Business Strategies

Chemicals

Progress in FY2022

OKIKAWA Toshiaki

Executive Officer,
Head of Chemicals Division

1 Isocyanuric Acid
Isocyanuric acid is a material used in TEPIC®, HI-LITE®, and melamine cyanurate, which is used as a flame retardant. In order to facilitate the stable provision of TEPIC® and HI-LITE®, which are sources of growth of thisdivision, to the market, we expanded our isocyanuric acid production facilities in December 2020, which contributed to an increase in sales.

2 TEPIC®
Basic Chemicals
We sell industrial chemicals such as sulfuric acid, nitric acid,ammonia, and urea, and their derivative products to a wide variety of industries. The Company is further improving the efficiency of our production system in order to create a stronger business foundation to minimize the impact on our earnings due toexternal factors, such as changes in economic trends in Japanor oversea and fluctuating fuel prices.
We are also manufacturing and supplying products to support cutting-edge fields, and providing products to the market
such as high-purity sulfuric acid, nitric acid, aqueous ammonia
and liquid ammonia from which impurities are removed to utmost level.
In addition, we established a manufacturing and supply system for our high-grade urea solution AdBlue®* that decomposes
nitrogen oxide contained in exhaust gas from diesel vehicles,
which is considered to be the cause of air pollution, into nitrogen
and water, thereby reducing environmental impact.

Fine Chemicals
We offer environmental chemicals such as HI-LITE®, used forsterilization and disinfection of swimming pools and water purification tanks, and Venus® Oilclean, a microorganism formulationthat decomposes oils and fats in wastewater from food factories,
as well as other chemicals such as FINEOXOCOL®, higher alcohol used in products including cosmetics.
In addition, TEPIC®, a high-performance chemical derived
from isocyanuric acid, a derivative of urea, and melamine cyanurate are positioned as key products for earnings growth. In addition to being used as a curative agent for coating powders,
TEPIC® is seeing an increase in demand for use in electronicmaterials such as solder resist ink and sealants for LED.
Melamine cyanurate is used as a non-halogen flame retardantor an auxiliary flame retardant for various engineering plastics.
In addition to focusing on the expansion of applications for these
existing products, we are promoting R&D of our own isocyanuric
acid derivatives.

*AdBlue® is a registered trademark of the Verband der Automobilindustrie (VAD).

The high-performance chemical TEPIC®, which has a distinctive triazine ring, is used in a wide range of applications.

For electronic material applications, we expect that demand for TEPIC® will continue to grow in various fields,
including the information & communication field (5G base stations for solder resist ink applications, substrates
for autonomous driving, etc.). In FY2022, we fell short of our plans notably due to the lockdowns in China, but in
FY2023, we forecast an increase in sales along with the recovery from COVID-19 pandemic. For general-purpose grades, we revised the sales prices in response to soaring international market prices due to rising raw
fuel and materials costs and logistics costs. We will pursue a well-balanced sales strategy by expanding salesof high-quality grades while avoiding low-price competition in general-purpose grades.

3 HI-LITE®

“Clean Water and Sanitation”, one of the SDGs, is an important global issue. We have exported some grades of
HI-LITE® since they have been certified as materials for disinfectants for drinking water in areas where hygiene management is insufficient, such as in developing countries. We will respond to the global demand fordisinfection, as well as the demand for disinfectant applications for drinking water.

4 High-Purity Sulfuric Acid
Demand for high-purity sulfuric acid is expected to grow in the information & communications field, a businessfield which will continue to grow. In FY2022, we fell short of our plans due to production adjustments at customerʼs semiconductor facilities, but we are forecasting that production adjustments will be complete andshipments will increase in the second half of FY2023. We will continue to maintain high quality and high availability.

