Mochida Pharmaceutical Group

Integrated Report2022

CONTENTS
1

Value Creation Story

03 Basic Management Policies

3

Governance

27 Corporate Governance

03 Motto and Corporate Philosophy

31 Business Risks

03 Long-term Vision / Vision for 2031

32 Compliance

05 Medium-term Management Plan

33 Officers

06 Code of Conduct

07 Corporate Development
09 Value Creation Process
11 Consolidated Financial Highlights

435 Environment
35 Consideration for the Environment

11	Changes in Major Consolidated Management

35 Environmental Management

Indicators

35 Environmental Initiatives

13 Interview with the President
2

By meeting medical and healthcare needs,
we aim to make an even greater contribution
to the improvement of human health.

Business Activities

Environment and Society

38 Environment Action Plan (Targets and results)

39 Society
39 Relationship with Employees

17 Pharmaceutical Business

41 Relationship with Society
42 Relationship with Local Community

17 Research & Development and Licensing Activities
20 Production
21 Quality Control and Safety Management
21 Sales and Information Provision Activities

24 Biomaterials Business
25 Healthcare Business

There are definitely things that we can do for patients.

5

Corporate Information

43 Consolidated Financial Statements
47 Share Information
48 Corporate Data
49 Our History

We will continue developing innovative medicines by grasping medical and healthcare needs.
Editorial Policy To increase stakeholders’ understanding of the Mochida Pharmaceutical Group, we have published this report as anintegrated report integrating non-financial information, such as our value creation story, business activities and ESG information, andfinancial information. When preparing this report, we referred to the International Integrated Reporting Framework advocated by theInternational Integrated Reporting Council (IIRC).

Motto

Organizations covered
Period covered
Published:

Farsighted, Innovative ResearchMochida Pharmaceutical Group (Mochida Pharmaceutical Co., Ltd. and its consolidated subsidiaries)

Centered on activities from April 1, 2021 through March 31, 2022, but also refers to more recent news

September 2022

Cautionary Note This integrated report contains statements that constitute forward-looking statements. These statements are based on
management’s current assumptions and beliefs in light of the information currently available to it and involve known and unknown risks
and uncertainties.
Actual results may differ materially from those in the forward-looking statements as a result of various factors. Information aboutpharmaceutical products (including products currently in development) which is included in this integrated report is not intended toconstitute an advertisement or medical advice.
This material is an English translation of the integrated report issued on September 26, 2022 in Japanese, and the Japanese version
is given priority regarding content and interpretation.

Corporate Philosophy

Actively contributing to human health and well-being in the field of medicine,
totally committed to the development of innovative products.

Mochida Pharmaceutical Group Integrated Report 2022

The stained-glass window expresses a prayer for health and depicts St. Luke, the patron saint of the
medical profession, administering medicine to people who are suffering.
This stained-glass window is displayed in the lobby of Mochida’s Head Office Building.

Mochida Pharmaceutical Group Integrated Report 2022

1 Value Creation Story

Basic Management Policies
Motto and Corporate Philosophy
Mochida Pharmaceutical Group has adopted “farsighted, innovative research” as its motto. Meanwhile, our corporate
philosophy “Actively contributing to human health and well-being in the field of medicine, totally committed to thedevelopment of innovative products” is our fundamental mission. We believe that our raison d’être is to create and provide
valuable products to patients and customers by capturing potential medical and healthcare needs to help people sufferingfrom illness or health problems.

Long-term Vision / Vision for 2031
Mochida Pharmaceutical Group’s long-term vision is to “Grow as a unique life and healthcare group whose raison d’être isrecognized internationally and which meets medical and healthcare needs.”
In May 2022, to achieve sustainable growth by overcoming a business environment that is expected to become
increasingly severe in the future, we have given shape to our long-term vision and developed the “Vision for 2031” that theGroup aims to realize in 2031, a milestone year 10 years from now.
Amid the diversification and sophistication of medical care, such as addressing intractable and rare diseases that havebeen difficult to treat with conventional small molecules and antibody drugs alone, to take on the challenge of addressing
unmet medical and health needs by incorporating new drug discovery modalities that are expected to grow in the future.
In addition to the current mainstay pharmaceutical and healthcare businesses, to work to position the biomaterials
business as one of the pillars of the next generation.

