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Quarterly Securities Report(The third quarter of 147th Business Term)for The Nine-month Period and Three-month
Quarter Ended December 31, 2023

TAKEDA PHARMACEUTICAL COMPANY LIMITEDAND ITS SUBSIDIARIESTable of Contents
Translation for reference purpose only
Index
Page

[Cover]A. Company Information

1

I. Overview of Takeda

2
2
2

1. Key Consolidated Financial Data
2. Business Overview
II. Operating and Financial Review
1. Risk Factors
2. Analysis on Business Performance, Financial Position and Cash Flows
3. Material Contracts
III. Information on the Company

3
3
3
18

1. Information on the Company’s Shares

19
19

2. Members of the Board of Directors

20

IV. Financial Information
1. Condensed Interim Consolidated Financial Statements
2. Others
B. Information on Guarantors of the Company

21
22
42
43

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[Cover][Document Filed][Applicable Law]
[Filed with][Filing Date][Fiscal period]

Quarterly Securities Report
Article 24-4-7, paragraph 1 of the Financial Instruments and Exchange Act of Japan
Director, Kanto Local Finance Bureau

February 2, 2024
The third quarter of 147th Business Term(from October 1, 2023 to December 31, 2023)[Company Name]
Takeda Pharmaceutical Company Limited[Title and Name of Representative] Christophe Weber, Representative Director, President & Chief Executive Officer[Address of Head Office]1-1, Doshomachi 4-chome, Chuo-ku, Osaka(The above address is the registered head office location and the ordinary business
operations are conducted at the “Nearest Place of Contact”)[Telephone Number]
Not applicable[Name of Contact Person]
Not applicable[Nearest Place of Contact]
1-1, Nihonbashi-Honcho 2-chome, Chuo-ku, Tokyo(Global Headquarters)[Telephone Number]+81-3-3278-2111 (Main telephone number)[Name of Contact Person]
Norimasa Takeda, Chief Accounting Officer & Corporate Controller, Global Finance[Place for public inspection]
Takeda Pharmaceutical Company Limited (Global Headquarters)(1-1, Nihonbashi Honcho 2-chome, Chuo-ku, Tokyo)
Tokyo Stock Exchange, Inc.
(2-1, Nihonbashi Kabutocho, Chuo-ku, Tokyo)
Nagoya Stock Exchange, Inc.
(8-20, Sakae 3-chome, Naka-ku, Nagoya)Fukuoka Stock Exchange(14-2, Tenjin 2-chome, Chuo-ku, Fukuoka)
Sapporo Stock Exchange(14-1, Minamiichijonishi 5-chome, Chuo-ku, Sapporo)-1-

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A. Company Information
I. Overview of Takeda
1. Key Consolidated Financial Data
JPY (millions), unless otherwise indicatedNine-month period
Nine-month period
For the year ended
ended December 31, ended December 31,
March 31,
Term

2022

2023

Revenue<Three-month period ended December 31>
Profit before tax
Net profit for the period
Net profit (loss) attributable to owners of the Company<Three-month period ended December 31>
Total comprehensive income for the period
Total equity
Total assets
Basic earnings (loss) per share (JPY)<Three-month period ended December 31>
Diluted earnings per share (JPY)
Ratio of equity attributable to owners of the Company tototal assets (%)
Net cash from operating activities
Net cash used in investing activities
Net cash used in financing activities
Cash and cash equivalents at the end of the period

3,071,322
1,096,551
327,175
285,903285,883
119,127
750,2096,176,498
13,504,705
184.3276.63
182.65

3,212,893
1,111,186
100,313147,191
147,085
105,720
625,154
6,742,607
14,222,947
94.10
67.38
93.17

45.7
683,463(168,610)(702,548)
685,14147.4
437,756(402,378)(296,193)
288,359(Note 1)
(Note 2)2023

4,027,478
375,090317,038
317,017
911,574
6,354,672
13,957,750
204.29201.9445.5
977,156(607,102)(709,148)
533,530

All amounts shown are rounded to the nearest million JPY.
The key consolidated financial data for the nine-month period ended December 31, 2022 and 2023 are based on thecondensed interim consolidated financial statements prepared in accordance with IAS 34.

2. Business Overview
There has been no significant change in our business for the nine-month period ended December 31, 2023.
As of December 31, 2023, Takeda consisted of 190 entities comprised of 172 consolidated subsidiaries (including
partnerships), 17 associates accounted for using the equity method, and Takeda Pharmaceutical Company Limited. There has
been no significant change in our group companies for the nine-month period ended December 31, 2023.

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II. Operating and Financial Review
1. Risk Factors
There were no new risk factors identified for the nine-month period ended December 31, 2023 as well as no significant changes
in the risk factors compared to what we reported in our Annual Securities Report for the year ended March 31, 2023 which was
filed in Japan.
2. Analysis on Business Performance, Financial Position and Cash Flows(1) Consolidated Financial Results (April 1 to December 31, 2023)
Billion JPY or percentage
FY2022Q3YTD

FY2023
Q3YTD

Change versus the same period of the previous fiscal year
AER
Amount of Change

Revenue
Cost of sales
Selling, general and administrative expenses
Research and development expenses
Amortization and impairment losses on intangible
assets associated with products
Other operating income
Other operating expenses
Operating profit
Finance income and (expenses), net
Share of profit (loss) of investments accounted forusing the equity method
Profit before tax
Income tax (expenses) benefit
Net profit for the period

CER% Change% Change

3,071.3(934.3)(742.5)(472.4)

3,212.9(1,044.2)(768.6)(534.1)141.6(109.9)(26.1)(61.7)

4.6 %
11.8 %
3.5 %
13.1 %

0.0 %6.8 %(1.3)%
7.3 %(409.2)
16.7(127.6)401.9(71.6)(507.0)10.8(145.7)224.1(126.6)(97.8)(5.9)(18.0)(177.8)(54.9)

23.9 %(35.4)%
14.1 %(44.2)%
76.7 %

16.3 %(35.7)%
9.1 %(42.9)%
77.9 %(3.1)
327.2(41.3)
285.9

2.7
100.3
46.9
147.2

5.9
(226.9)88.2(138.7)―(69.3)%―(48.5)%―(67.9)%―(50.1)%In this section, when comparing results to the same period of the previous fiscal year, the amount of change and percentagechange based on Actual Exchange Rates are presented in “AER” (which is presented in accordance with IFRS) and percentagechange based on Constant Exchange Rate (which is a non-IFRS measure) is presented in “CER”. Please refer to Core Results(April 1 to December 31, 2023), Definition of Core financial measures and Constant Exchange Rate change, for the definition of“Constant Exchange Rate change”.
Revenue
Revenue for the nine-month period ended December 31, 2023 was JPY 3,212.9 billion (JPY +141.6 billion and +4.6% AER,
+0.0% CER). The increase is attributable to favorable foreign exchange rates and growth from business momentum of PlasmaDerived Therapies (“PDT”) Immunology, Gastroenterology (“GI”) and Rare Diseases. The increase of these business areas wasoffset by the decrease in Oncology and Neuroscience. Although the decrease was partially mitigated by favorable foreignexchange rates, it was largely impacted by generic erosion and intensified competition on certain products in the current period. In
addition, revenue outside of our five key business areas decreased mainly due to lower revenue contribution from COVID-19
vaccines in Japan.

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Revenue by Geographic Region
The following shows revenue by geographic region:
Billion JPY or percentage

Revenue:Japan
United States
Europe and Canada
Asia (excluding Japan)
Latin America
Russia/CIS
Other*1
Total

FY2022Q3YTD

FY2023
Q3YTD

Change versus the same period of the previous fiscal year
AER
Amount of Change

389.8
1,621.8
632.4
169.0
121.4
66.7
70.2
3,071.3

342.6
1,685.5
721.5
188.8
138.4
45.4
90.7
3,212.9

CER% Change(47.2)
63.7
89.1
19.8
16.9
(21.3)
20.5
141.6(12.1)%
3.9 %
14.1 %
11.7 %
14.0 %(32.0)%
29.3 %
4.6 %% Change(12.3)%(1.8)%
4.7 %8.9 %15.2 %(16.9)%
35.4 %
0.0 %*1 Other includes the Middle East, Oceania and Africa.

Revenue by Business Area
The following shows revenue by business area:
Billion JPY or percentage

Revenue:
GI
Rare Diseases
Rare Hematology
Rare Genetics and OtherPDT Immunology
Oncology
Neuroscience
Other
Total

FY2022Q3YTD

FY2023
Q3YTD

Change versus the same period of the previous fiscal year
AER
Amount of Change

857.5
553.6
232.6
321.0
502.4
345.0
477.1
335.7
3,071.3

936.1
585.1
230.0
355.0
611.2
346.3
474.9
259.4
3,212.9

78.5
31.5
(2.6)
34.1
108.8
1.3
(2.3)
(76.3)
141.6

CER% Change

9.2 %
5.7 %
(1.1)%
10.6 %
21.7 %
0.4 %(0.5)%(22.7)%
4.6 %% Change

3.6 %
3.3 %
(4.3)%
8.9 %
16.2 %(2.2)%(5.8)%(28.3)%
0.0 %Year-on-year change in revenue for this nine-month period in each of our business areas was primarily attributable to thefollowing products:
GI
In GI, revenue was JPY 936.1 billion (JPY +78.5 billion and +9.2% AER, +3.6% CER).
Sales of ENTYVIO (for ulcerative colitis (“UC”) and Crohn’s disease (“CD”)) were JPY 619.3 billion (JPY +71.4 billion and+13.0% AER, +6.6% CER). Sales in the U.S. were JPY 431.8 billion (JPY +43.5 billion and +11.2% AER). The increase wasdue to favorable foreign exchange rates and demand in the first line biologic inflammatory bowel disease (“IBD”) population
primarily in UC. Sales in Europe and Canada were JPY 143.1 billion (JPY +20.7 billion and +16.9% AER). The increase wasprimarily due to favorable foreign exchange rates and new patient gains by an increased use of the subcutaneous formulation.
Sales of GATTEX/REVESTIVE (for short bowel syndrome) were JPY 90.0 billion (JPY +11.8 billion and +15.1% AER,
+10.9% CER). The increase was primarily due to increased demand in the U.S., Europe and Japan, expansion activities(infant indication label expansion and geographic expansion), and favorable exchange rates.
Sales of TAKECAB/VOCINTI (for acid-related diseases) were JPY 90.3 billion (JPY +5.8 billion and +6.8% AER, +6.2%
CER). The increase was primarily due to increased sales in Japan and the Growth and Emerging Markets including Brazil andChina.
Sales of DEXILANT (for acid reflux disease) were JPY 36.1 billion (JPY -19.0 billion and -34.5% AER, -38.7% CER). The
decrease was due to the loss of exclusivity and the termination of the authorized generics program in the U.S.

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Rare Diseases
In Rare Diseases, revenue was JPY 585.1 billion (JPY +31.5 billion and +5.7% AER, +3.3% CER).
Revenue of Rare Hematology was JPY 230.0 billion (JPY -2.6 billion and -1.1% AER, -4.3% CER).
Sales of FEIBA (for hemophilia A and B) were JPY 28.9 billion (JPY -3.7 billion and -11.3% AER, -14.1% CER). The
decrease was mainly due to competition in many countries as well as tender delays in Growth and Emerging Markets.
Sales of VONVENDI (for von Willebrand disease) were JPY 12.0 billion (JPY +2.8 billion and +30.6% AER, +22.5% CER).
The increase was primarily due to increased demand in the U.S.
Sales of ADVATE (for hemophilia A) were JPY 93.9 billion (JPY +1.8 billion and +2.0% AER, -0.9% CER). The increase
was attributable to favorable foreign exchange rates.
The increase of VONVENDI and ADVATE was partially offset by the decrease of other rare hematology products.
Revenue of Rare Genetics and Other was JPY 355.0 billion (JPY +34.1 billion and +10.6% AER, +8.9% CER).
Sales of TAKHZYRO (for hereditary angioedema) were JPY 136.4 billion (JPY +19.5 billion and +16.7% AER, +11.5%
CER). The continued growth was attributable to sustained launch momentum, expansion into new patient populations such as
pediatrics, rising diagnosis rates, the growth of the prophylactic market, and favorable exchange rates.
Sales of LIVTENCITY (for post-transplant cytomegalovirus (“CMV”) infection/disease) were JPY 13.9 billion (JPY +6.6
billion and +90.8% AER, +78.8% CER). The increase was primarily attributable to strong market penetration and successful
launch performance in the U.S., complemented by continued geographical expansion in Europe.
Sales of enzyme replacement therapy ELAPRASE (for Hunter syndrome) were JPY 70.0 billion (JPY +5.0 billion and +7.7%
AER, +7.5% CER). The increase was primarily due to strong demand in the Growth and Emerging Markets.
PDT Immunology
In PDT Immunology, revenue was JPY 611.2 billion (JPY +108.8 billion and +21.7% AER, +16.2% CER).
Aggregate sales of immunoglobulin products were JPY 485.7 billion (JPY +95.2 billion and +24.4% AER, +18.4% CER).
Sales of each of our three global immunoglobulin brands marked double digit percentage of revenue growth, due to continued
strong demand globally and growing supply, as well as favorable foreign exchange rates. Those include GAMMAGARDLIQUID/KIOVIG (for the treatment of primary immunodeficiency (“PID”) and multifocal motor neuropathy (“MMN”)), andsubcutaneous immunoglobulin therapies (CUVITRU and HYQVIA) which are growing due to their benefit to patients andconvenience in administration compared to intravenous therapies.
Aggregate sales of albumin products including HUMAN ALBUMIN and FLEXBUMIN (both primarily used for
hypovolemia and hypoalbuminemia) were JPY 94.3 billion (JPY +8.8 billion and +10.2% AER, +6.9% CER). The increase
was primarily driven by strong albumin demand in China.
Oncology
In Oncology, revenue was JPY 346.3 billion (JPY +1.3 billion and +0.4% AER, -2.2% CER).
Sales of VELCADE (for multiple myeloma) were JPY 4.1 billion (JPY -20.6 billion and -83.3% AER, -84.2% CER). The
decrease was due to generic erosion in the U.S.
Sales of NINLARO (for multiple myeloma) were JPY 66.7 billion (JPY -9.2 billion and -12.1% AER, -15.1% CER). The
decrease was due to intensified competition and decreased demand mainly in the U.S, partially aided by favorable foreignexchange rates.
Sales of ADCETRIS (for malignant lymphomas) were JPY 84.2 billion (JPY +18.5 billion and +28.1% AER, +27.9% CER).
The increase was led by strong growth in Growth and Emerging Markets.
Sales of ICLUSIG (for leukemia) were JPY 41.5 billion (JPY +5.9 billion and +16.7% AER, +9.2% CER). The increase wasdue to steady growth in the U.S. and favorable foreign exchange rates.
Sales of ALUNBRIG (for small-cell lung cancer) were JPY 21.1 billion (JPY +5.4 billion and +34.0% AER, +30.3% CER).
The increase benefited from strong demand across all regions.
Sales of other Oncology products in aggregate increased year-on-year, including the contribution from FRUZAQLA (forcolorectal cancer), a product newly launched in the U.S. in November 2023.

