factory established2012

JLL Korea establishedToda Factory established

2014

2007

2009

JLL Malaysia
established

FACTORY49

FACTORY

sales
offices

30

1981

1990s

1995

EP Catheter

M

Self Manufactured

Open Stent Graft

M

D

M

1998

Started the Interventional
coronary businessCoronary Stent

1990

2005

Mechanical Heart Valve

D

Colonic Stent
D

Atrial Septal Defect Closure Device

Started the cardiovascularsurgery businessStarted structural heartdisease business

1991

2012

M

Started the gastrointestinal
business

Data Section

Product History
Distribution

2014

M

2017

PTCA Balloon Catheter

D

D

Started the
EP/Ablation business

1989

Established in Toshima-ku, TokyoManagement Foundation

sales
officessales
offices

2010s

2000s

20

2020s

40

sales
offices

Growth Strategy

JUNKEN MEDICAL
became a subsidiaryIPO

FACTORY

Oyama Factory
established

Opened Tennoz Accademia(in-house education center)

1997

2020

FACTORY

Value Creation

Started development and manufacture of medical devices to meet the needsof medical professionals

sales
offices

Changed exchange market
from the First Section to thePrime Market of the Tokyo
Stock Exchange

Changed exchange market from the
JASDAQ (Standard) market to the First
Section of the Tokyo Stock Exchange

Introduction

1999

2022

2016

Started in business as a medical device distributor to deliver highly novel products toas quickly as possible for the benefit of patients in Japan10

Growth History

2022
D

Embolic Coils

D

Started the neurovascularintervention business

1981

Cardiac PacemakerD

Started the cardiac rhythm
device business3
5

Japan Lifeline Integrated Report 2023
Japan Lifeline Integrated Report 2023

Vascular Graft

D

M

Internal atrial cardioversion catheter

2022
M

Bile-duct tube stent M

Japan Lifeline Integrated Report 2023

4
6

Top Message

Top Message

Establishing a Unique Business
Model
Starting in business as a distributor ofpacemakers

Japan Lifeline Integrated Report 2023

Data Section

7

I always think about how we can maximize the value
we deliver to our customers in the medical field.
In principle, we have a policy of expanding our inhouse products. However, if we can introduce products from overseas that create high synergies with ourown, we will be able to strengthen the competitiveness of our entire product portfolio by actively pursuing such opportunities. Investors often ask me, “Will
you lean more toward manufacturing in the future?”
My idea about this is very simple: It does not matter if outstanding products are sourced or made inhouse. It is best to introduce such products as quickly
as possible for the benefit of the medical field. As aresult, being a distributor and manufacturer is whatmakes us so unique in the market.
From a different perspective, I also put a greatamount of efforts on hiring the right people. At interviews, we always want to find candidates who are
genuinely honest and street smart rather than focusing solely on their academic achievements. Afterthey join us, we assign them to appropriate roles andresponsibilities within the organization as they develop individual competencies. Since organization is aliving thing, in my view, I believe that it is necessary
for it to change flexibly with the market and businesstrends, and the characteristics of our human resources rather than staying as a fixed entity. To leverage
our limited management resources, we must selectproper talents and concentrate important resources.
Recently, we have made a major business decision tomove away from the coronary intervention businessand focus on the neurovascular and the gastrointestinal businesses. It was such a drastic change that we
made drastic shifts in personnel as well.

Management Foundation

President and CEO

As imported medical devices from overseas manufacturers occupied a large share of the Japanesemarket along with our business expansion, there wasan increase in cases where foreign makers acquired
our suppliers or they entered the Japanese market directly by establishing Japanese subsidiaries. I felt akeen sense of crisis when we went to the trouble ofobtaining distribution rights only to find that our business plans were greatly impacted by the emergenceof such trends.
Based on these circumstances, we decided to start
making our own products. Our past experience as a
distributor made me believe that there was a business
opportunity since some products from the US and theEurope did not match the Japanese body type or were
not easy to use. Therefore, we decided to meet thoseneeds by manufacturing in-house products in 2000.
In 2001, we initiated selling first proprietary product,
which was a guidewire.

What matters in corporate management

Growth Strategy

Start of in-house product development andmanufacturing

Approach to Management
as President

Value Creation

To support the zest for living

Introduction... for patient comfort.

I am one of the co-founders who established Japan
Lifeline in 1981, a little over 40 years ago, primarily forthe distribution of cardiac pacemakers manufactured
overseas.
The Company was founded around the beginningof the cardiac pacemaker treatment era in the US
and Europe, and various medical devices for treating
cardiac diseases were being developed and sold inoverseas markets. Taking advantage of this trend, we
increased our business performance by aggressively
purchasing new medical devices from the US and Europe and selling them in Japan.
In addition, the yen's sharp appreciation against the
US dollar after the Plaza Accord in 1985 provided a
tailwind for our business, which at the time was centered on import sales. Soon after, cardiac pacemakers and catheters started to be widely used to treat
heart diseases in Japan. As a distributor specializing
in medical devices, JLL expanded its product lineupand continued to grow steadily.

That was when our current business model, which
combines distribution and manufacturing functions,
was first implemented. Although manufacturers sometimes develop their own sales channels, it is rare for a
distributor to explore the possibility of self-production
on its own, whether in Japan or overseas.
Among the products that we offer, the percentage
of our in-house products has now grown to 54.9%(according to FY3/2023 results).

8

Top Message

Japan Lifeline’s Strengths

Review of FY3/2023 andRevision of the Medium-termManagement Plan
On achieving a record operating profit
In FY3/2023, we posted a record operating profit.
One of the reasons for this is that the market is becoming robust again. The number of atrial fibrillation
ablation cases, which had temporarily experienced
negative growth due to the impact of the COVID-19
pandemic, increased by about 6% YoY, and strong
sales of EP/Ablation and Cardiovascular products led
to improved business performance.
We also moved forward with the liquidation of ourcoronary intervention business, which had become
unprofitable.
We terminated an exclusive distribution agreement
for the distribution of a drug-eluting coronary stentearlier than originally planned and sold a Chinese
subsidiary that fabricated guidewires and other products. As a result, losses on inventory disposal and revaluation decreased significantly YoY, contributing to

Revision of the medium-term management
plan
The medium-term management plan, which weannounced in November 2020 and was supposed
to end in FY3/2025, was revised due to large gaps
between actual results and planned targets due toa major reorganization of our business portfolio andother factors. The new medium-term management
plan covers the five-year period from FY3/2024 to
FY3/2028.
In the new plan, “Expansion into new business areas” is one of the priority measures. While securing
stable growth in our current cardiovascular business,
we will focus on our neurovascular and gastrointestinal businesses to grow them into new earnings pillars
over the medium- to long-term. By FY3/2028, we aim
to achieve net sales of 8 billion yen from these new
businesses boosting company-wide net sales to 63
billion yen. Our unique way to advance into new fields
represents us well as we fully take advantage of bothour distribution and manufacturing capabilities. The

Growth Strategy

Our major strength as a manufacturer lies in our
high-quality products that meet the specialized needsof the medical field.
When we first embarked on manufacturing, the experience that we originally gained as a distributor was
extremely useful. Since we were constantly in contact with the market through our sales activities, wewere able to identify the market needs and use themin product development. As is often the case that wefall for producer-driven solutions too much created on
the development side and look for applicable needs,
that is the typical approach that often ends up in failure. In contrast, we only apply engineering ideas towhere there are needs for them.
In order to accurately understand the needs of the
medical field, it is important to know what is happening
there. To that end, not only our sales representatives
but also our marketing and development personnel
go to medical facilities to communicate directly withmedical experts. In doing so, we are thoroughly committed to grasping their specific concerns or identifying latent demands. This led to the creation of Internal
Atrial Cardioversion Catheter BeeAT and Open Stent
Graft FROZENIX, two of our one-of-a-kind products.

an improvement in the profit margin.
In addition, we have successfully launched two new
businesses, the neurovascular and the gastrointestinal, which also helped improve our business performance.

Value Creation

I previously mentioned that being both a distributor
and manufacturer makes us unique and serves as astrength. Let me talk more about it.
As a distributor, one of our major strengths is theability to provide all the services necessary to introduce medical devices from overseas to the Japanesemarket in a one-stop format. In order to market new
medical devices in Japan, there are many hurdles toclear such as clinical trials, obtaining regulatory approval, and establishing safety management andquality assurance systems. In addition, you would
need a capable sales system, which is costly to build.
Therefore, we have the advantage in building winwin business partnerships with foreign makers whowish to enter the Japanese market. We are very familiar with the domestic market, serving as an exclusive
sales agent to handle long-term exclusive contracts.
In Japan, we handle third-party products just as amanufacturer does for its own products. This meansthat we hold an inventory of the products that we sell.
Therefore, our distribution business adopts a high-value-added business model rather than a turnover-oriented business model that generally comes to mind when
we hear the word “wholesale”.

These products were the growth drivers that largely
drove our growth during the second half of the 2010s.

Introduction

Access to highly novel medical devices

Developing products by fully understanding
the needs of the market

Management Foundation
Data Section

9

Japan Lifeline Integrated Report 2023

10

Top Message

Securing profitability in existing businessdomains and refining our capital policy

We will continue to refine our unique business modeland take on challenges in the Japanese and overseas
markets. I also believe that it is not enough for a company involved in the medical device business to simply provide superior products and pursue economic
value.
We will continue to question what medical devices
are truly useful and needed for society from the perspective of medical professionals, patients, and medical economics. By contributing to the realization of ahealthy society, which is part of our Management Philosophy, we aim to increase social value and improve
corporate value.
I would like to thank all of our stakeholders for theircontinued support.

Sustainability Initiatives
Code of Conduct embodies our values
With regard to sustainability, we believe it is important to first define the values on which all employees
should base their work in order to promote company-wide efforts. As a result, we have revised the content of the Code of Conduct based on our former
compliance code.
In our Code of Conduct, we focused on using very
simple phrases that would associate positive impressions about the Company.
We will work to instill these values within the Company and put them into practice in our daily operations so that all of our stakeholders, not only medical
professionals, who are our direct customers, but alsopatients, business partners, local residents, shareholders, and employees, will be able to feel grateful.

Data Section

Japan Lifeline Integrated Report 2023

Message for our stakeholders

Management Foundation

11

Over the long term, expanding overseas sales channels for our in-house products is a major theme. Japan
has long relied on imports of highly controlled medical
devices from overseas. In this context, JLL has playeda certain role in the market as we have provided highly
controlled medical devices that are made in Japan.
On the other hand, our overseas sales are still very
weak. This is an issue that we must address. Products that are recognized for their value by Japanesepatients and medical professionals have the potential
to be widely adopted in overseas markets. Looking atoverseas strategies as a way to generate long-termvalue, we will accelerate the building of systems for
product development, manufacturing systems, andcompliance with the laws and regulations of each target country.

JLL has identified seven materialities as sustainability
issues.
In addition, the following were selected as materialities to be addressed in strengthening our businessfoundation based on an ESG framework:- Solve medical issues through innovative medical
devices- Reduce environmental impact- Create a workplace where employees can workwith comfort- Develop human resources and provide opportunities
for them to play an active role
- Secure product quality and stable supply- Strengthen corporate governance- Promote compliance
At this time, all materiality initiatives are generally
progressing well.
With regard to “Solve medical issues through innovative medical devices,” cross-organizational members are leading a brisk discussion on future R&D andintellectual property strategies, and taking concretemeasures that lead to the introduction of productsthat will have an impact.
In addition, with regard to “Develop human resources and provide opportunities for them to play an active role,” the ratio of female managers is still insufficient. We will carefully work on this issue.

In Closing

Growth Strategy“Continuously introducing competitive products” isour priority measure for our existing cardiovascularbusiness. We will focus on investing in products possessing various strengths to enhance our competitiveness in order to respond to the harsh businessenvironment such as revision of insurance reimbursement prices and intensifying competition.
The most important effort will be the reinforcementof our atrial cardioversion catheter and open stentgraft products. Although we have sold these products
for a long time as one-of-a-kind products, some competitors launched comparable products in FY3/2024.
With the pride in being a frontrunner for these products, we will continuously add new models and develop differentiated products to overcome such a competition.
Regarding the third priority measure, which is “Improving capital efficiency management,” we disclosed
the concept of cash allocation for the first time andannounced a policy to explore the most appropriatebalance between investments and returns during theperiod of the medium-term plan.
For R&D and other growth investments, we plan
to allocate 4 to 5 billion yen each year. For shareholder returns, we plan to secure about 25 billion
yen over the five-year period for dividends and sharebuybacks. As return on invested capital (ROIC) for

Long-term issues

Promoting seven materialities

Value Creation

Medium-term Growth Strategy

FY3/2023 was 11.9% and our estimated cost of capital was around 8%, we have self-analyzed our performance that we’re currently able to fulfill the expectedlevels of return required by investors.
In the future, however, since our capital will increase
along with the business growth, ROIC is expected todecrease unless we take special measures. Therefore,
we will aim to keep to the current 12% level of ROIC.
The underlying idea is to continuously provide attractive returns to investors.

Introduction

development of our neurovascular business is basedon a long-term exclusive distribution agreement. Although we do not have experience in this field, ourexperience and achievements in the cardiovascularwere highly evaluated by the suppliers and led to theconclusion of a new contract.
In the gastrointestinal business, we are working to
expand it by applying our special technologies developed through the in-house manufacturing of catheters and vascular grafts in the cardiovascular field. We
launched a new bile-duct tube stent in the previous
fiscal year with sales getting off to a better start than
anticipated. During the period of the medium-term
management plan, we will launch more products toincrease our presence in this field.

12

Value Creation Process

Value Creation Process
Management Philosophy ｜ Contributing to the realization of healthy society through the latest and optimal medical device technologies
External Environment

Invested
capitalBusiness Model

P.15

Value Provided to Stakeholders

P.17

Introduction

Japan Lifeline Business Model

Patients
Improve patients’quality of life
Value Creation

Reflect the needs of the medical field

Financial capital

Medical professionals

Demographic changes

Manufacturing capital

Import of products from overseas
Highly novel products from overseas

Regulatory affairs
and quality
assurance function

Increasing healthcare
costs

Stricter laws andregulations
Human capital

Technological innovation

Provide the Latest & Optimal Medical Devices

Manufacturing function
Development/Manufacturing

Work style reforms
in the medical field

Medical fieldworldwide

Business Partners
Mutual development
through fair trade

Shareholders
and Investors

Sales
locationsworldwide

Stable growth andshareholder returns

Data Section

High-quality, easy-to-use products

Provide opportunities for humanresource development and an
environment where employees
can work with peace of mind

Management Foundation

Climate changes

Intellectual capital

Employees

Growth Strategy

Longer lifespans

Distribution function

Contribute tohigh-quality medical
care

Local Community
Contribution as amember of the local
community

Social Capital

Reflect the needs of the medical field

Natural Environment
Natural capital

Medium-term management plan

P.21

Materiality

P.35

Reduce environmental
impact caused by ourbusiness activities

Sustainably increase corporate value by reinvesting the value created into capital

13

Japan Lifeline Integrated Report 2023

14

Six Capitals

Six Capitals
Note: All figures are current as of FY3/2023

Financial capital
Description

Relationship to value creation

Cash and cash equivalents¥18,357 million

Manufacturing capital
Description

Relationship to value creation

360 in Japan,
31 overseas

Japan Lifeline Integrated Report 2023

We have established sales bases that cover major medical facilities throughout Japan and have provided a meticulous level of support to our customers.
This is how we have built up a differentiated corporate brand and trust withthe medical field.

