November 9, 2021

SEIKAGAKU CORPORATION
Consolidated Financial Results (Japan GAAP) (Summary)for the First Six Months of Fiscal 2021
(Six-Month Period Ended September 30, 2021)
Listed exchanges: Tokyo Stock Exchange (First Section)
Stock code number: 4548
URL: https://www.seikagaku.co.jp/en/
Scheduled date to commence dividend payment: December 2, 2021
(All amounts have been rounded down to the nearest million yen)

1. Consolidated Financial Results for the First Six Months of Fiscal 2021
(from April 1, 2021 to September 30, 2021)(1) Consolidated Financial Results(Percentages indicate changes from the same period in the previous fiscal year)
Net sales
Millions ofYen

Operating income
Millions ofYen%

Ordinary income
Millions ofYen%%

First six months of fiscal 2021

20,530

54.6

6,038

665.0

6,393492.9

First six months of fiscal 2020

13,277(10.4)789(63.3)

1,078(56.4)

Net income attributable toowners of parent
Millions of%
Yen

Net income per share

Diluted net income
per share

Yen

Yen

First six months of fiscal 2021

5,019422.2

89.07-First six months of fiscal 2020961

( - )

17.04

-(Note) Comprehensive income:First six months of fiscal 2021:
First six months of fiscal 2020:

6,208
1,494

million yen [315.5%]
million yen [ - %](2) Consolidated Financial Position
Total assets

Total equity

Equity ratio

Millions of Yen

Millions of Yen%

As of September 30, 2021

76,72868,82489.7

As of March 31, 2021

69,91563,604

91.0(Reference) Shareholders’ equity:
As of September 30, 2021:
As of March 31, 2021:

68,824 million yen
63,604 million yen

2. Dividends

Fiscal 2020
Fiscal 2021
Fiscal 2021(Forecast)

1st QuarterYen-

2nd Quarter
Yen
10.00
15.00

Dividends per share
3rd Quarter
Yen-(Note) Revision of the forecasts most recently announced: No

1Year-end

AnnualYen
14.00

Yen
24.00

15.00

30.00

3. Forecast of Consolidated Financial Results for Fiscal 2021 (from April 1, 2021 to March 31, 2022)
Net sales

Fiscal 2021

Operating income

Millionsof Yen%32,200

16.1

Millionsof Yen4,550(Percentages indicate changes from the previous fiscal year)
Net income
Net income
Ordinary income
attributable toper shareowners of parent
Millionsof Yen%102.34,650%

Millionsof Yen

53.7

3,650%(14.4)

Yen

64.83(Note) Revision of the forecasts most recently announced: No* Notes(1) Changes in the status of material subsidiaries during the period: No(2) Application of specific accounting methods for preparing the quarterly consolidated financialstatements: Yes(3) Changes in accounting policies, changes in accounting estimates, and retrospective restatements(a) Changes in accounting policies accompanying revisions in accounting standards: Yes(b) Changes other than those in (a) above: No(c) Changes in accounting estimates: No(d) Retrospective restatements: No(4) Number of shares issued (common stock):(a)Number of shares at the end of the period(including treasury stock)

As of September
30, 2021

56,814,093 shares

As of March 31,
2021

56,814,093 shares(b) Number of treasury stock at the end ofthe period

As of September
30, 2021

567,772 shares

As of March 31,
2021

384,421 shares(c) Average number of shares issued during
the period (six months)

First six monthsof fiscal 2021

56,353,031 sharesFirst six monthsof fiscal 202056,421,925 shares*This financial reports are not subject to the quarterly review procedures of the certified public accountant and audit
firm.
* Disclaimer regarding forward-looking information including appropriate use of forecasted financial results
The forecast shown in these materials are based on information currently available and certain assumptions that theCompany regards as reasonable. Actual performance and other results may differ materially from these forecasted figures dueto various factors.