Vista2027 Business Strategies
Opportunities and Risks

Strengths●Rising prices of raw materials and fuels●Expansion of semiconductor market●Increasing demand for environmental-friendly
products●Introduction of carbon pricing● Manufacturing process for products with highself-extinguishing rates as well as high value-added
products by developing derivative products using
ammonia as a core raw material● Accumulation of more than half a century of research and know-how regarding ultra-high purity ofindustrial chemicals

Main Measures
1. Improve profitability of ammonia-related business after the withdrawal from themelamine business
2. Expand sales of high purity sulfuric acid
3. Expand sales and improve profitability of isocyanuric acid and HI-LITE®
4. Develop the business of Venus® Oilclean (a microorganism formulation)

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Integrated Report 2023

Efforts toachieve
Vista2027

In June 2022, the first year of Vista2027, we discontinued the production of melamine, which had been acore product in our ammonia-related products formore than half a century. Meanwhile, for sulfuric acidproducts, we will make capital investments and upgrade facilities in response to increasing demand. The
Chemicals business is susceptible to the effects offuel prices, supply demand balance, and market environment. Therefore, we will continue to strive to secure stable earnings while flexibly reviewing businessstrategies in response to environmental changes.
As a source of sustainable growth for the business, we will focus on the development and deployment of new products, mainly isocyanuric acid derivatives, while strengthening sales of products for theelectronic materials field. We started the full-fledgedcommercialization of STARFINE® (zinc cyanurate),

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58

from which effects as an additive for paints and adhesives can be expected. Together with the new gradesof TEPIC®, it has already been evaluated by many users for various purposes. We will also contribute towaste reduction with Venus® Oilclean, a microorganism formulation.

Exhibited STARFINE® at Converting Technology Exhibition
2023 (STARFINE®)

Integrated Report 2023

Value Creation & Growth Strategies

Most of the products of this division are comprised of industrial chemicals, such as ammonia and sulfuric acid, and derivative products/ high-purity products that have beendeveloped downstream with added value. These products are supporting people’s
lives in a wide range of fields. By building an efficient production system, we strive
to provide excellent products and technologies while reducing the environmental
burden.

Business Strategies

Progress in FY2022

ISHIKAWA Motoaki

Director, Senior Managing Executive Officer,
Head of Performance Materials Division

Display Materials
We are working on alignment materials for aligning liquid crystal molecules in a certain direction. SUNEVER® was made available for sale in 1989, and we have expanded our market share byincreasing the functionality of alignment materials, even when
the liquid crystal type used is changed from TN to STN or TFT. In
addition, in 2014, we started the sale of Rayalign®, a photo-alignment material for IPS liquid crystal, and this has become ourmain product. This product has been used in many smartphones,
tablets and laptops. In the future, it is expected that product demand for Rayalign® will further increase as resolutions in monitor and automotive applications increase.

With the mass adoption of EUV exposure technology (wavelength: 13.5 nm, semiconductor circuit width: 7 nm and under) in
2018, we are promoting high-quality improvements in the mass
production and next-generation development of EUV materials
and also focusing on three-dimensional (3D) packaging technology preparing for the limits of optical shrink.
*1,2 ARC® and OptiStack® are registered trademarks of Brewer Science, Inc.

Inorganic Materials
SNOWTEX®, a nano silica water dispersion serving as a fiber
processing agent, went on sale in 1951. Now we also offer organosilicasol serving as an organic solvent dispersion, and monomer sol, a product that can be used without solvent. These products are indispensable materials used in coating materials for
optical films and in abrasives for electronic substrate materials
and for other purposes. In the future, we will work on the development of CCS/CCUS-related materials and expand their applications to new eco-friendly products.

Semiconductor Materials
We started the manufacture and sale of ARC®*1 in 1998 based ona licensing agreement with US company, Brewer Science, Inc.
ARC® is a coating material designed to prevent issues such as
irregular reflection and interference of light, and coating failure
during micro-fabrication of the photoresist. We launched
OptiStack®*2 (multi-layer process material) in 2007 which greatly
expanded our business.

1 Liquid Crystal Alignment Materials for TVs
Currently, our major materials for displays are alignment materials for smartphones and tablets, and especially thephoto-alignment material for IPS liquid crystal. In the future, we will also use them for TVs. Although demand for LCD
TVs is predicted to decrease somewhat, we predict that demand for alignment materials will continue to increase basedon screen sizes. Also, since we believe that screen resolutions will continue to improve, we recognize that it is an important theme to accurately respond to technical requests from customers and expand the market share of our products. In
FY2022, we were able to expand our share of alignment materials for VA liquid crystal because some customers
switched from the competing product.