Relationship to value creation
Having a strong sales network leads to opportunities for entering contracts
with overseas manufacturers that are considering expanding their business to
the Japanese market. In addition, we look at the diverse needs of the medical
field and take these needs into account when developing new products.

Sales locations

48 in Japan,
1 overseas
Number of business
partner facilities

2,528 facilities

36

Number of R&D-related staff

106

Description
As a manufacturer, we focus on reducing environmental impact, mainly at ourfactories, and promote the reduction of greenhouse gas emissions and theimprovement of the waste recycling rate.

Relationship to value creation
Recognizing that tackling environmental issues is a corporate responsibility,
we are working to grow business while reducing environmental impact basedon the JLL Group Environmental Conservation Policy.

Greenhouse gas emissions
reduction rate(compared to FY3/2021)

Data Section

Number of Regulatory Affairs
and Quality Assurance
Department staff

Relationship to value creation

15

Description

Natural capital

Description

Our deeply experienced regulatory affairs team ensures the smooth introduction of highly novel medical devices that require clinical trials. In addition,
having diverse human resources in our development departments allows forthe generation of new ideas, leading to the resolution of technical issues andthe acquisition of patents for product commercialization.

ogy including cardiac pacemakers and implantable cardioverter defibrillators (ICD).
The certifying body for CDR certification is the Japanese Heart Rhythm Society.

Number of suppliersIntellectual capital
Our regulatory affairs team has extensive experience in obtaining regulatory
approval required for the sale of highly controlled medical devices. In development departments, we actively recruit people from different industries tosecure diverse human resources.

Through the collaboration of our highly specialized employees in the series of(as of June 30, 2023)
processes from product exploration and development to delivery to customers in the medical field, we can provide the latest,* Cardiac Device Representative (CDR): An expert who possesses specialized knowlmost suitable medical equipment.
edge and skills that provides information on medical devices and medical technol-Management Foundation

For product development, in addition to using in-house technologies, we collaborate with companies that possess various technological capabilities tocreate products that reflect the needs of the medical field. In manufacturing,
we maintain the quality of our products and realize a stable supply throughcooperation with partner companies.

4 in Japan,
1 overseas

Number of employees
who have obtained CDR*
certification

353

Relationship to value creation

Social Capital
R&D and manufacturing bases

78.6%

Growth Strategy

In developing and manufacturing in-house products, we are working to solve
various issues through the collaboration with business partners. Our strengthlies in our ability to work flexibly with companies with high technological capabilities, regardless of whether they possess experience with medical devices.

The Company is actively recruiting new graduates and mid-career hires, especially mid-career hires from different industries, leading to the diversityof our human resources. We are working to develop human resources by
providing extensive education and training so that employees can steadilyacquire specialized knowledge in handling medical devices after joining theCompany.

Value Creation

While focusing on capital efficiency, the Company allocates stably generated cash flows to R&D, capital expenditures, clinical trials, and other growthinvestments, and strives to enhance shareholder return while taking into account capital needs.

75.3%

Ratio of mid-career hires

Description

Introduction

The Company has established a stable financial base through a highly profitable business model that possesses both a distribution and a manufacturingfunction. The capital-to-asset ratio for FY3/2023 was 75.3%, and cash andcash equivalents at the end of the period were 18,357 million yen.

Capital-to-Asset Ratio

Human capital-4.9％

Industrial waste recycling rate

96％

16

Business Model

Business Model
We will continue to adhere to a unique business model that combines the functions of a distributor anda manufacturer. This combination is the source of our competitive advantage and serves as the foundation of business growth.

Being a distributor and manufacturer enables us
to build a flexible and robust product portfolio that is
highly responsive to changes in the business environment, which is one of our strengths.
In order to realize our Management Vision, we willkeep streamlining this business model to continuously
enhance our corporate value.

Tie-ups with overseas startups

Proprietary technologies cultivated in
the cardiovascular area

Explore new therapeutic areas/
new technologies

We began purchasing and selling vascular grafts
in 1991, and we have been offering J Graft, ourown vascular graft product since 2009. Thanks to
product improvements, J Graft has been provided
with both the hemostatic property and flexibility
required for vascular grafts, which has earned highpraise from the medical field. J Graft sales volume
has steadily increased over the 14 years since theproduct was launched.
In 2014, we launched the first open stent graft inJapan. This product reduces the physical burden
placed on patients by requiring only one surgery
instead of two, and also resolves problems facedby surgeons during the surgical procedure. Thesefeatures led to the discovery of latent needs in the
medical field, and surgical procedures utilizing thisproduct have become widespread.

Growth Strategy

Manufacturer

Full-Service Distributor

Our history in the cardiovascular (aortic)field

In 2016, we entered into an exclusive distributionagreement for the distribution of abdominal stentgrafts. As a result, our product lineup now includes
important devices used in the aortic field. By combining third-party products and in-house products
to create a product portfolio that other companies
do not possess, we developed a sales strategy
that highlights our superiority in covering a wide
range of aortic diseases under the slogan “ALL infor AORTA”. By training every one of our sales reps
to be able to handle abundant cases, we have built
a relationship of trust with surgeons, which has led
to an increase in market share.
In order to maintain and enhance the strength of
our product lineup, we launched Alto, a new abdominal stent graft product, in July 2021. Adding
to our FROZENIX open stent graft product lineup,
we introduced FROZENIX 4 Branched in December 2022 and FROZENIX Partial ET in August 2023.
We will continue to strengthen our product portfolio in order to maintain our competitive position.

Value Creation

If there are excellent medical devices that can solve
problems faced by the medical field, we will promptly
introduce them, regardless of whether it is a third-party product or an in-house product.
Combining highly novel third-party products with
our in-house offerings that meet the detailed needsof our customers allows us to provide a variety of options for doctors.

We have gained a strong market share in the cardiovascular (aortic) field by having a product portfolio that leverages both a distributor and a manufacturer function.

ALL in for AORTA

Introduction

Our Business Model

Strengths of Our Business
Model

Third-party products make up 40% of our
cardiovascular (aortic) field products(Cutting edge, speedy introduction,
long-term exclusive distribution)

Domestic Share of the Cardiovascular (Aortic) Area
Source: R&D and our research

Vascular grafts(open chest
surgery)

Products designed tomeet doctors’ needs

Highly novel products from overseas(Niche, high quality, high margin)* Includes open
stent grafts
Company ranking ..... 1st place

Regulatory affairs and quality
assurance function

Data Section

Sales locations worldwide

JLL 75%Market Size............... 8 billion yen

Flexible & Robust Product Portfolio
Business Foundation

Management Foundation

Apply such technologies to othertherapeutic areas

Market growth rate... +0-1%

In-house products make up 60% of our
cardiovascular (aortic) field products

Abdominal stentgrafts(catheter-based
treatment)

JLL
18%

Company ranking ..... 3rd place
Market Size............... 16 billion yen
Market growth rate... +2%

17

Japan Lifeline Integrated Report 2023

18

Business Model

Strengths as a Distributor
Advantages of being a full-service distributor

Our regulatory affairs team, utilizing a wealth of experience, smoothly handles these application proceduresin cooperation with foreign medical startups.

FULL-SERVICE DISTRIBUTOR
Sales Department
Purchasing and Logistics Department
Regulatory Affairs and Quality Assurance Department

Product SearchContract
Negotiation

Regulatory
Affairs andClinical Trials

Inventory/
Logistics

Sales Service

19

Japan Lifeline Integrated Report 2023

Develophigh-quality,easy-to-use
products

Closelycollaborate
betweendevelopment andmanufacturing

Strength No. 3: Application and expansionof proprietary technologies

Apply andexpandproprietary
technologies

Strength No.1: Ability to grasp the needsin the medical field
We believe that our strength lies in the ability to accurately grasp the needs of the medical field based on
information obtained through our sales network andby engineers who directly engage with doctors.
Let’s take our esophageal temperature monitoring
catheter as an example. Since the product is inserted through the nose, the electrodes of our product ismade thinner to conform to the Japanese body type.
This results in the less occurrence of bleeding from thenose compared to products manufactured overseas.
Also, we commercialized treatment devices that physicians used to make themselves in the medical field.
These devices include atrial cardioversion catheters
and open stent grafts, which have become de-facto
standard, with proven safety and effectiveness.

The accumulation of technologies that we have established through product development has led to therealization of ideas designed to differentiate our products from those of other companies. Furthermore,some of our exclusive technologies have been applied
to products in fields different from those we are familiar with, contributing to business development in new
fields.
With the extruded shaft processing technology established in our EP/Ablation business, it is possible
to mass produce catheter shafts at low cost whileachieving a design with complex internal structures,
hardness inclination, and a mix of materials. These
high-performance shafts are used in a variety of products, including our bile-duct tube stent, a gastrointestinal field product. It demonstrates excellent performance through the molding of dissimilar materials
such as PTFE and polyurethane in one piece, and has
been highly evaluated at the medical field.

Data Section

In many cases, overseas companies are leading thedevelopment of medical device industry, so we believe that our mission as a distributor is to quickly
deliver highly novel medical devices from overseas
to the medical field in Japan. Since our founding, wehave acquired sales rights for many overseas products and introduced them in Japan.
In order to explore new products, the Marketing
Department collects the latest information on medical devices and treatments through consultants
and participation in overseas conferences. In addition, we constantly receive contacts from overseas
manufacturers seeking to expand their business
into Japan because they are convinced with our
broad experience and capabilities in the introduction and distribution of a wide range of products.
In order to sell medical devices in Japan, it is necessary to obtain regulatory approval. In particular,
highly novel medical devices often require numerous documents to be submitted to prove their safety
and efficacy. Clinical trials may be required as well.

We have established a sales system that covers all
major medical facilities nationwide, and have built
trustful relationships with these facilities. Our sales
reps that possess specialized knowledge provide
detailed support and closely work with doctors. This
sales system is what makes us different from overseas rival companies we are competing with in Japan.
In addition, information on issues in the medical
field obtained through the sales network is utilized
to explore new products and to improve alreadylaunched products.

Management Foundation

Strength No. 1: Experience and know-how inintroducing high-novelty products

Identify needsin the medical
field

Strength No. 2: A sales network that builds
trust

Our product development bases are located in Toda
City, Saitama Prefecture, and Ichihara City, Chiba Prefecture, each of which is within the factory premises. Both product development and production teams
work hand-in-hand to improve quality and achieve ahigh yield by reviewing designs from the initial stageof product development with the later mass production process in mind. After the start of mass production, cost reduction, process improvement, and otheractivities are also performed though the cooperationof the product development and manufacturing sections. In addition, as other related departments arealso located in the same location, we believe that oneof our strengths is that product-related operations are
performed with a sense of unity.

Growth Strategy

Marketing Department

JLL was able to also grow as a manufacturer despite
the fact that we started in business as a distributor.
We believe the reasons for this was our ability to accurately reflect the needs of the Japanese medical fieldin our products and provide them as a domestic manufacturer in the medical device industry, where there
are many overseas products.
The establishment of our proprietary technologies
in the course of developing products to meet various
needs has become a strength, leading to the creationof new product ideas and further expansion into newfields.

Value Creation

Distributor Value Chain

Develop high-quality, easy-to-use products

Strength No. 2: Close collaboration between
our product development and manufacturing
teams

Introduction

As a distributor, our strength lies in our ability to perform a series of functions necessary from product introduction to sales. In particular, we are able to obtainregulatory approval necessary for the sale of medical
devices by ourselves and have a nationwide sales
network, making us attractive as a strong partner candidate for overseas manufacturers that are considering entering the Japanese market.
As a full-service distributor, we have acquired exclusive distribution rights and accumulated experience in doing business on the same standpoint as
manufacturers. This has led to a virtuous cycle that
also leads to opportunities to acquire new contracts.

Strengths as a Manufacturer

20Medium-term Management Plan

Medium-term Management
Plan
JLL published its revised medium-term management plan in May 2023. We will proceed toward realizing our Management Philosophy and Management Vision by steadily achieving the targets set in themedium-term management plan.

Five Quantitative Targets
We have established five quantitative targets that serve as KPIs to measure progress of the medium-term management plan.
Implementing both aggressive and protective measures, we aim to achieve steady top-line growth, an operating
profit margin of 20%, and a return on invested capital (ROIC) of 12%.
We plan to review the progress of each target during each fiscal year and disclose the outlook for achievementof the quantitative targets for the remaining periods of the plan, taking into account the various upside/downside
factors that have emerged over time.

Introduction

Review of the Previous Medium-term Management Plan and Basic
Details about the New Medium-term Management Plan

Medium-term KPI Targets

Review of the Previous Medium-term Management Plan
Net Sales

Net sales serves as an indicator to confirm steady business growth. The net sales
target that the Company must achieve by FY3/2028 has been set at 63 billion yen.

(FY3/2028)

FY3/2023 result: ¥51.75 billion
FY3/2024 forecast: ¥50.68 billion¥63 billion¥8 billion(FY3/2028)

We are focusing on the expansion of the neurovascular and gastrointestinal area,
our new business areas, as a specific strategy to boost net sales. The net sales
target for new business areas that the Company must achieve by FY3/2028 has
been set at 8 billion yen. Looking at each business individually, the net sales target
for the neurovascular is 4.5 billion yen and for the gastrointestinal is 3.5 billion yen.

* Neurovascular andgastrointestinal Businesses

FY3/2023 result: ¥0.88 billion
FY3/2024 forecast: ¥1.81 billion

Operating Profit
MarginWe have set operating profit margin as a quantitative target to secure resources
for medium- to long-term growth investment by continuously introducing competitive products with high profit margin potential.

Growth Strategy

Net Sales in
New Business
Areas*

Value Creation

In November 2020, we published the previous medium-term management plan (FY3/2021 to FY3/2025) in which
net sales CAGR and operating profit CAGR were provided as KPIs. We worked on the plan based on our mediumto long-term policies that aim to achieve both stable sales growth and a shift to a growth path that underlines profit
and efficiency. However, the gap between actual results and planned targets became significant due to revisions toour business portfolio, including the gradual downsizing of the coronary intervention business, the termination of an
exclusive distribution agreement for a major product in the EP/
Progress of the Previous Medium-term
Ablation business, and the divestment of the blood purification
Management Planbusiness.
Previous mediumFurthermore, results for the past three years (FY3/2021 toTargetResultterm management
FY3/2023) under the previous medium-term management plan
(to FY3/2025) (as of FY3/2023)
plan(FY3/2021 to FY3/2025)
fell short of targets for both net sales and operating profit due tothe impact of the external environment, including a slowdown of
Net sales CAGR
+10%+0%cases in the growth of the number of COVID-19 infections and a
Operating profit
significant drop in insurance reimbursement prices due to inten+15%+2%
CAGR
sified price competition in the market.

New Medium-term Management Plan

Previous
medium-term
management plan
FY3/2021 to FY3/2025

Billion yen
25.2%

50

51.7

51.3

51.5

51.7

New medium-term management plan
FY3/2024 to FY3/2028
63.0

50.6

30%
25%

45.5
42.2

40

20%

Third party products
net sales (left axis)
In-house products
net sales (left axis)
Operating profit margin(right axis)

EPS

¥120

(FY3/2028)

36.0

24.3

10%

20

ROIC

Period of
COVID-19 impact

10

5%
0%

0
‘15/3

21

‘16/3

We have set EPS as a quantitative target to prioritize capital efficiency management. The EPS target that the Company must achieve by FY3/2028 has been set
at 120 yen.
FY3/2023 result: ¥88.22
FY3/2024 forecast: ¥103.81

15%

29.2

30

FY3/2023 result: 20.9%
FY3/2024 forecast: 21.6%

Data Section

60

20％ level(each fiscal year)

Management Foundation

Since we have reached a point where we could shift our resources to the neurovascular field, where the numberof treatment cases for which therapeutic devices are used is expected to grow, and to the gastrointestinal field,
where we can develop products through the application and expansion of proprietary technologies, we withdrew
the previous plan set in May 2023 and formulated a new plan that reflects our latest strategy. We will steadily carryout the initiatives of the new plan (FY3/2024 to FY3/2028) starting in FY3/2024.