Efforts toward 2031
Pharmaceutical businessTo incorporate new drug discovery modalities, such as cells, nucleic acids, and genes, to enhance our drug discovery
pipeline and maintain the position as a core business;
Among them, to position regenerative medicine products as one of our focus areas and give priority to projects using
mesenchymal stem cells;
To launch products from our pipeline that incorporate new drug discovery modalities, including regenerative medicine
products, by FY2031.
●

Basic Management Policies

Raison D’être

Motto

Corporate
Philosophy

Medium- andLong-term Aspirations

Long-term
VisionMedium-termManagement Plan

Fundamental
Approach

Code of Conduct ofMochida Pharmaceutical Group

Mochida Pharmaceutical Group
expresses its raison d’ être in its mottoand corporate philosophy. It thenindicates its medium- and long-term
aspirations in its long-term vision andthree-year management plan.
We set out our fundamental approachfor conducting corporate activities in
an appropriate manner, striving forcompliance, and contributing to therealization of a sustainable society in
our Code of Conduct.

Vision for 2031
Long-term Vision

Grow as a unique life and healthcare group whose raison d'être isrecognized internationally and which meets medical and healthcare needs.

●

Materialize●

Biomaterials businessTo promote each project based on alginate, which is expected to have various medical applications, and work for an
early launch and business expansion. Also, to promote development with a view to global expansion.

Vision for 2031●

Healthcare businessTo focus on developing high-performance, value-added dermatological skin care products through communications withphysicians, pharmacists, and nurses etc.
To steadily expand the scale of our business by improving our business structure via the investment of sales resources,
etc., focusing on new areas, and introducing new and renewed products.

As a life and healthcare group, take on the challenge of addressing
unmet medical and health needs by incorporating new drug discovery
modalities that are expected to grow in the future.

●●

Global expansion
To expand into overseas markets by offering a lineup of distinctive products that meet the needs in each businesssegment;
To launch highly purified EPA drugs in Vietnam, China, the U.S., and other countries, subsequently to Thailand;Also, to promote the development of medical devices in our biomaterials business and regenerative medicine products in
our pharmaceuticals business, which we aim to launch in the future, with a view to global expansion.
●●●

Pharmaceuticals
Expand business domains
by incorporating new drug
discovery modalities(e.g., regenerative medicine
products)

Biomaterials
To promote each projectbased on alginate andexpand business

Healthcare
To pursue further growth byinvesting sales resources

Maintain the position as ourcore businessTo lineup distinctive products and lead them to global markets

03

Mochida Pharmaceutical Group Integrated Report 2022

Mochida Pharmaceutical Group Integrated Report 202204

1 Value Creation Story

Scale of business targeted for 2031
We aim to achieve sales of approximately 40 billion yen, including product fields such as the biomaterials business products
and regenerative medicine products in the pharmaceutical business, which are positioned as one of the pillars of the next
generation.
With these new businesses as growth drivers, we aim to develop our business to achieve total net sales of 140 billion
yen and an operating margin of 15%.

Medium-term Management Plan
To realize its “Vision for 2031,” Mochida Pharmaceutical Group has adopted the 22-24 Medium-term Management Plan as
an action plan for issues to be addressed over the next three years from the perspective of the sustainable enhancement ofcorporate value and in alignment with its Group’s Basic Sustainability Policy.
The business environment surrounding the pharmaceutical industry is expected to become even more challenging
going forward, given the continued promotion of policies to curb drug costs against the backdrop of the problem of securing
financial resources for social security expenses. The Group will continue to invest in growth to realize its “Vision for 2031,” inspite of the expectation of a temporary deterioration in earnings during the 22-24 Medium-term Management Plan period.

Medium-term Management Plan
Policy for the fiscal years 2022 through 2024
We will respond to medical and healthcare needs with concentration of the total power of theGroup covering research and development, manufacturing and marketing, pursue sustainablegrowth by promoting selection and focusing processes, and restructure the earnings structure to
respond to further environmental changes.

Key issues to be addressed
We will focus on the following issues under the theme of innovation creation and productivity improvement.
1. Maximization of profits in targeted areas with a focus on new drugs
To concentrate our resources on the targeted areas (cardiovascular medicine, obstetrics and gynecology, psychiatry,and gastroenterology) to maintain our prominence and maximize earnings from new drugs in our core pharmaceuticalbusiness;
To continually work to maintain a stable supply and proper quality of our products, while promoting improvements in our
cost structure by reducing procurement costs and reviewing our product lineup.
●●

2. Continuous investment in growth to realize the “Vision for 2031”
To pursue investments in business activities that will lead to future competitiveness;
To work to expand and promote the biomaterials business and aim for an early launch;To incorporate new drug discovery modalities, such as cells, nucleic acids, and genes. To give priority to development
especially in the field of regenerative medicine products.
●●

3. Strengthening of the corporate organization to create innovation and improve productivity
To harmonize and coordinate four approaches: optimization of business processes and business quality level, promotionof digital transformation, institutional reform, and the promotion of facility management, in order to achieve efficientorganizational operations and increase corporate value;To continue to support capacity development to improve performance and promote the development of humanresources that will drive innovation;
To focus on strengthening our human resource management system to ensure development and vitalization of humanresources;
To work to improve our organizational capabilities by optimizing our personnel strategy and allocation, whilestrengthening interdepartmental cooperation.
●

Code of Conduct
Mochida Pharmaceutical Group sets forth its fundamental approach not only for conducting corporate activities appropriatelyfrom the ethical perspective as a life and healthcare business, but also for striving for compliance (i.e. sincerely responding to
the needs of society including legal compliance), which is an absolute precondition for going concern as a social existence
and for contributing to realization of a sustainable society, as follows.