2S trengthening Development Capabilities and Establishment of a Structure to Increase Production for Semiconductor Materials
We strengthened the development capabilities in EUV materials for cutting-edge applications. We also focused our efforts on increasing the quality of current EUV materials and developing the next-generation versions. Moreover, in order
to increase the speed of development for South Korea market, we established the Semiconductors Division of R&D center at NCK on April 1, 2023. We are also preparing to operate the 3rd NCK BARC plant in Dangjin, South Korea, in order to
respond to the future growth in demand (Construction completed on May 15, 2023).

3 Oil and Gas Applications and CCS, CCUS Applications
We expanded sales of inorganic materials for use in improving oil and gas
recovery rate. The sharp rise on oil prices led to our acquisition of new customers and sales increased year on year in FY2022. We also engaged in initiatives related to CCS and CCUS applications, as a way to develop applications toward carbon neutrality. In FY2022, we were able to obtain usefuldata for demonstration test.

Strategies of Vista2027

Vista2027 Business Strategies
Opportunities and Risks

Strengths●Expansion of applications of photo-alignment materials
for IPS liquid crystal and growth of the OLED market●Expansion of the semiconductor market and progressin 3D packaging technology●Development of a smart society●Intensification of inter-corporate competitions●A sales and research system closely linked to customers in China, Taiwan, and South Korea●Optical control technology●Functional polymer design technology●Ultrafine particle control technology

Main Measures
4. Start the commercial operation of the
new NCK plant
5. Improve profitability of the inorganic
material (inorganic colloid) business

1. Improve existing products and expand
their applications
2. Reinforce and increase manufacturing
facilities and other facilities
3. Develop and launch new products

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Integrated Report 2023

Efforts toachieve
Vista2027

Next-Generation Display Materials
OLEDs are thinner and lighter than liquid crystals, offer high-speed response, and provide added value
such as foldability. They are being used more often insmartphones, premium TVs and other products. Recently, following OLED, next-generation self-luminous
displays incorporating technologies of quantum dot(QD) and LED, which promise higher image quality,
have been actively developed. We will aim to commercialize new products by developing proprietary materials, such as materials that enhance light extraction
efficiency, release layer materials, and QD-relatedmaterials.

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60

Semiconductor Packaging Materials
Technologies related to high-speed, large-capacity information and communication such as IoT, 5G, andsensors, are making rapid progress. For this reason,
further miniaturization and higher integration in theformation of electronic circuits are occurring. As wehave been working on the development of materials
for the process of 3D packaging with thinned semiconductor wafers, we plan to expand sales the materials
in the growing market.

Integrated Report 2023

Value Creation & Growth Strategies

Performance
Materials

In this rapidly evolving business, it is necessary to quickly and accurately grasp theneeds and technological trends of the market. For this, sales, research, and production,
including overseas bases, are integrated, and we emphasize activities that are closely related to customers. We aim to contribute to the development of society by providing products and services based on the reliable technical capabilities that wehave cultivated.

Business Strategies

Agricultural
ChemicalsValue Creation & Growth Strategies

We contribute to a stable food supply through consistent business activities from the research for new agricultural chemicals to their development, manufacture, and sales,and expansion of a broad product lineup through the acquisition of ingredients fromother companies and joint development of products.

Progress in FY2022

SATO Yuji

Managing Executive Officer,
Head of Agricultural Chemicals Division

Agrochemicals
Our agrochemical business started in the 1910s when our predecessors Nippon Seimi Seizo and Kanto Soda began manufacturing and selling insecticides and fungicides. Starting with TARGA®
(herbicide for grassy weeds) launched in 1984, we have continued to manufacture and sell products developed in-house such
as SIRIUS® (herbicide for paddy rice), SANMITE® (insecticide/acaricide) and PERMIT® (herbicide for paddy rice and corn),which have steadily improved profitability.
Afterwards, we experienced hard times as a result of inhouse development delays and intensifying competition withcompetitors. However, since the launch of LEIMAY® (fungicide)in 2008, we have returned to introducing products developed inhouse, and started sale of STARMITE® (acaricides) in 2009,ALTAIR® (paddy rice herbicide) in 2012, and GRACIA® (general
purpose pesticide) in 2018. In addition, we are actively pursuing
the acquisition of other companiesʼ agents and have enhanced
our agricultural chemical product portfolio by taking over the
global product Quintec® (fungicide) in 2019 and Japanese andKorean operations for the versatile DITHANE® (fungicide) in
2020.