‘17/3

‘18/3

Japan Lifeline Integrated Report 2023

‘19/3

‘20/3

‘21/3

‘22/3

‘23/3

‘24/3 ‘25/3 ‘26/3 ‘27/3 ‘28/3(forecast) (forecast) (forecast) (forecast) (forecast)

12％(FY3/2028)

We have set ROIC as a quantitative target to strengthen management that prioritizes capital efficiency, including investment efficiency, inventory efficiency, andfunding efficiency. The ROIC target that the Company must achieve by FY3/2028
has been set at 12%.
FY3/2023 result: 11.9%
FY3/2024 forecast: Approx. 12%22

medium-term management plan

Medium-term Management Plan Strategies

Medium-term Growth Strategy: Growth as both a distributor and a manufacturer

In order to realize our Management Philosophy, we aim to achieve long-term business growth and sustainableenhancement of corporate value. As a specific strategy, we will focus on achieving the targets of the medium-term
management plan.

Long-term Growth Strategy• Strengthen product portfolio• Expand our business areas by leveraging our strengths• Provide in-house products overseas

The size of the medical device market in Japan is estimated to be 3.5 to 4 trillion yen. With the growth of the elderly
population and longer lifespans, the Japan Lifeline-related market is expected to continue to grow at a stable CAGR
of 2 to 3%.

Risks and Assumptions Associated with the Medium-termManagement Plan

Growth Strategy

Japan Lifeline-related Market Conditions in Japan

Value Creation

We will respond to various needs in the medical field by strengthening our product portfolio, such as strengthening our product lineup in existing fields and introducing superior products that are expected to have synergies
with our in-house products. As part of our efforts to expand our business areas by leveraging our strengths, we willdevelop new business areas through the introduction of highly novel products and the application and developmentof our proprietary technologies.
In addition, by expanding our in-house products overseas, which are highly evaluated in Japan, we will expand
opportunities for realizing a healthy society through the latest and optimal medical devices both in Japan and overseas.

Introduction

As indicated in our Management Vision, we believe that serving as both a distributor and a manufacturer, and providing the latest and optimal options to the medical field in Japan and overseas, will lead to maximizing the valuethat we can provide to the medical field. Therefore, we will focus on the following three points.

In light of our long-term growth strategy and future market environment, we will work to strengthen our functions asboth a distributor and a manufacturer under our medium-term growth strategy.
In the capacity of a distributor, we have identified medical devices that are valuable to the medical field, introduced excellent medical devices to the domestic market at an early stage, and provided products through our sales
network. Taking advantage of these strengths, we will contribute to the medical field by introducing highly novel
products such as neurovascular and other products that have synergies with existing products. In addition, as work
style reforms for physicians progress, we will focus on introducing medical devices that will lead to solving a wide
range of issues in the medical field, such as improving the work efficiency of medical professionals.
In the capacity of a manufacturer, we will strengthen the BeeAT and FROZENIX product lineup, our major products. Although these products have contributed significantly to our earnings as one-of-a-kind products to thispoint, our competitors have launched similar products. As a pioneer in the market, we will maintain our market
share by offering a product lineup that meets diverse needs. At the same time, we will focus on expanding ourbusiness in the gastrointestinal field and developing new one-of-a-kind products by focusing on R&D investments.
During the period of the medium-term management plan, although the in-house sales ratio is expected to decline
due to business expansion in the neurovascular field, we will steadily proceed with preparations for expanding inhouse products overseas.
Although we expect stable cash flow from operating activities going forward, we plan to allocate funds to investments and returns in a well-balanced manner while ensuring financial stability and prioritizing capital efficiency.
Based on the medium-term management plan, we will continue towork toward the continuous growth of our business and further improvement of our corporate value.

The following risks are assumed to be associated with the implementation of measures and achievement of KPIs under the medium-term
management plan. Although we have incorporated assumptions into
the plan, we will work to minimize risks and maximize business opportunities in the future.

Management Foundation

Domestic (Japan) Market Size

Product Category

DiseasesMarket Size

Market Growth(forecast for the
next few years)

Cardiac/
Arrhythmias¥75.0 billion+0%¥12.4 billion

EP/Ablation

Cardiac/
Arrhythmias¥75.0 billion+4 to 5%¥26.2 billion

Cardiovascular(Aortic)

Cardiac/Aortic
Aneurysms¥38.0 billion+0%¥10.4 billion

Cardiovascular(Neurovascular)

Brain/Strokes,¥30.0 billion
Brain Aneurysms+5 to 6%¥0.2 billion

Gastrointestinal

Gastrointestinal
diseases/
Cancer, etc¥34.0 billion+3 to 5%

¥0.6 billion(gastrointestinal only)¥1.7 billion(other sales in the
category)¥252.0 billionー¥51.7 billion

Source: Market research by R&D and Japan Lifeline

23

Japan Lifeline Integrated Report 2023

Risks

Explanation

Assumptions factored into the plan

Unexpected loss ofmarket share for major
products● Sales of Internal Atrial Cardioversion Catheter BeeAT and Open
Stent Graft FROZENIX (our major products) accounted formore than 30% of total net sales in FY3/2023.
● We expect competition from these products to emerge from
FY3/2024 onwards.

Expect certain market share loss,
but maintain dominant market
share after 5 years

Slower-than-expected
growth in both casenumbers and market size

● Incorporate market growth data by product category into sales
plans using market reports, etc.
● Specifically, net sales of in-house products are highly
dependent on the growth rate of atrial fibrillation (AF) cases.

Growth rate of AF case numbers:
CAGR 6%(FY3/2024 to FY3/2028)

Greater-than-expected
decline in insurance
reimbursement prices● Insurance reimbursement prices are revised once every two
years, which may result in a decline in prices.
● The year of revision can have a significant impact on net sales
and gross profit.

Assume reasonable declines basedon past declines

Launch delays orcancellations due tofailure to meet productintroduction milestones● There are various milestones before a product is launched,including development, clinical trials, and obtaining regulatory
approval.
● Failure to meet milestones or schedule delays lead to launchdelays or cancellations.

Product milestones for eachproduct

Soaring costs/expenses
due to high inflation andthe weak yen● Increasing costs of raw materials procurement, productpurchases, and SG&A expenses due to inflation and yen
depreciation => putting pressure on gross and operating profit

Expect an annual inflation rate of
2 to 3% and an FX rate of
1 USD to 130 JPY

Approx. ¥450 billion

Domestic Medical Device Market(2022)¥3.5 to 4.0 trillion

Our current productportfolio covers
Approx.

¥250 billion

Data Section

Cardiac Rhythm
Management

Total

Japan Lifeline-relatedMarketNet Sales(FY3/2023)

24

Priority Measure 1 and 2

Priority Measures

Priority Measure 2: Continuously introduce competitive products
Address the Business Environment

Under the medium-term management plan, we will focus on three priority measures to promote management that gives priority to capital efficiency in addition to the steady growth of net sales and operating profit.

Neurovascular Business Net sales target for FY3/2028: ¥4.5 billion

Products for Brain Aneurysm Treatment
Market Size: ¥15 billion Expected Growth Rate: CAGR +6%

Gastrointestinal Business

Embolic Coil(launched in April, 2022)

Flow Diverter(planned for launch in March, 2028)

Net sales target for FY3/2028: ¥3.5 billion

Application and Expansion of Proprietary Technologies in the Gastrointestinal Field
Time of Release

Product

Proprietary Technology

Jun. 2017

Colonic stent

Stent-weaving technology for vascular grafts

Dec. 2019

RF needle for liver cancer treatment

Ablation catheter radiofrequency ablation
technology

Aug. 2022

Bile-duct tube stentHigh-performance shaft manufacturing
technology for catheters

Japan Lifeline Integrated Report 2023

Introduction of Third-party Products that Create Synergies
We will continue to explore third-party products that create high synergies with in-house products by utilizing our distribution function. VASCADE MVP, a hemostatic device for femoral vein, launched in October
2023 under an exclusive distribution agreement in Japan, is used tostop thigh puncture bleeding after ablation surgery. It is a product that
can allow patients to be released from the hospital soon after surgery,contributes to reducing the workload of medical professionals, and is
expected to generate synergy with our main EP/Ablation products. We
will continue to meet the needs of the medical field by introducing products that are expected to generate synergies with existing products.

Hemostasis Device for Femoral Vein
Data Section

In the gastrointestinal field, since the launch of our colonic stent in 2017, we have launched our in-house products
based on stent-weaving, radiofrequency ablation, and other technologies that we have cultivated in the cardiovascular business. In August 2022, we started selling products in the biliary-pancreatic field by utilizing our high-performance shaft manufacturing technology. Going forward, we will continue to apply our own technologies to develop
differentiated products, thereby promoting the penetration of our brand.

25

Management Foundation

Stent Retriever (planned for launch in March 2025)

Open Stent Graft

Growth Strategy

Aspiration Catheter(launched in May, 2023)

Atrial Cardioversion Catheter

Value Creation

The market for neurovascular diseases is expected to grow in the future due to treatment guideline revisions andother factors. In August 2022, JLL entered into an exclusive distribution agreement with Wallaby Medical to distribute eleven neurovascular products in Japan, including flow diverters, which are highly novel treatment devices.
By launching these products, we will build a top-class product lineup in Japan and establish our presence in theneurovascular business.

Although competitors have entered the market with products which
compete with Internal Atrial Cardioversion Catheter BeeAT and Open
Stent Graft FROZENIX, we will maintain our market share by strengthening our product lineup.
BeeAT is a catheter used to perform intra-cardiac defibrillation to facilitate procedures during atrial fibrillation (AF) ablation surgery. Demand
for the products has exceeded our initial expectations. We have been
selling BeeAT as a de facto standard product used in more than 80%
of AF cases in Japan and as a one-of-a-kind in-house product. We are
expanding our product lineup to meet the needs of customers, suchas IVC BeeAT for IVC approach via the femoral vein, which differs fromthe conventional approach, and Lumen BeeAT, a catheter with which a
guidewire can be used for accurate catheter placement.
FROZENIX has also gained broad recognition as a product that reduces
the physical burden on patients compared to conventional ways of surgery. We are strengthening our product portfolio so that our devices canbe used for new cases. These products include FROZENIX Partial ET, an
added version of open stent graft which helps reduce the risk of complications, and FROZENIX 4 Branched, another type of open stent graft
which includes vascular grafts in its design.
We will also focus on the development of new one-of-a-kind products
by utilizing our experience and know-how in product development, which
has cultivated markets by identifying latent needs in the medical field.

Introduction

Strengthen Major Products

Priority Measure 1: Expand into new business areas

Products for Acute Ischemic Stroke Treatment
Market Size: ¥11 billion Expected Growth Rate: CAGR +8%

While the number of cases involving the use of medical devices has increased with the growth of the elderly population and longer lifespans, unit prices of products have continued to decline due to the revision of insurance
reimbursement prices once every two years in accordance with the Japanese government's policies designed toreduce healthcare costs. We will continue to introduce differentiated products to the market in order to respond to
price declines and increase market share.

26

Priority Measure 3

Priority Measure 3. Improve capital efficiency management
Cash Allocation
We expect to generate a stable cash flow during the period of the medium-term management plan. After ensuring financial stability, cash will be prioritized for investment in growth, dividends, and other uses.
The source of the required funds will be cash on hand from operating cash flows with appropriate funds procured
as necessary.
Although we will allocate according to the following basic order, we will invest flexibly depending on the expected
return on investment.

Excess Cash

Consider allocations
according tothis order❷ Growth investments

Stand-by funds for
new investments

A few billions of yen❹ Dividends (extra)/Sharebuybacks❺ Internal reserves

About ¥10 billion

Will not hold excess cash too much,taking into account ROIC andEPS targets

In order to sell highly novel products in Japan, it is necessary to conduct clinical trials. We expect to invest 100 to
200 million yen annually in clinical trials in order to introduce
newly developed in-house products and new products fromoverseas manufacturers in Japan.

(4) Others
Other investments are expected to total between 100 to
200 million yen annually. Investments may be made to form
capital tie-ups with companies including foreign manufacturers with promising products.

27

Japan Lifeline Integrated Report 2023

(2) Capital Expenditure¥1.5 to 2 billion/year(3) Clinical Trials¥0.1 to 0.2 billion/year(4) Others¥0.1 to 0.2 billion/yearTotal¥4 to 5 billion/year

Unit: million yen

FY3/2021
Actual

FY3/2022
Actual

FY3/2023
Actual

FY3/2024
Forecast

Total Dividends(DPS in parentheses; Unit: one yen)

3,945 (49)3,041 (38)2,965 (38)3,147 (42)

-

539

1,948

4,000

3,945

3,580

4,913

7,147

ColumnStrengthen Shareholder Return
In the future, we will pay a stable base dividend with a target
payout ratio of around 40% or DOE of 5% and then add tothe dividend and repurchase shares as appropriate. The treasury shares held by the Company will be allocated to remuneration for Directors, with an upper limit of approximately
1% of the total number of issued shares, and any portion exceeding this limit will be canceled. Over the next five years,
we expect the total shareholder return amount, including
dividends and share buybacks, to be around 25 billion yen.

Data Section

R&D expenses are expected to be between 2.5 and 3 billion yen annually.
R&D activities are carried out at two Company locations: the Research & Development Department (Toda City,
Saitama Prefecture) and Ichihara Factory (Ichihara City, Chiba Prefecture). By leveraging our strengths in technology, we are working on product development in existing fields and the biliary-pancreatic field, which is a new
business field for the Company. We are also focusing on new technologies such as pulsed field ablation and regenerative medicine. In light of these activities, we expect that R&D expenses will increase around 4% to 5% annually.

¥2.5 to 3 billion/year

Management Foundation(1) R&D(1) R&D

Our basic policy for shareholder return is to return profits to shareholders once a year via a year-end dividend,
taking into consideration the business performance of each fiscal year and the demand for funds for future business development. The results of past dividends and share buybacks and the return forecast for FY3/2024 are as
follows.

Total

We plan to invest between 4 billion and 5 billion yen for growth annually, mainly in R&D, capital expenditure, clinical
trials, etc. Recently, in addition to renovating our core systems to respond to changes in the business environment
and improve the efficiency of business processes, we are working to strengthen and improve the efficiency of ourbusiness foundation through digital marketing and other measures.

Annual Investment Amount

Shareholder Return Policy

Share buybacks

Growth Investments

Item

Growth Strategy

Necessary cash to ensure
financial stability(3) Clinical Trials

Value Creation❸ Dividends (base)

Capital expenditure are expected to be between 1.5 and 2 billion yen annually.
Our new core systems went into operation in November 2023. We will continue to invest in core systems to improve operations (sales efficiency and inventory efficiency). Since we currently do not anticipate making large-scale
investments in manufacturing facilities, we expect depreciation expenses to be in the range of 1.6 to 1.8 billion yen
per year.