Code of Conduct of Mochida Pharmaceutical Group
1. Fundamental Approach to Business Activities(1)	We contribute to human health / well-being through stable supply of highly effective and safe products as a life /healthcare business.
(2)	Through appropriate business activities, we aim to gain the support of internal and external stakeholders.
(3)	In all our corporate activities, we ensure fairness and transparency, and if ever our commercial interests are atodds with our ethical principles, we choose the ethical course of action.
(4)	We always take environmental impacts into consideration in our business activities.

2. Fundamental Approach towards Social Demands(1)	We comply with laws, regulations and our rules established by each internal department, respond sincerely tothe various demands of society, and conduct corporate activities with high ethical standards. We also pursue
activities on an ongoing basis to nurture ethical awareness of all employees.
(2)	We appropriately manage company information and disclose accurate information quickly and fairly tocommunicate openly with society.
(3)	We respect the personality and individuality of all employees and aim to realize diverse work styles and to
improve the skills of each employee. We also strive to maintain and improve safe and healthy environment at
workplace.
(4)	We make sure that risks which might affect our business activities are managed as an enterprise.
(5)	We maintain a resolute attitude against anti-social forces.

3. Fundamental Approach of Senior Management (Led by Representative Director)(1)	Senior management will serve as a leading model to instill this Code of Conduct in the employees of MochidaPharmaceutical Group, recognizing its responsibility to materialize the spirit of this Code of Conduct.
(2)	Senior management will develop effective internal systems with comprehension of internal and external
feedback and seek to materialize corporate ethics.
(3)	Senior management will provide a whistleblowing hotline as one such effective internal system by which anyone
who notices a violation or potential violation of this Code of Conduct may report quickly and easily. Further, wemanage the facts and details known by whistleblowing in the strictest confidence and strictly preserve theinterests of whistleblowers, prohibiting any retaliatory action or disadvantageous treatment against
whistleblowers.
(4)	In the event of violation of this Code of Conduct, senior management will take responsibility for resolving theissue and strive to investigate the cause and to prevent its recurrence.

●

●

●

05

Mochida Pharmaceutical Group Integrated Report 2022

Mochida Pharmaceutical Group Integrated Report 2022

06

1 Value Creation Story

Corporate Development
Since its foundation, Mochida Pharmaceutical Group has consistently grown by contributing to medical advances in Japanas the first company in Japan to manufacture injections and a developer of “unique products” encompassing hormones,
enzymes and immunology, in line with its motto “farsighted, innovative research.”
The Group will constantly pursue “unique value” and, as a group in the life and healthcare business, will strive to meet
unmet medical and healthcare needs.

2022
●

1999
●

History

Unique products

Mochida Pharmaceutical Group traces its origins back to1913 when founder Ryokichi Mochida opened a pharmacy
in Hongo, Tokyo and began manufacturing
pharmaceuticals.
Starting with Ogoko, the first ophthalmic ointment
developed in Japan, Mochida provided unique products,
whilst branching out into new areas such as hormones,
enzymes, immunology, biopharmaceuticals and in-vitro
diagnostic agents.
We subsequently became a joint-stock company in1945 and, with the launch of sales and marketing activities
in 1949, we became a fully integrated pharmaceuticalcompany covering everything from R&D through to sales
and marketing.
We will continue seeing increasingly diverse medical
and healthcare needs as a business opportunity, andcreating useful new drugs in our core pharmaceuticalbusiness while also tackling new business areas such as
regenerative medicine. We will also put effort into thehealthcare business, building on the progress we havemade over more than 50 years, and into the biomaterials
business.

After Ogoko, the first ophthalmic ointment developed inJapan, we developed numerous hormonal preparations,
including Pelanin, the first estrogen preparation developedin Japan, progesterone preparations, and pituitaryhormone preparations, building a reputation as a pioneerof hormonal preparations. We also released numerous
enzyme preparations such as Sprase, and the technology
we developed in this field was later used as a basis for our
biotechnology activities, including the development ofinterferon preparations.
Epadel, launched in 1990, was the world’s firstpreparation of high purity eicosapentaenoic acid (EPA).
EPA is one of the fatty acids found in fish such as sardines.
Furthermore, we improved the formulation of thisproduct aiming at maximizing intestinal absorption andlaunched Epadel EM in 2022.

