ONO PHARMACEUTICAL CO., LTD.
ESG Presentation Meeting
March 26, 2024

[Number of Speakers]

4
Gyo Sagara
Toshihiro Tsujinaka

Masao Nomura
Ryuta Imura

President, Representative Director, and Chief
Executive Officer
Member of the Board of Directors, Senior
Executive Officer, Executive Director,
Corporate Strategy & Planning, Sustainability
Promotion
Member of the Board of Directors, Outside
Director
Senior Director, Corporate Communications

Presentation
Imura: Thank you very much for taking time out of your busy schedule to join us today in the ESG presentation
meeting of ONO PHARMACEUTICAL CO., LTD for FY2023.

As for today's agenda, First, President Sagara will explain sustainable management and materiality. Next,
Nomura, an outside Director, will explain corporate governance. Finally, Tsujinaka, Executive Directors,
Corporate Strategy & Planning, Sustainability Promotion, will explain the expansion of human capital, global
environmental conservation, and ESG evaluation.

Sagara: For the first time in the history of ONO's various presentation meetings, we have an outside memberof the board of directors, Mr. Nomura, taking the opportunity to speak toady. We have spent a lot of timeand effort considering the changes in our management structure from April 1, so I hope that you will all ask
Mr. Nomura many questions.

1

I would like to explain the Sustainable Management Policy. We are taking on the challenge of developing new
drugs to meet the needs of patients with unmet needs where there is still no cure. Moreover, the method is
to actively develop open innovation in collaboration with the world's top scientists, and since prostaglandin,
we have been conducting research and development for more than 50 years.
At the same time, we have been focusing on sustainable management related to ESG and SDGs in recent years.
This is due to the combination of the successful development of Opdivo in 2014, which is said to be abreakthrough new drug, and the 300th anniversary of the Company's founding in 1717 in 2017. Having hadthese opportunities, we are now promoting sustainable management based on the belief that we need tochange into a company that takes on the challenges of the world, society, and, to put it bluntly, humanity,
including pharmaceuticals and new drugs, with respect to unresolved issues. In short, we are now managing
the Company with the aim of further growing as a company that solves both our core business of drug
discovery and the social environment and the unsolved problems of mankind.

2

We have established the materiality and are reviewing and updating it from time to time. This slide shows thecurrent materiality. On the right side of the slide, we have reviewed the protection of value and the expansionof human capital, number 8, and then 12, 13, 14, 15, 16, and 17.

This is the 12th materiality, for example, ``Ensuring product reliability and safety,'' which means that weshould ensure the reliability and safety of not only products but also investigational drugs. We revised this
into "ensuring reliability and safety."3Including the title of materiality and other minor revisions, we have reviewed the materiality in seven areas
as I mentioned. The numbers 8 and 12 through 17 are outlined by red lines, respectively; the thick red line,
and the solid red line shows the revised title section of the materiality, and the dotted red line shows somerevised parts of the contents in the materiality.
As I mentioned earlier, the titles "Assurance of Product Reliability and Safety" and "Protection ofEnvironment" have been revised to "Conservation of the Global Environment." The difference is that
protection means to leave themselves as they are without modification, and conservation means to maintainthe global environment by modifying the necessary parts.
We have also changed the wording of "Legal compliance and thorough compliance". Then, we changed andrevised the title of "Supply Chain Management" to "Realization of Sustainability Management with Business
Partners".
With the dotted line, some revisions have been made to the content.

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We have set the new materiality as shown in the slide you see. We outlined number 1 and 2 with red lines
together with 8, 14, and 18. I myself will explain number 1 and 2 today. As for number 18, "Strengthening ofCorporate Governance", will be explained by Mr. Nomura, an outside Director, and “Expansion of Human
Capital” and “Conservation of the Global Environment will be explained and reported by Mr. Tsujinaka.

5

I myself would like to explain creation of innovative new drugs. When we created the prostaglandin related
products, we launched 11 new compounds as new drugs, again from the start of open innovation.
The next major success was Opdivo, which is currently indicated for 11 types of cancer. If we count theindications on a regimen basis, the number of indications can be as many as 20 or 30, but for 11 types ofcancer, we have been able to lead to create a large number of new drugs from a single research of both PG
and PD-1.
We will continue to focus on this open innovation, and are currently creating new drugs by adding newtechnologies such as AI, Informatics, and DX.