Introduction❶ Acquire business assets(2) Capital Expenditure

Takeyoshi Egawa
Vice President Senior Manager of Business Administration Department

28

Business Strategy

Business Strategy
Cardiac Rhythm Management
Handling implantable devices totreat arrhythmias

CAGR

+0%

Senior Operating Officer and Executive
General Manager of Arrhythmia Business Unit

Handling electrode-embedded catheters used
for diagnosis and treatment of arrhythmias

Sales Growth Target for the Mediumterm Management Plan Period
CAGR(Brady -1 to -2%, Tachy +1 to +2%)

Naohiro Nakada
Operating Officer and General
Manager of EP Department

Market Growth Forecast for the Medium-termManagement Plan Period (monetary value basis)

+0%

CAGR

Sales Growth Target for the Medium-term Management Plan Period+4 to 5%

CAGR

+5%

FY3/2023 Overview

In FY3/2023, Cardiac Rhythm Management net sales decreased 4.4% YoY to 12,403 million
yen. The sales were sluggish because the negative impact of the insurance reimbursement
revision that took place in April 2022 was more than expected, on top of the prolonging
impact of the COVID-19 pandemic.

In FY3/2023, EP/Ablation net sales increased 4.8% YoY to 26,292 million yen. The numberof atrial fibrillation (AF) ablation cases increased by about 6% from the previous fiscal year,
resulting in strong sales of AF-related in-house products.

Cardiac PacemakerOn the other hand, the devices that we handle have unique strengths such as long battery
life, accessories that help conduct surgeries smoothly, and a sales system with multiple
locations throughout Japan. We believe that it is possible to use these strengths to our advantage in order to beef up our overall appeal to customers and achieve tenacious growth.
In the tachycardia field, we will make every effort to further popularize our unique S-ICD
product. Since switching the supplier of our cardiac rhythm management products to Boston Scientific Japan in 2019, we have focused on S-ICD seminars and study sessions for
medical professionals. Although it took longer than expected due to the COVID-19 pandemic, S-ICD sales have been increasing steadily recently. I’m confident that it is the resultof our efforts. Going forward, we will strive to establish a stronger position in the market byfurther improving sales efficiency and increasing the S-ICD’s repeat adoption rate.

29

Japan Lifeline Integrated Report 2023

Detects the occurrenceof ventricular fibrillation,a fatal arrhythmia amongarrhythmias (tachycardia) inwhich the heart beats faster,and provides an electricalshock to bring the heartbeatback to normal.

S-ICD
Like the T-ICD, the S-ICD
delivers an electric shock
when ventricular fibrillation
occurs, but since thelead wire is implanted
subcutaneously, there is no
foreign body implanted in the
blood vessel or in the heart.

Medium-term Strategy: Strengthen Product Lineup
During the period of the plan, we aim to grow sales at a CAGR of 5% through to the final
year of the plan, the fiscal year ending March 2028, after bottoming out in FY3/2024, when
we expect a decline in sales due to the termination of our exclusive distribution of RF needles. The number of AF cases is expected to grow steadily over the medium term. By taking
advantage of this growth, we intend to increase AF-related product sales.
We will also focus on our largest growth driver, Internal Atrial Cardioversion Catheter BeeAT. Although our competitors recently entered the market with competing products, we will
maintain a dominant market share by strengthening our product lineup. In addition to VASCADE MVP, a hemostatic device for femoral vein launched in October 2023, we will steadilylaunch products that are planned to be introduced in the future to achieve the targets of themedium-term management plan.

Endoscopic Laser
Ablation Catheter
Laser irradiates from inside
a balloon section of thecatheter to isolate abnormal
excitation from the pulmonaryveins that cause atrial
fibrillation. An endoscope
inside the catheter allows for
accurate catheter placement
and ablation.

Data Section

Medium-term Strategy: Perform actions that utilize our strengths

T-ICD

Used during examinations
to diagnose arrhythmia anddetermine the appropriate
treatment method.

Management Foundation

We expect the cardiac rhythm management market to basically remain flat during the period of the medium-term management plan. However, we will aim to achieve sales growththat exceeds the market. Firstly, with regard to business conditions, the market on an implanted-unit basis will continue to expand against the backdrop of a gradual increase in
the elderly population. However, the monetary value-based market growth rate is expected
to remain flat as insurance reimbursement prices are on a downward trend, reflecting intensifying price competition in the market. In this matured market, product differentiationand sales efficiency are the keys to survival. In the bradycardia field, other companies haveintroduced leadless pacemaker technology, an innovative technology which defies conventional wisdom. As a result, it goes without saying that we are likely to face an uphill battle interms of product competitiveness in this area.

The medium-term management plan is premised on the assumption of a major change—
the emergence of a new technology called pulsed field ablation (PFA). Conventional radiofrequency ablation, which uses thermal energy, has the potential to damage adjacentorgans other than the lesion, such as the esophagus, but the greatest advantage of PFA
is that the risk of such damage is low. This technology is also expected to shorten surgery
times. Since our competitors are quickly moving forward in the PFA field, the technology
is expected to be introduced in Japan at some point in 2024. We are preparing to enter
the PFA market in order to follow suit. On the other hand, the spread of PFA is expected
to have a negative impact on our business, such as a decrease in demand for esophageal
temperature monitoring catheters, one of our major products.

EP Catheter
Growth Strategy

Medium-term Business Conditions

Medium-term Business Conditions

Value Creation

FY3/2023 Overview

Artificially stimulates the heart
using electrical stimulation
for patients with arrhythmia(bradycardia), a condition
where the heart beats too
slowly, to keep the pulse at a
steady rate.

Introduction

Market Growth Forecast for the Medium-termManagement Plan Period (monetary value basis)

EP/Ablation

Takashi Ito

Atrial Cardioversion
CatheterThis device can perform
atrial cardioversion for atrial
fibrillation that occurs mainly
during ablation treatment.

30

Business Strategy

Cardiovascular
Aortic: Medical devices for treating aortic disease
Neurovascular: Medical devices for treating ischemic stroke or brain aneurysms

Ischemic stroke
Aorticrelated products+0 to 1%
+8％

Brain aneurysm
related products+6%

Senior Vice President Executive
Manager of General Business HQ

Handling medical devices for treating
gastrointestinal diseases of the liver, colon, etc.
Market Growth Forecast for the Medium-termManagement Plan Period (monetary value basis)

Sales Growth Target for the Mediumterm Management Plan Period
Aortic CAGR +3 to 4%
Neurovascular Net sales target for
FY3/2028: ¥4.5 billion

CAGR+3 to 4%

Yasuaki Takeda
General Manager of GI Department, CVG
Business Unit
Sales Growth Target for the Mediumterm Management Plan Period

Net sales target for
FY3/2028: ¥3.5 billion(Reference: ¥0.65 billion in FY3/2023)

FY3/2023 Overview

In FY3/2023, cardiovascular net sales increased 8.6% YoY to 11,006 million yen. Sales ofaortic-related products in our existing business area were firm. Sales of neurovascular-related products, our new business area, also got off to a good start.

In FY3/2023, Gastrointestinal net sales decreased 37.2% YoY to 2,048 million yen. Net
sales of gastrointestinal-related products, which is an area of business that we are focusing
on, increased 44.2% YoY to 654 million yen. Although sales were strong in line with thelaunch of new products, we withdrew from the unprofitable coronary intervention business,
resulting in a significant decline in net sales in the fiscal year under review.
Vascular Graft

Colonic Stent

This device is used to treat
aneurysms by replacing
damaged blood vessels
through open chest surgery.

This device is used to treat
a blocked colon caused bycancer. A thin wire is inserted
through the blockage andthen the stent is placed along
the wire to open up the colon.

This device is inserted into
the aorta to hold it in placethrough expanding force. As
the distal side doesn't needsuturing, the surgery is lessinvasive.

In accordance with the policy of “Expanding into new business areas” provided in the medium-term management plan, we aim to enter the gastrointestinal field in a full-fledged mannerand expand business by tapping into the biliary-pancreatic market. However, because thegastrointestinal field is different from what we have experienced in the cardiovascular, fromproducts to customers, it was necessary to first establish a sales structure. By shifting personnel from other departments, we were able to build up our sales staff, and through time-consuming and systematic training, we were able to put in place a solid business foundation. In
regard to products, we are working to develop competitive products by utilizing our in-house
technologies such as high-performance shafts and stents established that are widely used in
the cardiovascular field. Taking advantage of our strengths as a Japanese manufacturer, we
are actively engaged in activities out on the field, such as having product engineers conduct
interviews with doctors directly. In the future, we would like to steadily establish a position in
the market by launching unique proprietary devices.

Management Foundation

Open Stent Graft

Medium-term Strategy

Growth Strategy

RF Needle for Liver
Cancer Treatment
A needle-shaped electrodeis percutaneously inserted
into the liver cancer tissue
and radiofrequency heatis generated around theelectrode to ablate and treat
the lesion as monitoring isprovided via an ultrasoundor CT.

Data Section

Under the medium-term management plan, we aim to achieve a net sales CAGR of 3%
to 4% for aorta-related products while targeting 4.5 billion yen (FY3/2023 net sales: 0.23
billion yen) in net sales for neurovascular-related products by FY3/2028.
In the aorta-related business, our main strategy is to expand our open stent graft business, a major product type. Since FROZENIX Partial ET, launched in August 2023, is an
open stent graft featuring a design that is expected to reduce the risk of complications, wewill focus on expanding sales with the aim of replacing conventional surgical procedureswith those that use open stent grafts.
We decided to enter the neurovascular-related field because the market growth rate ishigh at 6% to 8% and we could leverage Wallaby Medical’s excellent product portfolio. The
current product lineup of neurovascular-related consists of embolic coils and aspiration
catheters. However, we plan to expand this to 11 products within five years. The challenge
to our success in this area is to survive the fierce competition on the sales front. Although
the current sales progress rate is well enough, we will further strengthen our sales structureby hiring external personnel, enhancing internal training, and building relationships withcustomers.

Value Creation

FY3/2023 Overview

Medium-term Strategy

Introduction

Market Growth Forecast for the Medium-termManagement Plan Period (monetary value basis)
CAGR

Gastrointestinal

Tatsuya Murase

Product Development Using In-house Technologies
New Business Development
Although it is not included in the medium-term management plan, JLL entered into a longterm exclusive distribution agreement with Meril Life Sciences and decided to move into
the TAVI (Transcatheter Aortic Valve Implantation) field for the first time. In Japan, this field islarge with a market size of 56 billion yen with a CAGR of 5%. Although several competitors
have already playing in the market, the products we handle are competitive. Therefore, we
aim to establish a market presence as soon as possible by leveraging the know-how andcustomer base we have developed through sales of prosthetic heart valves in the past.

31

Japan Lifeline Integrated Report 2023

Embolic CoilThis device is placed ina brain aneurysm to stop
blood flow and prevent itfrom bursting (subarachnoid
hemorrhage).

The future growth of the Gastrointestinal business will require the enhancement of our biliary-pancreatic products. The bile duct tube stent, launched in 2022, captured approximately 10% of the market share in just one year. This product uses the catheter shaft
manufacturing technology that is widely used for EP products, and has been highly evaluated for its excellent passability and endurance. At present, we have four products in our
product pipeline, and we are working on a re-launch of our cholangioscope, which had
been positioned as our main product in the biliary-pancreatic field but found necessary forre-development at the initial clinical phase. Although we are a late comer into the market,
we aim to achieve steady growth by introducing competitive products through innovativeideas that lead to solutions.

Bile-duct tube stentThis device is used to widen
a narrowed bile duct, which
can be caused by stones
or tumors, and restore thenormal flow of bile.

32

Sustainability Management

Sustainability Management
Guided by our management philosophy, the JLL Group will achieve sustainable growth by working tosolve social issues through our business activities of providing the latest and optimal medical device
technologies while meeting the expectations of our stakeholders.

Identifying Materiality
In June 2021, we identified the seven materialities (important issues) using the process shown below. Moving
forward, we will promote sustainability initiatives by monitoring and managing the annual progress of the KPIs set
for each materiality.

Materiality Identification Process
STEP.

Sustainability Policy
STEP.

02

Identified social issues by referring to evaluation items in international sustainability guidelines (GRI,
SASB, SDGs).
Created a comprehensive long list of social issues and organized the items to create a short list of social
issues (27 items).

Prioritizing Social Issues
Evaluated and prioritized individual social issues by using the two axes of “importance to the company”
and “importance to stakeholders.” Created a social issue evaluation matrix and selected candidates forthe materialities that should be prioritized and initiated by the company.

STEP.

03

Value Creation

In order to respond to changes in the environment surrounding the JLL Group and the diversification of values, weestablished the Code of Conduct in December 2022 as action guidelines for directors and employees. This is basedon the belief that in order to put our management philosophy into practice, each and every one of us must think
about our stakeholders and take actions that meet their expectations. The Company aims to have all stakeholders
say, “I am grateful that I chose Japan Lifeline.” Since we believe that this type of approach is also important for oursustainability initiatives, the Code of Conduct will serve as guidelines in this area as well.

Identifying Social Issues
Introduction

01

Validation

Grateful for Japan Lifeline (JLL)
STEP.

1. “I’m grateful for JLL’s products.” by every patient04

2. “We’re grateful that JLL people have come.” by medical professionals

Identifying Materiality
Growth Strategy

Code of Conduct

The selected materiality candidates were discussed by the directors to confirm their validity.

We identified the seven materialities as issues that the Company needs to address, organizing theminto 2 categories: issues to be resolved through business and issues to be addressed to strengthen
the business foundation.

3. “We’re grateful that we could do business with JLL.” by business partners
4. “We’re grateful that JLL people are here.” by local communities
5. “We’re grateful to be a shareholder of JLL.” by shareholders

Identified Materialities

6. “We’re grateful to work for JLL.” by employees

Area

Sustainability Promotion Structure

Philosophy
Realizing a Healthy
Society

Sustainability Committee

Japan Lifeline Integrated Report 2023

• Improve technology for in-house products• Introduce medical devices with high clinicalvalue

Board of Directors
ReportingIssues to be Addressed to Strengthen the Business Foundation

Instruction

Sustainability Committee

Area

Chairperson : President & CEO
Members : Operating Directors
Secretariat : Corporate Planning Dept.
Reporting

Environment
Consideration for the
Global Environment

Suprevision/Monitoring

Subcommittee
General Manager: Senior Executive Vice President and COO
Healthcare Issues
Solving Subcommittee

Environment
Subcommittee

Stable Supply
Subcommittee

Human Resources andDiversity Subcommittee
Corporate Governance
Subcommittee

Divisions33

Solve medical issues through innovative
medical devices

Major Themes

SocialCreating a Rewarding
Workplace
Supply of Safe andReliable Products

Materiality
Reduce environmental impact
Create a workplace where employees
can work with comfort• Create a comfortable work environment• Respect human diversity• Respect human rights

Develop human resources and provide
opportunities for them to play anactive role

• Support employees to achieve specialized skills
and personal goals• Strengthen education and training

Secure product quality and stable supply• Strengthen the quality control system• Secure stable supply of products

Strengthen corporate governance• Strengthen auditing and supervisory functions•E xecute management decisions and operations
with objectivity and transparency• Strengthen risk management initiatives

Promote compliance•E nsure fairness and transparency in corporate
activities

Quality Control
Subcommittee
Compliance andRisk Management
Subcommittee

GovernanceActs as a Responsible
Company

Major Themes• Use resources effectively• Reduce greenhouse gases• Reduce waste / Process waste properly

Data Section

The Sustainability Committee, which is chaired by
the president and CEO and composed of operating
directors, plays a central role in determining andpromoting company-wide action policies related
to our sustainability efforts. Seven subcommittees
have been established under the committee foreach materiality, and specific activities are carriedout under the instructions of the committee. The
Sustainability Committee receives quarterly activity
reports from each subcommittee and monitors the
progress toward targets.
The Board of Directors regularly receives reports
from the Sustainability Committee, oversees theCommittee, and decides on important matters related to sustainability.