●

Pelanin(first estrogen preparation
developed in Japan)

Ogoko(ophthalmic ointment)

1,200

Lialda®
(treatment for ulcerative colitis)

2011
●

1990
●

Epadel(world’s first high-purity
EPA preparation)

Lexapro®
(antidepressant)
1,000

2008
●

Dinagest(treatment for endometriosis)

800

1985
●

Miraclid(world’s first ulinastatin
preparation)

Collage Cream(first basic skin care product containing
soluble collagen developed in Japan)

1970
●

400

Skina Babe(baby bath oil)

1951●

Sprase(first hyaluronidase
preparation developed in Japan)

1945
MochidaPharmaceuticalCo., Ltd.
was established.

1913
Mochida wasfounded in Hongo,
Tokyo.

1913

●

1980

1913
●

2016

Collage Furfur(first shampoo containing
antimycotic ingredientsdeveloped in Japan)

Net sales(100 Millions
of Yen)

600

1932
●

Epadel EM(a self-emulsifying formulation ofhighly purified EPA)

2004
Mochida HealthcareCo., Ltd. commenced
operation.

1970
Established theParamedical Division.
1963
Listed on the Second
Section of the Tokyo
Stock Exchange (TSE).

2005
MochidaPharmaceutical Plant
Co., Ltd. commenced
operation.

2014
MochidaPharmaceutical Sales
Co., Ltd. commenced
operation.

200

1975
Listed on the First
Section of the TSE.
0

1945

1970

1990

2010

2020

(For some products, the year of launch is given)

07

Mochida Pharmaceutical Group Integrated Report 2022

Mochida Pharmaceutical Group Integrated Report 202208

1 Value Creation Story

Value Creation Process
Mochida Pharmaceutical Group aims to grow as a unique life and healthcare group which meets

healthcare businesses. Through the above activities, we aim to provide value as a pharmaceutical

medical and healthcare needs, gaining global recognition for its raison d’être, in accordance with its

company in the form of “improvement in the QOL of patients and their families,” “support for the

corporate philosophy “Actively contributing to human health and well-being in the field of medicine,different stages of a woman’s life” and “contribution to human health and well-being.” We are also

totally committed to the development of innovative products.” We are committed to the “creation ofcommitted to contributing to the realization of a sustainable society, which will, in turn, lead tounique products to meet needs,” the “stable supply of high quality pharmaceuticals” and the “properachievement of the SDGs, and we will strive for sustainable enhancement of corporate value throughprovision of valuable information” through our activities in the pharmaceutical, biomaterials andcontinuous growth as a company needed by society.

Social issues

Unmet
medicalneeds

Business Activities

Capitals

Contribution tohuman health and well-being

Financial capital

Improvement in the QOL of patients and their families
Support for the different stages of a woman’s life

Human capital
Improvementof QOL

Provision of value

Pharmaceutical business

Creation of unique products that meet needs
Stable supply of high quality pharmaceuticals

Intellectual capital

Proper provision of valuable information
Escalationof
medical costs

Social capital

Biomaterials businessContribution to a sustainable society
Our contribution to the SDGs

Manufactured capital
Women’shealthHealthcare business
Natural capital
Code of Conduct
of MochidaPharmaceuticalGroup

Human resource development
Compliance

Sustainable enhancement of corporate value
Materiality
09

Mochida Pharmaceutical Group Integrated Report 2022

Material issues which Mochida Pharmaceutical Group should address
as a priority for the sustainable improvement of corporate value

Mochida Pharmaceutical Group Integrated Report 2022

10

1 Value Creation Story

Consolidated Financial Highlights
Net sales

Operating income andoperating margin(Millions of Yen)

(Millions of Yen)(%)

(Millions of Yen)

120,000

20,00015.0

12,000106,761

Profit attributable to owners of parent

110,179

109,643

10.9

9,023

14,3929.7

80,000(Millions of Yen)

(Millions of Yen)

300

180,000

15,000277.39155,047227.27

8,587

8,435
10.0

8.7

11,662(Yen)

159,019

163,139

161,791

157,488

11.9
11.2

222.29212.87200

8,000

119,687

120,000

125,110

(%)