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Neuroscience
In Neuroscience, revenue was JPY 474.9 billion (JPY -2.3 billion and -0.5% AER, -5.8% CER).
Sales of VYVANSE/ELVANSE (for attention deficit hyperactivity disorder (“ADHD”)) were JPY 312.9 billion (JPY -22.6
billion and -6.7% AER, -12.1% CER). The decrease was due to the multiple generic entrants in the U.S. starting from August
2023, while the growth of the adult market in Europe and favorable foreign exchange rates could only offset the negative
impacts partially.
Sales of ADDERALL XR (for ADHD) were JPY 35.2 billion (JPY +16.2 billion and +84.7% AER, +73.5% CER). The
increase was primarily due to a shortage of generic versions of the instant release formulation marketed by competitors in the
U.S.
Sales of INTUNIV (for ADHD) were JPY 25.4 billion (JPY +8.8 billion and +52.7% AER, +50.2% CER). The increase wasprimarily due to buy-back of full rights in Japan.
The increase of ADDERALL XR and INTUNIV was partially offset by the decrease of other neuroscience products such as
ROZEREM (for insomnia), attributable to the continued impact of generic products in Japan.
Cost of Sales
Cost of Sales was JPY 1,044.2 billion (JPY +109.9 billion and +11.8% AER, +6.8% CER). The increase was primarily due torevenue growth in our five key business area with a change in product mix and the depreciation of Japanese yen as compared tothe same period of the previous fiscal year. This was partially offset by a decrease in non-cash charges related to the unwind of
the fair value step up on acquired inventories recognized in connection with the acquisition of Shire.
Selling, General and Administrative (SG&A) expenses
SG&A expenses were JPY 768.6 billion (JPY +26.1 billion and +3.5% AER, -1.3% CER). The increase was mainly due to thedepreciation of Japanese yen partially offset by various cost efficiencies.
Research and Development (R&D) expenses
R&D expenses were JPY 534.1 billion (JPY +61.7 billion and +13.1% AER, +7.3% CER). The increase was mainly due tovarious investments in pipeline programs and the depreciation of Japanese yen.
Amortization and Impairment Losses on Intangible Assets Associated with Products
Amortization and Impairment Losses on Intangible Assets Associated with Products was JPY 507.0 billion (JPY +97.8 billion and+23.9% AER, +16.3% CER). The increase was mainly due to an increase in impairment charges for certain assets related to inprocess R&D and marketed products and an increase of amortization expenses due to the depreciation of Japanese yen. The JPY
119.3 billion impairment losses recorded in the current period primarily includes JPY 74.0 billion impairment charges for
ALOFISEL (for complex Crohn's perianal fistulas) following topline results of phase 3 ADMIRE-CD II trial and JPY 28.5 billion
impairment charges following a decision to voluntarily withdraw EXKIVITY (for non-small cell lung cancer) globally.
Other Operating Income
Other Operating Income was JPY 10.8 billion (JPY -5.9 billion and -35.4% AER, -35.7% CER).
Other Operating Expenses
Other Operating Expenses were JPY 145.7 billion (JPY +18.0 billion and +14.1% AER, +9.1% CER). The increase was primarily
driven by increases of restructuring expenses and additional losses recorded for the supply agreement litigation with AbbVie, Inc.
(AbbVie) in the current period, partially offset by a decrease in valuation reserve for pre-launch inventories.
Operating Profit
As a result of the above factors, Operating Profit was JPY 224.1 billion (JPY -177.8 billion and -44.2% AER, -42.9% CER).
Net Finance Expenses
Net Finance Expenses were JPY 126.6 billion (JPY +54.9 billion and +76.7% AER, +77.9% CER). The increase of Net FinanceExpenses compared to the same period of the previous fiscal year was primarily due to a decrease in financial income reflecting
gains from acquisitions of prior equity method companies and a positive impact from the remeasurement of warrants to purchasestocks of company held by Takeda recorded in the same period of the previous fiscal year.
Share of Profit of Investments Accounted for Using the Equity Method
Share of Profit of Investments Accounted for Using the Equity Method was JPY 2.7 billion (JPY +5.9 billion, compared to Shareof Loss of Investments Accounted for Using the Equity Method of JPY 3.1 billion in the same period of the previous fiscal year).

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Income Tax (Expenses) Benefit
Income Tax Benefit was JPY 46.9 billion (JPY +88.2 billion, compared to Income Tax Expenses of JPY 41.3 billion in the same
period of the previous fiscal year). The increase was primarily due to a tax expense reduction of JPY 63.5 billion resulting fromthe reversal of the income taxes payable in excess of the settlement with Irish Revenue Commissioners with respect to a tax
assessment related to the treatment of an acquisition break fee Shire received from AbbVie in 2014 as well as lower pretax
earnings. These increases were partially offset by the tax charges from the write-down of deferred tax assets and legal entity
restructuring in the current period.
Net Profit for the Period
Net Profit for the Period was JPY 147.2 billion (JPY -138.7 billion and -48.5% AER, -50.1% CER).

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Translation for reference purpose onlyCore Results (April 1 to December 31, 2023)
Definition of Core financial measures and Constant Exchange Rate change
Takeda uses the concept of Core financial measures for measuring financial performance. These measures are not defined byInternational Financial Reporting Standards (IFRS).
Core Revenue represents revenue adjusted to exclude significant items unrelated to Takeda's core operations.
Core Operating Profit represents net profit adjusted to exclude income tax expenses, the share of profit or loss of investments
accounted for using the equity method, finance expenses and income, other operating expenses and income, amortization andimpairment losses on acquired intangible assets and other items unrelated to Takeda’s core operations, such as non-recurring
items, purchase accounting effects and transaction related costs.
Core EPS represents net profit adjusted to exclude the impact of items excluded in the calculation of Core Operating Profit, andother non-operating items (e.g. amongst other items, fair value adjustments and the imputed financial charge related to contingent
consideration) that are unusual, non-recurring in nature or unrelated to Takeda’s ongoing operations and the tax effect of each of
the adjustments, divided by the average outstanding shares (excluding treasury shares) of the reporting periods presented.
Constant Exchange Rate (CER) change eliminates the effect of foreign exchange rates from year-over-year comparisons bytranslating Reported or Core results for the current period using corresponding exchange rates in the same period of the previous
fiscal year.
Results of Core Operations
Billion JPY or percentage
FY2022Q3YTD

FY2023
Q3YTD

Change versus the same period of the previous fiscal year
AER
Amount of ChangeCore Revenue
Core Operating Profit
Core EPS (JPY)

3,071.3954.7
456

3,212.9
865.6
412

CER
% change

141.6(89.1)(44)

4.6 %(9.3)%(9.7)%% change

0.0 %(12.7)%(12.9)%

Core Revenue
Core Revenue for the nine-month period ended December 31, 2023 was JPY 3,212.9 billion (JPY +141.6 billion and +4.6% AER,
+0.0% CER). There were no significant items unrelated to Takeda’s core operations excluded from revenue in the current period
or in the same period of the previous fiscal year, and, accordingly, Core Revenue for these periods is the same as Reported
Revenue. Business momentum was led by Takeda’s Growth and Launch Products* which totaled JPY 1,384.7 billion (JPY+216.6 billion and +18.5% AER, +12.7% CER).
* Takeda’s Growth and Launch Products
GI: ENTYVIO, ALOFISEL
Rare Diseases: TAKHZYRO, LIVTENCITY, ADZYNMAPDT Immunology: Immunoglobulin products including GAMMAGARD LIQUID/KIOVIG, HYQVIA, and CUVITRU,Albumin products including HUMAN ALBUMIN and FLEXBUMIN
Oncology: ALUNBRIG, EXKIVITY (Takeda decided to voluntarily withdraw the product globally), FRUZAQLAOther: QDENGA

Core Operating Profit
Core Operating Profit for the current period was JPY 865.6 billion (JPY -89.1 billion and -9.3% AER, -12.7% CER). The
decrease was primarily due to a change in product mix and investments in various pipeline programs and data and technology.
Core EPS
Core EPS for the current period was JPY 412 (JPY -44 and -9.7% AER, -12.9% CER).

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(2) Consolidated Financial Position
The amount of change from the previous fiscal year-end is presented based on Actual Exchange Rates.
Assets.
Total Assets as of December 31, 2023 were JPY 14,222.9 billion (JPY +265.2 billion). The increases of Goodwill, Inventories,
and Property, Plant and Equipment (JPY +320.6 billion, JPY +183.2 billion, JPY +150.3 billion, respectively) were mainly due tothe effect of foreign currency translation. These increases were partially offset by a decrease in Cash and Cash Equivalents (JPY-245.2 billion). In addition, Intangible Assets decreased (JPY -172.6 billion) mainly due to amortization along with impairments
partially offset by the effect of foreign currency translation.
Liabilities.
Total Liabilities as of December 31, 2023 were JPY 7,480.3 billion (JPY -122.7 billion). The decrease of Trade and Other
Payables (JPY -165.6 billion) was primarily due to payments for the remaining upfront payment related to the acquisition of
TAK-279 from Nimbus Therapeutics, LLC (Nimbus) and the exclusive license agreement with HUTCHMED (China) Limited(HUTCHMED). The decrease of Income Taxes Payable (JPY -140.4 billion) was mainly due to income taxes paid during thecurrent period. In addition, Deferred Tax Liabilities decreased (JPY -137.6 billion). These decreases were partially offset by anincrease in Bonds and Loans (JPY +281.8 billion) due to the issuance of commercial paper and the effect of foreign currencytranslation. Total Bonds and Loans were JPY 4,664.2 billion*.
*

The carrying amount of Bonds was JPY 3,927.6 billion and Loans was JPY 736.5 billion as of December 31, 2023. Breakdown
of Bonds and Loans' carrying amount is as follows.

Bonds:Name of Bond
(Face Value if Denominated in
Foreign Currency)
Unsecured US dollar denominated seniornotes (USD 1,301 million)
Unsecured US dollar denominated seniornotes (USD 3,000 million)
Unsecured Euro denominated senior notes(EUR 3,000 million)
Unsecured US dollar denominated seniornotes (USD 1,750 million)

Issuance
June 2015

Carrying Amount(Billion JPY)
185.5
410.6

November 2018

September 2026
November 2026 ~November 2030

November 2018

November 2028

246.9

Hybrid bonds (subordinated bonds)
Unsecured US dollar denominated seniornotes (USD 7,000 million)
Unsecured Euro denominated senior notes(EUR 3,600 million)

June 2019

499.4

July 2020

June 2079
March 2030 ~July 2060
July 2027 ~July 2040

Unsecured JPY denominated senior bonds

October 2021
November 2023 ~December 2023

October 2031
February 2024 ~March 2024

249.5

Commercial paper
Total

September 2016

Maturity
June 2025 ~June 2045

July 2020

-9-

467.9

986.9
560.8

320.0
3,927.6

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Loans:Name of Loan
(Face Value if Denominated in
Foreign Currency)

Execution

Maturity

Carrying Amount(Billion JPY)

Syndicated loans

April 2016

April 2026

100.0

Syndicated loans

April 2017

April 2027

113.5

Syndicated loans (USD 1,500 million)

April 2017

April 2027

212.6

Syndicated loans

April 2023
March 2016 ~March 2023

April 2030
April 2024 ~March 2029

100.0

Bilateral loans
Other
Total

210.0
0.4
736.5

On April 26, 2023, Takeda repaid JPY 100.0 billion in Syndicated Loans falling due and on the same day entered into new
Syndicated Loans of JPY 100.0 billion maturing on April 26, 2030. Following this, Takeda redeemed USD 1,000 million of
unsecured senior notes issued in September 2016 on their maturity date of September 23, 2023. Furthermore, Takeda redeemed
USD 500 million of unsecured senior notes issued in November 2018 on their maturity date of November 26, 2023. Takeda had
short term commercial paper drawings outstanding of JPY 320.0 billion as at December 31, 2023.
Equity.
Total Equity as of December 31, 2023 was JPY 6,742.6 billion (JPY +387.9 billion). The increase of Other Components of Equity(JPY +481.5 billion) was mainly due to fluctuation in currency translation adjustments reflecting the depreciation of Japanese yen.
This increase was partially offset by a decrease in Retained Earnings (JPY -144.3 billion) mainly due to the decrease of JPY 287.8
billion related to dividends payments while Net Profit for the Period contributed to an increase.
Consolidated Cash FlowsNet cash from (used in) operating activities
Net cash from (used in) investing activities
Net cash from (used in) financing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Effects of exchange rate changes on cash and cash equivalents
Cash and cash equivalents at the end of the period

Billion JPY
FY2022 Q3YTDFY2023 Q3YTD
683.5
437.8
(168.6)(402.4)(702.5)(296.2)(187.7)(260.8)
849.7
533.5
23.1
15.6
685.1
288.4

The amount of change from the same period of the previous fiscal year is presented based on Actual Exchange Rates.
Net cash from operating activities
Net cash from operating activities for the current period was JPY 437.8 billion (JPY -245.7 billion). The decrease was due tounfavorable impacts from Changes in Assets and Liabilities, unfavorable impacts from a lower net profit for the period adjusted
for non-cash items and other adjustments, and other changes.
Net cash used in investing activities
Net cash used in investing activities was JPY 402.4 billion (JPY +233.8 billion). This increase was mainly due to an increase in
Acquisition of Intangible Assets related to the acquisition of TAK-279 from Nimbus and the exclusive license agreement with
HUTCHMED.
Net cash used in financing activities
Net cash used in financing activities was JPY 296.2 billion (JPY -406.4 billion). The decrease was mainly due to a net increase incommercial paper drawings of JPY 280.0 billion, a net decrease in redemption of bonds of JPY 60.9 billion, and the settlement ofcross currency interest rate swaps related to bonds during the current period.