Materiality

Management Foundation

Issues to be Resolved through Business

34

Materiality and KPIs

Materiality and KPIs
Area

Philosophy

Environment

Solve medical issues
through innovative
medical devices

Reduce environmental
impact

KPIs

Major FY3/2023 Results

R&D expense

Bring about increases in R&D expenses

R&D expenses (non-consolidated) of 2,316 million yen(year-on-year increase of 7.3%)

Number of patent applications

Number of patent applications: 100 (total for FY3/2023-FY3/2025)

34 patents (non-consolidated)

Exploring new areas of business from Intellectual Property

Planning and implementation of measures

Introduction of user-friendly products• Identify needs of the medical field and develop products that

Application and Expansion of proprietary technologies toother fields• Explore highly novel products

Establishment of an environmental policy and promotion
systemCO2 emissions

ーーmeet those needs• Establish an environmental promotion system

Formulation of Environmental Conservation Policy• Reduce CO2 emissions by 50% by FY3/2031

Scope 1 & 2 Emissions (consolidated): 6,612 t(year-on-year decrease of 1.6%)(compared to FY3/2021 levels)

Industrial waste recycling rate

• Achieve 90% industrial waste recycling rate

96% (non-consolidated)

Assessment on the current status and implementation of
measures to improve work-life balance• Monitor and improve of actual working hours

Grasped the actual working hours per person peryear (1941.7 hrs.) (non-consolidated)

Value Creation

Create a workplace
where employees canwork with comfort

Major Medium-Term Targets (to be achieved by FY3/2025)

Introduction

Issues to be
ResolvedthroughBusiness

Materiality and SGDs

• Achieve a female manager ratio 15% by FY3/2031

Ratio of female managers• Increase ratio of female employees / Study and implement

2.6% (non-consolidated)measures to support women• Conduct risk assessments on human rights

Formulation of human rights policy

Formulation of human resources policy and establishmentof human resources development promotion system• Formulate a human resources policy and promote human

Establishment of human resources development
promotion system

Improvement of employee satisfaction• Improve employee satisfaction• Conducted employee satisfaction surveys• Obtain MDSAP* certificate

Maintain and improve the quality of our in-house products• Analyze complaint reports and conduct surveys for doctors

Diversification and internalization of outsourcing of criticalcomponents and subcontracted processing

Reinforcement on information security measures
Governance
Strengthening of the compliance system

Promotion of efforts to improve understanding of thewhistleblower system• Improve our surveillance evaluation• Promote the use of multiple production lines• Promote multifunctional workforce• Increase coverage of multiple production lines and in-houseproduction by 5% (compared to FY3/2024 results)• Completion of MDSAP applicationー• Commenced production line duplication work for

multiple itemsー• Appointment of one additional outside director• Comply with the Corporate Governance Code• Reassess company-wide risks, determine countermeasures,verify and implement reviews continuously• Create and implement a five-year roadmap based on the resultsof company-wide risk analysis• Implement various training programs and raise awareness ofcompliance

Data Section

Implementation of measures to comply with the Corporate
Governance Code
Promotion of risk management

Promote complianceyear-on-year

Compliance with global regulatory requirements(Acquire MDSAP certificate)

Promotion of production line duplication

Strengthen corporate
governance• Increase education and training expenses per employee by 5%

Education and training expenses per employee(non-consolidated): 97,142 yen (year-on-yearincrease of 39.8%)

Management Foundation

Secure product quality
and stable supply• Analyzed survey results and formulated measures

to improve employee satisfaction
Education and training expenses per employee

Issues to be
Addressed toStrengthen
the Business
Foundation

resources development

Growth Strategy

SocialDevelop humanresources and provide
opportunities for them toplay an active role

Reinforcement on efforts to reduce human rights risks

to the Nomination and Remuneration Advisory
Committee• BCP development at all sites• Creation of company-wide risk list

Conducted training for all employees (2 times)• Conducted various training programs designed

for employees as well as job-specific training
programs• Establish a whistleblower system that complies with the• Established a whistleblower system that complies

Whistleblower Protection Act• Ensure that the whistleblower system is known throughout theCompany to promote its appropriate use• Conducted whistleblower system-related training

with the Whistleblower Protection Act
programs and awareness surveys for employees* Medical Device Single Audit Program	MDSAP is a program that verifies the conformity and adequacy of a manufacturer’s QMS to the regulatory requirements of regulatory authorities in five countries (the UnitedStates, Australia, Brazil, Canada, and Japan) in a single survey by an accredited survey organization.

35

Japan Lifeline Integrated Report 2023

36

Environment

Environment

Board of Directors
Reporting

In response to serious environmental problems such as global warming and environmental pollution,
the JLL Group is working to reduce the environmental impact of our business activities in order to realize a sustainable society that can achieve a balance between global environmental conservation andeconomic development.

Instruction

Reporting

Risk Management Committee

Sustainability Committee
Chairperson : President & CEO
Members: Operating Directors
Secretariat : Corporate Planning Dept.
Reporting

Cooperation

Policy, which is provided below, in February 2023 inorder to promote initiatives throughout the Group.
Based on this policy, we will fulfill our responsibilities
as a member of society by promoting environmental
conservation initiatives throughout the Group.

1. Reduce the risk of environmental pollution
sign, development, production, sales, use, and disposal of medical devices.
•
In all of our business activities, we will not use prohibited hazardous chemicals and will manage thechemical substances contained in our products.

2. Promote environmental preservation•
To cope with climate change, we will work to reduce greenhouse gas emissions through the use of

Divisions

Specific Initiatives

ing limited resources.
• To coexist in harmony with nature, we will engage in responsible procurement that takes into accountthe conservation and sustainability of water resources and biodiversity.

3. Comply with laws, regulations, ordinances, and other social norms• We will comply with domestic and international environmental laws, regulations, ordinances, and agree-ments we have agreed to in all of our business activities.

4. Promote environmental management

Japan Lifeline Integrated Report 2023

ability Committee on the progress of activities, risk
assessments, and countermeasures, and receives instructions as appropriate. In addition, with regard toclimate change risks, the Sustainability Committee
works together with the Risk Management Committee
to share information and take other actions.

Utilization of Renewable Energy
We installed solar power generation systems at the
Toda Factory in 2017 and the Ichihara Factory in 2021.
The total estimated annual power generation of bothfactories is 286.2 MWh, resulting in a reduction of
126.2 tons of CO2 emissions. We will also promote theuse of renewable energy at other factories.
Solar panels at Ichihara Factory

In addition to our initiatives to reduce and reuse waste,
we also focus on recycling in order to contribute to
the realization of a recycling-oriented society. We will
strive to increase the recycling rate by expanding thescope of waste to be recycled, such as waste generated in the product manufacturing process and products that are no longer usable after their sterilization
expiration date.
Nonconsolidated

FY3/2021

FY3/2022

FY3/2023

Industrial waste
recycling rate

90%

92%

96%

Effective Use of Water Resources
Since there are many processes in which clean water is used for the production of our products, we areworking to reduce the amount of water used at eachfactory. Specifically, we are working to conserve water
resources by installing chillers (cooling water circulation systems) in facilities that require a large amountof tap water for cooling, etc. to recirculate and reusewater once it has been used.
(Non-consolidated)
R&D andmanufacturing
departments

FY3/2021

FY3/2022

FY3/2023

Amount ofwater used

12,584 m²

16,821 m²

13,184 m²

Data Section• We will fulfill our accountability by proactively disclosing information on our environmental initiatives.

We manage chemical substances in accordance withthe laws and regulations of each country to ensurethat products do not contain chemical substancesthat have a negative impact on the environment or thehuman body.
In addition, the Oyama Factory and Ichihara Factoryuse EOG (ethylene oxide gas) for product sterilization.
Although EOG-based sterilization is highly effective
even at low temperatures and is widely used for thesterilization of medical devices, EOG is highly toxic.
Therefore, we aim to reduce environmental impact byusing a combustion apparatus to decompose the gas
containing EOG emitted from the sterilizer, purify it toa harmless level, and release it into the atmosphere.

Recycling of Industrial Waste

Management Foundation

renewable energy and the promotion of energy conservation.
• To create a recycling-oriented society, we will work toward zero emissions by efficiently using and reus-37

3. Comply with laws, regulations, ordinances,and other social norms

Growth Strategy• We are committed to providing environmentally friendly products throughout the entire process of de-Under the direction of the Sustainability Committee,
the Environment Subcommittee plays a central rolein considering specific measures and promoting activities for environmental conservation. The Environment Subcommittee reports quarterly to the Sustain

2. Promote environmental preservation

4. Promote environmental management

Controls for Hazardous Substances

Environmental Promotion System

1. Reduce the risk of environmental pollution

Value Creation

Since we regard efforts to preserve the global environment as an important management issue, we established the JLL Group Environmental Conservation

Person in Charge: Vice President andExecutive Manager of
R&D and Manufacturing
Headquarters

Environmental Subcommittee Initiatives

Introduction

JLL Group Environmental
Conservation Policy

CRO: Director

Suprevision/Monitoring

Environment Subcommittee

Reduce environmental impact

Supervision

38

Environment● Opportunities

Disclosure based on TCFD Recommendations
The JLL Group recognizes that climate change brings about significant risks and opportunities that will affect ourbusiness continuity and sustainable growth. Based on the recommendations of the Task Force on Climate-related
Financial Disclosures (TCFD) established by the Financial Stability Board (FSB), we will actively promote the disclosure of our climate change initiatives according to four disclosure items.

Category

Resource
Efficiency

Opportunity factors
Use of efficient meansof transportation/
efficient production anddistribution processes

Impact on our Company
1.5°C/2°C

4°C

MediumLow

Use of recycling

Under the direction of the Sustainability Committee, the Environment Subcommittee plays a central role in considering specific measures and promoting activities related to climate change. The Environmental Subcommittee
reports quarterly to the Sustainability Committee on the progress of activities, risk assessment and countermeasures, and receives instructions as appropriate. In addition, with regard to climate change risks, the Sustainability
Committee works together with the Risk Management Committee to share information and take other actions.

Develop and expand
low-carbon products/
services
Changing consumer
preferences

MediumAccess to new markets

Low

Strategy● Transition Risk
Category

ResilienceLow•D evelop environmentally friendly products (lowRisk factors

medical institutions (e.g., reduced operation time)

Technologies

Replacement ofexisting products
and services with
low-carbon options

Impact on our Company
1.5°C/2°C
MediumCountermeasures

4°C
Low

• Promote energy-saving activities in a systematic manner• Utilize renewable energy• Develop environmentally friendly products (low carbon

Low

Low

emissions during manufacturing and use)
• Develop products that contribute to the efficiency of

medical institutions (e.g., reduced operation time)•D evelop environmentally friendly products (low carbon• Promote multiple procurement of raw materials and

Low

High

Low

•D
 evelop products that contribute to the efficiency of

medical institutions (e.g., reduced operation time)• Proactively address and disclose information in

Soaring raw
material costs

Low

Low

• Develop a collaborative climate change plan with supply

chain constituents● Physical Risk

plans

The Environmental Subcommittee plays a central role in assessing risks related to climate change and regularly reviews
risk assessments based on temporal perspective, likelihoodof occurrence, and scope of impact, and responds according
to priority level. The Sustainability Committee receives quarterly reports from the Environmental Subcommittee to checkthe status of risk management and works together with the
Risk Management Committee to share information and takeother actions.

Risk factors
Increased severity
and frequency of
extreme weather
events such as
cyclones and floods
Changes in rainfall
patterns, extremes
in weather patterns

Japan Lifeline Integrated Report 2023

Countermeasures

4°C• Establish BCP plans for typhoons, floods, and otherMediumHigh

Overview

Temporal
Perspective

The extent to which climate change
impacts are expected to affect Groupbusiness (long term, medium term,
short term)

Likelihood of
Occurrence

The extents to which climate change
impacts may affect Group business(high, medium, or low)

Scope of
Impact

The extent to which climate change
impacts will affect Group business(large, medium, or small scale)

We have set CO2 emissions as a KPI for “Reduce environmental impact,” which is one of the materialities, and progress isbeing managed. The targets and results over the past three
years are as follows.
CO2 emissions reduction target

Impact on our Company
1.5°C/2°C

Indicators and Targets

Evaluation
Axis

50% reduction in CO2 emissions by 2030 (compared to FY3/2021)(Scope 1 and 2 emissions*, consolidated)

Data Section

39•S tudy alternatives for logistics and early recovery

Management Foundation

Changes inConsumer Behavior

response to climate change-related requests

Chronic

consider alternatives

Mediumemissions during manufacturing and use)Acute

• Develop medical devices to treat new diseases

Low

Growth Strategy

Pricing progressionof GHG emissions

Category•D evelop products that contribute to the efficiency of

Risk Management

Policy/Regulations

Markets

carbon emissions during manufacturing and use)

Low

Value Creation

To identify risks and opportunities from climate change, we have set 1.5°C/2°C and 4°C scenarios based on information published by the Intergovernmental Panel on Climate Change (IPCC), and the International Energy Agency(IEA). The Environmental Subcommittee analyzed the scenarios and evaluated the financial impact on our businessbased on temporal perspective, likelihood of occurrence, and scope of impact.

Low

Participation in
renewable energy
programs, adoption ofenergy conservation
measures
Resource substitution/
diversification• Promote efficiency in manufacturing processes

Introduction

Markets• Promote efficiency in transportation• Promote recycling of industrial waste

Governance
Products andServices

Countermeasuresdisasters• Decentralize development and manufacturing functions• Promote multiple procurement of raw materials and* Scope 1 & 2 emissions: Direct and indirect greenhouse gas emissions through the company’s operations

consider alternatives• Study alternatives for logistics and early recovery plans

Low

Medium• Promote efficiency in the development andActual CO2 emissions (Scope 1 and 2, consolidated)

Unit: t-CO2

FY3/2021

FY3/2022

FY3/2023

Actual CO2 emissions(Scope 1 and 2,
consolidated)

6,950

6,720

6,612

Base year comparison

-

-3.3%

-4.9%

manufacturing verification process40

SocialSocialSpecific Initiatives

Support for Specialized Knowledge Acquisition

Ensuring Diversity in Recruitment
Amid the diverse relationships between companies and society, we consider human capital to be anissue that needs to be addressed through our business activities and strive to create workplaces where
employees find their work to be challenging and rewarding. At the same time, we have positioned“product liability” as another issue and will work to ensure a stable supply of products that can be usedwith peace of mind.