Pipeline expansion. Naturally, pharmaceutical companies need to make their pipelines as rich and robust as
possible. We are developing various activities to achieve this, but the first step is to see how many compounds
we can generate from our own research laboratories.
Currently, a total of 24 compounds are in the clinical stage. In addition, we will acquire as many attractive
compounds as possible through licensing activities, or, depending on the situation, we may consider M&A tostrengthen our pipeline.
In this financial year, we have obtained global rights to one antibody drug candidates from NEXI in Korea. In
addition, the development of ONO-4059 is underway in the US, which is currently on schedule for launch in
2026, and the patients enrollment of Phase II has been completed.
In this way, we intend to strengthen our various internal and external assets as much as possible and addthem to our pipeline. We are currently in the early stages of joint research, but we are very active in ourefforts, and we intend to enrich our pipeline in the future.
I am late to mention this, but this fiscal year, ONO-8250 and Opdivo subcutaneous injection have entered theclinical stage. That’s all from me.
Imura: Mr. Nomura, an outside Directors, will continue with an explanation of corporate governance.

6

Nomura: This is the first time I meet you all. At the beginning of this presentation, President Sagara put me
under pressure, but today I would like to explain corporate governance. I myself was appointed as an outside
director in 2018 and have chaired the Executive Personnel Proposal Review Meeting and the Executive
Compensation Proposal Review Meeting since January 2022.

First, regarding the corporate governance structure, the Executive Personnel Plan Review Meeting and the
Executive Compensation Plan Review Meeting, which I chair, are listed on the right side of the Board of
Directors as the bodies that deliberate on executive personnel matters and executive compensation.

7

The corporate governance structure officers are shown in this table. We have seven directors, three of whom
are outside directors, one of whom is female director, and two of whom, including myself, have corporate
management experience.

Now, regarding our initiatives in corporate governance, as I explained earlier in the organizational chart, thepersonnel and compensation of directors and corporate auditors, which are important for governance, arediscussed at the Executive Appointment Meeting and the Executive Compensation Review Meeting, both ofwhich have highly independent outside directors as key members, as shown in this document. Furthermore,
we strive to ensure management transparency and objectivity.

8

President used to be a member of the executive compensation plan review meeting, but he was asked toleave the meeting when the performance evaluation and compensation of President himself were discussed,
so that objectivity was maintained by having only outside directors participate in the discussions.

In order to be more objective and independent, the Board of Directors has been composed of three outside
directors since this April. It was decided that Director Sagara would be positioned as an explainer of theCompany's proposal and would not participate in the deliberations.
On the other hand, the Executive Officer Personnel Plan Review Meeting will also deliberate on the executive
structure, including the appointment of executive officers, and the CEO will be invited to participate in thedecision-making process. The number of internal members has been changed from two to one. However,depending on the content of the agenda, top management appointments, etc., the chairperson may also havethe authority to ask the members to leave the meeting. As I mentioned, the Executive Personnel Proposal
Review Meeting will consist of four members.

9

The Executive Personnel Proposal Review Meeting discussed the so-called Succession Plan and the selectionof the President's successor, starting in January 2023. As a result, a new president and a new management
structure were decided at the Board of Directors meeting this past January.
The Succession Plan, which is outlined in red at the bottom of the page, is in such a way that it implements
consultation and management that takes into consideration the independence of outside directors.
As shown in the document, the study was conducted five times. In fact, if we include the meetings with only
outside directors, which are hidden between the lines, there have been several more. Officially, there havebeen five such meetings, and with regard to the selection method, schedule, etc., the emphasis was placed in
the form of discussions and management that maintained the independence of outside directors, for example,
by holding interviews of candidates only with outside directors and consolidating their opinions based on
those interviews.
We believe that we were able to consider the Succession Plan with a high degree of independence andobjectivity, and in the form of our involvement in the deliberation and decision-making process for the nextmanagement structure.
Since my appointment as an outside director, a female outside director has been appointed in 2020. In 2022,
as I mentioned earlier, I, an outside director, have been appointed as the chairperson of the meeting to review
the executive compensation plan and the executive personnel plan. Similarly, the Company introduced aperformance-linked stock compensation plan.
Starting in 2023, the Board of Directors will consist of four internal directors and three external directors. As
I mentioned earlier, from April this year, the Executive Compensation Proposal Review Meeting will consist of
three outside directors, and the Executive Personnel Proposal Review Meeting will consist of outside directors
and the CEO, which will further improve governance.
During the same period, in the fiscal year in which I assumed the position of outside director, one year before
2018, in the fiscal year in March, I believe the policy shareholding was 31.6%, and in the fiscal year ended10March 2023, this figure was 14.4%, and I believe that governance has been steadily enhanced and improvedin a variety of ways. That is all for my explanation.
Imura: Mr. Tsujinaka, Executive Director, Corporate Strategy & Planning, Sustainability Promotion, will explain
the expansion of human capital and global environmental conservation and ESG evaluation.