11.7
11.2

120,665

126,974

12.0

10.5

13,003
11,912

11.7
15,000R&D expenditures andR&D expenditures-to-sales ratio

10,56913.1

101,799 102,995

Total assets and net assets

Net income per share

12,295

11,884
10,849128,646
10,000

8.0

5,000

4.0

12,003

10,59010,0008,807
117.56

4,598
40,000

5.0

4,000

0.0

0

100

60,0005,000

02018.32019.32020.32021.32022.302018.32019.32020.32021.32022.32018.32019.32020.32021.32022.302018.32019.32020.32021.32022.3Operating income
Operating margin

0

2018.32019.32020.32021.32022.302018.32019.32020.32021.32022.30.0

R&D expenditures
R&D expenditures-to-sales ratio

Total assets
Net assets

Changes in Major Consolidated Management Indicators(Millions of Yen)

2013.32014.32015.32017.32018.32019.32020.32021.32022.3

Net sales

89,21093,94787,252

2016.392,272

97,349106,761

109,643

101,799

102,995

110,179

R&D expenditures

12,519

11,961

11,777

13,454

15,226

11,912

13,003

11,884

10,84912,295

Operating income

14,017

16,60011,68912,154

11,374

11,662

10,5908,807

12,003

14,392

Recurring income

14,188

16,79911,90912,392

11,64812,008

10,928

9,154

12,26014,79910,569Profit attributable to owners of parent

9,152

9,892

7,544

8,150

8,526

9,023

8,435

4,598

8,587

Comprehensive income

10,227

11,514

8,860

9,121

9,686

11,257

11,467873

11,412

7,619

Total assets

120,828

130,669

127,557

137,713148,372

155,047

159,019

157,488

161,791

163,139

Net assets

88,542

93,68898,670104,929

111,869

119,687

125,110

120,665

126,974

128,646

Net cash provided by (used in) operating activities

11,90912,4785,122

15,211

5,583

3,283

12,565

9,347

9,198

7,459

Net cash provided by (used in) investing activities△ 1,964△ 4,359△ 1,953△15,576△ 1,835△ 426△ 1,121△ 1,760△ 880△ 2,007

Net cash provided by (used in) financing activities△ 4,122△ 6,089△ 5,288△ 2,917△ 3,291△ 3,483△ 6,094△ 5,328△ 5,112△ 5,956

Cash and cash equivalents at end of year

33,72335,753

33,63530,35130,80830,18235,532

37,791

40,98740,515

Per-Share Information*
Net income (EPS) (yen)221.13244.33188.63205.23214.73227.27212.87117.56222.29277.39Net assets (BPS) (yen)2,153.67

2,332.58

2,484.20

2,642.32

2,817.36

3,014.53

3,189.15

3,113.69

3,317.92

3,424.21

Shareholders' equity ratio (%)

73.3

71.7

77.4

76.2

75.4

77.2

78.7

76.6

78.5

78.9

Return on equity (ROE) (%)

10.7

10.9

7.8

8.0

7.9

7.8

6.9

3.7

6.9

8.3

Price to earnings ratio (PER) (times)

13.7

15.1

20.9

20.4

19.2

16.5

26.7

35.5

19.3

13.5

Number of employees(Average number of part-time employees)

1,753
(398)

1,726
(402)

1,746
(417)

1,726
(420)

1,713
(418)

1,666
(420)

1,617
(448)

1,581
(482)

1,558
(504)

1,544
(503)

Financial Indicators* The Company conducted the consolidation of shares of its common shares at a rate of one share for every five shares on October 1, 2013. The Company also conducted
a two - for- one share split of its common shares on April 1, 2019. Per- share information is calculated on the assumption that the share consolidation and share split wereconducted at the beginning of the fiscal year ended March 31, 2013.

11

Mochida Pharmaceutical Group Integrated Report 2022

Mochida Pharmaceutical Group Integrated Report 2022

12

1 Value Creation Story

Interview with the President
Through our business activities,
I am committed to fulfilling oursocial responsibility of contributing
to human health and well-being andstrive for sustainable growth andimprovement in corporate value.

Naoyuki Mochida,
Representative Director, President

Q

Tell us about the business results and achievements in fiscal year 2021.

A

Thanks mainly to sales growth in the pharmaceutical business, we achieved gains insales and income, with our sales and net income jumping to the highest levels in our
history.