Policies for Human Resource Development

We provide training to provide employees with theabilities and skills that they are required to possess

41

Management Basics Training(for understanding
principles of conduct)(designed for
newly-appointed managers)

Training for Enhancing Problem-Solving Abilities

Training for Team Building
Professional Career Training(for understanding principles of professional conduct and self reflection)
Training for Third-year Employees
New Employee
Training

Japan Lifeline Integrated Report 2023

Second-year
Follow-up Training

Labor Management
Knowledge Acquisition(e-learning)
designed for
newly-appointed
managers

Specialized Skill Training

Fundamental
Training for Evaluators(designed for
newly-appointed managers)

e-learning

Training for Newly-appointed Senior Managers

Promotion of the active participationof female workers

Theme-based Specialized
CareerTraining
Development
Skills

Career Training (senior level)

Employment-level Based Training

1 on 1 Training

DepartmentSupport for Individual
Independence and Growth specificTraining for Mid-career Hires

Mid-level
employeesYoungemployees
New
Employees

Training for the Enhancement of Organizational Functions

March 31, 2023

21% (108 people)* Cardiac Device Representative (CDR): An expert who possesses specialized
knowledge and skills that provides information on medical devices and medical
technology including cardiac pacemakers and implantable cardioverter defibrillators (ICD). The certifying body for CDR certification is the Japanese Heart
Rhythm Society.

R&D

Mid-career hires
from otherindustries

517
people 56% (290 people)

Mid-career hires
from the same
industry

23% (119 people)

New graduate hires

49% (32 people)
26% (17 people)

65
people25% (16 people)
In-house training center (Tennoz Accademia)

Investment in Human Resource Development
In order to ensure continuous human resource development by investing in education and training, wehave set “Education and training expenses per employee” as a KPI. We have established an annual planwith the goal of increasing education and training expenses per employee by 5% year-on-year, and centrally manage the progress of the plan. By responding
flexibly, such as holding training sessions as necessary that were not planned at the beginning of the
fiscal year and additional study sessions that were inhigh demand, the results for human resource development investment for the fiscal year ended March 31,
2023 far exceeded the target.

Data Section

Management

Education and Training System

March 31, 2023

Sales/Marketing

Management Foundation

Systems for Human Resource Development

Composition Ratio of New Graduates andMid-career Hires

Growth Strategy

In order to realize our management philosophy, we
have set our vision of the ideal human resources as“people who can think and act on their own, people
who are sincere and never lie”. We also want employees to grow, always having a mindset to learn newthings proactively, a mindset to improve their insightas professionals, and a mindset that is not individualistic and respects teamwork. Fostering such humanresources will, we believe, lead to sustainable growththat leverages our strengths.

as well as career-specific training based on how many
years they have worked for the company, their position, age, and other factors in order to promote thegrowth of each employee and support career development. In addition to providing each employee withthe opportunity to take training courses to acquire
skills relevant to his or her work, the program also allows for self-directed learning through e-learning.
For new graduates that join the Company, not only
on-the-job training but also follow-up training is provided on a regular basis, and job rotation is conductedaround three years after joining the Company with theaim of fostering their development by providing themwith a variety of experiences.
In addition, we are working to realize autonomous
career development by providing opportunities totake on new challenges through our internal recruitment system and self-application system.

Value Creation

Policies and Systems for
Human Resource Development

Introduction

Develop human resources and provide opportunities for them to play
an active role

When hiring employees, we are conscious of the balance between hiring new graduates, mid-career hires
from the same industry, and mid-career hires fromother industries. In particular, we are actively hiring
people from other industries.
Although expertise in handling medical devices isessential, this specialized knowledge can be acquired
through education and training after joining the Company. What is more important is that diverse humanresources work together to revitalize the organizationand encourage the growth of each employee.

As we handle highly controlled medical devices, ouremployees, who sell and develop products, need toacquire specialized knowledge.
In particular, employees involved in the sale andmarketing of implantable medical devices such as
cardiac pacemakers and implantable cardioverter
defibrillators (ICD), which are our core products, arerequired to obtain CDR* certification. We maintain ahigh certification test pass rate by having establisheda systematic in-house education system and providing follow-up training that corresponds to the level ofeach examinee. As of June 30, 2023, 353 employees(37% of the Company’s employees) have obtained
CDR certification to provide support for the properand safe use of products at medical sites throughout
Japan.

Training using a surgery simulator

Education and training expenses per employee
Education and training expenses
per employee per year
(non-consolidated)
FY3/2021

FY3/2022

FY3/2023

62,701 yen

69,495 yen

97,142 yen

YoY 5.2%

YoY 10.8%

YoY 39.8%

decreaseincreaseincrease

42

SocialCreate a workplace where employees can work with comfort
Respecting Human Diversity
and Work Environment
Establishment

Conduct employee satisfaction surveys
Forum for the promotion of the active participation of
female workers

Secure stable supply of products

Improving Work-Life Balance

43

Japan Lifeline Integrated Report 2023

Procurement Policy

In March 2023, we formulated a Procurement Policy for the procurement of goods, materials, and services.
Based on this policy, we will work on supply chain management to improve product quality and ensure astable supply.
Fairness

Yumiko HoshibaVice President and General Manager of Human
Resources & General Affairs Department

Global opportunities for fairtransactions

Compliance

Abide by laws, regulations, and social
norms

We will provide fair opportunities for competition to all
suppliers globally.

We will comply with relevant laws and regulations. We dosound and fair procurement activities with social norms.

Advanced

Win-Win

Secure the latest technologicalcapabilities and product safety

We will constantly explore the latest and mostappropriate technology that makes our products
different. We aim to ensure product safety throughcooperative relationships with our suppliers.

Data Section

In order to provide an environment where
employees can balance work and personal life,
we are expanding systems and measures, suchas introducing flextime and remote work, andencouraging employees to take paid leave andchildcare leave. We also provide support tomaintain mental health, such as stress checks
and counseling with industrial physicians.
Improving work-life balance is also important
for respecting human diversity. We will continue
this initiative as part of our efforts to improve
productivity and encourage the creation of ideas.

Management Foundation

As a company that handles medical devices that are
critical to the lives of patients, the stable supply of
products is a major responsibility. Therefore, we aretaking various measures to achieve this.

ColumnColumn

Malaysia Factory
Growth Strategy

In the fiscal year ended March 31, 2023, we started
conducting an employee satisfaction survey for all
employees in order to grasp their awareness of workand the workplace environment. In addition to questions about engagement related to their work, theworkplace, and the Company, we also asked questions about work and human relationship burdens.
The survey response rate was over 90%. The survey
results are analyzed to identify issues that are high priorities for the Company and to make improvements.
By conducting this survey annually, we will continuously work to improve issues and measure the effectiveness of improvement results.

Based on our management philosophy, we have established a quality policy and comply with the Act
on Securing Quality, Efficacy and Safety of Products
Including Pharmaceuticals and Medical Devices andrelated laws and regulations, and maintain as wellas improve our quality management system in compliance with ISO 13485 (global standard for medical
device quality management systems). Through these
efforts, we work to ensure product quality and safety in a series of processes including design, development, manufacturing, sales, and post-marketing
safety management. ISO 13485 certification has beenacquired by Headquarters and all domestic and overseas factories.
In May 2023, we also obtained MDSAP (Medical
Device Single Audit Program) certification since weare looking at expanding our in-house products overseas in the future. MDSAP is a single audit programthat certifies compliance with the quality management
system regulations of the member countries (U.S.A.,
Australia, Brazil, Canada, and Japan).

In addition to efforts to secure multiple productionlines for the manufacture of in-house products, we arebuilding a system that enables us to substitute the
manufacture of all products at our domestic plants inthe event of an emergency, based on our experienceduring the COVID-19 pandemic, since we are highly
dependent on our overseas plants and those of ourbusiness partners. We also conduct risk assessmentsof suppliers in the procurement of parts and materials,
and take measures such as securing multiple suppliers for important parts and high-risk parts.
In addition, we will always keep a certain numberof inventories of products. If supply difficulties are expected due to disruptions in manufacturing and distribution, we will respond by accumulating inventories
to the largest extent possible.
Furthermore, we have formulated a business continuity plan (BCP) to prepare for business interruptions
caused by large-scale natural disasters.

Value Creation

Specific Initiatives

As we work to promote diversity, we recognize that
expanding opportunities for women to play an activerole is an issue. The percentage of female employees
in managerial positions is very low, at 2.6%, comparedwith the ratio of female employees, which is 25.2%.
We have always employed and evaluated our employees in an impartial, gender-neutral manner, and we
also implemented lectures by outside instructors andin-house training programs and forums to support
the career development of women. We will continue
to focus on initiatives to promote the advancement of
women with the goal of increasing the ratio of female
managers to 15% by the fiscal year ending March 31,
2031.

Product Quality Management

Introduction

We believe that a company can only create new value when diverse human resources feel that their work
is rewarding and can play an active role. To this end,
we are working to eliminate all prejudice and discrimination to create a workplace where employees haverespect for each other. In addition, we recognize thatdiversification of work styles is an important issue,
and we will review related systems.

Promotion of Active Participation of Female
Workers

Secure product quality and stable supply

Coexistence and co-prosperity with
our suppliers based on trusting
relationships

We will build long-term relationships of trust with our
suppliers and strive for mutual development through hard
work and cooperation.

44

Governance

Governance

Board of Directors

In order to fulfill our responsibilities as a company that handles medical devices and achieve sustainable growth in the midst of a drastically changing business environment, we believe that strengthening
corporate governance is indispensable and that promoting compliance is particularly important. Therefore, we have set each of them as a materiality to take actions.

Basic Views on Corporate Governance andCorporate Governance Structure
We recognize the importance of establishing effective
corporate governance in order to put our management philosophy into practice, meet the expectations
and demands of stakeholders, and aim for the sustainable enhancement of corporate value.
The Company will ensure the transparency and objectivity of management by strengthening corporate
governance, one of our materialities, and realize effective corporate governance that can respond quickly
and accurately to changes in the business environment.

For our organizational form, we have chosen to be acompany with an Audit and Supervisory Committee.
We are strengthening the Audit and Supervisor Committee’s function for supervising the Board of Directors meetings. In addition to establishing the Nomination and Remuneration Advisory Committee as anadvisory body to the Board of Directors, the Compliance Committee, Risk Management Committee,
Sustainability Committee, and Information Security
Committee have been established to strengthen corporate governance under the direction of the Boardof Directors.

Election/Dismissal
Consultation

Audit andSupervisory Committee

Auditing/
Supervision

Board of Directors
Submission
Instruction

Accounting Auditor

ReportingAppointment/
Dismissal

Internal Audit Division

President and CEO

Cooperation

Compliance Committee

Risk Management Committee

Sustainability Committee

Instruction
Information
Security Committee

Auditing

New Development
Committee

Internal Auditing

Investment Committee
Proposal/Reporting

Execution-related Instruction/Supervision

Business Execution Departments・ Subsidiaries

45

Japan Lifeline Integrated Report 2023

Process for Evaluating the Effectiveness of theBoard of Directors

Conducted anonymous self-evaluation questionnaire
for all directors and analyzed and evaluated the effectiveness of the Board of Directors based on the opinions of outside consultants.
Major Items of the Self-evaluation Questionnaire

1. Composition and operation of the Board of
Directors
2. Management strategy and business strategy
3. Corporate ethics and risk management
4. Evaluation on business performance andevaluation on each member’s performance andtheir remuneration
5. Dialogue with shareholders, etc.

The Audit and Supervisory Committee consists of
one director who is a Full-time Audit and Supervisory Committee Member well versed in the Company’sbusiness, and three outside directors who are highly
independent from the Company. In principle, the Audit
and Supervisory Committee holds regular meetings
once a month and extraordinary meetings as needed.
In addition to attending meetings of the Board of Directors and important meetings as necessary, the Audit and Supervisory Committee members hold regularmeetings with the President and CEO to exchange
opinions and maintain close communication on issues
to be addressed by the company, the status of the environment for the audit by the Audit and Supervisory
Committee, and important audit-related issues. In addition, the Audit and Supervisory Committee receives
reports from the Internal Audit Division from time totime, discusses the audit plan of the Internal Audit Division in advance, cooperating together to carry out
audit procedures as necessary.

Nomination and Remuneration
Advisory Committee

Data Section

Cooperation

Nomination and Remuneration
Advisory Committee

To further enhance the effectiveness of the Board of
Directors, we analyze and evaluate the effectivenessof the Board of Directors every year and disclose an
overview of the results. A summary of the evaluationof the effectiveness of the Board of Directors for the
fiscal year ended March 31, 2023 is provided below.

Audit and Supervisory
Committee

Management Foundation

General Shareholders Meeting
Election/Dismissal

Cooperation

In the Board of Directors meeting for the fiscal year
ending March 2023, we deliberated and decided on
important matters such as budget, financial statements, significant organizational and personnel issues, investment and financing projects, important
contracts, transfer of subsidiary shares, and importantmatters related to sustainability, all following laws, articles of incorporation, and Board of Directors regulations. We have reviewed financial statements, the status of directors’ duties, and important matters related
to compliance on the monthly basis. Additionally, we
received reports from the Investment Committee andthe Sustainability Committee, and held abundant discussions.

Evaluation on the Effectiveness Regarding theBoard of Directors

Corporate Governance Structure
Election/Dismissal

Matters Deliberated by the Board of Directors

Growth Strategy

Corporate Governance Structure

Value Creation

Basic Views on Corporate Governance

The Board of Directors consists of a total of 15 members: 11 directors (excluding those who are membersof the Audit and Supervisory Committee) (including 3
outside directors) and 4 directors who are membersof the Audit and Supervisory Committee (including 3
outside directors). In principle, the Board of Directors
holds regular meetings once a month and extraordinary meetings as needed. Also, in order to provide
sufficient information to outside directors, the Company conducts preliminary briefings on Board of Directors meeting proposals.

The Board of Directors is appropriately fulfilling its
roles and functions, and we have analyzed and evaluated it as being effective. We also confirmed that there
has been a significant improvement in the evaluationof our efforts to promote constructive dialogue withshareholders (such as institutional investors), which
was identified as an issue in last year’s effectivenessevaluation. In addition, we agreed that there is still aneed for further enhancement of director training (providing training opportunities when directors take office and continuously afterwards) to further improvethe effectiveness of the Board of Directors.

Introduction

Strengthening Corporate Governance

Composition and Operation of the Board of
Directors

Outline of the Analysis/Evaluation Results andFuture Issues

The Nomination and Remuneration Advisory Committee consists of five members (two directors and threeoutside directors (one of whom is an Audit and Supervisory Committee Member)) and is chaired by anoutside director. As an advisory body to the Board of
Directors, the Nomination and Remuneration Advisory Committee deliberates on the remuneration systemfor directors and director candidates, reports to theBoard of Directors, and determines individual remuneration for directors (excluding those who are Audit
and Supervisory Committee members).