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(3) Research & Development Activities and Results
Research and development expenses for the nine-month period ended December 31, 2023 were JPY 534.1 billion.
Takeda’s R&D engine is focused on translating science into highly innovative, life-transformative medicines that make a criticaldifference to patients. Takeda supports dedicated R&D efforts across three areas: Innovative Biopharma, Plasma-Derived
Therapies (“PDT”) and Vaccines. The R&D engine for Innovative Biopharma is the largest component of our R&D investment
and has produced exciting new molecular entities (“NMEs”) that represent potential best-in-class and/or first-in-class medicines inareas of high unmet medical need across our core therapeutic areas (Gastrointestinal and inflammation, neuroscience, oncology,
and rare genetics and hematology). We are working to harness the potential of cell and gene therapies by investing in new
capabilities and next-generation platforms internally and through a network of partnerships. We are embracing data and digitaltechnologies to improve the quality of innovation and accelerate execution.
Takeda’s pipeline is positioned to support both the near-term and mid- to long-term sustained growth of the company. Once first
approval of a product is achieved, Takeda R&D is equipped to support geographic expansions of such approval and approvals in
additional indications, as well as post-marketing commitment and potential additional formulation work. Takeda’s R&D teamworks closely with the commercial functions to maximize the value of marketed products and reflect commercial insights in its
R&D strategies and portfolio.
Major progress on R&D events since April 2023 are listed as follows:
R&D pipeline
Gastrointestinal and Inflammation
In Gastrointestinal and Inflammation, Takeda focuses on delivering innovative, life-changing therapeutics for patients withgastrointestinal diseases, including those of the liver as well as immune-mediated inflammatory diseases. Takeda is maximizing
the potential of our inflammatory bowel disease (IBD) franchise around ENTYVIO, including development of a subcutaneous
formulation and expansion into other indications such as active chronic pouchitis. Takeda is also expanding its position withGATTEX/REVESTIVE to support further potential geographic expansion. Furthermore, Takeda is progressing a pipeline built
through in-house discovery, partnerships and business development, exploring opportunities in inflammatory diseases(specifically in gastric, dermatological and rheumatic disorders, along with select rare hematological & renal diseases), liverdiseases, and motility disorders. TAK-279 is an example of an acquisition through business development of a late-stage, potential
best-in-class oral allosteric tyrosine kinase 2 (TYK2) inhibitor with potential to treat multiple immune-mediated inflammatory
diseases. Fazirsiran (TAK-999) is an example of an addition through partnership and a potential first-in-class RNAi for alpha-1
antitrypsin-deficiency associated liver disease in late-stage development.
Note: ADZYNMA (TAK-755) and mezagitamab (TAK-079) have been developed in Gastrointestinal and Inflammation startingfrom FY2023 Q4.
ENTYVIO / Generic name: vedolizumab–

In April 2023, Takeda announced that the U.S. Food and Drug Administration (FDA) accepted for review its Biologics
License Application (BLA) resubmission for the investigational subcutaneous (SC) administration of ENTYVIO for
maintenance therapy in adults with moderately to severely active ulcerative colitis (UC) after induction therapy with
ENTYVIO intravenous (IV). The resubmission was intended to address FDA feedback in a December 2019 Complete
Response Letter (CRL). Since receiving the CRL Takeda worked closely with the FDA to address the Agency’s
feedback; and this resubmission package included additional data collected to investigate the use of subcutaneousadministration of ENTYVIO. The contents of the letter were unrelated to the IV formulation of ENTYVIO, the clinicalsafety and efficacy data, and conclusions from the pivotal VISIBLE 1 trial supporting the ENTYVIO SC BLA. VISIBLE
1 assessed the safety and efficacy of a SC formulation of ENTYVIO as maintenance therapy in 216 adult patients withmoderately to severely active UC who achieved clinical response at week 6 following two doses of open-label ENTYVIO
IV therapy at weeks 0 and 2. The primary endpoint was clinical remission at week 52, which was defined as a total Mayoscore of ≤2 and no subscore >1. In September 2023, Takeda announced that the FDA approved a SC administration of
ENTYVIO for maintenance therapy in adults with moderately to severely active UC after induction therapy with
ENTYVIO IV.

–

In September 2023, Takeda announced that the FDA accepted for review its BLA for the investigational SC
administration of ENTYVIO for maintenance therapy in adults with moderately to severely active Crohn’s disease (CD)after induction therapy with ENTYVIO IV. The BLA package is based on data from VISIBLE 2 trial that assessed thesafety and efficacy of an SC formulation of ENTYVIO as maintenance therapy compared to placebo in 409 adultpatients with moderately to severely active CD who achieved clinical response at week 6 following two doses of open-- 11 -

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label ENTYVIO IV therapy at weeks 0 and 2. The primary endpoint was clinical remission at week 52, which was
defined as CD Activity Index (CDAI) score ≤150.
–

In September 2023, Takeda announced that it received an approval from the Japanese Ministry of Health, Labour andWelfare (MHLW) for a partial change to the marketing authorization status of ENTYVIO Pens for S.C. Injection 108
mg /Syringes for S.C. Injection 108 mg (ENTYVIO SC) as a maintenance therapy for moderate to severe active Crohn's
disease (CD) with inadequate response to conventional treatment. This approval is based on the results of the
MLN0002SC-3031 and MLN0002SC-3030 clinical trials, which are international Phase 3 trials that evaluated theefficacy and safety of ENTYVIO SC as a maintenance therapy in moderate to severe active CD.

ALOFISEL / Generic name: darvadstrocel–

In October 2023, Takeda announced that the Phase 3 ADMIRE-CD II study, assessing the efficacy and safety of
ALOFISEL for the treatment of complex Crohn’s Perianal Fistulas (CPF), did not meet its primary endpoint of combined
remission at 24 weeks, based on topline data. The safety profile for darvadstrocel was consistent with prior studies andthere were no new safety signals identified. Full results of the study will be presented at a future medical meeting or
published in a peer-reviewed journal. ALOFISEL is approved in the European Union (EU), Israel, Switzerland, Serbia,
United Kingdom and Japan based on positive data from the previously completed ADMIRE-CD study.

ADZYNMA / Generic name: apadamtase alfa/cinaxadamtase alfa (Development code: TAK-755)– In June 2023, Takeda presented favorable interim results from a global pivotal Phase 3 randomized, controlled, openlabel, crossover trial evaluating the safety and efficacy of TAK-755 replacement therapy for the prophylactic treatmentof congenital thrombotic thrombocytopenic purpura (cTTP), and pharmacokinetics (PK) characteristics of TAK-755, as
well as long-term data on TAK-755 prophylaxis from a Phase 3b continuation study at the International Society on
Thrombosis and Haemostasis (ISTH) 2023 Congress. In the pivotal trial, no patient had an acute TTP event while
receiving TAK-755 prophylactic treatment. TAK-755 also reduced the incidence of thrombocytopenia by 60%, ascompared to plasma-based therapy (hazard ratio [HR] 0.40; 95% confidence interval [CI]; 0.3- 0.7). Treatment-emergent
adverse events (TEAEs) were reported in 10.3% of patients ages 12-68 receiving TAK-755 compared to 50% of patients
receiving plasma-based therapy, demonstrating a favorable safety and tolerability profile with a potential safetyadvantage over plasma-based therapies. PK characteristics of ADAMTS13 after a single infusion (0-168 hours) were
evaluated and compared to plasma-based therapy in 36 cTTP patients aged 12 and older. Patients receiving TAK-755
achieved a five-fold increase in their ADAMTS13 activity levels compared to those receiving plasma-based therapy(Cmax 100% activity for TAK-755 vs. 19% activity for plasma-based therapy) and lower variability (23.8% vs. 56%
coefficient of variation [CV], respectively). Also, the results of an interim analysis of the Phase 3b continuation study,
evaluating the safety and efficacy of long-term TAK-755 prophylaxis in 29 patients with cTTP, demonstrated aconsistently favorable safety profile with TAK-755 prophylaxis and no development of neutralizing antibodies. Zeroacute TTP events occurred during TAK-755 prophylaxis, and the incidence rates of subacute TTP events and TTP
manifestations were comparable to those with TAK-755 prophylaxis in the pivotal study.

– In August 2023, Takeda announced that it filed an application for manufacturing and marketing approval for TAK-755
for the expected indication of cTTP with the Japanese Ministry of Health, Labour and Welfare (MHLW). The application
is based on the interim analysis of the global Phase 3 clinical trial 281102 primarily focusing on patients with cTTP,
including five Japanese individuals, and the Phase 3b continuation trial TAK-755-3002. In these trials, TAK-755 wasevaluated for its efficacy and safety as a treatment for cTTP.

–

In November 2023, Takeda announced that the U.S. Food and Drug Administration (FDA) approved ADZYNMA for theprophylactic and on-demand treatment of adult and pediatric patients with cTTP. The FDA previously granted Fast Track
Designation, Orphan Drug Designation, and Rare Pediatric Disease Designation in cTTP, as well as Priority Review for
ADZYNMA’s Biologic License Application (BLA). The FDA granted the company a Rare Pediatric Disease Voucher
for the approval of ADZYNMA. The FDA approval of ADZYNMA was supported by the totality of the evidence
provided by the analysis of efficacy, pharmacokinetic, safety and tolerability data from the first randomized, controlled,
open-label, crossover Phase 3 trial in cTTP as well as by data from the continuation trial. ADZYNMA is the first and- 12 -

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only FDA-approved recombinant ADAMTS13 (rADAMTS13) designed to address an unmet medical need in people
with cTTP by replacing the deficient ADAMTS13 enzyme.
Development Code: TAK-279–

In November 2023, Takeda presented positive results from its randomized, double-blind, placebo-controlled, Phase 2b
trial evaluating TAK-279 in patients with active psoriatic arthritis during a late-breaking session at the American Collegeof Rheumatology (ACR) Convergence 2023. The study met its primary endpoint with a statistically significant
proportion of patients, 53.3% (15 mg) and 54.2% (30 mg), treated once-daily with TAK-279 achieving at least an
American College of Rheumatology 20 (ACR 20) response compared to 29.2% in the placebo arm at week 12 (p =0.002). TAK-279 demonstrated improvements in key secondary endpoints and the safety and tolerability profile in thetrial was consistent with that observed in the Phase 2b plaque psoriasis clinical study. Based on the Phase 2b results,
Takeda intends to initiate a Phase 3 development program of TAK-279 in psoriatic arthritis. Takeda also initiated a Phase
3 development program of TAK-279 in plaque psoriasis in Q3 FY2023 and plans to evaluate TAK-279 in Crohn’sdisease, ulcerative colitis and additional immune-mediated inflammatory diseases.

Development code: TAK-721 (Planned trade name: Eohilia) / Generic name: budesonide–

In September 2023, Takeda announced that the U.S. Food and Drug Administration (FDA) accepted for review its New
Drug Application (NDA) resubmission for TAK-721 (budesonide oral suspension) which is being investigated for the
short-term treatment of eosinophilic esophagitis (EoE). The resubmission is intended to address previous FDA feedback
to Takeda’s original NDA submission.