In the pharmaceutical industry, there was the first-ever off-year NHI drug price list revision in April 2021, in order for thegovernment to maintain the policy of pharmaceutical cost reductions in the context of the need to secure stable financial
resources for the social security system. Competition between companies is also intensifying, and the business environment
remains harsh.
In this environment, we started FY2021 expecting declines in sales and income, however, thanks mainly to sales
growth in the pharmaceutical business, we ended up posting gains in sales and income, with our sales and net income
jumping to the highest levels in our history.
The pharmaceutical business reported increased sales, mainly reflecting sales growth driven by new drugs, as well as
royalties received. The healthcare business posted higher sales on the back of growth in sales of the Collage Furfur series ofshampoo, rinse and soap products containing an antimycotics, the Collage Furfur Hair Growth series, and the Collage Repair
series of basic skin care products.
Operating income rose, reflecting an increase in gross profit, despite higher selling, general and administrative
expenses primarily attributable to higher research and development expenses.
13

Mochida Pharmaceutical Group Integrated Report 2022

Looking at our development pipelines, we filed for NDA of MND-2119* for the treatment of hyperlipidemia andMD-711, inhaled treprostinil, for the treatment of pulmonary arterial hypertension. Furthermore, as a second project in thebiomaterials business, we also began an exploratory clinical trial for dMD-002, a treatment for cavernous nerve injury.
We launched several new products, the adalimumab biosimilar Adalimumab BS MA. Mochida Healthcare released
Collage Furfur Hair Growth Foam, a medicated hair growth agent for women and Collage Furfur Scalp Shampoo, a*Launched as Epadel EM in September 2022
medicated shampoo.

Q

Tell us about “Vision for 2031,” announced in May 2022.

A

We aim to meet medical and healthcare needs through new drug discovery
modalities. We will also position the biomaterials business as one of the pillars of
the next generation.

The Group has always conducted business activities with “Grow as a unique life and healthcare group whose raison d’être isrecognized internationally and which meets medical and healthcare needs” as its long-term vision. To expand on our pastefforts and achieve sustainable growth by overcoming a business environment that is expected to become increasingly
severe in the future, we have given shape to our existing long-term vision and developed the “Vision for 2031” that the Groupaims to realize in 2031, a milestone year 10 years from now. We will aim to offer new therapies for intractable and rarediseases that have been difficult to treat with conventional small molecules and antibody drugs alone, and we will strive toaddress unmet medical and healthcare needs by incorporating new drug discovery modalities that are expected to grow in
the future, such as cells, nucleic acids, and genes. In particular, we will position regenerative medicine products as one of
our focus areas and give priority to projects using mesenchymal stem cells.
We will also work to position the biomaterials business as one of the pillars of the next generation, alongside the current
mainstay pharmaceutical and healthcare businesses. In the biomaterials business, we will promote various projects based on
alginate, which is expected to have a wide range of applications in the medical and biotechnological fields, and work for an
early market launch and business expansion.
We will also look to expand into overseas markets by offering a lineup of distinctive products that meet the needs ineach business segment. Our current aim is to launch highly purified EPA drugs in Vietnam, China, the U.S., and othercountries, following their launch in Thailand, however, we will also push ahead with the development of other products suchas biomaterials and regenerative medicines with an eye to global expansion.
In terms of the scale of business targeted for 2031, we aim to achieve sales of approximately 40 billion yen, including
product fields such as the biomaterials business products and regenerative medicine products in the pharmaceuticalbusiness, and aim to develop our business to achieve total net sales of 140 billion yen and an operating margin of 15%.
We will establish and steadily implement a plan of action for the achievement of “Vision for 2031.”

Q

Tell us about the main points of the Medium-term Management Plan (FY2022-2024).

A

We will focus on three issues under the theme of innovation creation andproductivity improvement.

To realize “Vision for 2031,” we have adopted the 22-24 Medium-term Management Plan as an action plan for issues to beaddressed over the three-year period from 2022 to 2024 from the perspective of the sustainable enhancement of corporate
value and in alignment with the Basic Sustainability Policy.
The 22-24 Medium-term Management Plan focuses on three issues under the theme of innovation creation andproductivity improvement. The first issue is “maximization of profits in targeted areas with a focus on new drugs.” We willconcentrate our resources on the targeted areas (cardiovascular medicine, obstetrics and gynecology, psychiatry, andgastroenterology) to maximize earnings from new drugs in our core pharmaceutical business. In particular, we will raise
Mochida Pharmaceutical Group Integrated Report 2022

