May 8, 2013

NIHON KOHDEN CORPORATION (6849)
Stock Exchange Listing: 1st section Tokyo Stock Exchange
Head Office: Tokyo
Representative: Fumio Suzuki, President and COO
Contact: Toshihiko Hiraoka, Operating Officer, General Manager, Corporate Planning Dept.
Phone: +81 / 3-5996-8003

Nihon Kohden draws up a new mid-term business plan
Nihon Kohden today announced a new mid-term business plan, Strong Growth 2017, covering fiscal years
2013 to 2016. This four-year business plan aims to sustain growth of the Nihon Kohden Group and enhance
the corporate value of the Company in line with its corporate philosophy of “Fighting disease andenhancing health by advanced technology in order to contribute to the world as well as create an affluent
life for employees”.
The Company’s previous mid-term business plan, SPEED UP III, was the first stage in realizing theCompany’s long-term vision “The Change 2020 – The Global Leader of Medical Solutions –” which wasset out in 2010 for the next ten years through to 2020.
Nihon Kohden achieved its previous mid-term business plan targets of 130 billion yen in sales and a 10%
operating margin. This was due to the Company’s efforts to expand and strengthen core business areas.
Nihon Kohden also established competitive advantages in Japan’s acute care hospital market. TheCompany also commercialized its own parameter measurement technologies such as esCCO*1 and derived
18-lead ECG*2 which resulted in increased brand recognition around the world. However, strong growth inemerging markets remains as an issue to be solved.
The Company’s next mid-term business plan, Strong Growth 2017, is the second stage in realizing its
long-term vision. The coming four-year period is crucial for building a more solid foundation. Nihon
Kohden aims to achieve sustainable growth in Japan under the national future vision to reorganize themedical and nursing care systems by 2025 and achieve strong growth in international markets. TheCompany will also enhance its operating base to ensure its growth.
*1

esCCO, estimated continuous cardiac output, is a new measurement method to calculate cardiac output
continuously using ECG and pulse oximetry.

*218-lead ECG is a new measurement method to derive 6-lead ECG, right-side leads V3R-V5R and posteriorleads V7-V9 from the standard 12-lead ECG.

-1-I. Long-term vision: The Change 2020 – The Global Leader of Medical Solutions –Nihon Kohden’s envisioned corporate status for 2020 is as follows:(1)

Lead the world in the development of revolutionary breakthrough technology
The Company will utilize the 60 years of technical experience and expertise of the Nihon KohdenGroup to:1) Promote healthier and longer life through collaboration between the public, private andacademic sectors both within and outside Japan in the development of world-first
revolutionary technologies for the prevention, early diagnosis and treatment oflifestyle-related illnesses, dementia and other intractable disease; and2) Help hospitals assure medical safety and security by creating advanced new measurement
parameters and sharpening the Company’s competitive monitoring technologies that willlead to appropriate and efficient clinical care.

(2)

Achieve the highest level of quality in the world
Nihon Kohden will achieve the highest level of quality in the world in order to sustain customer
satisfaction well into the future, thereby earning a solid reputation as a reliable partner.

(3)

Attain top share in applicable global markets
Nihon Kohden will ensure that business strategies are tailored to regional characteristics anddevelop optimized business structures that encompass all processes from product development toproduction, distribution and after-sales service in order to enable a prompt and effective responseto the changing needs of the global healthcare market such as aging populations in developed
markets and demand for basic healthcare networks in emerging economies which areexperiencing rapid economic growth. To this end, the Company will strive to attain top market
share in a wider range of its own products in both the domestic and international markets whileaiming for a top share of all its own products in the domestic market.

The target for the period ending March 2020 is sales of ¥200 billion, operating income of ¥25 billion
and overseas sales ratio of 35%.

II. Mid-term business plan: Strong Growth 2017
1. Basic Principles
Each and every employee will act autonomously and implement the following principles aimed atrealizing the Company’s long-term vision:(a)User oriented – Take all necessary actions for the customer(b)

Relationships – Strengthen relationships with customers and partners both inside and outside theCompany(c)

Global – Enhance global communication skills as well as think and act with a global perspective(d)Speed – Strive to do everything with greater speed-2-2. Key strategies(1) Pursue the highest level of quality in the world
Nihon Kohden will enhance its credibility as a leading medical equipment manufacturer byensuring quality in every activity of every division across the entire Nihon Kohden Group, fromdevelopment and design to production, logistics, sales and services, to keep its customers satisfied
and ensure that customers around the world recognize Nihon Kohden for its superior quality
products, sales and services.

(2) Strengthen technological development capabilities-Nihon Kohden will further reinforce its technological strength and speed of development
processes. To this end, the Company will strengthen its R&D organization to address theneeds of clinical practice swiftly and flexibly. The Company will also promoteindustry-government-academia collaboration as well as collaboration with other companies
both inside and outside Japan.

-The Company will combine its own core technologies to develop new technologies andproducts that help enhance medical safety and operating efficiencies, which will allow furtherdifferentiation.

(3) Strengthen business expansion by region
Nihon Kohden will strive to achieve strong growth internationally and take steps to reinforce its
business expansion in the Americas, Europe and Asia. Specifically, the Company will focus initiatives
on strengthening business activities in Japan, the U.S. and emerging markets including BRICs.

1) Japan: Create solutions for a national future vision of medical and nursing careservices in 2025
Nihon Kohden will further cultivate its strength in the acute care hospital market and provide
comprehensive solutions corresponding to the differentiation of medical providers,collaboration between medical and nursing care, and the establishment of an integrated
community care system.