Neuroscience
In Neuroscience, Takeda is focusing its R&D investments on potentially transformative treatments for neurological andneuromuscular diseases of high unmet need and building its pipeline through a combination of in-house expertise andpartnerships. By harnessing advances in disease biology understanding, translational tools, and innovative modalities, Takeda is
primarily focusing on rare neurology, in particular, on potential investigative therapies for sleep-wake disorders such as
narcolepsy and idiopathic hypersomnia with a franchise of orexin-2 receptor agonists (TAK-861, danavorexton (TAK-925), etc.),rare epilepsies with soticlestat (TAK-935) and central nervous system (CNS) and somatic symptoms of Hunter Syndrome withpabinafusp alfa (TAK-141). Additionally, Takeda makes targeted investments to investigate well-defined segments ofneuromuscular diseases, neurodegenerative diseases and movement disorders.
Oncology
In Oncology, we aspire to cure cancer, with inspiration from patients and innovation from everywhere. We are focused on: (1)building on our legacy in hematologic malignancies with marketed products (NINLARO, ADCETRIS, and ICLUSIG, etc.); (2)growing a solid tumor portfolio with marketed products (ALUNBRIG and FRUZAQLA [marketed in the U.S., development inother regions outside of mainland China, Hong Kong and Macau ongoing]); and (3) advancing a cutting-edge pipeline of highly
innovative assets and platforms.
CABOMETYX / Generic name: cabozantinib–

In January 2024, Takeda announced that the detailed results from CONTACT-02, a phase 3 pivotal study led by Exelixis,
evaluating CABOMETYX in combination with atezolizumab compared with a second novel hormonal therapy (NHT) in
patients with metastatic castration-resistant prostate cancer (mCRPC) and measurable extra-pelvic soft tissue disease
who have progressed on one prior NHT were presented during Oral Abstract Session at the American Society of ClinicalOncology 2024 Genitourinary Cancers Symposium (ASCO GU). For the primary endpoint of progression-free survival(PFS), at a median follow-up of 14.3 months for the PFS ITT (intent-to-treat) population (n=400), the hazard ratio (HR)was 0.65 (95% confidence interval [CI]: 0.50-0.84; p=0.0007); the median PFS (mPFS) was 6.3 months for
CABOMETYX in combination with atezolizumab compared with 4.2 months for NHT. This was nearly identical to the
PFS for the ITT population (n=507): HR was 0.64 (95% CI: 0.50-0.81, p=0.0002). At a median follow-up of 12.0
months for the ITT population, the median overall survival (OS), the other primary endpoint, was 16.7 months for
CABOMETYX in combination with atezolizumab compared with 14.6 months for second NHT (HR: 0.79; 95% CI:
0.58-1.07; p=0.13), showing a trend toward OS improvement. The safety profiles of CABOMETYX and atezolizumab
observed in this trial were consistent with their known safety profiles as monotherapies, and no new safety concerns wereidentified with the combination regimen.

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ADCETRIS / Generic name: brentuximab vedotin–

In October 2023, Takeda announced that the European Commission (EC) approved ADCETRIS in combination withdoxorubicin, vinblastine and dacarbazine (AVD) to treat adult patients with previously untreated CD30+ Stage III
Hodgkin lymphoma. The decision follows a positive opinion from the Committee for Medicinal Products for Human Use(CHMP) in September, 2023. The approval is based on the results of the randomized Phase 3 ECHELON-1 trial
designed to compare ADCETRIS plus AVD to doxorubicin, bleomycin, vinblastine, and dacarbazine (ABVD) as atherapy in adult patients with previously untreated Stage III or IV Hodgkin lymphoma. The trial met its primary endpointof modified progression-free survival (PFS), as well as its key secondary endpoint of overall survival (OS),demonstrating a statistically significant improvement in OS in adult patients with previously untreated Stage III or IVclassical Hodgkin lymphoma treated with ADCETRIS+AVD. The safety profile of ADCETRIS was consistent withprevious studies, and no new safety signals were observed.

–

In November 2023, Takeda announced that it received an approval from the Japanese Ministry of Health, Labour andWelfare (MHLW) for a partial change in approved items of the manufacturing and marketing approval of ADCETRIS
with the new indication of relapsed or refractory CD30-positive cutaneous T-cell lymphoma (CTCL). The approval isbased on the results of the Phase 3 ALCANZA trial conducted outside of Japan as well as the Japanese Phase 2
investigator-initiated SGN-35-OU trial in patients with relapsed or refractory CD30-positive CTCL.

NINLARO / Generic name: ixazomib–

In September 2023, Takeda announced that it submitted a New Drug Application (NDA) to the Japanese Ministry of
Health, Labour and Welfare (MHLW) for NINLARO capsules 0.5 mg as an additional dosage form of NINLARO(Capsules 2.3 mg/3 mg/4 mg). Aiming to achieve more appropriate dose adjustment in maintenance therapy for patientswith multiple myeloma, Takeda filed this application to provide patients with a new treatment option (1.5 mg dose (0.5mg/capsule x 3)) using a low-dose formulation of NINLARO.

EXKIVITY / Generic name: mobocertinib–

In October 2023, Takeda announced that, following discussions with the U.S. Food and Drug Administration (FDA), it
will be working with the FDA towards a voluntary withdrawal of EXKIVITY in the U.S. for adult patients withepidermal growth factor receptor (EGFR) exon20 insertion mutation-positive (insertion+) locally advanced or metastatic
non-small cell lung cancer (NSCLC) whose disease has progressed on or after platinum-based chemotherapy. Takeda
intends to similarly initiate voluntary withdrawal globally where EXKIVITY is approved and is working with regulatorsin other countries where it is currently available on next steps. This decision was based on the outcome of the Phase 3
EXCLAIM-2 confirmatory trial, which did not meet its primary endpoint and thus did not fulfill the confirmatory datarequirements of the accelerated approval granted by the U.S. FDA nor the conditional marketing approvals granted inother countries. The EXCLAIM-2 trial was a Phase 3, multicenter, open-label study designed to investigate the safety
and efficacy of EXKIVITY as a monotherapy versus platinum-based chemotherapy in first-line EGFR exon20 insertion+
locally advanced or metastatic NSCLC. No new safety signals were observed in the EXCLAIM-2 trial. Full data fromthe trial will be presented at an upcoming medical meeting or published in a peer-reviewed journal.

FRUZAQLA / Generic name: fruquintinib–

In June 2023, Takeda and HUTCHMED (China) Limited announced that the European Medicines Agency (EMA)
validated and accepted for regulatory review the marketing authorization application (MAA) for fruquintinib for thetreatment of adult patients with previously treated metastatic colorectal cancer (mCRC). If approved, fruquintinib will be
the first and only highly selective and potent inhibitor of vascular endothelial growth factor receptors (VEGFR) -1, -2
and -3 approved in the European Union (EU) for previously treated mCRC. The MAA for fruquintinib includes resultsfrom the global Phase 3 FRESCO-2 clinical trial along with data from the Phase 3 FRESCO clinical trial.

–

In June 2023, Takeda and HUTCHMED (China) Limited announced that results of the Phase 3 FRESCO-2 study
evaluating fruquintinib in patients with previously treated mCRC were published in The Lancet. FRESCO-2 is a global
Phase 3 clinical trial (MRCT) conducted in the U.S., Europe, Japan and Australia investigating fruquintinib plus best
supportive care (BSC) vs placebo plus BSC in patients with previously treated mCRC. The FRESCO-2 study met its
primary and key secondary endpoints, demonstrating that treatment with fruquintinib resulted in a statistically significant
and clinically meaningful improvement in overall survival (OS) and progression-free survival (PFS), respectively. The
safety profile of fruquintinib in FRESCO-2 was consistent with previously reported fruquintinib studies.

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In September 2023, Takeda announced that it submitted a New Drug Application (NDA) to the Japanese Ministry of
Health, Labour and Welfare (MHLW) for fruquintinib for the treatment of previously treated mCRC. The NDA for
fruquintinib is based on the global Phase 3 FRESCO-2 clinical trial and the Phase 3 FRESCO clinical trial.

–

In November 2023, Takeda announced that the U.S. Food and Drug Administration (FDA) approved FRUZAQLA for
adults with mCRC who have been previously treated with fluoropyrimidine-, oxaliplatin-, and irinotecan-based
chemotherapy, an anti-VEGF therapy, and, if RAS wild-type and medically appropriate, an anti-EGFR therapy.
FRUZAQLA is the first and only selective inhibitor of all three VEGF receptor kinases approved in the U.S. forpreviously treated mCRC regardless of biomarker status. The approval of FRUZAQLA is based on data from two large
Phase 3 trials: the global FRESCO-2 clinical trial along with the FRESCO clinical trial conducted in China.

Rare Genetics and Hematology
In Rare Genetics and Hematology, Takeda focuses on several areas of high unmet medical need. In hereditary angioedema,
Takeda aspires to transform the treatment paradigm, including through TAKHZYRO, with continued investment in lifecycle
management programs. In rare hematology, Takeda focuses on addressing today’s needs in the treatment of bleeding disorders,
including through ADVATE and ADYNOVATE/ADYNOVI. In addition, Takeda aims to redefine the management of posttransplant cytomegalovirus (CMV) infection/disease with LIVTENCITY. Takeda commits to fulfilling our vision to deliver lifetransforming medicines to patients with rare diseases.
ADYNOVATE/ADYNOVI / Generic name: antihemophilic factor (recombinant), PEGylated–

In June 2023, Takeda announced that it received an approval from the Japanese Ministry of Health, Labour and Welfare(MHLW) for a partial change in approved items of the manufacturing and marketing approval of ADYNOVATE for
dosage and administration. This approval will contribute driving personalized treatments by adjusting dosage andadministration including dosing amount and intervals, depending on individual patient’s clinical presentation and activity
level. The approval is based primarily on the results of the global Phase 3 CONTINUATION study and Phase 3
PROPEL study conducted outside of Japan.

OBIZUR / Generic name: Susoctocog Alfa (recombinant)–

In June 2023, Takeda announced that it has submitted a marketing authorization application to the Japanese Ministry of
Health, Labour and Welfare (MHLW) for Susoctocog Alfa (recombinant) for the control of bleeding in patients withacquired hemophilia A (AHA). The application is based primarily on a Japanese Phase 2/3 trial in adult Japanese patientswith AHA and a Phase 2/3 trial conducted outside of Japan in non-Japanese adult patients with AHA.

LIVTENCITY / Generic name: maribavir–

In November 2023, Takeda announced that it submitted a New Drug Application (NDA) to the Japanese Ministry of
Health, Labour and Welfare (MHLW) for maribavir for the treatment of patients with post-transplant (including
hematopoietic stem cell transplant) cytomegalovirus (CMV) infection/disease. The NDA is primarily based on theJapanese Phase 3 open-label trial in patients with CMV infection who underwent hematopoietic stem cell transplant(HSCT) or solid organ transplant (SOT), and the Phase 3 open-label SOLSTICE trial conducted outside of Japan inpatients with CMV infection refractory or resistant to prior anti-CMV treatment who underwent HSCT or SOT.

–In December 2023, Takeda announced that LIVTENCITY was approved by the National Medical Products
Administration (NMPA) of China for the treatment of adult patients with post- HSCT or SOT CMV infection/disease
that is refractory to treatment (with or without genotypic resistance) with ganciclovir, valganciclovir, cidofovir or
foscarnet. The NMPA approval is based on the results of the Phase 3 SOLSTICE trial. LIVTENCITY was granted
Breakthrough Therapy Designation by China Center for Drug Evaluation (CDE) in 2021. LIVTENCITY is the first andonly inhibitor of CMV-specific UL97 protein kinase in China for this indication.

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Plasma-Derived Therapies (PDT)
Takeda has created a dedicated PDT business unit with a focus to manage the business end-to-end, from plasma collection to
manufacturing, R&D, and commercialization. In PDT, we aspire to develop life-saving plasma derived treatments which areessential for patients with a variety of rare and complex chronic diseases. The dedicated R&D organization in PDT is charged
with maximizing the value of existing therapies, identifying new targeted therapies, and optimizing efficiencies of current productmanufacturing. Near-term, our priority is focused on delivering value from our broad immunoglobulin portfolio (HYQVIA,CUVITRU, GAMMAGARD and GAMMAGARD S/D) through pursuit of new indications, geographic expansions, and enhanced
patient experience through integrated healthcare technologies. In our hematology and specialty care portfolio, our priority is
pursuing new indication and formulation development opportunities for PROTHROMPLEX (4F-PCC), FEIBA, CEPROTIN and
ARALAST. Additionally, we are developing next generation immunoglobulin products with 20% fSCIg (TAK-881), IgG Low
IgA (TAK-880) and pursuing other early stage opportunities (e.g. hypersialylated Immunoglobulin (hsIgG)) that would add to ourdiversified commercial portfolio of more than 20 therapeutic products distributed worldwide.
HYQVIA / Generic name: Immunoglobulin (IG) Infusion 10% (Human) w/ Recombinant Human Hyaluronidase for subcutaneousadministration–

In April 2023, Takeda announced that the U.S. Food and Drug Administration (FDA) approved a supplemental biologics
license application (sBLA) to expand the use of HYQVIA to treat primary immunodeficiency (PI) in children 2-16 years
old. The FDA approval of HYQVIA for the treatment of PI in pediatric patients was based on evidence from a pivotal,
prospective, open-label, non-controlled Phase 3 clinical trial that included 44 PI patients between the ages of 2 and 16.
During the 12-month trial period, HYQVIA was shown to be efficacious with respect to the occurrence of acute serious
bacterial infections (aSBIs), a primary endpoint. The mean aSBI rate per year was 0.04 and was statistically significantly
lower (with an upper 1-sided 99% confidence interval of 0.21, p<0.001) than the predefined success rate of less than one
aSBI per subject per year, favoring efficacy of HYQVIA treatment in pediatric subjects with PI diseases. Results fromthe interim data analysis, where all subjects completed 12 months of participation (one year of observation period) in the
study, indicated similar safety profiles to adults.