Veterinary Pharmaceuticals
Through our development of agricultural pesticides, we havediscovered compounds that are not only effective for use on agricultural crop pests, but also on fleas and ticks that are parasitic in dogs and cats, and have continued to examine these compounds as veterinary pharmaceuticals. In 2008, we entered alicensing agreement with Intervet Inc. Development of veterinary pharmaceuticals using Fluralaner, a compound invented byus, as an active ingredient has advanced.
Since launched in Europe and the United States under thebrand name BRAVECTO®* in 2014, veterinary pharmaceuticals
containing Fluralaner as an active ingredient are now used in
more than 100 countries and are leading the growth of Agricultural Chemicals Division. In addition to our products for dogs
and cats, “EXZOLT®”* for chickens, cattle, and sheep is also obtaining a marketing authorization in an increasing number ofcountries.

1 GRACIA®
GRACIA®, a pesticide developed in-house, is fast-acting on a wide range of crop pests andhas little impact on honeybees which are useful insects. It was released in South Korea in2018 and went on sale in Japan in May 2019. The product was launched in Indonesia in
2021, in India in 2022, and will be launched progressively in various Asian countries from2023 onward.

2 ROUNDUP®
ROUND NOZZLE® ULV5, a product that allows for dispersion of ROUNDUP® MAXLOAD in a way that reduces
farmer workload, is gaining popularity. We are working to increase sales of ROUNDUP® MAXLOAD by utilizing
the boom sprayer nozzle for large-scale farmers released in FY2021. Sales of ROUNDUP® MAXLOAD AL for
general consumers are expected to increase due to continued acquisition of new users and expansion of retail
distribution.

3 Fluralaner
Veterinary pharmaceuticals for companion animals and livestocks containing Fluralaner as an active ingredient are available in more than 100 countries. In FY2022, sales of animal health products containing Fluralaneras an active pharmaceutical ingredient continued to increase year on year, mainly for companion animals.
Along with the low birthrate and aging population, the idea that companion animals are like a family to theirowners is growing in popularity. We expect that the demand for veterinary pharmaceuticals will increase in
the future as people become more aware about companion animal health.

*BRAVECTO® and EXZOLT® are registered trademarks of Intervet International B.V. and Intervet Inc.

Strategies of Vista2027

Vista2027 Business Strategies
Opportunities and Risks

Strengths●Labor shortage due to the population decline in Japan●Growing need for measures to increase food production due to the increase in global population●Growth of bio-based agrochemicals and materials●Expansion of market for companion animals●Ability to create distinctive, new agrochemicals
from the core technologies of fine organic synthesis
and biological evaluation●Experiences and track records spanning many years
from research for new agricultural chemicals to
manufacturing and sales●High level of motivation cultivated through maintaining high profit margins and continuous growth

Main Measures
1. Popularize and expand sales of main products such as GRACIA®, and continue to enhance our respective
marketing efforts for large-scale farmers and agricultural corporations, and general consumers
2. Conduct steady development of NC-653 (novel herbicide), NC-656 (novel herbicide) and NC-520 (novel
nursery-box insecticide for paddy rice), and create new pipelines
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Integrated Report 2023

Efforts toachieve
Vista2027

In order to enhance our product portfolio, we will continue to introduce and jointly develop products fromother companies, including biological agrochemicals.
In addition, as in-house developed products, following the development of a herbicide for paddy rice
flooding treatment (development code NC-653), we
also started to develop a herbicide for application on
stems and leaves of paddy rice (development code
NC-656) and a nursery-box insecticide for paddy rice
(development code NC-520). Moreover, we have established a joint venture (Nissan Bharat Rasayan PVT.
LTD.) in India for the purpose of manufacturing the active ingredients in agrochemicals. It started commercial operation in March 2023. By having this joint ventureʼs manufacturing plant together with the Onoda
Plant, we can respond to growing demand for our ag-

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62

rochemicals. We expect it will contribute to thegrowth of our agrochemicals business by establishinga robust active production and supply system that iscost-competitive.