Tsujinaka: At the beginning of the meeting, President Sagara also reported that we reviewed the materiality.
We also reviewed a part of the "Expansion of Human Capital."
In brief, we have shifted from a focus on talent development that contributes to our growth strategy to atalent strategy for the realization of our management philosophy and vision, which is to recruit and develop
talent that contribute to our growth strategy and to foster an organizational climate and culture in whichthese people can work enthusiastically. We are working on this as a talent strategy.
In addition, KPIs have been changed as shown. I will explain it later again.

11

Our efforts to expand human capital are summarized in this single slide. Under the corporate philosophy of
Dedicated to the fight against disease and pain, we are working to become a global specialty pharmaceuticalcompany.
In 2031, to overcome the Opdivo patent cliff and become a company that grows even more, we are working
on four growth strategies under our mid-term management plan. And in order to realize the four horizontal
growth strategies, we must develop talent who are willing to venture more and more into new areas. We
position and train those who are responsible for such specifications as professional talent.
In addition, we also develop cross-functional talent such as next-generation management talent, global talent,
digital talent, and innovation talent; they are positioned as cross-functional talent.
Up to this point, these employees have been selected as talent within the Company, but we are also runninga program to equally train all employees and raise their level of performance.
In addition, we have positioned our talent strategy to include fostering an organizational climate in whichthese employees are motivated to work.

12Now let me explain a few more details. I would like to start with the selected talent. First of all, we are training
our next generation of management personnel in a selective training program for people in each age group,
approximately 30, 35, 40 to 45 years old, and we are developing talent on a replacement basis.
And finally, we have been providing executive training for four years. This training started eight years ago, andmany general managers from various ONO Pharmaceutical functions have taken this course, including thenew president, Dr. Takino, and myself.
In addition, as a global talent development program, the Global Skill Improvement Program, in short, weunderstand that global talents are, of course, to be developed through work. However, we are convinced thatthe development of talent who are skilled not only in language but also in cross-cultural communication will
accelerate such a movement.
Incidentally, most of our overseas talent and global talent have entered into the international scene after
completing this program. We intend to continue to develop such talent without interruption, which will
always be conducive to globalization.

13

Next is the status of digital talent development. We divided the digital talent into three categories for training
people. People who can understand DX, people who can participate in DX, people who can lead DX. All
employees go through the understanding stage. We want to give all employees a tactile understanding ofwhat DX is all about.
We are also working to develop about 500 employees across the Company who can take on the challenge ofincorporating DX into their daily business in each function.
In addition, we are running individual programs to train about 100 employees who are well versed in both IT,
digital and business, and who can lead the entire Company's DX efforts.

14

We also offer an unusual program, the Ono Innovation Platform, a program for developing innovative talent.
As we are a pharmaceutical company, each function, such as R&D, Sales & Marketing, and CMC & production,is composed of highly specialized functions. While we nurture talent with deep knowledge and experience ina single area, we have conceived of this program in the sense of nurturing people who have a bird's eye viewof the business as a whole and who excel in new ideas.
This is modeled after a new business. We would like to think of services, etc. other than drugs in the area oflife science, and from the perspective of providing them to patients and to the world, we would like them tolearn various things from the perspective of new business and use them while experiencing things that theycannot experience in their existing businesses, we want to create innovation. This is the program that we are
executing to achieve such a goal.
We would like to develop talent that contribute to innovation through programs such as the Innovation Cafe
for learning, programs that provide opportunities to meet with venture company owners, programs thatprovide experiences that you can actually go to a venture company to improve oneself, and programs thatallow people to actually develop new businesses, and then assign a mentor to the person who has developed
the new business and run it together.

15

These are the current locations of the goals. For each goal, listed number of e have completed such a programand have become a pool of talent. We intend to continue to firmly promote the development of this program.