46

GovernanceDirectors
Keisuke Suzuki

Atsuhiro Suzuki

President and CEO
1981 Vice President of the Company
1997 Executive Vice President
2005 President and CEO

Senior Executive Vice President & COO
1984 Joined the Company
2005 Vice President of the Company
2007 Senior Vice President
2011 Executive Vice President
2013 Executive Vice President
2015 Representative Director and Executive
Vice President

Tatsuya Murase

Senior Vice President
Executive Manager of Corporate
Administration Headquarters
1998 Joined the Company
2015 Vice President of the Company
2020 Senior Vice President

Senior Vice President
Executive Manager of General Business
Headquarters
2009 Joined the Company
2022 Vice President of the Company
2024 Senior Vice President
Attendance at Board of Directors meetings
Attended 10 meetings of the Board of Directors (100% attendance rate)from time of appointment in June 2022

Outside Director (Audit and Supervisory
Committee Member) Independent
2012 Outside Corporate Auditor of theCompany2021 Outside Director of the Company(Audit and Supervisory Committee Member)
Attendance at Board of Directors meetings
Attended 12 meetings of the Board of Directors (100% attendance rate) /Attended 15 meetings of the Audit and Supervisory Committee (100%attendance rate)

Daizo Asari

Yutaka Karigome

Outside Director (Audit and Supervisory
Committee Member) Independent
2014 Outside Corporate Auditor of the Company
2021 Outside Director of the Company(Audit and Supervisory Committee Member)

Outside Director (Audit and Supervisory
Committee Member) Independent
2006 Outside Corporate Auditor of theCompany (retired from position in 2014)
2021 Outside Director of the Company(Audit and Supervisory Committee Member)

Attendance at Board of Directors meetings
Attended 12 meetings of the Board of Directors (100% attendance rate) / Attended 15
meetings of the Audit and Supervisory Committee (100% attendance rate)
Attended 5 meetings of the Nomination and Remuneration Advisory Committee (100%attendance rate)

Attendance at Board of Directors meetings
Attended 12 meetings of the Board of Directors (100% attendance rate) /Attended 15 meetings of the Audit and Supervisory Committee (100%attendance rate)

Tadashi Idei

Skill Matrix

Vice President
Executive Manager of R&D and
Manufacturing Headquarters
2006 Joined the Company
2017 Vice President of the Company

Vice President
Executive Manager of Regulatory Affairs
Headquarters
2009 Joined the Company
2017 Vice President of the Company

In order that the Board of Directors may fulfill its roles and duties effectively, the Company aims for the Board to
be composed of members who have experience and knowledge in the areas of corporate management, businesspromotion, and strengthening of business foundation. When nominating candidates for outside director, the Company aims to achieve a composition of people with experience such as a corporate manager and with specialist
knowledge in areas such as finance and accounting, or law and compliance.

Attendance at Board of Directors meetings
Attended 12 meetings of the Board of Directors (100% attendance rate)

Attendance at Board of Directors meetings
Attended 12 meetings of the Board of Directors (100% attendance rate)

Skill Matrix

Corporate Management

Name

Management
Experience

Knowledge of theMedical Device
Industry

Sales
Marketing

Position

Business Promotion

Takeyoshi Egawa

Vice President
General Manager of Human Resources& General Affairs Department
1992 Joined the Company
2018 Vice President of the Company

Vice President
Senior Manager of Business
Administration Department

Keisuke Suzuki

President & CEO

◯

◯

◯

Atsuhiro Suzuki

Senior Executive Vice President
& COO

◯

◯

◯

2018 Joined the Company
2023 Vice President of the Company

Kenji Yamada
Tatsuya Murase
Toru Takamiya
Tadashi Idei
Yumiko Hoshiba
Takeyoshi Egawa
Fumihiro Sasaki
Yoshiaki Ikei
Yusuke Naiki

Senior Vice President◯◯

Vice President◯◯

Vice President◯

Attendance at Board of Directors meetings
Attended 12 meetings of the Board of Directors (100% attendance rate)

Attendance at Board of Directors meetings
Appointed as a member of the Board of Directors in June 2023

Fumihiro Sasaki

Yoshiaki Ikei

Outside Director Independent
2012 Outside Director of the Company

Outside Director Independent
2017 Outside Director of the Company

Yusuke Naiki
Outside Director Independent
2021 Outside Director of the Company

Attendance at Board of Directors meetings
Attended 12 meetings of the Board of Directors (100% attendance rate)

Japan Lifeline Integrated Report 2023

Attendance at Board of Directors meetings
Attended 12 meetings of the Board of Directors (100% attendance rate) /Attended 5 meetings of the Nomination and Remuneration Advisory
Committee (100% attendance rate)

Senior Vice President

◯

◯

◯
◯

Outside Director◯

Outside Director◯

Masahiko
Nakamura

Outside Director (Audit andSupervisory Committee Member)
Outside Director (Audit andSupervisory Committee Member)
Outside Director (Audit andSupervisory Committee Member)

DX/IT

◯

◯
◯

Outside Director

Personnel Affairs/
Human resource
Development◯

Vice President

Vice President (Full-time Audit andSupervisory Committee Member)Yutaka Karigome

Legal Affairs
Compliance

Vice President

Shogo Takahashi

Daizo Asari

Finance/
Accounting

◯

◯

◯
◯

◯

◯
◯

◯
◯

◯

Data Section

Attendance at Board of Directors meetings
Attended 12 meetings of the Board of Directors (100% attendance rate) /Attended 5 meetings of the Nomination and Remuneration Advisory
Committee (100% attendance rate) Chairperson

Strengthening Business Foundation

R&D/
Manufacturing/
Medical Affairs

Management Foundation

Yumiko Hoshiba

Growth Strategy

Toru Takamiya

Value Creation

Kenji Yamada

Attendance at Board of Directors meetings
Attended 12 meetings of the Board of Directors (100% attendance rate)

47

Attendance at Board of Directors meetings
Attended 12 meetings of the Board of Directors (100% attendance rate) /Attended 5 meetings of the Nomination and Remuneration Advisory
Committee (100% attendance rate)

Masahiko Nakamura

Vice President (Full-time Audit andSupervisory Committee Member)
1994 Joined the Company
2011 Vice President of the Company
2013 Senior Vice President
2022 V ice President (Full-time Audit andSupervisory Committee Member)
Attendance at Board of Directors meetings
Attended 12 meetings of the Board of Directors (100% attendance rate) /Attended 11 meetings of the Audit and Supervisory Committee (100% attendance rate)from time of appointment in June 2022 Chairperson

Introduction

Attendance at Board of Directors meetings
Attended 12 meetings of the Board of Directors (100% attendance rate)
Chairperson / Attended 5 meetings of the Nomination and Remuneration
Advisory Committee (100% attendance rate)

Shogo Takahashi◯◯◯* 1. The above table lists up to three of the skills possessed by the directors, and does not show all of the skills they possess.
2. “Management Experience” means experience and knowledge that provides the basis for strategic thinking aimed at achieving sustainable improvements in corporate
value over the medium to long term.
3. “Knowledge of the Medical Device Industry” means experience and knowledge that provides the basis for comprehensive decision-making in the rapidly changing
medical device industry.
4. “Sales/Marketing” means experience and knowledge that provides the basis for formulating competitive sales strategies in the medical device industry.
5. “R&D/Manufacturing/Medical Affairs” means experience and knowledge that provides the basis for formulating competitive product strategies in the medical device
industry.
6. “Finance/Accounting” means experience and knowledge that provides the basis for making decisions in relation to corporate and business activities.
7. “Legal Affairs/Compliance” means experience and knowledge that provides the basis for taking advantage of opportunities and managing risk in relation to corporate
and business activities.
8. “Personnel Affairs/Human Resource Development” means experience and knowledge that provides the basis for securing and utilizing management resources inrelation to corporate and business activities.
9. “DX/IT” means experience and knowledge that provides the basis for reforming business processes in relation to corporate and business activities.

48

GovernanceAppointment of Directors

49Japan Lifeline Integrated Report 2023

Remuneration Structure and Method of
Determining the Amount of Remuneration
The remuneration for directors is composed of fixed
remuneration, performance-linked bonuses, and performance-linked stock remuneration (Directors’ remuneration BIP trust). In addition to fixed monetary
remuneration, we have adopted performance-linked
bonuses as monetary remuneration linked to shortterm performance and performance-linked stock remuneration as an incentive for medium- to long-term
improvement of corporate value. In addition, for directors who are Audit and Supervisory Committee
members and outside directors, we will only provide
fixed remuneration, considering their roles and level of
independence from the Company.
Following approval at the 43rd Ordinary General Shareholders Meeting held on June 28, 2023, theCompany partially revised the remuneration structure
and the method of determining the amount of remuneration for Directors (excluding Directors who aremembers of the Audit and Supervisory Committee
and Outside Directors) effective July 2023. The main
revisions include changing the timing of the delivery ofshares in stock-based remuneration from when directors retire to when they remain in office, changing the
calculation method for the Company’s shares to beacquired by directors, and adding a clawback system.

Method for Calculating
Remuneration

Fixed remuneration is determinedby the NRA Committee, which is
appointed by the Board of Directors.
The NRA Committee takes into
account each director’s position,
responsibilities, and contributions
to performance, as well as
benchmarking against remunerationlevels in outside database services.
For directors who are membersof the Audit and Supervisory
Committee, their fixed remuneration
is decided through discussions
within the Audit and Supervisory
Committee.

Indicators used tomeasure achievement of
performance goals

ー

Payment method

Monthly

Directors (excluding those whoare members of the Audit andSupervisory Committee and those
who are outside directors)
The basic bonus is calculated
based on performance-linked
variables and the distribution bonus
is calculated based on individual
contribution rates determined by
the NRA Committee.
The ratio between the basic bonus
and the distribution bonus is set
at 8:2.
The basic bonus amount iscalculated by multiplying the basic
bonus standard amount determinedfor each director eligible forpayment by a performance-linked
variable calculated based on theindividual performance achievement
ratios of the three indicators of theconsolidated performance forecast
for a fiscal year disclosed at the
beginning of each fiscal year (with100% achievement being 1.0).
• Consolidated net sales• Consolidated operating profit(after deducting bonuses todirectors upon achievementof 100% of the consolidated
earnings forecast)• EPS
Paid out once a year, within threemonths after the end of the fiscal
year

Performance-linked
stock remuneration(Directors’ Remuneration
BIP Trust)Directors (excluding those whoare members of the Audit andSupervisory Committee and those
who are outside directors)
The points granted are calculated
by multiplying the base points
determined for each director eligible
for payment by the performancelinked variable set by the degree ofachievement of the three indicatorsof the consolidated performance
forecast for a fiscal year, which isdisclosed at the beginning of eachfiscal year.
Directors are then provided
with our Company’s shares andthe monetary equivalent of theconversion disposal amount of ourCompany’s shares according to
the resulting points (with one point
corresponding to one share).

• Consolidated net sales• Consolidated operating profit(after deducting bonuses todirectors upon achievementof 100% of the consolidated
earnings forecast)• EPS
Paid out once a year after the endof the fiscal year

Policy for Determining the Ratio of Remuneration by Type of Director
The ratio of performance-linked remuneration to the total amount of remuneration is approximately 80% for fixed
remuneration and 20% for performance-linked remuneration in the case of a standard level of performance achievement, as an average of the eligible directors. The ratio of non-monetary remuneration to total remuneration is, on
average, 90% for monetary remuneration and 10% for non-monetary remuneration.
Remuneration by Director Category (FY3/2023)
Categories

Directors(Excluding Audit andSupervisory Committee
Members and outside directors)
Directors (Audit and Supervisory
Committee Members)(Excluding outside directors)
Outside Director

Total amount of
remuneration(Millions of yen)

Total amount by remuneration type (Millions of yen)
PerformanceFixed
Non-monetaryBonuslinkedremuneration
remuneration(Millions of yen) remuneration(Millions of yen)
(Millions of yen)
(Millions of yen)

Numberof eligible
directors(Person)

454

382

ー

72

42

9

30

30

ー

ー

ー

2

49

49

ー

ー

ー

6

Data Section

The Nomination and Remuneration Advisory Committee discusses the succession plan for the CEO. With
regard to the development of candidates for succession, the President and CEO takes the initiative inproviding opportunities for candidates to accumulateknowledge and experience through personnel transfers, assignments of high managerial importance, andother measures, and the Nomination and Remuneration Advisory Committee confirms the process. In
addition, the Nomination and Remuneration Advisory
Committee confirms the status of candidate development by conducting a multifaceted evaluation of successor candidates annually.

Directors
Eligible Recipients

Basic Policy of Remuneration for Directors
1. Provide appropriate incentives for achieving
performance targets
2. Provide a competitive remuneration level thatwill lead to the recruitment of excellent humanresources
3. The amount of remuneration should lead tothe enhancement of corporate value over the
medium- to long-term
4. The process of determining remuneration
should be highly objective and transparent

Performance-linked bonus

Management Foundation

Succession Plan

Fixed remuneration

Growth Strategy

If during a director’s term of office it is recognizedthat any of the predetermined criteria for dismissal
are met, the Nomination and Remuneration Advisory Committee will deliberate on the matter, and uponreceipt of the Committee’s report, the Board of Directors will make a decision and initiate procedures for
dismissal by resolution at the General Shareholders
Meeting.

In order to ensure objectivity and transparency in the
remuneration determination process, the Nomination
and Remuneration Advisory Committee deliberates on
the basic policy for remuneration, composition, andamount of remuneration of directors, and the Board of
Directors decides based on the report from the Nomination and Remuneration Advisory Committee.

Remuneration for Directors

Value Creation

Appointment Criteria• Excellent personality and insight, and highethical standards• Able to make appropriate decisions regarding
overall management• Able to objectively analyze and make judgmentsfrom a company-wide perspective• Excellent foresight, insight, and leadership• Audit and Supervisory Committee Member
candidates must have the knowledge,
experience, and expertise necessary for
conducting audits

Remuneration for Directors

Introduction

After the Nomination and Remuneration Advisory
Committee deliberates on director candidates basedon the following appointment criteria, the Board of
Directors decides on the candidates based on thereport from the Nomination and Remuneration Advisory Committee and proposals for appointments arepresented during the General Shareholders Meeting.
For director candidates who are members of the Audit and Supervisory Committee, prior consent by the
Audit and Supervisory Committee shall be obtained tobe considered as a director candidate.

* 1. The above includes one director who served as an AS Committee member and resigned at the conclusion of the 42nd general shareholders’ meeting held on June 28,2022.
2. For performance-linked bonuses, we have listed the amount set aside for executive bonuses for this fiscal year.
3. As performance-linked stock remuneration (Directors’ Remuneration BIP Trust), we have recorded an amount of 42 million yen set aside for stock remuneration basedon the number of points awarded or expected to be awarded this fiscal year.
4. In addition to the total amount of the above remuneration, based on the resolution of the 37th general shareholders’ meeting held on June 28, 2017, we have paid 1 million
yen as a retirement bonus to one retiring director. This amount includes 1 million yen set aside for retirement bonuses disclosed in the business report of the previous
fiscal year.

50

Governance

Basic Views on Information Security Measures

As a Company that handles medical devices, we havea responsibility to ensure a stable supply of medical devices to patients and medical professionals.
In order to reliably fulfill these responsibilities and toachieve sustainable enhancement of corporate value,
we are promoting the development of a risk management system so that appropriate measures can betaken against risks that may have a significant impact
on business activities.

Recognizing that information security risks have asignificant impact on our management, we are working to strengthen our countermeasures. In addition totechnical measures such as the introduction of systems and countermeasure tools and physical measures such as office access control and restricting
access to classified areas, we also focus on humanmeasures by providing e-learning education and targeted e-mail attack training since we believe that it isimportant to improve the security-related awarenessand knowledge of each employee.

Risk Management System* CSIRT (Computer Security Incident Response Team)	An organization that collects information on information security and takes
measures in preparation for incidents that could lead to serious information
security incidents, and executes and manages measures in the event of anincident

As a company that handles medical devices that are
critical to the lives of patients, we believe that in order to be a trusted presence at all times, we must not
only comply with laws and regulations but also follow compliance policies with high ethical standards.
To that end, the actions of each and every employee
are important. Therefore, we strive to ensure thoroughcompliance awareness by disseminating the Code of
Conduct so that we can meet the expectations of all
stakeholders and build relationships of trust.

Efforts to Raise Awareness of Compliance

Based on the Compliance Promotion Regulations,
the Board of Directors has appointed a Chief Compliance Officer (CCO) and the Compliance Committee,
chaired by the CCO, plays a central role in promoting
company-wide compliance activities. The Compliance Committee meets quarterly to discuss various
compliance issues, including sharing informationon compliance violation cases, the operation of thewhistleblower system, and the status of compliancetraining. In addition, the CCO reports quarterly to theBoard of Directors on the status of company-wide
compliance and receives instructions as appropriate.