–

In June 2023, Takeda announced full results from the pivotal Phase 3 ADVANCE-CIDP 1 clinical trial investigating
HYQVIA as maintenance therapy in adult patients with chronic inflammatory demyelinating polyneuropathy (CIDP).
ADVANCE-CIDP 1 is a Phase 3, prospective, randomized, double-blind, multicenter, placebo-controlled study in which
adults with stable CIDP on intravenous immunoglobulin (IVIG) were randomized 1:1 to be switched to HYQVIA (n=62)
or placebo (n=70) and received their assigned treatment for six months or until relapse or study withdrawal. The primary
endpoint was proportion of participants who experienced a relapse defined as worsening of CIDP symptoms as measured
by Inflammatory Neuropathy Cause and Treatment (INCAT). Secondary endpoints included patient proportion
experiencing functional worsening, time to relapse, change from pre-subcutaneous treatment baseline in Rasch-built
Overall Disability Scale (R-ODS) centile score and safety. Results showed a clinically significant reduction in relapse
rate with HYQVIA vs placebo (9.7% vs. 31.4%, respectively; p=0.0045) and other analysis showed delayed time torelapse with HYQVIA vs. placebo. Favorable data across other endpoints from the study and favorable tolerability werealso observed. These findings were presented at the 2023 Peripheral Nerve Society (PNS) Annual Meeting in Denmarkin June 2023, and simultaneously published in the Journal of the Peripheral Nervous System (JPNS).

–

In January 2024, Takeda announced that the FDA approved HYQVIA for the treatment of CIDP as maintenance therapy
to prevent the relapse of neuromuscular disability and impairment in adult patients. The approval is based on results fromADVANCE-CIDP 1 clinical trial and ADVANCE-CIDP 3, a single-arm, open-label, extension study. HYQVIA is the
only FDA-approved combination of immunoglobulin (IG) and hyaluronidase, which makes it a facilitated subcutaneous
immunoglobulin (SCIG) infusion. For adults with CIDP, HYQVIA can be infused up to once monthly (every two, threeor four weeks) due to the hyaluronidase component, which facilitates the dispersion and absorption of large IG volumes
in the subcutaneous space between the skin and the muscle. Because it is delivered subcutaneously, HYQVIA can beadministered by a healthcare professional in a medical office, infusion center or at a patient’s home. In addition, it can be
self-administered after appropriate patient or caregiver training.

–

In January 2024, Takeda announced that the European Commission (EC) approved HYQVIA as maintenance therapy inpatients of all ages with CIDP after stabilization with IVIG therapy. The approval is based on data from the pivotal Phase
3 ADVANCE-CIDP 1 clinical trial, which evaluated efficacy and safety of HYQVIA as maintenance therapy to prevent
relapse in patients with CIDP.

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CEPROTIN / Generic name: Human Dry Protein C Concentrate (Development code: TAK-662)–

In April 2023, Takeda announced that it submitted a New Drug Application (NDA) to the Japanese Ministry of Health,Labour and Welfare (MHLW) for manufacturing and marketing approval of human dry protein C concentrate(TAK-662) for the treatment of venous thromboembolism and purpura fulminans caused by congenital protein C
deficiency, as well as for the suppression of thrombi. The application is based primarily on a Phase 1/2 trial in Japanesepatients with congenital protein C deficiency and two Phase 2/3 trials (IMAG-098 and 400101) outside of Japan inpatients with congenital protein C deficiency. In these trials, TAK-662 demonstrated its efficacy and safety as atreatment for congenital protein C deficiency.

CUVITRU / Generic name: Immunoglobulin (IG) Infusion 20% (Human) for subcutaneous administration–

In September 2023, Takeda announced that the Japanese Ministry of Health, Labour and Welfare (MHLW) approved theuse of CUVITRU in patients aged 2 years and older with agammaglobulinemia or hypogammaglobulinemia, disorders
characterized by very low or absent levels of antibodies and an increased risk of serious recurring infection caused byprimary immunodeficiency (PID) or secondary immunodeficiency (SID). The approval marks Takeda’s firstsubcutaneous immunoglobulin (SCIG) therapy for patients in Japan. The approval is based on results from a Phase 3
clinical trial that evaluated the efficacy, safety, tolerability and pharmacokinetics of CUVITRU in Japanese patients with
PID, as well as two Phase 2/3 clinical trials conducted in patients with PID in North America and Europe. Results fromthe clinical trial in 17 patients in Japan confirmed its efficacy and safety profile. No serious or severe adverse eventswere reported, and CUVITRU was well-tolerated. The most frequently reported adverse reactions were headache andinjection site swelling in four patients (23.5%) and injection site erythema in three patients (17.6%) during CUVITRU
treatment. Previously reported clinical trial results also confirmed the efficacy and safety of CUVITRU.

GAMMAGARD LIQUID / Generic name: Immunoglobulin (IG) Infusion 10% (Human)–

In January 2024, Takeda announced that the U.S. Food and Drug Administration (FDA) approved GAMMAGARDLIQUID as an intravenous immunoglobulin (IVIG) therapy to improve neuromuscular disability and impairment in
adults with chronic inflammatory demyelinating polyneuropathy (CIDP). It can be used as induction therapy, which
includes an induction dose and maintenance doses. For treatment of CIDP, GAMMAGARD LIQUID has not beenstudied in immunoglobulin-naive patients nor as maintenance therapy has not been studied for periods longer than 6months. The approval is based on results from a prospective, open-label, single-arm, multicenter ADVANCE-CIDP 2
clinical trial that evaluated the efficacy and safety of GAMMAGARD LIQUID in adults with CIDP who developed arelapse in HYQVIA’s ADVANCE-CIDP 1 trial.

VaccineIn Vaccines, Takeda is applying innovation to tackle some of the world’s most challenging infectious diseases such as dengue(QDENGA (development code: TAK-003)), COVID-19 (NUVAXOVID). To support the expansion of our pipeline and thedevelopment of our programs, we have entered into partnerships with government organizations in Japan and the U.S., andleading global institutions. Such partnerships have been essential in building the critical capabilities that will be necessary todeliver on our programs and realize their full potential.
QDENGA / Generic name: Dengue tetravalent vaccine [live, attenuated] (Development code: TAK-003)–

In July 2023, Takeda announced that it voluntarily withdrew the U.S. Biologics License Application (BLA) for
TAK-003, following discussions with the U.S. Food and Drug Administration (FDA) on aspects of data collection,
which cannot be addressed within the current BLA review cycle. The future plan for TAK-003 in the U.S. will be further
evaluated given the need for travelers and those living in dengue-endemic areas of the U.S., such as Puerto Rico. The
efficacy and safety profiles of TAK-003 have been demonstrated through a robust clinical trial program, including a 4.5year Phase 3 study of over 20,000 children and adolescents living in eight dengue endemic areas. The study was
designed per World Health Organization (WHO) guidance for a second-generation dengue vaccine, and it considered theneed to achieve high levels of subject retention and protocol compliance in endemic regions. The vaccine is approved in
multiple endemic and non-endemic countries, with more approvals expected over the coming years.

–

In October 2023, Takeda announced that the WHO Strategic Advisory Group of Experts on Immunization (SAGE)
shared recommendations for use of QDENGA.
SAGE made the following recommendations:– The vaccine to be considered for introduction in settings with high dengue disease burden and high transmission
intensity to maximize the public health impact and minimize any potential risk in seronegative persons.

- 17 -

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Translation for reference purpose only–

The vaccine to be introduced to children aged 6 to 16 years of age. Within this age range, the vaccine should be
introduced about 1-2 years prior to the age-specific peak incidence of dengue-related hospitalizations. The vaccine
should be administered in a 2-dose schedule with a 3-month interval between doses.
– The vaccine introduction should be accompanied by a well-designed communication strategy and community
engagement.
SAGE reviewed data across 19 Phase 1, 2 and 3 trials with more than 28,000 children and adults, including the pivotal
Phase 3 Tetravalent Immunization against Dengue Efficacy Study (TIDES) trial, which was designed according to theWHO’s guidance for a second-generation dengue vaccine.
The WHO will consider the SAGE recommendation and is expected to update its position paper on dengue vaccines toinclude final guidance on the use of QDENGA in public vaccination programs.
Building a sustainable research platform / Enhancing R&D collaboration
In addition to our concentrated efforts to increase our in-house R&D capabilities, external partnerships with third-party partners
are a key component of our strategy for enhancing our R&D pipeline. Our strategy to expand and diversify our external
partnerships allows us to take part in research of a wide variety of new products and increases the chances that we will be able totake part in a major research-related breakthrough.
–In August 2023, Takeda announced that it entered into an exclusive licensing agreement with ImmunoGen, Inc.
(ImmunoGen) to develop and commercialize mirvetuximab soravtansine-gynx (MIRV) for the Japanese market. MIRV
is an intravenous injection antibody-drug conjugate (ADC), in which a microtubule inhibitor is linked to an anti-folate
receptor-α (FRα) antibody. It is the first ADC developed for the treatment of ovarian cancer. MIRV is approved under
accelerated approval in the U.S. for the treatment of adult patients with FRα positive, platinum-resistant epithelial
ovarian, fallopian tube, or primary peritoneal cancer, who have received one to three prior systemic treatment regimens.
MIRV was the first medicine to show a significant prolongation of overall survival (OS) compared with conventional
chemotherapy for the treatment of platinum-resistant relapsed or refractory ovarian cancer in a phase 3 MIRASOL study,
conducted outside of Japan.

–

In January 2024, Takeda and Protagonist Therapeutics, Inc. announced the signing of a worldwide license andcollaboration agreement for the development and commercialization of rusfertide, an investigational injectable hepcidin
mimetic peptide of the natural hormone hepcidin, currently in a pivotal Phase 3 trial, VERIFY, for the treatment of
Polycythemia Vera (PV). Discovered through Protagonist's peptide technology platform, rusfertide’s mechanism ofaction is thought to regulate iron homeostasis and control the absorption, storage and distribution of iron in the body. The
randomized portion of the Phase 2 REVIVE study of rusfertide in PV achieved its primary endpoint. The long-term
follow-up data from the 2-year open label extension were presented at the American Society of Hematology 2023
Annual Meeting, which showed durable hematocrit control, decreased phlebotomy use, long-term tolerability and no newsafety signals in patients with PV. Protagonist will remain responsible for research and development through thecompletion of the Phase 3 clinical trial and U.S regulatory approval. Takeda has rights for ex-U.S. development and is
responsible for leading global commercialization activities.

(4) Major Facilities
The following shows a significant change in new facility construction for the nine-month period ended December 31, 2023.
Classifi
cationName orSubsidiaries’
Company Name
[Main Location]

US Inc.
Constru Baxalta[Los
Angeles,
ction
CA, U.S.A.]

Budget*1
OperatingSegment

Details

Pharmaceuti Manufacturing
cals

Schedule

Total
Paid
Financing Commence
JPY
JPY
Completionment(millions) (millions)

32,382

331

Funds onhand

*1 The budget is calculated based on the exchange rates as of December 31, 2023.
3. Material Contracts
There were no material contracts executed during the three-month period ended December 31, 2023.

- 18 -

January2024

June 2027

Table of Contents
Translation for reference purpose only
III. Information on the Company
1. Information on the Company’s Shares(1) Total number of shares and other related information
1) Total number of shares
Total number of sharesauthorized to be issued (Shares)

Class

Common stockTotal

3,500,000,000
3,500,000,0002) Number of shares issued
Number of shares
outstanding(As of December 31, 2023)

Class

Common stock
Total(Note1)(Note2)

Number of shares
outstanding as of the fillingdate(February 2, 2024)

1,582,392,825
1,582,392,825

1,582,399,825
1,582,399,825

Stock exchange on
which the Company islistedDescription

Tokyo (Prime Market),
Nagoya (Premier Market),
Fukuoka, Sapporo, and New
York

The number of shares per one
unit of shares is 100 shares.

——

The Company's American Depositary Shares (ADS) are listed on the New York Stock Exchange.
The number of shares outstanding as of the filing date does not include shares issued upon exercise of stockacquisition rights from February 1, 2024 to the filing date of Quarterly Securities Report (February 2, 2024).

(2) Status of stock acquisition rights
1) Contents of stock option plans
Not applicable.
2) Status of other stock acquisition rights
Not applicable.
(3) Exercise status of bonds with stock acquisition rights containing a clause for exercise price adjustments
Not applicable.
(4) Changes in the total number of issued shares and the amount of share capital and capital reserve

Date

Change in the
total number ofissued shares(Thousand of
shares)Balance of thetotal number ofissued shares(Thousand of
shares)Change inshare capital
JPY (millions)

Balance ofshare capital
JPY (millions)

Change incapital reserve
JPY (millions)

Balance ofcapital reserve
JPY (millions)20

1,582,393

40

1,676,543

40

1,668,555

From October 1, 2023
to December 31, 2023
(Note)The increases are due to the exercise of stock acquisition rights.

(5) Major shareholders
No information required in the 3rd quarter.

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Table of Contents
Translation for reference purpose only
(6) Information on voting rights
1) Total number of shares
As of December 31, 2023
Number of shares
Number of voting(Shares)rights (Units)——

Classification
Shares without voting rights
Shares with restricted voting rights(Treasury stock and other)
Shares with restricted voting rights(Others)

Shares with full voting rights(Treasury stock and other)
Shares with full voting rights(Others)
Shares less than one unit
Number of issued shares
Total number of voting rights(Note1)(Note2)

Description
—

—

—

—

—

—

—

7,513,000——

287,000——

Common stock

1,573,040,900

15,730,409—

Common stock

1,551,925
1,582,392,825———
15,730,409

Shares less than one unit
(100 shares)——(Treasury stock)
Common stock(Crossholding stock)
Common stock"Shares with full voting rights (Others)" includes 3,630,200 (voting rights: 36,302) and 2,257,800 (voting
rights: 22,578) of the shares held by the ESOP and BIP trust, respectively.
"Shares less than one unit" includes 14 of the shares as the treasury stock, and 139 and 219 of the shares heldby the ESOP and BIP trust, respectively.