14

1 Value Creation Storyawareness about the value of Lialda, a treatment for ulcerative colitis, Goofice, a treatment for chronic constipation, andUrece, a treatment for gout and hyperuricemia, in a bid to maximize sales. In addition, we will strive to leverage ourexperience as a leading manufacturer of highly purified EPA drug in marketing activities for Epadel EM, a self-emulsifying
formulation of highly purified EPA launched in September 2022. Meanwhile, we will continually work to maintain a stablesupply and proper quality of our products based on an end-to-end view of the supply chain, while promoting improvements
in our cost structure by reducing procurement costs and reviewing our product lineup.
The second issue we will focus on is “continuous investment in growth to realize the ‘Vision for 2031’.” In addition tocontinuous investment in existing research and development projects, we will pursue investments in business activities thatwill lead to future competitiveness in areas such as the biomaterials business and regenerative medicine.
The third issue is “strengthening of the corporate organization to create innovation and improve productivity.” We will
harmonize and coordinate four approaches: optimization of business processes and business quality level, promotion ofdigital transformation, institutional reform, and the promotion of facility management, in order to achieve efficientorganizational operations and increase corporate value. Furthermore, we will focus on developing human resources to drive
innovation, reinforcing the human resource management structure, and increasing our organizational strength. In September
2022, we commenced operations at our new head office building. We intend to create an environment conducive to thegeneration of new ideas and innovation, which will lead to improvement in productivity. The business environment
surrounding the pharmaceutical industry is expected to become increasingly severe in the future. The Group will continue toinvest in growth to realize its “Vision for 2031,” in spite of the expectation of a temporary deterioration in earnings during the
22-24 Medium-term Management Plan period. We are determined to steadily implement the 22-24 Medium-termManagement Plan and lay the groundwork for the next three-year plan.

Q

What are your views on the provision of value to society?

A

Mochida Pharmaceutical Group will continue to grow sustainably as a company
playing a necessary role in society, by providing value as a pharmaceuticalcompany; in other words, by “contributing to human health and well-being.”

Contributing to human health and well-being through our business activities is our mission. We are committed to the“creation of unique products to meet needs,” the “stable supply of high quality pharmaceuticals” and the “proper provision ofvaluable information” through our activities in the pharmaceutical, biomaterials and healthcare businesses. Through this, wewill provide value as a pharmaceutical company in the form of “improvement in the QOL of patients and their families,”“support for the different stages of a woman’s life” and ultimately “contribution to human health and well-being.”
In terms of “improvement in the QOL of patients and their families,” we intend to focus on the development of regenerative
medicines as advanced therapies for intractable and rare diseases to help improve the QOL of patients. As regards “support
for the different stages of a woman’s life,” we are committed to contributing to a society in which women enjoy good healthand can actively participate by continuing to put effort into the obstetrics and gynecology field through drugs such as
Dienogest.
We also committed to the realization of a sustainable society, integrating ESG (environmental, social and governanceconsiderations) into our business activities, including operating under appropriate corporate governance, giving consideration
to environmental issues such as climate change, respecting human rights, and working to develop workplaces where diverse
human resources can participate.
Under our Basic Sustainability Policy, we will continue to grow sustainably as a company playing a necessary role insociety, by providing value as a pharmaceutical company; in other words, by “contributing to human health and well-being.”
In doing so, we will contribute to the realization of a sustainable society that will also help achieve the SDGs. We recognizethat action of sustainability issues is an important management issue and will continue to focus on sustainability in the future
based on our basic policy.

15

Mochida Pharmaceutical Group Integrated Report 2022

Q

Tell us about your materiality.

A

We identified five material issues that matter most to us and most to society.

We screened many possible material issues in a wide range and, through internal discussion, primarily at meetings of theBoard of Directors and Sustainability Committee, we identified material matters which should be addressed as a priority forthe sustainable improvement of corporate value.
Based on an assessment of the issues that matter most to us and those that matter most to society, we identified fivematerial issues: “development of human resources,” “compliance,” “creation of unique products to meet needs,” “stablesupply of high quality pharmaceuticals” and “proper provision of valuable information.”
We will focus on the “development of human resources” and “compliance” as material issues underpinning themanagement foundations. “Compliance” is an absolute condition for corporate survival. Furthermore, we believe that a major
driver underpinning corporate value creation is “human resources” and we will, therefore, strive to create companies andworkplaces where every employee can demonstrate their full potential and grow.
At the same time, we will focus on “creation of unique products to meet needs,” “stable supply of high quality
pharmaceuticals” and “proper provision of valuable
information” as material issues in relation to our businesses.
We will continue working on the “creation of unique products
to meet needs,” perceiving increasingly diverse medical andhealthcare needs as a business opportunity and adapting tochanges in the business environment.
Additionally, through the “stable supply of high quality
pharmaceuticals” and “proper provision of valuable
information,” we will contribute to human health and wellbeing and seek enhancement in our corporate value.
Our material issues as appropriate, adapting flexibly tofuture changes in society.

Q

Tell us about your shareholder returns policy.

A

We will continue working to pay stable dividends.

The Group considers it important to continuously strive to increase corporate value by developing business performance andreturn appropriate profits to shareholders. Our basic policy is to maintain stable dividends while enhancing internal reserves
for future business development, and we will determine dividends based on an awareness of the importance of returning
profits to shareholders according to revenues.
The business environment is expected to become more severe, but we intend to maintain a dividend of at least 80 JPY
per share during the 22-24 Medium-term Management Plan period. We also intend to acquire treasury shares in a flexible
manner in response to changes in the business environment.