In addition, we will visualize and manage the talent necessary to drive and execute the four growth strategies
I mentioned at the beginning of this document. We believe that approximately 700 people will be neededover the next five years. We would like to develop and hire a total of about 700 people who will contribute to
our growth strategy, including about 500 people from inside the Company and about 200 people to be hiredfrom outside. Currently, after two years, more than 40% have been filled. We will continue to accelerate thiseffort.

16

As I mentioned at the beginning, we also offer various programs in addition to these selected talents. We are
running programs hard such as these, which are outlined in red, to all of our employees, including rank-based
training, self-development training, mission statements, and training programs that encourage employees toshare in the Company's mission statement and what the Company is aiming for.
Incidentally, the highest driver of engagement in our engagement surveys is the degree of empathy for thismission. We will continue to work hard on this project.

17

The Group as a whole provides an average of 55 hours of training opportunities per person. And we are
spending just over JPY120,000 as a cost. In addition, when the supervisors of those who have completed thetraining have rated their employees, more than 85% of the employees who have received the training havealso received some type of behavioral change. We would like to continue to work on this as well.

Next, we want to create an environment in which these employees are motivated to work, and we want tofoster an organizational climate and culture, so we have set and are proceeding with the KPIs as you can see.

18

Since FY2022, through the Mercer Engagement Survey, we have been looking at where each of us is globally,
how we compare to all industries in Japan, and how we compare to other global companies.
ONO's current value as of the end of FY2022 is 68 points, 10 points higher than the average for all industries
in Japan, but a little less than 11 points short of a global life science company. We are starting with these areas
and are working to make this global life science company a benchmark for higher engagement.

We put it like this: if we can be a company that attracts diverse talent, encourages them to stay and work fora long time, and at the same time fosters a sense of unity that has a trade-off relationship with diversity, we
can be a company with high engagement.
To achieve this, we believe that it is necessary to have an attractive corporate culture that is fair andtransparent, a system that allows employees to exercise their individuality and play active roles, and a flexible
working environment that can adapt to change. We have set KPIs for each of them based on these ideas.

19First, there is diversity in management positions. Around 2014, with the launch of Opdivo, we took a proactive
approach to career recruitment. Currently, carriers account for just under 20% of all employees, and thepercentage of carriers in management positions is increasing each year. I believe that this ratio will continue
to increase, and that the ratio of career to proper managers will increase a little more in favor of career
workers.
On the other hand, the challenge is the composition of management positions for female employees. As ofJanuary 2024, the rate is 5.6%. There was once a time when the percentage was less than 2%. To improve thissituation, we have been increasing the percentage of female employees in recruitment since around 2011.
From around 2019, we have decided to increase the number of employees who are one step ahead ofmanagement, or in other words, those who are at the level of assistant managers, as they are often referred
to in Japanese companies. We have therefore achieved our goal of increasing the percentage of female
employees to at least 15% among assistant managers from 2019 to 2022.
And since last year, we have been working to achieve the goal of expanding the ratio to 10% in five years and
20% in 10 years, through corporate reports and other means. As of last year, it was 4.1%, and after one year,
it has increased by 1.5% to 5.6%. Although our efforts are still insufficient, we will work hard to increase thisratio and aim for a more diverse organization.

20

In addition, we are expanding our internal recruiting program, which we call the Diversification of Experienceand Perspective Development Program. Those who have been with the Company for more than three years,
for example, challenged to expand their individual diversity by going out to new areas, such as sales &marketing, development, or discovery & research, rather than their former departments.
We had been thinking about it since 2017 to 2018 and started in 2019, but it did not work for the first three
years. Finally, around 2022, the program began to function, and 25 people were transferred using thisprogram last year. This year, 52 people have taken on new work challenges. In addition, probably 60 people
will be transferred this year.
We would like to use these programs to work on the blossoming of individual diversity.

21

In addition, some people are hesitant to suddenly take on other occupations. For such people, we haveintroduced a challenge job system in which employees can challenge various departments remotely for 20%
or one day out of five days in a week.
In FY2022, the program was introduced on a pilot basis and 20 people challenged. Half of these employees
have been transferred through the internal recruiting program which I mentioned earlier. This year, 46 people
are currently trying out for new positions, just once a week.
Through these programs, we hope to further increase the diversity of individuals within the Company.