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1. Results of Operations for the First Six Months of Fiscal 2021
(Six-Month Period Ended September 30, 2021)(1) Qualitative explanation on quarterly financial results
In the first six months (April 1 to September 30, 2021) of the fiscal year ending March 31, 2022 (fiscal 2021),
net sales were ¥20,530 million, up 54.6% year on year. The result is attributable to a rebound from the impact of
the spread of COVID-19 infection in Japan and abroad in the first half of the previous fiscal year, as well as a
substantial increase in royalty income (reclassified from non-operating income to net sales beginning in fiscal2021) and the launch of the joint function improving agent JOYCLU, positive factors that offset the impact ofNational Health Insurance (NHI) drug price reductions in Japan.
Operating income rose 665.0% year on year to ¥6,038 million, with the sales increase offsetting higher SGA
expenses, mainly R&D expenses attributable to costs related to an additional clinical study underway in the U.S.
for SI-6603, a treatment for lumbar disc herniation. Ordinary income rose 492.9% year on year to ¥6,393 million,and net income attributable to owners of parent rose 422.2% to ¥5,019 million.
1) Net sales by segment
Pharmaceuticals Business- Domestic Pharmaceuticals (¥6,805 million, up 14.2% year on year)
Deliveries to medical institutions and market share for ARTZ, a joint function improving agent for knee
osteoarthritis, increased year on year as a result of continued switching from competing products partly
attributable to the effect of measures to acquire new user facilities coupled with a market rebound following acontraction in the first half of the previous fiscal year caused by the spread of COVID-19 infection. The market
share and volume growth offset the impact of NHI drug price reductions and led to an increase in the Company’ssales.
With regard to the joint function improving agent JOYCLU, launched on May 19, 2021, although theCompany called attention to the risk of shock or anaphylaxis in the Important Side Effects section of theJOYCLU package insert, in response to multiple reports of shock or anaphylaxis occurring in patients following
administration of JOYCLU, the Company issued a Dear Healthcare Professionals Letter of Rapid Safety
Communication (Blue Letter) on June 1. The Company will continue cooperative efforts with sales partner Ono
Pharmaceutical Co., Ltd. to proactively gather side effects reports and other information and strive for early
identification of the cause of the side effects with the cooperation of medical professionals and institutions.
Deliveries to medical institutions of the OPEGAN series of ophthalmic viscoelastic devices increased year
on year, reflecting a rebound following market contraction in the first half of the previous fiscal year amid adecrease in the number of cataract surgeries accompanying the spread of COVID-19 infection. The Company’ssales fell due to NHI drug price reductions and a decline in shipments from a high level in the first six months offiscal 2020.
The Company’s sales of MucoUp, a submucosal injection agent for endoscopic surgery, rose as a result ofbringing forward shipments to the sales partner.
Deliveries to medical institutions and the Company’s sales of HERNICORE, a treatment for lumbar discherniation, increased thanks to a rebound in outpatient services following a decline in the first half of theprevious fiscal year accompanying the spread of COVID-19 infection and an enhancement of information
provision activities directed at medical institutions carried out together with the sales partner.
- Overseas Pharmaceuticals (¥4,449 million, up 49.5% year on year)
Local sales volume in the U.S. and the Company’s sales of Gel-One, an intra-articular single-injection
viscosupplement for the treatment of knee osteoarthritis, increased year on year, reflecting a rebound from theimpact of factors such as the market contraction caused by the spread of COVID-19 infection in the first half ofthe previous fiscal year, as well as the successful measures by the sales partner to promote switching fromcompeting products.
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Local sales volume in the U.S. of SUPARTZ FX, an intra-articular 5-injection viscosupplement for thetreatment of knee osteoarthritis, increased due to a rebound from the powerful impact of the spread of COVID19 infection experienced in the first half of the previous fiscal year, despite continuation of the trend in the U.S.
market toward a preference for products that require a low number of injections, such as single-injection andthree-injection products. The Company’s sales increased as a result of bringing forward shipments to avoiddistribution risk.
Local sales volume in China of ARTZ increased because of factors including the stepping up of activities topromote prescriptions. The Company’s sales rose sharply, reflecting concentration of shipments in the first halfin addition to the local volume increase.
- Bulk Products and Contract Development and Manufacturing Organization*1 (¥1,330 million, up 40.3%
year on year)
Although sales of bulk products declined, overall sales increased because of growth in sales of contractdevelopment and manufacturing services at overseas subsidiary Dalton Chemical Laboratories, Inc.
As a result of these developments and a substantial increase in royalty income*2 (¥3,550 million, up 3,818.3%
year on year), sales from the Pharmaceuticals business segment rose 61.7% year on year to ¥16,136 million.
*1 Starting from the consolidated financial results for the second quarter of fiscal 2020, the sales of Dalton
Chemical Laboratories, Inc., which became a subsidiary in March 2020, are included in the Pharmaceuticals
business.
*2 Beginning in fiscal 2021, royalty income has been reclassified from non-operating income to net sales.
LAL Business
Sales from the LAL business segment increased 33.2% year on year to ¥4,394 million due to an increase in salesof Bacterial Endotoxin Testing (BET) reagents and Clinical Diagnostic (Fungitell) reagents thanks toreinforcement of sales activities at overseas subsidiary Associates of Cape Cod, Inc. and to higher orders for
BET contract services and steady sales in Japan.
(2) Explanation of forward-looking statements, including the forecast of consolidated financial results
Although in the second quarter the Company achieved the full-year income forecasts in the forecast ofconsolidated financial results announced on May 13, 2021, the result is attributable to concentration in the firsthalf of sales drivers such as royalty income and bringing forward of shipments of overseas pharmaceuticals. In
light of anticipated higher R&D expenses to result from costs related to measures to promote subject enrollment
for an additional clinical study for SI-6603 in the third quarter and beyond and the impact on sales of JOYCLUof issuance of the Blue Letter, there is no change in the forecast of full-year consolidated financial results.
Note: The above forecast has been prepared on the basis of economic circumstances, market trends, and otherassumptions made at the time of release of this document. Actual results may differ from the forecast due to avariety of factors.

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