R SymBio Pharmaceuticals / 4582
Coverage

Update Notes

Research Coverage Report by Shared Research Inc. | https://sharedresearch.jp

This PDF document is an updated note on the company. A comprehensive version of the report on the company, including this latest update, isavailable on our website and various professional platforms.

On February 4, 2021, SymBio Pharmaceuticals Ltd. announced earnings results for full-year FY12/20.
FY12/19

Cumulative(JPYmn)FY12/20

FY12/20

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

% of Est.

FY Est.

Sales

1,611

2,005

2,008

2,838

551

1,361

2,333

2,987

98.2%

3,043

YoY

81.4%

4.0%

-33.8%-26.0%-65.8%-32.1%

16.2%

5.3%

609

529

563

865

128

330

611

867

144.0%
37.8%

-7.7%
26.4%

-39.1%
28.0%-26.3%
30.5%-79.0%
23.2%-37.7%
24.2%

8.5%
26.2%

0.2%
29.0%

Gross profit
YoY
GPM

SG&A expenses

1,205

2,545

4,099

5,166

1,090

2,170

3,753

5,373

YoY
SG&A ratio

25.0%
74.8%

34.1%
126.9%

44.8%
204.1%

34.9%
182.1%-9.6%
197.6%-14.7%
159.5%-8.4%
160.9%

4.0%
179.9%

Operating profit-596-2,015-3,536-4,302-962-1,840-3,142-4,506

-

-

-

-

-

-

-

-

-616

-2,069-3,642-4,377-991-1,883-3,221-4,616

-

-

-

-

-

-

-

-

Net income-617-2,070-3,641-4,376-992-1,885-2,694-4,090YoY
Net margin

-

-

-

-

-

-

-

-

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

1,611
81.4%
609

394
-62.2%-793-99.7%
33

830
3.3%
302

551
-65.8%
128809
105.7%
202

972
281

654
-21.1%
256

144.0%
37.8%--90.5%
-

21.4%
36.4%

-79.0%
23.2%

25.0%

738.4%
28.9%-15.2%
39.1%

YoY
OPM

Recurring profit
YoY
RPM

Quarterly(JPYmn)Sales
YoY

Gross profit
YoY
GPM

FY12/19

FY12/20

SG&A expenses

1,205

1,340

1,555

1,067

1,090

1,080

1,583

1,620

YoY
SG&A ratio

25.0%
74.8%

43.4%
340.4%

66.5%
-

7.0%
128.6%-9.6%
197.6%-19.4%
133.5%

1.8%
162.9%

51.8%
247.5%

Operating profit-596--1,419--1,521
-

-765
-

-962
-

-878
-

-1,302--1,364--616--1,453--1,573
-

-735
-

-991
-

-892
-

-1,338--1,395--617--1,453--1,571
-

-736
-

-992
-

-893
-

-809
-

-1,396
-

YoY
OPM

-

Recurring profit
YoY
RPM

-

Net income
YoY
Net margin

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

7.2%

-

-4,592---4,656---3,796----

Source: Shared Research based on company data
Note: Figures may differ from company materials due to differences in rounding methods.
“-”denotes YoY change of over 1000%.

Breakdown of SG&A expenses
FY12/19

Cumulative(JPYmn)
SG&A expenses

FY12/20

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

1,205

2,545

4,099

5,166

1,090

2,170

3,753

5,373

25.0%

34.1%

44.8%

34.9%

-9.6%

-14.7%

-8.4%

4.0%

R&D expenses

472

963

1,972

2,442

438

834

1,745

2,267

YoY

13.4%

14.8%

52.5%

33.2%

-7.1%

-13.4%-11.5%

-7.2%

733

1,582

2,127

2,725

651

1,336

2,008

3,107

33.8%

49.3%

38.3%

36.5%

-11.1%-15.5%

-5.6%

14.0%

YoY

SG&A expenses excl. R&D
YoY

FY12/19

Quarterly(JPYmn)
SG&A expenses
YoY

FY12/20

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

1,205

1,340

1,555

1,067

1,090

1,080

1,583

1,620
51.8%

25.0%

43.4%

66.5%

7.0%

-9.6%

-19.4%

1.8%

R&D expenses

472

491

1,009

470

438

396

911

522

YoY

13.4%

16.2%

122.1%-13.0%-7.1%-19.4%

-9.7%

11.0%

SG&A expenses excl. R&D
YoY

733

849

546

597

651

685

672

1,098

33.8%

66.0%

13.8%

30.6%

-11.1%-19.3%

23.2%

83.9%

Source: Shared Research based on company data
Note: Figures may differ from company materials due to differences in rounding methods.