2) Treasury stock and other
As of December 31, 2023

Name of shareholders(Treasury stock)
Takeda Pharmaceutical
Company Limited(Crossholding stock)
Amato Pharmaceutical
Products, Ltd.
Watanabe Chemical, Co., Ltd.
Total
(Note)

Number ofshares held
under own
name (Shares)

Number ofshares held
under the nameof others(Shares)

Total shares
held (Shares)

Percentage of
total issued
shares issued(%)

1-1, Doshomachi 4chome, Chuo-ku, Osaka

7,513,000—

7,513,000

0.47

5-3, Shinsenri Higashimachi 1-chome,
Toyonaka-city, Osaka

275,000—

275,000

0.02

12,0007,800,000——

12,0007,800,000

0.00
0.49

Address

6-1, Hiranomachi 3chome, Chuo-ku,
Osaka-city, OsakaIn addition to 14 shares of the above treasury stock and shares less than one unit, 3,630,339 of the shares heldby the ESOP trust and 2,258,019 of the shares held by the BIP trust are included in treasury stock on thecondensed interim consolidated financial statements.

2. Members of the Board of Directors
No changes from the latest Annual Securities Report.

- 20 -

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Translation for reference purpose only
IV. Financial Information
Basis of Preparation of the Condensed Interim Consolidated Financial Statements
Takeda has prepared the condensed interim consolidated financial statements in accordance with IAS 34 “Interim Financial
Reporting” based on the provision of Article 93 of Ordinance on Terminology, Forms and Preparation Methods of Quarterly
Consolidated Financial Statements (Ordinance of the Ministry of Finance No. 64, 2007 in Japan).

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Table of Contents
Translation for reference purpose only
1. Condensed Interim Consolidated Financial Statements(1) Condensed Interim Consolidated Statements of Profit or Loss

Note

Revenue
Cost of sales
Selling, general and administrative expenses
Research and development expenses
Amortization and impairment losses on
intangible assets associated with products
Other operating income
Other operating expenses
Operating profit
Finance income
Finance expenses
Share of profit (loss) of investments
accounted for using the equity method
Profit before tax
Income tax (expenses) benefit
Net profit for the period
Attributable to:
Owners of the Company
Non-controlling interests
Net profit for the period
Earnings per share (JPY)
Basic earnings per share
Diluted earnings per share

4

5
6

7

8
8

JPY (millions, except per share data)
Nine-month Period Ended
Three-month Period Ended
December 31,
December 31,
2022
2023
2022
2023
3,071,322
3,212,893
1,096,551
1,111,186(934,300)(1,044,177)(335,973)(379,481)(742,513)(768,585)(262,299)(267,520)(472,381)(534,068)(174,629)(187,381)(409,219)
16,676(127,643)
401,943
55,130(507,003)
10,768(145,685)
224,144
46,101(135,576)
3,200(44,284)
146,990
41,679(137,338)
894(35,446)
104,914
22,550(126,765)(172,663)(79,749)(67,329)(3,133)
327,175(41,273)285,903

2,731
100,31346,878147,191(1,767)
107,153
11,996
119,149

1,125
61,26044,496
105,756

285,88319285,903

147,085
106
147,191

119,127
22
119,149

105,720
36
105,756

184.32
182.65

94.10
93.17

76.63
75.86

67.38
66.70

See accompanying notes to condensed interim consolidated financial statements.

- 22 -

Table of Contents
Translation for reference purpose only
(2) Condensed Interim Consolidated Statements of Comprehensive Income

Net profit for the period
Other comprehensive income (loss)
Items that will not be reclassified to profit or loss:
Changes in fair value of financial assets measured at fairvalue through other comprehensive income
Remeasurement of defined benefit pension plans

JPY (millions)Nine-month Period Ended
Three-month Period
December 31,
Ended December 31,
2022
2023
2022
2023
285,903
147,191
119,149
105,756

Items that may be reclassified subsequently to profit or loss:
Exchange differences on translation of foreign operations
Cash flow hedges
Hedging cost
Share of other comprehensive income (loss) of investments
accounted for using the equity method
Other comprehensive income (loss) for the period, net of tax
Total comprehensive income (loss) for the period
Attributable to:
Owners of the Company
Non-controlling interests
Total comprehensive income (loss) for the period

730
12,977
13,707(1,383)(3,038)(4,421)(4,554)(418)(4,972)(7,920)(5,681)(13,602)481,206(17,584)(12,107)459,803
22,746301(553,986)
15,616
10,642(319,417)
24,7602,880(915)
450,599
464,306
750,209(466)
482,383
477,963
625,154170(527,558)(532,531)(413,381)(187)(291,964)(305,566)(199,810)

750,19316
750,209625,030
124
625,154(413,341)(40)(413,381)(199,814)
4(199,810)

See accompanying notes to condensed interim consolidated financial statements.

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Table of Contents
Translation for reference purpose only
(3) Condensed Interim Consolidated Statements of Financial Position
JPY (millions)
Note

As of March 31, 2023

As of December 31, 2023

ASSETS
Non-current assets:
Property, plant and equipment
Goodwill
Intangible assets
Investments accounted for using the equity method
Other financial assets
Other non-current assets
Deferred tax assets
Total non-current assets
Current assets:
Inventories

1,691,229
4,790,723
4,269,657
99,174
279,683
63,325366,003
11,559,794

1,841,499
5,111,287
4,097,022
103,312269,606
54,703
316,689
11,794,117

986,457

1,169,640

Trade and other receivables
Other financial assets
Income taxes receivable
Other current assets
Cash and cash equivalents
Assets held for sale
Total current assets
Total assets

649,429
20,17432,264
160,868
533,530
15,2352,397,956
13,957,750

716,230
29,045
26,849179,393288,359
19,313
2,428,830
14,222,947

9

4,042,741
534,269
127,594
24,55855,96965,389270,620
5,121,138

4,293,872
542,126
138,945
4,101
13,61972,473133,036
5,198,172

9

339,600
649,233
185,537
232,377
508,360
566,689144
2,481,940
7,603,078

370,292
483,666
248,100
112,446
482,467
585,197—
2,282,168
7,480,340

LIABILITIES AND EQUITY
LIABILITIES
Non-current liabilities:
Bonds and loans
Other financial liabilities
Net defined benefit liabilities
Income taxes payable
Provisions
Other non-current liabilities
Deferred tax liabilities
Total non-current liabilities
Current liabilities:
Bonds and loans
Trade and other payables
Other financial liabilities
Income taxes payable
Provisions
Other current liabilities
Liabilities held for sale
Total current liabilities
Total liabilities- 24 -

Table of Contents
Translation for reference purpose only
JPY (millions)
Note
EQUITY
Share capital
Share premium
Treasury shares
Retained earnings
Other components of equity
Equity attributable to owners of the Company
Non-controlling interests
Total equity
Total liabilities and equity

As of March 31, 2023

As of December 31, 2023

1,676,345
1,728,830(100,317)
1,541,146
1,508,119
6,354,122549
6,354,672
13,957,750

See accompanying notes to condensed interim consolidated financial statements.

- 25 -

1,676,543
1,730,138(51,253)
1,396,838
1,989,669
6,741,934
673
6,742,607
14,222,947

Table of Contents
Translation for reference purpose only
(4) Condensed Interim Consolidated Statements of Changes in Equity
Nine-month period ended December 31, 2022 (From April 1 to December 31, 2022)
JPY (millions)
Equity attributable to owners of the Company
Other components of equity

Note

As of April 1, 2022

22,068SharecapitalSharepremium

TreasurysharesRetainedearnings

Exchangedifferencesontranslationof foreign
operations

1,676,263

1,708,873(116,007)

1,479,716

984,141(1,960)4,121

1,477,756

988,263

22,068(65,901)(6,135)—938,294

5,685,180

504

5,685,684—

285,88319285,903

480,326

698(17,584)(12,107)

12,977464,310464,310(4)

464,306

480,326

698(17,584)(12,107)

12,977464,310750,19316

750,209

Effect of hyperinflation
Restated opening balance

Changes in fairvalue offinancial assets
measured at fairvalue throughothercomprehensive
income1,676,263

1,708,873(116,007)

Net profit for the period

Cash flow
hedges(65,901)

Hedging
cost

Remeasureme
nts of defined
benefitpension plans

Total
other
componentsof equity

Total
equityattributableto ownersof theCompany

Noncontrollinginterests—

934,173

5,683,019

504

5,683,523

4,121

2,161

(6,135)285,883

Other comprehensive income (loss)
Comprehensive income (loss) for the period

—

—

71

71

—

285,883

Total
equity2,161Transactions with owners:
Issuance of new shares
Acquisition of treasury shares
Disposal of treasury shares
Dividends(5)(27,056)0

1

10(278,321)

Transfers from other components of equity

22,402

Share-based compensation
Exercise of share-based awards
Total transactions with owners
As of December 31, 2022

(9,424)(12,977)

45,823

—

142

142

—

(27,062)(27,062)

—

1

1

—

(278,321)(278,321)(22,402)———45,82345,823(42,727)

42,749

—

22

71

3,162

15,693(255,919)—(9,424)——(12,977)(22,402)(259,395)—(259,395)

1,676,334

1,712,036(100,314)

1,507,720

1,468,588

13,341(83,486)(18,242)—

1,380,202

6,175,978

520

6,176,498

See accompanying notes to condensed interim consolidated financial statements.

- 26 -

22

Table of Contents
Translation for reference purpose only
Nine-month period ended December 31, 2023 (From April 1 to December 31, 2023)
JPY (millions)
Equity attributable to owners of the Company
Other components of equity

Note

As of April 1, 2023

SharecapitalSharepremium

TreasurysharesRetainedearnings

Exchangedifferencesontranslationof foreign
operations

1,676,345

1,728,830(100,317)

1,541,146

1,606,128

Net profit for the period

Changes in fairvalue offinancial assets
measured at fairvalue throughothercomprehensive
income12,470Cash flow
hedges(87,352)

Hedging
cost

Remeasureme
nts of defined
benefitpension plans

Total
other
componentsof equity

Total
equityattributableto ownersof theCompany—

1,508,119

6,354,122549

6,354,672—

147,085

106

147,191(23,127)

147,085

Other comprehensive income (loss)
Comprehensive income (loss) for the period

—

—

198

198

—

147,085

Noncontrollinginterests

Total
equity459,256(1,320)22,746301(3,038)477,945477,94518

477,963459,256(1,320)22,746301(3,038)477,945625,030

124

625,154

Transactions with owners:
Issuance of new shares
Acquisition of treasury shares(2,362)

Disposal of treasury shares
Dividends

0

0

10

(287,788)

Changes in ownershipTransfers from other components of equity(3,605)

567

3,038

—

395

395

—

(2,362)(2,362)

—

1

1

—

(287,788)(287,788)

—

—

3,605

—

(0)

—

(0)

—

52,60352,603—(67)

Share-based compensation

52,603

Exercise of share-based awards(51,492)

51,426198

1,308

49,064(291,393)

—

567

—

—

3,038

3,605

(237,218)(0)(237,219)

1,676,543

1,730,138(51,253)

1,396,838

2,065,384

11,717(64,606)(22,826)—

1,989,669

6,741,934

673

6,742,607

Total transactions with owners
As of December 31, 2023

See accompanying notes to condensed interim consolidated financial statements.

- 27 -(67)

Table of Contents
Translation for reference purpose only
(5) Condensed Interim Consolidated Statements of Cash Flows
JPY (millions)

Notes
Cash flows from operating activities:
Net profit for the period
Depreciation and amortization
Impairment losses
Equity-settled share-based compensation
Loss (gain) on sales and disposal of property, plant and equipment
Gain on divestment of business and subsidiaries
Change in fair value of financial assets and liabilities associated with contingent consideration arrangements,
net
Finance (income) and expenses, net
Share of loss (profit) of investments accounted for using the equity method
Income tax expenses (benefit)
Changes in assets and liabilities:
Decrease (increase) in trade and other receivables
Increase in inventories
Increase (decrease) in trade and other payables
Increase (decrease) in provisions
Decrease in other financial liabilities
Other, net
Cash generated from operations
Income taxes paid
Tax refunds and interest on tax refunds received
Net cash from operating activities
Cash flows from investing activities:
Interest received
Dividends received
Acquisition of property, plant and equipment
Proceeds from sales of property, plant and equipment
Acquisition of intangible assets
Acquisition of investments
Proceeds from sales and redemption of investments
Proceeds from sales of business, net of cash and cash equivalents divested
Other, net
Net cash used in investing activities- 28 -

Nine-month Period Ended
December 31,
2022
2023
285,903502,990
41,96945,823(161)(959)

147,191
541,258
134,281
52,683
1,988
(441)

4,323
71,635
3,133
41,273

12,773
126,563(2,731)(46,878)

6,856(34,240)(144,971)
11,605(7,906)
21,258
848,529(173,363)
8,297
683,463(58,793)(128,490)
20,587(138,669)(10,014)(47,242)604,064(179,298)
12,990437,756

2,792
3,234
(104,888)
80(84,721)(5,441)
20,553—(219)(168,610)

8,245
531
(130,884)8,604(285,520)(4,724)
1,089
365
(82)
(402,378)

Table of Contents
Translation for reference purpose onlyNotes

JPY (millions)Nine-month Period Ended
December 31,
2022
2023

Cash flows from financing activities:
Net increase in short-term loans and commercial papers
Proceeds from issuance of bonds and long-term loans
Repayments of bonds and long-term loans
Proceeds from the settlement of cross currency interest rate swaps related to bonds
Acquisition of treasury sharesInterest paid
Dividends paid
Repayments of lease liabilities
Other, net
Net cash used in financing activities
Net decrease in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Effects of exchange rate changes on cash and cash equivalents
Cash and cash equivalents at the end of the period

See accompanying notes to condensed interim consolidated financial statements.