Integrated Report 2023

Business Strategies

Healthcare

Progress in FY2022

ISHIWATA Norihisa
Executive Officer,
Head of Healthcare Division

Healthcare
In the 1970s, a number of companies from other industries entered the pharmaceutical business. We focused our researchand development on lifestyle-related diseases and launchedefonidipine hydrochloride, an antihypertensive drug, in 1994. It is
distributed in Japan by Zeria Pharmaceutical and Shionogi as
LANDEL®*1, and in South Korea by GC Biopharma as FINTE®tab.
In 2003, Kowa Company launched the anti-cholesterol drug
pitavastatin calcium hydrate as LIVALO®*2, which is currently
sold in over 30 countries around the world. After domestic substance patent have expired in 2013, the decline in market shares
due to generic drugs and the impact of drug price revisions haveresulted in a continuing difficult situation in Japan. The creationof new drugs is an urgent issue for us.
With the organizational restructuring in April 2022, the drug
discovery research function was transferred to the Planning andDevelopment Division, where it is handled by the Healthcare
Business Development Department. The Healthcare Division istaking charge from the out-licensing stage, developing the business from a comprehensive perspective of broader healthcare
together with medical materials.

Custom Chemicals
We operate a “solution proposal” contract business and a joint
development business that provide total support for the development of active pharmaceutical ingredients (APIs) in response
to customer needs. We accept contracts for the development of
manufacturing processes at each stage from preclinical to commercial production, as well as for the manufacture of APIs andintermediates under GMP-compliant conditions. Accompanying
this, we also handle services such as quality design, stability
testing, impurity/metabolite sample synthesis, and preparationof application materials for the drug master file.
Recently, we have expanded our business of supplying APIsfor generic drugs, and are not only handling highly active APIs
that require containment, but also efficiently manufacturinghighly active vitamin D3 APIs in addition to prostaglandin derivatives using our proprietary two-component coupling method
based on our diverse fine organic synthesis technologies.
In addition, we have developed our proprietary liquid-phase synthesis technology “SYNCSOL®” for innovative contract peptide
production.
*1 LANDEL® is a registered trademark of Zeria Pharmaceutical Co., Ltd.
*2 LIVALO® is a registered trademark of Kowa Company, Ltd.

 onstruction of Basic Technologies to Accelerate Oligonucleotide Drug Discovery and Promo1Ction of Joint Drug Discovery with Pharmaceutical Companies
Oligonucleotide therapeutics are attracting attention in their main roles as next-generation pharmaceuticals. In addition to accelerating our research by strengthening our unique technologies in oligonucleotide drug discovery, we
have been jointly working with multiple pharmaceutical companies to create development compounds since 2019and expanding these partnerships.

2 Advancement of Strategic Alliance with Modulus Discovery, Inc. to Accelerate Small Molecule
Drug Discovery
With recent advances in supercomputers, it is becoming possible to design small molecule drug candidates fortarget molecules with high precision. Since 2021, we have engaged in a strategic drug discovery collaborationagreement with Modulus Discovery, Inc., which leverages its basic technologies such as cutting-edge computational technology. In this agreement, Nissan Chemical share the development of drug candidates and jointly
out-license them to pharmaceutical companies with Modulus Discovery, Inc.

3 Establishment of an Efficient Peptide Manufacturing Technology
In 2018, we invested in PeptiStar, which is aiming to establish a stable supply system for APIs of constrained peptides.
Meanwhile, we have developed a novel liquid phase peptide synthesis technology (SYNCSOL®) that enables dramatic
cost reduction. In the future, we intend to develop this technology for not only APIs but also peripheral medical materials.

4C ontinuous Launch of Highly Bioactive Generic Drugs
The demand for eldecalcitol, a drug for treatment of osteoporosis, is growing because the number of patientswith osteoporosis is expected to increase due to population aging. Based on the production results of maxacalcitol, a highly active vitamin D3 API, in FY2020 we started the sale of eldecalcitol, which requires high-quality
control because of the susceptibility to decomposition and impurities caused by oxygen, moisture, and heat in
the air. In the future, with an eye to expanding into overseas markets in addition to new development, we will
establish a stable supply system and nurture it as a source of growth.