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R SymBio Pharmaceuticals / 4582
Coverage

Update Notes

Research Coverage Report by Shared Research Inc. | https://sharedresearch.jp

Full-year FY12/20 results▷

Sales:▷

Recurring loss:

JPY4.6bn (loss of JPY4.4bn in FY12/19)

Net loss:

JPY4.1bn (loss of JPY4.4bn in FY12/19)▷▷

JPY3.0bn (+5.3% YoY)

Operating loss: JPY4.5bn (loss of JPY4.3bn in FY12/19)

Sales increased YoY, as the company booked sales of Treakisym®.
Losses expanded across the board despite higher sales due to an increase in SG&A expenses. SG&A expenses increased 4.0% YoY
to JPY5.4bn and R&D expenses declined 7.4% YoY to JPY2.3bn. This included expenses for conducting clinical trials of
intravenous formulations of Treakisym® and rigosertib. Excluding R&D expenses, SG&A rose 14.0% YoY to JPY3.1bn. The
company incurred development costs for its in-house sales organization. The difference between recurring loss and net loss is
attributable to a JPY525mn settlement payment booked as extraordinary income.

Domestic
Preparations for in-house sales organization begin
The business alliance agreement between SymBio and Eisai Co., Ltd. under which Eisai acts as a sales agent expired in December
2020. The company therefore began preparations to build an in-house sales organization for domestic sales of Treakisym®.
In FY12/21, the company has deployed a nationwide network of 53 marketing representatives as well as nine hematology experts
to cover each region to establish a highly productive internal sales organization capable of making proposals that fit the needs ofeach region.
To establish a nationwide distribution structure, in September 2020, the company concluded a basic agreement with Suzuken
Co., Ltd (Suzuken Group) and Toho Pharmaceutical Co., Ltd (a consolidated subsidiary of Toho Holdings Co., Ltd.; Kyoso Mirai
Group) for the procurement and sale of pharmaceuticals. SymBio is using Suzuken Group and Kyoso Mirai Group as its sole
distributors after the marketing agreement with Eisai expired. The company has established two distribution centers, one in
Eastern Japan and the other in Western Japan, under management by S.D. Collabo Co., Ltd.
SymBio has thus completed building its in-house sales organization, and transitioned to in-house sales of Treakisym® in December
2020 after expiry of the business alliance agreement with Eisai.

Stable product supply
SymBio imports lyophilized Treakisym® for injection from Astellas Deutschland (consolidated subsidiary of Astellas Pharma).
Treakisym® inventories were substantially depleted in 1H relative to year-ago levels, but inventory levels recovered in 2H assecondary packaging and quality tests were applied to some batches of Treakisym® 100mg vials imported from Astellas
Deutschland.
In September 2020, the company obtained manufacturing and marketing approval for liquid formulations of Treakisym® (RTD
formulation) under license from Eagle Pharmaceuticals with plans to begin sales in January 2021. Import and shipments to thesole distributors of the Treakisym® (RTD formulation) began in Q4 FY12/20 (October–December 2020).

Treakisym® (SyB L-0501[lyophilized injection]/SyB L-1701 [RTD]/SyB L-1702 [RI]/SyB C-0501 [oral]; anticancer agent; generic name:bendamustine hydrochloride)
The anticancer agent Treakisym® is used to treat malignant lymphomas, indicated for untreated low-grade non-Hodgkin’s
lymphoma and mantle cell lymphoma (marketing approval obtained in December 2016), refractory or relapsed low-grade NHL
and MCL (October 2010), and chronic lymphocytic leukemia (August 2016).

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R SymBio Pharmaceuticals / 4582
Coverage