- 29 -——(281,585)—(26,929)(86,563)(268,997)(32,510)(5,964)(702,548)(187,695)
849,695
23,141
685,141

280,000
100,000(320,817)
60,063(2,326)(78,685)(278,062)(43,394)(12,971)(296,193)(260,814)
533,530
15,644
288,359

Table of Contents
Translation for reference purpose only
Notes to Condensed Interim Consolidated Financial Statements
1.

Reporting Entity

Takeda Pharmaceutical Company Limited (the “Company”) is a public company incorporated in Japan. The Company and its
subsidiaries (collectively, “Takeda”) is a global, values-based, R&D-driven biopharmaceutical company with a diverse portfolio,
engaged primarily in the research, development, production and global commercialization of pharmaceutical products. Takeda’s
principal pharmaceutical products include medicines in the following key business areas: gastroenterology (“GI”), rare diseases,
Plasma-Derived Therapies (“PDT”) immunology, oncology, and neuroscience.
2.

Basis of Preparation(1) ComplianceTakeda has prepared the condensed interim consolidated financial statements in accordance with IAS 34 “Interim Financial
Reporting” as issued by the International Accounting Standards Board (“IASB”).
The condensed interim consolidated financial statements do not contain all the information required in consolidated financial
statements as of the end of a fiscal year. Therefore, the condensed interim consolidated financial statements should be used withthe consolidated financial statements as of and for the fiscal year ended March 31, 2023.
(2) Approval of Financial Statements
Takeda’s condensed interim consolidated financial statements as of and for the nine-month period ended December 31, 2023 wereapproved on February 2, 2024 by Representative Director, President & Chief Executive Officer (“CEO”) Christophe Weber andDirector & Chief Financial Officer Costa Saroukos.
(3) Functional and Presentation Currency
The condensed interim consolidated financial statements are presented in Japanese yen (“JPY”), which is the functional currencyof the Company. All financial information presented in JPY has been rounded to the nearest JPY million, except when otherwise
indicated. In tables with rounded figures, sums may not add up due to rounding.
(4) Use of Judgments, Estimates and Assumptions
The preparation of the condensed interim consolidated financial statements requires management to make certain judgments,
estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities,
revenues and expenses, and the disclosure of contingent assets and liabilities. Actual results could differ from these estimates.
These estimates and underlying assumptions are reviewed on a continuous basis. Changes in these accounting estimates arerecognized in the period in which the estimates are revised and in any future periods affected.
The condensed interim consolidated financial statements are prepared based on the same judgments and estimations as well as theaccounting estimates and assumptions applied and described in Takeda’s consolidated financial statements as of and for the fiscal
year ended March 31, 2023.
3.

Material Accounting Policies

Material accounting policies adopted for the condensed interim consolidated financial statements are the same as those adopted
for the consolidated financial statements as of and for the fiscal year ended March 31, 2023.
Takeda calculated income tax expenses for the nine-month period ended December 31, 2023, based on the estimated averageannual effective tax rate.

- 30 -

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Translation for reference purpose only
4.

Operating Segment and Revenue Information

Takeda comprises a single operating segment and is engaged in the research, development, manufacturing, marketing and outlicensing of pharmaceutical products. This is consistent with how the financial information is viewed in allocating resources,
measuring performance, and forecasting future periods by the CEO who is Takeda’s Chief Operating Decision Maker.
(1) Disaggregation of Revenue Information
Takeda’s revenue from contracts with customers is comprised of the following:
Revenue by Type of Good or Service

Sales of pharmaceutical products
Out-licensing and service income
Total

JPY (millions)Nine-month Period Ended December 31,
2022
2023
2,982,909
3,149,744
88,414
63,1493,071,322
3,212,893

Sales of pharmaceutical products
Out-licensing and service income
Total

JPY (millions)Three-month period ended December 31,
2022
2023
1,068,509
1,089,062
28,042
22,124
1,096,551
1,111,186

Revenue by Business Area and Product
JPY (millions)Nine-month Period Ended December 31,
2022
2023
Gastroenterology:
ENTYVIOTAKECAB/VOCINTI (1)GATTEX/REVESTIVE
DEXILANTPANTOLOC/CONTROLOC (2)ALOFISEL
OthersTotal Gastroenterology
Rare Diseases:
Rare Hematology:
ADVATEADYNOVATE/ADYNOVIFEIBAVONVENDI
RECOMBINATE
OthersTotal Rare Hematology- 31 -

547,888
84,54078,213
55,106
33,7771,984
56,007
857,515

619,291
90,30789,99936,11735,5202,556
62,267
936,056

92,092
49,86032,5939,207
9,667
39,226
232,645

93,912
51,23528,911
12,027
8,957
35,001230,042

Table of Contents
Translation for reference purpose only
JPY (millions)Nine-month Period Ended December 31,
2022
2023
Rare Genetics and Other:
TAKHZYROELAPRASE
REPLAGALVPRIVLIVTENCITY
OthersTotal Rare Genetics and Other
Total Rare Diseases
PDT Immunology:
immunoglobulin
albumin
OthersTotal PDT Immunology
Oncology:
ADCETRISLEUPLIN/ENANTONENINLAROICLUSIG
ALUNBRIGVELCADE
EXKIVITY
OthersTotal Oncology
Neuroscience:
VYVANSE/ELVANSE
TRINTELLIX
OthersTotal Neuroscience
Other:AZILVA (1)FOSRENOL
OthersTotal Other
Total
(1)
(2)

The figures include the amounts of fixed dose combinations and blister packs.
Generic name: pantoprazole- 32 -

116,880
65,00250,55936,3307,312
44,871
320,954553,600

136,429
69,98355,06838,962
13,94840,643355,033
585,075

390,483
85,50826,426502,418

485,696
94,26531,261
611,22265,78585,18275,93935,52915,764
24,7352,250
39,770344,953

84,244
79,674
66,741
41,46021,1204,138
3,357
45,536346,269

335,449
79,69961,994477,141

312,872
80,226
81,771
474,868

56,59010,906
268,199335,695
3,071,322

29,055
11,135219,213259,403
3,212,893

Table of Contents
Translation for reference purpose only
JPY (millions)Three-month period ended December 31,
2022
2023
Gastroenterology:
ENTYVIOTAKECAB/VOCINTI (1)GATTEX/REVESTIVE
DEXILANTPANTOLOC/CONTROLOC (2)ALOFISEL
OthersTotal Gastroenterology
Rare Diseases:
Rare Hematology:
ADVATEADYNOVATE/ADYNOVIFEIBAVONVENDI
RECOMBINATE
OthersTotal Rare Hematology
Rare Genetics and Other:
TAKHZYROELAPRASE
REPLAGALVPRIVLIVTENCITY
OthersTotal Rare Genetics and Other
Total Rare Diseases
PDT Immunology:
immunoglobulin
albumin
OthersTotal PDT Immunology
Oncology:
LEUPLIN/ENANTONEADCETRISNINLAROICLUSIG
ALUNBRIGVELCADE
EXKIVITY
OthersTotal Oncology- 33 -

201,272
29,84529,77917,115
11,571
849
20,693
311,124

227,582
31,52831,108
12,952
12,6381,029
22,352
339,189

29,724
15,464
11,2993,308
3,491
13,642
76,92831,20817,751
9,101
4,594
2,965
11,702
77,32144,053
22,58916,251
12,9903,084
15,479114,446
191,374

49,33724,312
18,862
14,632
5,623
14,017
126,784
204,104

145,428
33,743
9,269
188,440

176,538
35,317
10,987
222,843

31,52524,07027,12012,312
6,053
3,905
811
13,865
119,662

30,89629,972
20,39914,449
7,408
1,232
(110)
16,862
121,107

Table of Contents
Translation for reference purpose only
JPY (millions)Three-month period ended December 31,
2022
2023
Neuroscience:
VYVANSE/ELVANSE
TRINTELLIX
OthersTotal Neuroscience
Other:AZILVA (1)FOSRENOL
OthersTotal Other
Total
(1)
(2)

124,21329,901
20,713
174,827

86,60329,25828,307
144,167

19,4053,380
88,338111,124
1,096,551

5,374
2,998
71,404
79,776
1,111,186

The figures include the amounts of fixed dose combinations and blister packs.
Generic name: pantoprazole(2) Geographic Information
Takeda’s revenue from contracts with customers is based on the following geographic locations:
JPY (millions)Nine-month Period Ended December 31,
2022
2023
389,843
342,647
1,621,772
1,685,498
632,403
721,538
169,024
188,779
121,425
138,375
66,70045,36070,156
90,696
3,071,322
3,212,893

Japan
U.S.
Europe and Canada
Asia (excluding Japan)
Latin America
Russia/CIS
Other
Total

“Other” includes the Middle East, Oceania and Africa. This disaggregation provides revenue attributable to countries or regions
based on the customer location.
JPY (millions)Three-month period ended December 31,
2022
2023
128,490
114,119589,246
580,736
223,438
261,570
63,30665,50338,16746,30628,882
14,27025,021
28,682
1,096,551
1,111,186

Japan
U.S.
Europe and Canada
Asia (excluding Japan)
Latin America
Russia/CIS
Other
Total

“Other” includes the Middle East, Oceania and Africa. This disaggregation provides revenue attributable to countries or regions
based on the customer location.

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5.

Amortization and impairment losses on intangible assets associated with products

The impairment losses recorded for the nine-month period ended December 31, 2023 was JPY 119,307 million, which primarily
include JPY 73,979 million impairment charges for ALOFISEL (for complex Crohn's perianal fistulas) following topline resultsof phase 3 ADMIRE-CD II trial and JPY 28,477 million impairment charges for EXKIVITY (for the treatment of non-small celllung cancer) following a decision to initiate a voluntary withdrawal globally.
6.

Other Operating Expenses

Other operating expenses were JPY 127,643 million and JPY 145,685 million for the nine-month period ended December 31,
2022 and 2023, respectively.
Other operating expenses for the nine-month period ended December 31, 2022 included the restructuring expenses JPY 38,473
million, pre-launch inventory write-offs JPY 18,984 million and write-off of option fees Takeda paid as part of collaborationagreements JPY 14,796 million.
Other operating expenses for the nine-month period ended December 31, 2023 included the restructuring expenses JPY 60,130
million, additional losses recorded for the supply agreement litigation with AbbVie, Inc. (AbbVie) in the current period JPY
25,339 million and loss from changes in the fair value of financial assets associated contingent consideration arrangements JPY
12,957 million.
7.
Income Tax (Expenses) Benefit
Shire received a tax assessment from the Irish Revenue Commissioners (“Irish Revenue”) on November 28, 2018 for EUR 398
million. This assessment relates to the tax treatment of the USD 1,635 million break fee Shire received from AbbVie inconnection with the terminated offer to acquire Shire made by AbbVie in 2014. Shire was acquired by Takeda in January 2019.
Takeda appealed the assessment to the Tax Appeals Commission (“TAC”) and the appeal was heard by the TAC in late 2020. On
July 30, 2021, Takeda received a ruling on the matter from the TAC, with the TAC ruling in favor of the Irish Revenue andrecorded an income taxes payable for the case. Subsequently, on October 17, 2023, Takeda agreed with the Irish Revenue to settle
the tax assessment for EUR 130 million including interest and without penalties, as a full and final settlement of all liabilities inrelation to the receipt of the break fee. As a result, Takeda reversed its income taxes payable in excess of the settlement amount of
EUR 130 million and recorded JPY 63,547 million reduction to tax expenses for the nine-month period ended December 31,
2023. Takeda made a payment in the settlement in the three-month period ended December 31, 2023.
The effective tax rate for the nine-month period ended December 31, 2023 was (46.7)% compared to 12.6% for the nine-month
period ended December 31, 2022, mainly due to the tax expense reduction described above. This was partially offset by the tax
charges from the write-down of deferred tax assets and legal entity restructuring for the nine-month period ended December 31,
2023.

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8.

Earnings per Share

The basis for calculating basic and diluted earnings per share (attributable to owners of the Company) is as follows:
Nine-month Period Ended
December 31,
2022
2023
Net profit for the period attributable to owners of the Company
Net profit for the period attributable to owners of the Company (million JPY)
Net profit used for calculation of earnings per share (million JPY)
Weighted average number of ordinary shares outstanding during the period (thousands ofshares) [basic]
Dilutive effect (thousands of shares)
Weighted average number of ordinary shares outstanding during the period (thousands ofshares) [diluted]
Earnings per share
Basic earnings per share (JPY)
Diluted earnings per share (JPY)285,883
285,883

147,085
147,085

1,550,992
14,243

1,563,101
15,575

1,565,235

1,578,676

184.32
182.65

94.10
93.17

Three-month Period Ended
December 31,
2022
2023
Net profit for the period attributable to owners of the Company
Net profit for the period attributable to owners of the Company (million JPY)
Net profit used for calculation of earnings per share (million JPY)
Weighted average number of ordinary shares outstanding during the period (thousands ofshares) [basic]
Dilutive effect (thousands of shares)
Weighted average number of ordinary shares outstanding during the period (thousands ofshares) [diluted]
Earnings per share
Basic earnings per share (JPY)
Diluted earnings per share (JPY)- 36 -

119,127
119,127

105,720
105,720

1,554,524
15,892

1,568,902
16,217

1,570,416

1,585,118

76.63
75.86

67.38
66.70

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9.