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In addition, we are also working to diversify our work styles. It is often referred to as the post-COVID-19 styleof working. We assume that remote work has advanced considerably in all companies during COVID-19.
What are we going to do post-COVID-19? So, starting in May 2023, ONO decided to define the style of working
by department. Jobs with many different outcomes: discovery & research, development, and sales &marketing. Instead of making it uniform company-wide, we decided to set it up by each department and workon it. The Company only required people to take the initiatives for team building at least twice a month. Other
than that, each department was allowed to decide anything necessary firmly on its own. They may work faceto-face or in a hybrid work style that incorporates remote work. A super-flex system has also been introduced.
We would like to explore more efficient styles of working while sharing diverse ways of working.
In addition, we started a system of side/concurrent jobs in June last year. This has allowed more than 40
employees to step into new places so far. We hope that by doing this, they will gain experience that theywould not be able to have within the Company and bring that experience to the Company to help diversify
the Company.

23

Through these efforts, the number of points of engagement has increased by 1 point in a year. And with global
life science companies, we were able to reduce the gap by 3 points from 11 points last year. We are still in theprocess of working on this, but we will continue to make firm efforts.

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This is the last slide. We are also making a strong effort to promote health management. We believe that thehealth of our employees and their families is what makes our work possible. We offer a variety of programsfrom all perspectives, including physical, mental, and lifestyle aspects, and we are currently working to achieve
our goal of a three-year age difference between actual age and healthy age.
In recognition of these efforts, the Company has been selected as the “White 500, Certified Health &Productivity Management Outstanding Organization“, for six consecutive years. In addition, the Company was
re-selected this year for the “Health & Productivity Stock“. We will continue to expand our human capitalthrough these efforts.

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Next, I would like to explain a brief introduction about global environmental conservation. We are reviewing
the materiality of this as well. We have changed the concept from global environmental protection toconservation and have set a variety of KPI's.

We are working to realize a decarbonized society, a water recycling society, and a resource recycling society
under the title of Environment Challenging Ono Vision “ECO VISION 2050.”

26

In the current fiscal year, we have also reestablished our medium- and long-term environmental targets. The
largest part of our efforts is to achieve net-zero greenhouse gas emissions by 2035, 15 years ahead of ouroriginal target of net-zero emissions in 2050.

We have set challenging goals for each of them, and we are not only setting them in words, but we are also
moving forward with the establishment of a clear roadmap.

27

At the same time, we are working to preserve the biodiversity of the global environment. In line with the deep
approach of locate, evaluate, assess, prepare, we are currently developing initiatives to minimize ONO's
negative risks to biodiversity through ONO's operations and to contribute to nature positivity, which we canonly do as ONO. In this regard, we intend to strengthen our environmental efforts even more firmly bydisclosing information in line with the TNFD from the next fiscal year.

28Finally, we would like to provide an update on the status of ESG external evaluations. As you can see, we havebeen selected for the DJSI World Index for three consecutive years, and we have also received a double-A
rating from the CDP in the areas of climate change and water for three consecutive years.
We will continue our efforts to be a company that is recognized by the world for its environmental initiatives.
That is all from me.

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Question & Answer
Imura: Mr. Muraoka, please go ahead.
Muraoka: Hello. This is Muraoka from Morgan Stanley MUFG. Let me ask a question to Mr. Nomura. As far as
the Succession Plan is concerned, I would like to take it a little further, just to the extent possible, what kindof discussions have you had? There may have been some opposition, maybe not so much from outside theCompany, but what was the breadth of the discussion? It would be very helpful if you could share information
with us to the extent possible.
Nomura: Thank you for your question. I think your question was about what kind of discussions were held, tothe extent possible.
As I explained earlier, we outside directors were firmly involved, and in retrospect, I believe we were able toenhance our independence in our discussions and operations. As for the content of the discussion, I andanother outside director, Mr. Nagae, Special Corporate Advisor of Panasonic Corporation, were discussing
how to proceed with the selection process and the schedule, referring to our own experiences and othercompanies' case studies as experienced corporate management professionals, we started with suchdiscussions.
Also, regarding the status of candidate training, there were many executive officers and above who have been
trained in the management development program, so we confirmed the details of the program andconsidered the candidates in the form of a set of candidates.
We also discussed the image of the president that ONO needs today, and in general, the qualities of a new
manager who can match the tough times ahead or times of change. I believe that we were able to have a very
deep and dense discussion.
Based on these assumptions, we took the time to interview the candidates and finally selected Dr. Takino asa candidate for president. As you have just asked about this, each person involved in this case had their own
thoughts on this.
The only thing in common among us was that ONO is now entering an important phase in which it will takeon the challenge of becoming a global company with the Opdivo cliff ahead of us. We, including the outside
directors, agreed that Dr. Takino is the most suitable person for the position because he has the talent to lead
the Company's sustainable growth, as well as the career and ability to lead our employees and promote andrealize the globalization. That is all for discussion and comments.
Muraoka: Thank you. Now, one more question, which is slightly different from today's discussion, but which
I would also like to ask you, Mr. Nomura, is what you usually think about when you are working as an outside
director.
In the past few days, especially, I have been reminded that another company, which has been experiencing
problems with the side effects of its products, and various problems affecting people in the supply chain. Onceagain, I believe that pharmaceuticals are inextricably linked to health risks.
My question is that even when difficult problems like this occur, the outside directors may be in a position
where he/she could be held responsible in a sense due to the duty of due care and attention, but how do you
manage such risks including such small efforts, even though you are not a professional in medicine? For30