Update Notes

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The combination therapy of Treakisym® and rituximab (BR therapy) was newly included in the Practical Guidelines for
Hematological Malignancies 2018 published by Japanese Society of Hematology as a standard treatment option, which applies toall of the approved indications. This has seen Treakisym® establish its position as a standard treatment for lymphatic cancer.
Also, SymBio obtained approval for the partial revision to the marketing authorization of Treakisym® in July 2018. Treakisym® can
now be used in combination with new anti-CD20 antibodies and not just rituximab for the treatment of CD20-positive follicularlymphoma, the most common histological type of low-grade NHL. This allows the company to provide patients a new treatment
option: combination therapy with obinutuzumab. In March 2019, SymBio obtained approval for the partial revision to its
application to use Treakisym® as a pretreatment agent in tumor-specific T cell infusion therapy. This allows Treakisym® to be used
as a pretreatment agent for Kymriah® intravenous infusion, which was the first chimeric antigen receptor T-cell (CAR-T) therapy
approved in Japan and on the NHI drug price list from May 2019. Growing use of Treakisym® as a pretreatment agent inregenerative medicine has solidified its positioning as standard therapy for malignant lymphomas.
In the phase III clinical study of Treakisym® administered in combination with rituximab (BR therapy) targeting relapsed or
refractory diffuse large B-cell lymphoma (r/r DLBCL), an additional indication following the above approved ones, results showedthat the response rate (primary endpoint) was better than expected. Based on this, the company filed for approval for partial
revision to manufacturing and marketing approval in May 2020. It is currently conducting a follow-up study with overall survival
as the primary endpoint, because evaluating the survival data (e.g., overall survival and progression-free survival) for Treakisym®
administered in combination with rituximab is crucial for establishing Treakisym® as a treatment for DLBCL. Also, after Chugai
Pharmaceutical Co., Ltd. applied for manufacture and marketing approval for polatuzumab vedotin in combination with BR
therapy to treat r/r DLBCL in June 2020, the company made a partial change to its application for approval for Treakisym® incombination with polatuzumab vedotin and rituximab. If the new drug applications by Chugai and SymBio are approved andpolatuzumab vedotin is added to the NHI drug price list, Treakisym® can be used with polatuzumab vedotin in combination withBR therapy. At present there are no effective treatments for the additional indication of r/r DLBCL, which is usually treated by a
combination of anticancer agents as salvage chemotherapy, so development of a highly effective but safe new drug would be
ideal. Since BR therapy is already being used in the West to treat r/r DLBCL, patient organizations and related academic societies
have petitioned MHLW so that it can be used in Japan as soon as possible.
The company concluded an exclusive licensing agreement in Japan with Eagle Pharmaceuticals (based in New Jersey, US) in
September 2017 for the RTD and RI formulations of Treakisym®. Manufacturing and marketing approval of the RTD formulation
was obtained in September 2020, and the company plans to launch it in January 2021. The company is conducting clinical trials
to confirm safety of the RI formulation and plans to apply for approval in FY12/21. Unlike the current lyophilized powder
formulation, the RTD formulation reduces the workload of medical professionals, because it eliminates the need for troublesome
manual dissolution. The RI formulation can be administered in just 10 minutes versus 60 minutes for the current lyophilized
injection and RTD formulation. This reduces the burden on patients and healthcare professionals, providing significant value
added. Multiple patent protections in the form of a liquid product license will enable the extension of the product life ofTreakisym® to 2031.

Rigosertib Sodium (SyB L-1101 [IV]/SyB C-1101 [oral]; anticancer agent; generic name: rigosertib Sodium)
Onconova Therapeutics, Inc., the licensor, conducted a global phase III trial (INSPIRE study) across more than 20 countries
addressing higher-risk myelodysplastic syndromes (higher-risk MDS) with overall survival as the primary endpoint. The target ispatients who do not respond to the current standard treatment with hypomethylating agents, relapse after treatment under thecurrent standard of care, or are intolerant to hypomethylating agents. In August 2020, Onconova announced a comparator trial
to physicians’ choice of treatment failed to achieve the primary endpoint. The company leads clinical trials conducted in Japanand is looking to apply the knowledge gleaned from additional analysis of the INSPIRE study to rigosertib development going
forward.
Regarding the oral formulation of rigosertib, Onconova completed a phase I/II clinical trial for the drug used in combination withazacytidine, whose results suggested the efficacy and safety of the combination therapy. To verify the tolerability and safety of

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R SymBio Pharmaceuticals / 4582
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Update Notes

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the high-dose oral formulation of rigosertib as an initial treatment for higher-risk MDS among Japanese patients, SymBio began aphase I clinical trial in Japan in June 2017 and completed patient enrollment in June 2019.