Strategies of Vista2027

Vista2027 Business Strategies
Opportunities and Risks

Strengths●Increasing demand for generic drugs●Expanded efforts in middle molecule drug development●Aging population and diversification of healthcare●Intensification of inter-corporate competitions●Fine organic synthesis technology●GMP compliant high-level containment technology●Chemistry, Manufacturing, and Controls (CMC)
support for APIs
●Cutting-edge evaluation functions

Main Measures
1. Healthcare: Concentrate investment in the oligonucleotide drug discovery and commercialize and expand
sales of medical materials (biointerface control materials, cosmetic materials, etc.)
2. Custom Chemicals: Strengthen highly profitable business models, expand into overseas markets, and aim forjoint development (peptides, etc.)

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Integrated Report 2023

Efforts toachieve
Vista2027

We will focus on oligonucleotide therapeutics utilizing
our proprietary basic technology for oligonucleotide
drug discovery and steadily promote joint drug discovery platform with pharmaceutical companies. In
the area of small molecule drugs, we will work on theuse of AI as a shift from existing drug discovery method. The API of LIVALO® will be developed by taking advantage of economies of scale. As for medical materials, we will promote commercialization and sales
expansion of new products, including biointerface
control materials and cosmetic materials. In addition
to the generic drug maxacalcitol, which was launched
in FY2015, eldecalcitol, which was launched in FY2020,
has achieved significant growth as a pillar of our business. In the future, we will accelerate the development of new generic drug APIs which leverage our

Nissan Chemical Corporation64

strength, and be fully engaged in business not only inJapan but also in overseas markets. Furthermore, leveraging the overwhelming technological superiorityof our proprietary liquid-phase synthesis technology“SYNCSOL®”, we will develop the peptide contracted
business and the joint-development business.
Through these measures, we will further develop
Custom Chemicals into a highly profitable business.
It will take time to obtain results for new pharmaceuticals and medical materials. Until then, we willcontinue to boldly take on the challenge of developing
new pharmaceuticals and medical materials while
supporting the backbone with our highly profitable
Custom Chemicals business.

Integrated Report 2023

Value Creation & Growth Strategies

In order to appropriately respond to changes in the business environment and achieve
mid- to long-term growth, we are accelerating the selection and concentration of business areas. In addition, we contribute to the resolution of health issues by developing
and launching new pharmaceuticals, generic drugs and medical materials based on
our unique technologies.

Business Strategies

Progress in FY2022

ENDO Hideyuki

Managing Executive Officer, CTO,
Head of Planning and Development Division

Healthcare
We carry out drug discovery, mainly oligonucleotide therapeutics, and development for commercialization of materials for regenerative medicine and raw materials for cosmetics.
In the drug discovery, we are focusing on oligonucleotide
therapeutics. In order to contribute to improving patientsʼ quality of life through the creation of innovative new drugs, we arestrengthening our platform through collaboration with academia
and our partner companies and building our robust R&D portfolio through alliances with pharmaceutical companies.
In the field of regenerative medicine, as well as starting investigator-initiated clinical research using Cellhesion®, a scaffold that enables 3D mass culture of undifferentiated mesenchymal stem cells said to be highly safe, we started paid shipmentsof Advance-CR, a material for non-frozen transportation andstorage of cell clumps (spheroids). In addition, prevelex®, anagent to prevent adhesion of proteins and cells, etc. to containers has contributed significantly to the start of clinical trials atpartner companies. We will continue to aim for applications in
the containers for test and research, fields of gene medicines
and antibody pharmaceuticals.
In the cosmetics field, in addition to the increased use
of NFG® (NANOFIBERGEL®) in skin care products provided bycosmetics manufacturers, it gained adoption in hair care products. We are working to further expand its use.