Bonds and Loans(1) Bonds
During the nine-month period ended December 31, 2023, Takeda redeemed the following bonds.
Principal Amount in
Instrument
Issuance
Redemption date
contractual currency
USD Unsecured Senior Notes

September 2016

September 23, 2023

USD1,000 million

USD Unsecured Senior Notes

November 2018

November 26, 2023

USD500 million

Type ofredemption
Maturity
redemption
Maturity
redemption(2) Loans
During the nine-month period ended December 31, 2023, Takeda entered into the following borrowing.
Principal Amount in
Instrument
Execution
Maturity
contractual currency
Syndicated loans

April 2023

April 2030

JPY 100,000 million

During the nine-month period ended December 31, 2023, Takeda repaid the following borrowing.
Principal Amount in
Instrument
Execution
Repayment date
contractual currency
Syndicated loans
10.

April 2016

April 26, 2023

JPY 100,000 million

Type ofrepayment
Maturity
repayment

Equity and Other Equity Items(1) Disposal of treasury shares
During the nine-month period ended December 31, 2022, the Company conducted the disposal of 8,091 thousand treasury
shares under the Long Term Incentive Plan (“LTIP”) for the Company Group employees overseas. The disposal of treasury
shares resulted in a decrease in treasury shares of JPY 27,599 million.
During the nine-month period ended December 31, 2023, the Company conducted the disposal of 13,958 thousand treasury
shares under the LTIP for the Company Group employees overseas. The disposal of treasury shares resulted in a decreasein treasury shares of JPY 47,614 million.
The Company's treasury shares were converted into the Company’s American Depositary Shares and settled with
employees.
(2) Dividends
Total dividends
declared and paid
JPY (millions)

Dividends
per share(JPY)

Record date

Effective dateQ1 2022

140,365

90.00

March 31, 2022

June 30, 2022

Q3 2022

140,47490.00

September 30, 2022

December 1, 2022

Q1 2023

140,475

90.00

March 31, 2023

June 29, 2023

Q3 2023

148,037

94.00

September 30, 2023

December 1, 2023

Dividends declared and paid
April 1, 2022 to December 31, 2022

April 1, 2023 to December 31, 2023

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11.

Financial Instruments(1) Fair Value Measurements
Derivative and non-derivative financial instruments measured at fair value are categorized in the following three-tier fairvalue hierarchy that reflects the significance of the inputs in making the measurements. Level 1 is defined as observable
inputs, such as quoted prices in active markets for an identical asset or liability. Level 2 is defined as inputs other thanquoted prices in active markets within Level 1 that are directly or indirectly observable. Level 3 is defined as unobservable
inputs.
As of December 31, 2023
Assets:Financial assets measured at fair value throughprofit or loss
Derivatives
Investments in convertible notes
Investments in debt instruments
Financial assets associated with contingent
consideration arrangements

Level 1

Derivatives for which hedge accounting is applied
Financial assets measured at fair value through OCI
Trade and other receivables
Equity instruments
Total
Liabilities:
Financial liabilities measured at fair value throughprofit or loss
Derivatives
Financial liabilities associated with contingent
consideration arrangements
Derivatives for which hedge accounting is applied
Total

JPY (millions)Level 2
Level 3

Total

—
—
—

22,770——7,311
10,997
1,113

30,081
10,997
1,113——

11,95011,950—44,299—44,299—91,10991,109104,931—
172,000—
84,708116,079

104,931
175,817379,188

—

7,223

7,311

14,534————
23,66430,886

8,321—
15,632

8,321
23,66446,518(2) Valuation Techniques
The fair value of derivatives classified as Level 2 is measured based on Treasury management system valuation models or
the Black-Scholes model, whose significant inputs are based on observable market data.
Derivatives classified as Level 3 include those recognized in connection with settlements of cash flows arising fromdifferences between the fixed prices and floating market prices of renewable energy in a virtual power purchase agreement
and those recognized in an agreement to offset the volatility of such cash flows. The fair value of derivatives in Level 3 ismeasured using the discounted cash flow method. The key assumptions taken into account include forecasted renewableenergy prices and the expected generation of the renewable energy generating facility.
The fair value of the investment in convertible notes is measured using techniques such as the discounted cash flow andoption pricing models.
The fair value of trade and other receivables, which are due from customers that Takeda has the option to factor, aremeasured based on the invoiced amount.
Equity investments and investments in debt instruments are not held for trading. If equity instruments or investments indebt instruments are quoted in an active market, the fair value is based on price quotations at the period-end-date. If equity
instruments or investments in debt instruments are not quoted in an active market, the fair value is calculated utilizing an
adjusted book value per share method or EBITDA multiples approach based on available information as of each periodend-date and comparable companies. The principal input that is not observable and utilized for the calculation of the fairvalue of equity instruments and investments in debt instruments classified as Level 3 is the EBITDA rate used for the
EBITDA multiples approach, which ranges from 4.1 times to 12.4 times.
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Financial assets and liabilities associated with contingent consideration arrangements are measured at fair value at the timeof the divestiture or the acquisition date of business combination. When the contingent consideration arrangement meetsthe definition of a financial asset or liability, it is subsequently re-measured at fair value at each closing date. The
determination of the fair value is based on models such as scenario-based methods and discounted cash flows. The key
assumptions take into consideration the probability of meeting each performance target, forecasted revenue projections, andthe discount factor. The financial assets associated with contingent consideration arrangements are recognized mainly in
relation to the divestiture of XIIDRA. The financial liabilities associated with contingent consideration arrangements are
discussed in Note (5) Financial liabilities associated with contingent consideration arrangements.
(3) Transfers between levels
Takeda recognizes transfers between levels of the fair value hierarchy, at the end of the reporting period during which thechange has occurred. There were transfers from Level 3 to Level 1 recorded in the nine-month period ended December 31,
2023. These transfers resulted from the investments in the companies whose shares were previously not listed on an equity
or stock exchange and had no recent observable active trades in the shares. During the nine-month period ended
December 31, 2023, the companies listed their equity shares on an exchange and are currently actively traded in the market.
As the equity shares have a published price quotation in an active market, the fair value measurement was transferred fromLevel 3 to Level 1 on the fair value hierarchy during the nine-month period ended December 31, 2023. There were no othersignificant transfers between levels of the fair value hierarchy during the nine-month period ended December 31, 2023.
(4) Level 3 fair values
Takeda invests in equity instruments mainly for research collaboration. The following table shows a reconciliation from theopening balances to the closing balances for Level 3 financial asset fair values for the nine-month period ended
December 31, 2023. The disclosure related to Level 3 financial liabilities which are financial liabilities associated with
contingent consideration arrangements are included in (5) Financial liabilities associated with contingent consideration
arrangements. There are no significant changes in fair value during the changes in certain assumptions which influence thefair value measurement for Level 3 financial assets.

As of the beginning of the period
Changes recognized as finance income or financeexpenses
Changes in fair value of financial assets
associated with contingent consideration due toother elements than time value
Changes in fair value of financial assets
measured at fair value through OCI andexchange differences on translation of foreign
operations
Purchases
Sales
Transfers to Level 1
Acquisition from conversion of convertible notes
As of the end of the period

JPY (millions)Nine-month Period Ended December 31, 2023
Financial assets associatedwith contingent
consideration arrangements
Equity instruments
23,806
83,236- 39 -(600)—(12,957)

—

1,701
—
—
—
—
11,950

574
1,691
(1)
(5,022)
4,230
84,708

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Translation for reference purpose only
(5) Financial liabilities associated with contingent consideration arrangements
Financial liabilities associated with contingent consideration arrangements represent consideration related to businesscombinations or license agreements that are payable only upon future events such as the achievement of development
milestones and sales targets, including pre-existing contingent consideration arrangements of the companies that are
acquired by Takeda. At each reporting date, the fair value of financial liabilities associated with contingent consideration
arrangements is re-measured based on risk-adjusted future cash flows discounted using an appropriate discount rate.
As of December 31, 2023, the balance primarily relates to pre-existing contingent consideration arrangements from
historical acquisitions.
The fair value of financial liabilities associated with contingent consideration arrangements could increase or decrease due
to changes in certain assumptions which underpin the fair value measurements. The assumptions include probability of
milestones being achieved.
The fair value of financial liabilities associated with contingent consideration arrangements are classified as Level 3 in thefair value hierarchy. The following table shows a reconciliation from the opening balances to the closing balances forfinancial liabilities associated with contingent consideration arrangements for the nine-month period ended December 31,
2023. There are no significant changes in fair value during the changes in significant assumptions which influence the fairvalue measurement for financial liabilities associated with contingent consideration arrangements.
JPY (millions)Nine-month Period Ended
December 31, 2023
8,139
27
155
8,321

As of the beginning of the period
Changes in the fair value during the period
Foreign currency translation differences
As of the end of the period(6) Financial instruments not measured at fair value

The carrying amount and fair value of financial instruments that are not measured at fair value in the condensed interim
consolidated statements of financial position are as follows. Fair value information is not provided for financial
instruments, if the carrying amount is a reasonable estimate of fair value due to the relatively short period of maturity ofthese instruments.
JPY (millions)
As of December 31, 2023
Carrying
amountFair value
3,607,636
3,307,319
736,236
733,090

Bonds
Long-term loans

Long-term financial liabilities are recognized at their carrying amount. The fair value of bonds is measured at quotes whose
significant inputs to the valuation model used are based on observable market data. The fair value of loans is measured at
the present value of future cash flows discounted using the applicable market rate on the loans in consideration of the credit
risk by each group classified in a specified period. The fair value of bonds and long-term loans are classified as Level 2 in
the fair value hierarchy.

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12.

Commitments and Contingent Liabilities

Litigation
Takeda is involved in various legal and administrative proceedings. There were no significant updates during the nine-month
period ended December 31, 2023, except for the matters below.
Sales, Marketing, and Regulation
COLCRYS Antitrust Litigation
In September 2021, an antitrust class action was filed against Takeda Pharmaceuticals U.S.A., Inc. (“Takeda”) in the U.S. District
Court for the Eastern District of Pennsylvania. The plaintiffs, a putative class of wholesalers, allege that settlements that Takeda
entered into in 2015 and 2016 to resolve patent litigation claims against several generic drug manufacturers related to genericformulations of COLCRYS were anticompetitive. In September 2023, Takeda reached an agreement in principle to resolve theantitrust matter for an amount that is immaterial, which was fully executed in December 2023. The settlement had no material
impact on Takeda’s condensed interim consolidated statements of profit or loss.
AbbVie Supply Agreement Litigation
In November 2020, AbbVie brought suit against Takeda Pharmaceutical Company Limited (“Takeda”) in Delaware Chancery
Court alleging Takeda breached its agreement with AbbVie related to the supply of LUPRON in the U.S. due to shortages arisingfrom quality issues the U.S. Food & Drug Administration identified concerning Takeda’s production facility in Hikari, Japan aspart of a Form 483 issued in November 2019 and a Warning Letter issued in June 2020. In the litigation, AbbVie sought bothpreliminary injunctive relief and monetary damages. In September 2021, the court issued an order denying AbbVie’s request for
injunctive relief. The court subsequently issued a decision finding Takeda in breach of the supply agreement. In September 2023,
the court issued a decision regarding the quantification of AbbVie’s monetary damages and subsequently entered judgment in
December 2023. In accordance with the judgment, Takeda will pay USD 506 million, including interest, in April 2024. Takeda
had established a provision against this case during the course of the litigation and, as a result of the court’s September 2023
decision, recorded an additional JPY 25,339 million loss in other operating expenses and JPY 6,577 million in finance expenses
for the interest for the nine-month period ended December 31, 2023.
Investigation of Patient Assistance Programs
In June 2019, the DOJ (through the U.S. Attorney’s Office in Boston) issued a subpoena to Shire Pharmaceuticals LLC, which
was acquired by Takeda during the year ended March 31, 2019 (through Takeda’s acquisition of Shire plc). The subpoena
generally seeks information about Shire’s interactions with 501(c)(3) organizations that provide financial assistance to Medicare
patients taking Shire drugs, including the hereditary angioedema medications FIRAZYR and CINRYZE. Takeda was cooperatingwith the investigation and in December 2023, Takeda reached a settlement for an amount that is immaterial. The settlement had
no material impact on Takeda’s condensed interim consolidated statements of profit or loss.
13.

Subsequent Events

Not applicable.

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2. Others
Interim Dividend
In accordance with the provision of Article 29 of the Articles of Incorporation of the Company, Takeda made the following
resolution on an interim dividend for the 147th fiscal year (from April 1, 2023 to March 31, 2024) at the meeting of the Boardof Directors held on October 26, 2023, and paid the interim dividend.
(a) Total amount of interim dividends(b) Interim dividend per share(c) Effective date/ Payment start date

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JPY 148,037,012,490
JPY 94.00
December 1, 2023

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Translation for reference purpose only

B. Information on Guarantors of the Company
Not applicable.

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