Antiviral drug SyB V-1901 (generic name: brincidofovir）
In September 2019, SymBio concluded an exclusive global license agreement with Chimerix Inc. (hereafter Chimerix) for
brincidofovir (SyB V-1901, hereafter BCV IV and BCV Oral), an antiviral drug in intravenous and oral forms). The company
acquired exclusive global rights to develop, manufacture, and market BCV for all diseases except smallpox.
After a review at the global advisory board held in February 2020, the company concluded that it would prioritize global
development of BCV IV (mainly in Japan, the US, and Europe) to treat adenovirus (AdV) infections in patients receiving
hematopoietic stem cell transplantation to address an unmet medical need. Based on safety and efficacy data acquired from its
study, the company plans to review the drug’s efficacy against dsDNA viral infections in patients receiving hematopoietic stem
cell transplantation and extend its target indications to include multiviral infections. By exploring the potential for expanding
target disease areas to viral infections related to organ transplants (including kidney transplants), the company aims to grow themarket for and maximize the business value of BCV. The company is presently in preparation to initiate a dose-finding study ofthe liquid formulation of BCV in pediatric patients slated to begin in December 2021.
Clinical trials by Chimerix have demonstrated superior, broad-spectrum antivirus activity of BCV Oral against dsDNA viruses,
raising expectations for its potential as a safe and effective therapy to prevent and treat a range of viral infections in patients
receiving hematopoietic stem cell transplantation.
Chimerix announced in December 2020 that the FDA had accepted its new drug application (NDA) for BCV as a medical defense
against smallpox. The FDA has approved priority review for BCV under the Prescription Drug User Fee Act (PDUFA) and set thedate for completing the review (PDUFA date) at April 7, 2021.

SyB P-1501, a post-operative patient-controlled analgesia
Regarding SyB P-1501 licensed by The Medicines Company (marketed as IONSYS in the US), the company initiated an arbitration
against The Medicines Company (MDCO), under the rules of the International Chamber of Commerce, seeking damages of
USD82mn arising from MDCO’s repudiation of the license agreement. SymBio argued that MDCO’s failure to provide sufficientassurance to the company regarding the performance of obligations under the license agreement in light of its decision towithdraw from business activities relating to SyB P-1501 in the European and US markets was a material breach of the license
agreement. In September 2020, SymBio announced it had received the arbitration judgment and although the Court of
Arbitration did not award damages sought by the company, it did order MDCO to pay 50% of legal costs (about USD5mn)
sought by the company.

Overseas
The company marketed SyB L-0501 in South Korea, Taiwan, and Singapore, and product sales were in line with the company’splans.

In-licensing of drug candidates
The company is currently focusing on unrolling global development plans for antiviral drug brincidofovir it in-licensed in
September 2019. It is constantly looking into multiple licensing deals and looking for and evaluating promising in-licensing drugcandidates.

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R SymBio Pharmaceuticals / 4582
Coverage

Update Notes

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Full-year company forecast
FY12/20(JPYmn)Sales
Gross profit
Gross profit margin

FY12/21

1H Act.
1,361
330

2H Act.
1,626
537

FY Act.
2,987
867

FY Est.
9,151
6,957
76.0%

24.2%

33.0%

29.0%

SG&A expenses

2,170

3,203

5,373

5,596

SG&A ratio

159.5%

197.0%

179.9%

61.2%

R&D expenses
Excluding R&D expenses
Operating profit

834
1,336
-1,8401,433
1,770-2,666

2,267
3,107-4,506

2,019
3,577
1,361

Recurring profit-1,883-2,733-4,616

Net income-1,885-

Operating profit margin
Recurring profit margin
Net margin

-

-

-

14.9%

-2,205--4,090

14.8%

-

-

12.6%

-

1,350
1,149

Source: Shared Research based on company data.
Note: Figures may differ from company materials due to differences in rounding methods.

Earnings outlook
The company’s FY12/21 forecast calls for sales of JPY9.2bn (+206.4% YoY), operating profit of JPY1.4bn (operating loss of
JPY4.5bn in FY12/20), recurring profit of JPY1.4bn (recurring loss of JPY4.6bn), and a net profit of JPY1.1bn (net loss of JPY4.1bn).
The company expects increased product sales in Japan due to the move to sell Treakisym® in-house, and to turn profitable at alllevels on the back of sales growth.
The company forecasts SG&A expenses of JPY5.6bn (+4.1% YoY) and R&D expenses of JPY2.0bn (-10.9% YoY). It will proceedwith development of Treakisym® to treat r/r DLBCL, Treakisym® liquid formulations, and rigosertib, as well as antiviral drug
brincidofovir. SG&A expenses excluding R&D expenses are an estimated JPY3.6bn (+15.1% YoY). The company will prepare toestablish its in-house sales structure and expand its business overseas so that it can turn profitable in FY12/21 and sustain earnings
expansion thereafter.
The main pipeline development plans are as follows.