Environment & Energy
We are committed to product development that contributes tothe realization of a sustainable society through Green Transformation (GX).
As for lithium-ion batteries (LIB), we are developing slurry
additives with the aim of improving input/output characteristics,
extending service life, and reducing process costs, for their earlycommercialization. We are developing materials for catalyst layers in polymer electrolyte fuel cells and ammonia electrolyte
synthesis catalysts for utilizing hydrogen energy, as well as
charge transport materials that contribute to improve the efficiency of lightweight flexible solar cells.
With the aim of realizing a recycling-oriented society, we arepromoting the development of a gas separation membrane technology expected to reduce costs for CO2 separation and recovery, and the early commercialization of ECOPROMOTE®, a resin
additive, that contributes to cost reduction in the molding process and improving a heat-resisting property of polylactic acid
which is rapidly spreading as a biodegradable bioplastic.
Animal Care
We are working on planning and development for commercialization in the field of veterinary pharmaceuticals. We are planningand developing new veterinary drugs using the R&D technology
of small molecule drugs cultivated by Nissan Chemical overmany years, and formulating strategies for establishing a sales
and distribution system for veterinary drugs in Japan.

Information & Communication
We are working on the development of new materials that support cutting-edge devices required to realize Society 5.0.
We are promoting market development for materials including μLED-related materials attracting attention as next-generation displays with high brightness and high reliability, wafer-level package-related materials that enable miniaturization andthinness, SUNCONNECT®, an optical interconnect material that
support high-speed, large-capacity data communications, andliquid metal-based thermal interface material developed by
Arieca Inc.

Nissan Chemical Corporation

New Material Planning and Research Management
Through venture capital based investment and other means, we
are working to discover high-quality start-up companies andnew development themes. We are working at the revitalizationof development themes by introducing new materials and technologies in each field and accelerate commercialization by strategically investing in startup companies.
Also, through the training of researchers and the support of
R&D themes, we are working for enhancement of R&D capabilities by creating a mechanism that leads to the evolution of existing technologies and the creation of new technologies.

65

Integrated Report 2023

1 Cellhesion®-MS
As a result of our joint research with Incorporated Medical Institute Saiseikai SOBAJIMA Clinic, we commenced
the clinical research on knee osteoarthritis (OA) using adipose-derived mesenchymal stem cells cultured with
Cellhesion®-MS. Compared with plane-cultured mesenchymal stem cells in conventional culture vessels, theyshow improvements in the potency of accumulation in involved and injured sites, the anti-inflammatory effect,
and the angiogenesis potency and other aspects. Therefore, it is expected to exert a higher efficacy on the OA
treatment.

2 prevelex®
prevelex® series developed by Nissan Chemical are anti-adhesion coatings for biological substances that are
applicable from test and research to clinical applications. Heartseed announced that they had successfully
dosed the first patient in a phase I/II clinical trial, an investigational cell therapy for heart failure. prevelex®
CC1 was used for the production of iPSC-derived cardiomyocyte spheroids for the clinical trial.

3 SUNCONNECT®
SUNCONNECT®, an optical interconnect material with high heat resistance and low optical loss, has been evaluated by customer companies as a material for polymer optical waveguides, and its paid sales have alreadystarted. For opto-electronic hybrid technology, which is expected to see further development in the future, wewill widely deploy this material, mainly to semiconductor package substrate manufacturers in Japan and overseas.

4 Charge Transport Materials for Solar Cells
Regarding organic photovoltaics (OPV), lightweight and flexible solar cells that practical application preceded,
efficiency improvement by adopting next-generation active layers, has become one of the most important issues, and our charge transport materials are being evaluated by customers. Currently, we are utilizing thisknowledge to develop materials for perovskite solar cells.

Strategies of Vista2027

Vista2027 Business Strategies
Opportunities and Risks

Strengths●Expansion of regenerative medicine market, growth ofbeauty and health market●Development of digital society and expansion of ICT
market●Increasing demand for technological development
aimed at the realization of a low-carbon society●Development delays and late arrival of expected new fields●Fusion of fine organic synthesis, functional material
design and biological evaluation●Thin film coating based interface control technology●Extensive network with external research institutes

Main Measures
1. Accelerate development by allocating resources to important themes
2. Incorporate new technologies and materials from inside and outside the Company
into in-house technology
3. Improve contact with customers and strengthen solution proposals capability

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Integrated Report 2023

Value Creation & Growth Strategies

Planning andDevelopment
Division

By combining our core technologies with new materials and technologies, we are striving to create new products and businesses with high added value that meet the needsof society. To further accelerate development, the Planning and Development Division
was established in FY2020. In FY2022, we established the Healthcare Business Development Department by integrating functions of drug discovery and medical
materials, and in FY2023 we newly established the Animal Care Planning Group.