example, how do you make an effort to nip such a small risk in the bud? I'm asking in the hope that I can learnsomething that we can share.
Nomura: I don't know if this will answer your question, but ONO is also evaluating the effectiveness of theboard of directors, and we, the outside directors, would like to visit the site as well, and we conduct
inspections of research institutes, manufacturing plants, etc. As for your question, I used to work in the gas
industry, so I was always at risk of such accidents, so I was wondering if there were any near-misses at thesite. I personally believe that this is the way to confirm the safety and the attitude of employees in their efforts
while being shown the site.
Even though we are in different industries, I would like to have the Company show me the frontlines andexchange opinions with the employees on the frontlines. In the process, we are wondering if there are any
hidden risks that could be shown to us.
I am aware of the question you just asked, but I think it is important for every industry and every company tobe aware of what will happen when the problem becomes bigger, rather than thinking of it as someone else's
problem. We believe that doing so will help to reduce or even prevent accidents. I hope I have answered yourquestion.
Muraoka: Thank you. It was helpful. T
Imura: Next, Ms. Yatsunami of Nissei Asset Management, please go ahead.
Yatsunami: I have two questions. First, you have just explained the details of the Executive Personnel Proposal
Review Meeting. I would like to ask you about the other one, the actual activities of the Executive
Compensation Proposal Review Meeting. In terms of how Mr. Nomura evaluates the Company’s executive
compensation system at present: for example, sorry if my understanding is wrong, but in the case of yourcompany, there is a large portion of fixed remuneration and continuous service, and there is no index for stock
price, and the performance-linked portion is more qualitative evaluation. What kind of discussions are being
held at the review meeting? Or, if you are going to change something in the future, what kind of changes, ifany, ONO needs to make in the compensation system to achieve globalization in the future? Could you tell us
about this?
Nomura: Thank you for your question. First of all, as I mentioned at the beginning, we have changed executive
compensation to the current performance-linked compensation in 2022. Before it was changed, the fixedcompensation portion was 70%, and the performance-linked portion was 30%, including bonuses and stock,
but we have brought this to 50%/50%, and at present the fixed portion is 50%, the performance-linked
compensation bonus is 25%, and the performance-linked stock compensation is 25%, for a total of 50% of theperformance-linked portion. First, the Company has increased the proportion of performance-linked
compensation.
There was also a question in the form of an indicator against the stock price that was not included. Although
ROE is included in some performance-linked portions, we currently do not include indicators that directlyreflect stock price trends.
As related to the previous question, I personally believe that the role of outside directors is to enhance
corporate value over the medium to long term, and that this is our greatest responsibility to our stakeholders.
ONO, as I am sure you know, is aiming to become a global specialty pharmaceutical company by 2031, with aview to the Opdivo cliff.
The four growth strategies, ESG, and materiality, as explained earlier, are included in the evaluation items. I
personally think that they are difficult to quantify. Progress, content, and enrichment of the content are the31things that are subject to evaluation. So, I think that was 70% of the total, and the performance-linked
remuneration portion is a qualitative evaluation of performance.
In terms of a series of movements, that’s the way it’s going to be however, in the future, we will also refer tothe systems and standards of other companies in the same industry with regard to the current compensationof directors. I still think that this could change significantly in the future, and that the performance evaluation
portion of compensation will become a higher part of compensation. I believe that this is a major trend, andwe will continue to discuss a more appropriate executive compensation system.
Yatsunami: Secondly, I think this is part of what you have just explained. I understand that you have alreadyexplained the concept of your quantitative mid-term plan to the outside world, but you have not announced
it in any quantitative way. You have just explained a little about how the board of directors evaluates the
progress of mid-term strategies, quantitative evaluation, and monitoring in the evaluation of directors'
compensation. If there is anything to add, please let us know.
Nomura: Okay, I will outline this as well. Basically, the Board of Directors also monitors the progress of themedium-term management plan, as a matter of course. The progress of each theme is presented at the Boardof Directors' meeting, and we, as outside directors, give our opinions, impressions, and point out problems.
Basically, not a numerical target for the mid-term business plan, but we have rather a big supreme goal of
becoming a global specialty pharma company. We have 18 materialities toward this goal, and the Board of
Directors discusses, confirms, and points out the reasons for setting each of the materialities, the medium- tolong-term vision, indicators, which are also included in the CG Report, and major initiatives, and the progressof these. We monitor the progress of each individual issue as we strive to become a global specialty
pharmaceutical company.
Yatsunami: I understand your thoughts very well. Thank you.
Imura: I would like to ask Mr. Yamaguchi of Citigroup Securities, please go ahead.
Yamaguchi: Your company has a history of producing very distinctive products in R&D. On the other hand,
the Opdivo cliff is quite large in terms of size. I think you must be troubled by the balance between quality
and sales when you have to choose between R&D values that are unique to your company and products thatare not unique to your company but are okay because they will sell anyway. At present, I expect that you will
not compromise in terms of quality or originality, and have you been doing so for a long time? Or have you
been flexible depending on the situation? I would like to ask Mr. Sagara.
Sagara: You are asking me a question with a good understanding of ONO's history and direction; basically weare always aiming for innovations such as prostaglandins, enzyme inhibitors from the same period, PD-1, andother innovations like these.
However, Opdivo patent expiration will be a big one. Therefore, if the policy is to fulfill unmet needs at a
certain time, we consider, or may consider incorporating them into the enhancement of the pipeline, even if
they are not particularly great innovations.