In order to comply with compliance as a company, it isnecessary for each employee to understand its importance and follow compliance regulations during daily
business operations. We are taking various measuresto raise awareness of compliance among employees.
The President and CEO talks about the Code of Conduct online and we provide online training as well as
e-learning to address various themes. We are also
working to raise awareness among employees about
our internal reporting system.

Compliance System Chart
Board of Directors
Appointment

ReportingConsultation

Instruction

Chief Compliance Officer
Submission

ReportingInstruction

Reporting

JLL Compliance Consultation Desk
＜Internal Contact＞
Compliance Consultation Desk

Internal Reporting System
The Company has established a whistleblower system to detect and respond to compliance violationsat an early stage and to prevent them from occurring.
We have two whistleblower system contact points: An
external third-party organization that allows anonymous reporting, and an internal contact point where
employees can report and also feel free to discuss
compliance issues. Either contact point gives maximum consideration to the anonymity and privacy ofwhistleblowers, protects whistleblowers so that they
are not disadvantaged by reporting, conducts investigations, and takes corrective measures as necessary.

Data Section* A system that evaluates that business operators have put in place structures orother measures to appropriately handle personal information.

As the Group’s business activities are supported bymany people, we strongly recognize that it is necessary to respect the human rights of all people involvedin our business activities. To fulfill our responsibility torespect human rights as a company, we establishedthe “JLL Group Human Rights Policy” in December,
2022. We are promoting initiatives to reduce humanrights risks not only in the Group but also in the supply
chain.

Compliance System

Protection of Personal Information
Personal information handled by the Company ismanaged and protected in accordance with the Basic
Regulations for the Protection of Personal Information. In addition, by acquiring the Privacy Mark*, we
confirm that the system and operations for protecting
personal information are maintained in an appropriatemanner.

Formulation of the JLL Group Human Rights
PolicyManagement Foundation

In order to fulfill our responsibility to supply medical
devices, we are promoting the establishment of abusiness continuity system based on the basic rules
for business continuity. We have formulated a business continuity plan (BCP) for early resumption frombusiness interruption due to a large-scale natural disaster and are continuously developing it as well as
conducting drills to enhance its effectiveness.

Based on the Information Security Management Regulations, the Board of Directors has appointed a Chief
Information Security Officer (CISO), and the Information Security Committee, chaired by the CISO, playsa central role in promoting company-wide information
security measures. The Information Security Committee meets semi-annually to identify issues to be addressed, confirm the progress of measures, and confirm the results of training. Furthermore, in the event of
an information security incident, such as unauthorizedaccess, malware infection, or loss of storage media,
the CSIRT* plays a role in responding under the instructions of the Information Security Committee incooperation with external organizations as necessary.

Basic Views on Compliance

Growth Strategy

Business Continuity Initiatives

Information Security Management System

Specific Initiatives

Value Creation

Based on the Risk Management Regulations, theBoard of Directors has appointed a Chief Risk Management Officer (CRO) and the Risk Management
Committee, chaired by the CRO, promotes company-wide risk management. The Risk Management
Committee meets semi-annually to identify and evaluate risks, determine policies for responding to risks,and confirm response status. The committee also
works with related committees such as the Sustainability Committee and the Information Security Committee to ensure effective risk management. In theevent that a risk that may have a significant impact
on business activities arises and requires a company-wide response, a task force headed by the President and CEO as Executive Manager will be established to take appropriate action to minimize losses.

Compliance

Introduction

Basic Views on Risk Management

Compliance Promotion

Relevant Departments

Information Security

Compliance Committee

Risk Management＜External Contact＞
JLL Group Helpline

Response

Reporting/Consultation

Group Employees

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Japan Lifeline Integrated Report 2023

52

Consolidated Financial/Non-financial Data

Consolidated Financial/Non-financial Data
(1) Consolidated Profit and Loss Statement
Scope(2) Consolidated Balance Sheet
FY3/2018

FY3/2019

FY3/2020

FY3/2021

FY3/2022

FY3/2023

FY2017FY2018FY2019FY2020

FY2021

FY2022

Net sales

Million yen

Consolidated

42,29845,52551,761

51,286

51,46951,750(Net Sales YoY)%

Consolidated

13.8

7.6

13.7

-0.9

0.4

COGS

Million yen

Consolidated

15,722

17,703

22,57022,622Gross Profit

Million yen

Consolidated

26,57627,822

29,191

28,664

Scope

FY3/2018

FY3/2019

FY3/2020

FY3/2021

FY3/2022

FY3/2023

FY2017FY2018FY2019FY2020

FY2021

FY2022Current Assets

Million yen

Consolidated

40,821

41,66544,07744,52245,15347,130

0.5

Tangible Fixed Assets

Million yen

Consolidated

9,914

9,920

11,341

13,111

12,911

12,452

22,634

21,855Intangible Fixed Assets

Million yen

Consolidated

576

558

493

505

1,470

2,414

28,83529,895Investments and Others

Million yen

Consolidated

9,668

15,63819,08914,822

13,662

12,643

Consolidated

62.8

61.1

56.4

55.9

56.0

57.8

Fixed Assets

Million yen

Consolidated

20,15926,11730,92328,43928,04427,510Consolidated

15,904

17,29518,756

18,296

18,861

19,057

Total Assets

Million yen

Consolidated

60,98067,78375,00072,962

73,19774,641

Operating profit

Million yen

Consolidated

10,671

10,526

10,434

10,367

9,973

10,837

Current Liabilities

Million yen

Consolidated

15,452

14,58016,093

16,467

14,211

14,381(Operating Profit YoY)%

Consolidated

13.8

-1.4

-0.9

-0.6

-3.8

8.7

Fixed Liabilities

Million yen

Consolidated

4,438

6,709

7,500

5,190

4,418

4,063

Operating profit margin%

Consolidated

25.2

23.1

20.2

20.2

19.4

20.9

Total Liabilities

Million yen

Consolidated

19,89021,28923,594

21,657

18,62918,445

Shareholder’s Equity
Accumulated othercomprehensive income
Share Warrant

Million yen

Consolidated

41,08846,496

51,61851,26754,36256,265

Million yen

Consolidated

-11

-16

-211

37

205

-69

Million yen

Consolidated

13

13

ー

ー

ー

ー

Net Assets

Million yen

Consolidated

41,09046,49351,40651,30454,56756,195

Non-Operating Income

Million yen

Consolidated

259

571

891

1,031

316

293

Non-Operating Expense

Million yen

Consolidated

200

289

900

879

285

224

Ordinary profit

Million yen

Consolidated

10,73010,808

10,425

10,51910,005

10,905

Ordinary profit margin%

Consolidated

25.4

23.7

20.1

20.5

19.4

21.1

Million yen

Consolidated

1

5

3

3

44

100

Million yen

Consolidated

116

12

4

5,982

8

1,217

Total Liabilities and Net
AssetsMillion yen

Consolidated

60,98067,78375,00072,962

73,19774,641Net Profit Before Tax

Million yen

Consolidated

10,615

10,801

10,425

4,540

10,041

9,789

Cash and Cash Equivalents

Million yen

Consolidated

6,732

8,018

9,555

13,70816,05818,357Tax Expenses

Million yen

Consolidated

3,137

3,077

2,676

2,540

2,556

2,897

Accounts Receivables

Million yen

Consolidated

12,331

12,17813,762

13,145

12,437

13,223

Net profit

Million yen

Consolidated

7,478

7,723

7,748

2,000

7,484

6,891

Inventory

Million yen

Consolidated

13,57917,071

18,187

15,987

14,85013,142

Net Profit Margin%

Consolidated

17.7

17.0

15.0

3.9

14.5

13.3

Accounts Payables

Million yen

Consolidated

2,278

3,087

4,081

2,872

3,287

3,429

In-house sales ratio%

Consolidated

55.4

54.9

50.7

49.9

52.4

54.9

Retained Earnings

Million yen

Consolidated

25,09130,49935,91235,35238,89042,741

Interest-bearing Debt

Million yen

Consolidated

9,396

9,987

11,538

10,396

8,352

6,883

Net Debt

Million yen

Consolidated

2,663

1,968

1,983

-3,311-7,705-11,473

R&D expense

Million yen

Consolidated

1,121

1,431

1,743

1,667

2,159

2,316

Capital expenditure

Million yen

Consolidated

3,630

1,248

2,536

1,382

1,633

976

Depreciation Expenses

Million yen

Consolidated

953

1,176

1,264

1,525

1,611

1,566

Invested Capital*1

Million yen

Consolidated

50,48456,484

63,156

61,66362,714

63,148Working Capital*2

Million yen

Consolidated

23,632

26,161

27,86826,26024,00022,937Growth Strategy

Extraordinary Profit
Extraordinary Loss

Value Creation%
Million yen

Introduction

Gross Profit Margin
SGA*1 A sum of interest-bearing debt (gross) and shareholder’s equity*2 Accounts receivables + Inventory - Accounts payables

Scope
Number of Shares Outstanding
at Year-End (incl. treasury shares)
Number of Treasury Shares atYear-End*1

ThousandsharesThousandsharesAverage Number of Shares During
the FY (excl. treasury shares)

Consolidated

FY3/2018

FY3/2019

FY3/2020

FY3/2021

FY3/2022

FY3/2023

FY2017FY2018FY2019FY2020

FY2021

FY202290,41990,41985,41985,41985,41982,919Management Foundation(3) Financial Indicators, etc.
(4) Non-financial Indicators, etc.
Scope

FY3/2021

FY3/2022

FY3/2023

FY2020

FY2021

FY2022

Greenhouse gas emissions

t-CO2

Consolidated

6,950

6,720

6,612

Electricity usage

Mwh

Consolidated

10,508

10,606

10,581

Gasoline use㎘

Non-consolidated

631

611

619

Industrial waste recycling rate%

Non-consolidated

90

92

96

Water usem2

Non-consolidated

12,584

16,821

13,18410,005

10,005

5,165

5,050

5,500

4,999

ThousandsharesConsolidated

75,91480,41480,25180,32280,367

78,116

EPS*2

Yen

Consolidated

98.51

96.05

96.55

24.91

93.13

88.22

BPS

Yen

Consolidated

510.81578.01640.54638.36682.79721.20

Ratio of female managers%

Non-consolidated

1.5

2.1

2.6

DPS

Yen

Consolidated

28.75

29.00

29.00

49.00

38.00

38.00

Average years of service

Years

Non-consolidated

9.6

10.2

10.5

Payout Ratio%

Consolidated

29.2

30.2

30.0

196.7

40.8

43.1

Average overtime hours (non-consolidated)

Hours

Non-consolidated

17.7

17.8

18.9

ROE

%

Consolidated

24.2

17.6

15.8

3.9

14.1

12.4

Paid leave utilization rate (non-consolidated)%

Non-consolidated

39.2

46.3

51.0

ROA

%

Consolidated

21.2

16.8

14.6

14.2

13.7

14.8

ROIC*3%

Consolidated

14.7

12.9

11.5

11.7

11.0

11.9

Education and training expenses per
employee (non-consolidated)

Yen

Non-consolidated

62,701

69,495

97,142

Capital-to-Asset Ratio%

Consolidated

67.4

68.6

68.5

70.3

74.5

75.3

Number of Board of Directors meetings held

NumberNon-consolidated

12

12

12

Receivabes Turnover Period

Day

Consolidated

100.7

98.3

91.5

95.8

90.7

90.5

Remuneration for Directors

Million yen

Non-consolidated

471

472

534

Inventory Turnover Period

Day

Consolidated

276.9

316.0

285.1

275.7

248.6

233.8

Non-consolidated

0

0

0

Day

Consolidated

47.7

55.3

58.0

56.1

49.7

56.1

Legal violations (administrative and criminal
penalties, etc.)

Incidents

Payables Turnover Period
Cash Conversion Cycle

Day

Consolidated

329.8

358.9

318.6

315.4

289.7

268.2

Number of Employees (Consolidated)

PersonConsolidated

906

932

1,074

1,167

1,205

1,166

Data Section

Consolidated*1 Company shares held by the BIP Trust for directors and Company shares held by the Trust for the Trust-type Employee Shareholding Incentive Plan (E-Ship) are included
in treasury shares. (E-Ship terminated on July 29, 2021)*2 EPS after taking into account the stock split. A 1:2 stock split was carried out in January 2018. In light of this, EPS for FY3/2018 is calculated assuming that the stock
split took place at the beginning of the previous fiscal year.
*3 Denominator profit is operating profit after tax. After-tax operating profit = operating profit x (1 - effective tax rate (30.62%)

53

Japan Lifeline Integrated Report 2023

54

Company Information/Stock Information

Company Information

Stock Information

Company Profile
Company Name

Basic Stock Information

as of March 31, 2023

Securities code

7575

Keisuke Suzuki, President and CEO

Stock Exchange Listing

Tokyo Stock Exchange, Prime

Headquarters

Tennoz Ocean Square, 25F, 2-2-20, Higashishinagawa, Shinagawa-ku,
Tokyo 140-0002 Japan

Total number of shares issued by the Company

346,400,000

Total number of shares outstanding

82,919,976

EstablishedFebruary 6, 1981

Number of shareholders

14,724

Share unit

100

Base date

March 31

Shareholder registry administrator

Mitsubishi UFJ Trust and Banking Corporation

Company Representative

Stock Exchange Listing

Tokyo Stock Exchange, Prime
7575

Main Business

Import, production, and sales of medical devices

Paid-in Capital

2,115 Million yen

Accounting Closing Date

March 31
Consolidated: 1,166 Non-Consolidated: 962 (as of March 31, 2023)

Locations48 Sales Offices, Haneda Logistics Center, Kansai Logistics Center, Research& Development Department, Toda Factory, Oyama Factory, Ichihara Factory,
TENNNOZ ACCADEMIA (Education Center) (as of March 31, 2023)

Shares by Owner

as of March 31, 2023
Growth Strategy

Employees

Consolidated Subsidiary

Value Creation

Securities code

Introduction

Japan Lifeline Co., Ltd.

Treasury stock

5.90%

JLL Malaysia Sdn. Bhd.

Financial institutions

21.81%
Individuals and others

FY3/2023
Net sales

Unit: Billion yen

28.94%

51.7 billion yen

60

TSE 1st Section

19.21%
Data Section

Launched Internal Atrial Cardioversion Catheter BeeAT
A one-of-a-kind product for EP/ablation

20

Other companies

Foreign investors

Launched Open Stent Graft FROZENIX
An in-house product for cardiovascular surgery

Started developing in-house products

1.12%

23.01%

Third-party product net sales (left axis)

40

30

Financial instruments firms

82,919,976

In-house product net sales (left axis)
50

Total numberof shares
outstanding

Management Foundation

Track Record

FY3/2023
In-house sales ratio

54.9%

JASDAQ (OTC listed)10

For inquiries regarding this report, please contact:0

12 12 12 12 12 12 12 12 12 12 12 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3 /3
1/ 2/ 3/ 4/ 5/ 6/ 7/ 8/ 1/ 0/ 1/ 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 23‘8 ‘8 ‘8 ‘8 ‘8 ‘8 ‘8 ‘8 ‘8 ‘9 ‘9 ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘ ‘

55Japan Lifeline Integrated Report 2023

Corporate Planning Dept., Japan Lifeline Co., Ltd. TEL: +81-3-6711-5214
E-Mail: ir@jll.co.jp

URL: https://www.jll.co.jp

56