Treakisym®
▷▷

For r/r DLBCL, in May 2020, the company filed partial revisions for the manufacturing and marketing approval for Treakisym®.
SymBio is preparing to begin sales of the RTD formulation in-licensed from Eagle Pharmaceuticals, which was approved in
September 2020, with plans to begin sales in January 2021, and progressing with clinical trials of the RI formulation mainly toconfirm safety.

Oral and intravenous rigosertib products▷

SymBio is continuing to develop intravenous rigosertib formulation. Onconova, the licensor of anticancer drug rigosertib,announced in August 2020 that its global phase III trial (INSPIRE study) addressing higher-risk myelodysplastic syndromes(higher-risk MDS) intolerant of treatment with hypomethylating agents failed to meet its primary endpoints. SymBio engages
in clinical development of rigosertib in Japan, and plans to use the knowledge obtained from genomic analysis of the INSPIRE
study in future development of rigosertib.

Antiviral drug brincidofovir
Regarding the intravenous formulation of brincidofovir (BCV IV), after a review at the global advisory board held in February 2020,
the company concluded that it would prioritize global development of BCV IV (mainly in Japan, the US, and Europe) to treat
adenovirus (AdV) infections in patients receiving hematopoietic stem cell transplantation to address an unmet medical need. The

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R SymBio Pharmaceuticals / 4582
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Update Notes

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company will continue to work with specialist researchers to design international clinical trials for BCV IV and BCV Oral topromote global development of the two formulations.

On February 4, 2021, the company announced a three-year medium-term plan covering FY12/21–FY12/23.
Medium-term plan targets
FY12/21

FY12/22

FY12/23(JPYmn)Est.

TargetTarget

Sales

9,151

10,985

12,369YoY

206.4%

20.0%

12.6%

1,361

1,738

2,099

-

27.7%

20.8%

14.9%

15.8%

17.0%

1,350

1,727

2,088

-

27.9%

20.9%

14.8%

15.7%

16.9%

1,149

1,470

1,778

-

27.9%

21.0%

12.6%

13.4%

14.4%

Operating profit
YoY
Operating profit margin

Recurring profit
YoY
Recurring profit margin

Net income
YoY
Net margin

Source: Shared Research based on company data

Targets in medium-term plan (FY12/21–FY12/23)
Sales
SymBio expects product sales of Treakisym® to account for the bulk of sales. Product sales targets reflect the recent pace of market
penetration and sales trends, which feed into the company’s revised sales growth rates calculated over the medium-term plan
period. Sales through FY12/20 were booked based on product shipment sales to the sales distributor, Eisai. From FY12/21 onward,
sales will be booked on product shipment sales to pharmaceutical wholesalers from the company’s own in-house salesorganization.
In estimating sales from FY12/21 onward, SymBio disclosed targets assuming increased product sales of Treakisym® as it expects
to gain approval of the drug as a treatment for relapsed or refractory diffuse large B-cell lymphoma (DLBCL) in Q2 FY12/21.

SG&A expenses
The company has broken down SG&A expenses into primarily R&D spending and other SG&A expenses.

▷ The company calculated R&D expenses based on the latest development plans for its existing pipeline comprising Treakisym®,
rigosertib, and brincidofovir, an antiviral drug.

▷ The company does not assume any upfront payments for in-licensing drug candidates outside its existing pipeline after
brincidofovir, an antiviral drug, although it will continue to evaluate and investigate them.

▷ Other SG&A expenses comprise primarily Treakisym® sales and marketing, production and distribution, business development,
and management related costs. From FY12/21, SymBio assumes costs associated with operating its own sales organization forsales of Treakisym®. It forecasts an increase primarily in personnel costs due to a higher medical representative headcount andhigher costs due to more activities.

Net income
In the previous medium-term plan announced in February 2020, the company forecast net income exceeding recurring profit in
FY12/21 and FY20/22 to reflect the reduction in loss carried forward from FY12/21 onward on tax effect accounting. Heeding theadvice of accounting auditors, the new medium-term plan was formulated by removing income taxes adjustment factors for
FY12/21 onward.

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R SymBio Pharmaceuticals / 4582
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Personnel plans
SymBio completed the formation of its 62-member nationwide sales structure in FY12/20. It plans to allocate the bare minimumof necessary personnel in other parts of the organization and is budgeting for personnel expenses accordingly. The company
plans to increase personnel expenses for global expansion of brincidofovir, an antiviral drug, and reflected this in personnel
expenses.

Funding plans
Regarding funding plans, the company will work toward strengthening its financial base so that it can respond in a flexible andnimble way to the need for funds according to business developments.

This note is the most recent addition to the full report.

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