Imura : Mr. Sakai of UBS Securities, please go ahead.
Sakai: This may be getting off the subject, but I am very concerned about animal testing, and I have been tovarious ESG and sustainability meetings held by pharmaceutical companies this year, but not a single company
has mentioned this point. At the end of the presentation, Mr. Tsujinaka mentioned that biological diversity is

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an issue to be considered in the future, but I wonder if this part is included in that. This is just from my personal
feelings. I am a member of WWF, but one thing is that I am still concerned about animals.
Last year, there were reports that the cost of so-called crab-eating monkeys soared to JPY10 million per animal,
and there were also reports that the progress of clinical trials for anticancer drugs in the US was delayed. Inthat sense, I think it is important to reduce this part of the burden and burden in terms of sustainability. Whatdo you think about this? Is this part of the process taboo for pharmaceutical companies? Or is there any otheridea that you have in mind? I would like to ask just for a reference, please.
Tsujinaka: Thank you for your question. First of all, in response to Mr. Sakai's question about whether thebiodiversity initiative has been able to reduce or start to think about the reduction of animal testing at the
research stage, we unfortunately have not yet been able to go that far. We want to investigate the possibility
that the various chemicals and other substances discharged by us may be contributing to the negative
situation, and to reduce these negative factors as much as possible, and to qualitatively and quantitatively
eliminate the negative aspects of the situation.
As for Nature Positive, it is very difficult to prove objectively, but we would like to think of ways specifically tocontribute to Nature Positive in the areas where ONO has laboratories and manufacturing plants, as well as
wetlands in the regions where we do business, in a way that is unique to a pharmaceutical company.
Mr. Sakai, we have not yet reached the point of deepening the discussion on what is going on with animal
testing and what about the issue of crab-eating monkeys.
On the other hand, we think you have a good point. We will discuss this with the research division, andalthough we may not be able to immediately provide a numerical target, we will make every effort to present
some kind of direction, goal, or somewhat our attitude. I don't think I have answered your question
adequately, but what do you think?
Sakai: I see. I would like to ask you to answer the question again next time. Thank you very much.
Imura: We would like to conclude today's ESG briefing. Thank you all very much for taking time out of yourbusy schedules to join us today.

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