2) Establish a stronger presence in the U.S. which is a center of leading-edge medicaltreatment
Nihon Kohden aims to build a strong presence in the U.S. by cultivating high-end markets andestablishing a stronger foothold in low-end markets through the reinforcement of itsdirect-sales force, stronger ties with GPOs, developing new sales channels and expanding its
product line-ups. The Company will expand its presence by increasing sales of Defensive
MonitoringTM* in the patient monitors business, promoting a strategy of focusing on the U.S.
top 50 hospitals in the neurology business, and enriching the product line-up of Defibtech inthe resuscitation field.
* Defensive Monitoring TM is a method of patient monitoring by using the Company’s product,
PrefenseTM, to prevent medical harm.

-3-3) Increase market share in emerging markets as a key growth driver
China
Nihon Kohden will accelerate business operations by unifying development, production, salesand services. In addition, the Company will expand export from China and raise its production
efficiency by increasing production volume.

Emerging markets
Nihon Kohden will promote a high-end market strategy of offering products made in Japanthat are highly functional and IT-compliant and a low-end market strategy of offering pricecompetitive products made in China or at other local production sites. In addition, theCompany will work to raise brand recognition with its unique technologies such as esCCO andto expand its sales and service networks.

(4) Achieve further growth in core businesses
Nihon Kohden will take steps to achieve further growth in its core businesses both inside andoutside Japan in order to expand its global market share and establish a stable and consistentrevenue base.

Patient Monitors
Nihon Kohden will increase its share in global markets by strengthening its sales force andexpanding products that ensure medical safety and improve operating efficiencies in line with theneeds of each region. The Company will launch new, highly competitive bedside monitors andtelemetry products and raise brand recognition through its unique technologies such as esCCO andCO2 sensors.

Diagnostic Equipment
Neurology products: Nihon Kohden will expand market-leading business and strengthen its
brand positioning globally by satisfying new needs* in developed markets and targeting
growing emerging markets.
* EEG monitoring or remote monitoring in emergency rooms and neuro ICUs.

Cardiology products: Nihon Kohden will expand its share in global markets by broadening its
product range and reinforcing compatibilities with IT systems, and raising brand recognition
with its unique technologies such as derived 18-lead ECG.

Diagnostic information systems: In Japan, Nihon Kohden will expand its line-up for small andmedium-sized hospitals and for regional medical care networks. In Europe and China, theCompany will differentiate itself from competitors with locally developed ECG data
management systems.

Hematology instruments: Nihon Kohden will strengthen its international business ofhematology analyzers and reagents as well as expand the immunology analyzers and reagentsbusiness by adding types of reagents.

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Treatment Equipment
As the only Japanese manufacturer of defibrillators and AEDs, Nihon Kohden will expand its
line-up of products that contribute to emergency care. In addition, the Company will continue tointroduce the most advanced treatment equipment from all over the world into Japan that offers
synergies with the Company’s own products.

Consumables and Services
Nihon Kohden will improve its price competitiveness through automated production and overseas
production, and expand sales by offering combined packages of products and consumables. Inaddition, the Company will expand its repair and maintenance service offerings as well as user
training programs.

(5) Develop new businesses
Nihon Kohden aims to develop new core businesses by self-development, alliances, M&A andother measures. The Company will pursue the development and introduction of medical equipment
designed to improve medical safety, address lifestyle–related diseases, dementia, and intractablediseases. The Company will also pursue solutions for an integrated community care system.

Expand treatment equipment business1)

Nihon Kohden will expand its product line-up of ventilators and anesthesia machines throughalliances.

2)

The Company will develop emergency care equipment and strengthen its presence in theemergency care market.

Create a new business of neurological diagnosis, treatment and rehabilitation equipment
Nihon Kohden will offer comprehensive solutions from diagnosis to treatment and rehabilitation ofneurological diseases. The Company is developing technologies for the early detection ofAlzheimer’s and depression, and treatment of nerve diseases.

Create a physiological parameter businessNihon Kohden will raise recognition and clinical assessment values of its advanced SpO2 and CO2sensors. The Company will create a physiological parameter business and build-up its brand as asensor manufacturer.

(6) Consolidate corporate fundamentals
In order to adapt to changes in the business environment and become the world’s leader in medical
equipment, Nihon Kohden will foster a more robust business structure that is globalized, efficientand fast-paced as well as implement CSR activities aimed at sustainable growth and strengthen its
human resource development initiatives.

-5-3. Strong Growth 2017 targets for FY 2016 ending March 2017 (consolidated)
FY 2012 actual

FY 2016¥132.5billion¥170.0billion- Domestic¥110.2billion¥121.5billion- Overseas¥22.3

billion¥48.5

billionOperating income¥13.4

billion¥18.0

billion

ROE

12.7%

13.0%

Sales

Break down of overseas sales by region

FY 2012 actual

FY 2016

Americas¥8.0

billion¥19.5

billionEurope¥5.6

billion¥10.0

billion

Asia

¥7.5

billion¥17.0

billion

Other

¥1.0

billion¥2.0

billionExchange rate assumptions: ¥90 to the dollar, ¥118 to the euro

4. Main facility planning
Nihon Kohden will improve R&D environment in the head office to improve intellectual productivity
and enhance R&D efficiency. The Company will also automate its manufacturing facilities and prepare
for increasing production volumes and reducing costs.
Disclaimer: This document is based on Company evaluations and analyses at the time of writing and does not in
any way constitute a guarantee or warranty that the Company will achieve the numerical targets or
implement the measures stated herein.

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