Mochida Pharmaceutical Group Integrated Report 2022

16

2 Business Activities

Pharmaceutical Business

Development

Research & Development and Licensing Activities
Research
In our research, we maximize foresight and originality in allprocesses, based on our unique research anddevelopment capabilities and diverse technological knowhow cultivated over many years. We are also taking on thechallenge of addressing unmet medical and health needs,
including addressing intractable and rare diseases thathave been difficult to treat with conventional small
molecules and antibody drugs alone.
Through open innovation and drug discovery utilizing
external resources to incorporate new modalities that are
expected to grow in the future such as cells, nucleic acids,
and genes, we aim to enhance our drug discovery pipeline.
Especially in the field of regenerative medicine products,
we are giving priority to projects using mesenchymal stem
cells, and are currently in the process of developing
therapies using human dental pulp-derived stem cells andhigh purity mesenchymal stem cells (RECs: Rapidly
Expanding Cells). We are also focusing on the in-licensingof early-stage drug candidates, and since 2019, we have
implemented MOIRe (Mochida Open Innovation Research),
our open innovation program for drug discovery researchbased on proposals from academic researchers.

Research Center (Gotemba, Shizuoka)

New drug-discovery modalities- Initiatives for the realization of “Vision for 2031” Dental pulp stem cells
Dental pulp stem cells are stem cells taken from the pulp cavity inside the tooth and are a type of mesenchymal stem
cell. Stem cells collected from deciduous teeth are particularly active and have a high capacity for tissue repair andregeneration. As they can be collected from deciduous teeth, collection can be performed at any time, reducing theinvasiveness on the donor. Therefore, it is expected to be utilized in the future source of cells for regenerative medicine
products that can be stably supplied domestically.
We are working on the commercialization of regenerative medicine products with Kidswell Bio Corporation, which isan expert in human dental pulp-derived stem cells.

17

Mochida Pharmaceutical Group Integrated Report 2022

By promoting in-licensing of drug candidates, we are working to enhance the pipeline in targeted areas and the fields inwhich we specialize and also promoting the in-licensing and development of biosimilars. At the same time, we are working tomaximize values of current products through initiatives such as new indications and new formulations, and the discovery ofevidence through post-marketing studies. We are optimizing organization and resource allocation to accelerate
developmental activities with improved accuracy and pushing ahead with drug development in close cooperation withoutside partners and contract research organizations (CROs).
Looking at our development pipelines, we obtained manufacturing and marketing approval for Epadel EM (development
code: MND-2119), for the treatment of hyperlipidemia. We are in the process of applying for manufacturing and marketing
approval for MD-711, an inhaled treprostinil, for the treatment of pulmonary arterial hypertension. A pediatric indication of
Lialda ®, a pediatric indication of Lexapro ®, MD-120, an antidepressant, being developed in collaboration with Pfizer Japan
Inc., MND-21, a therapeutic agent for hypertriglyceridemia, being developed in collaboration with Sumitomo Pharmaceuticals(Suzhou) Co., Ltd. in China, ACT-541468, a therapeutic agent for insomnia, being developed in collaboration with Idorsia
Pharmaceuticals Japan Ltd., and a pediatric indication of Urece ® are all in the Phase Ⅲ clinical trial stage. Development of
MD-711 for the indication of pulmonary hypertension in interstitial lung disease is in the Phase Ⅱ/Ⅲ clinical trial stage.
(As of August 1, 2022)[ Pipeline ]
Code

As of August 1, 2022

Name

Stage

Indications

Formulation

Remarks

MND-2119

ethyl icosapentate

Approved

Hyperlipidemia

Oral

In-house development <Japan>

MD-711

treprostinil

Filed

Pulmonary arterial
hypertension

Inhalant

MD-0901

mesalazine

Phase Ⅲ

Ulcerative colitis (pediatricindication)

Oral

Licensed-in from Shire Pharmaceuticals Group(now part of Takeda)
In-house development <Japan>

MLD-55

escitalopram

Phase Ⅲ

Depression (pediatricindication)

Oral

Licensed-in from Lundbeck
In-house development <Japan>

MD-120desvenlafaxine

Phase Ⅲ

Depression

Oral

Co-development with Pfizer <Japan>

MND-21ethyl icosapentate

Phase Ⅲ

Hypertriglyceridemia

Oral

Collaboration with Sumitomo Pharmaceuticals(Suzhou) <China>

ACT-541468

daridorexant

Phase Ⅲ

Insomnia

Oral

Co-development with Idorsia Pharmaceuticals
Japan <Japan>

FYU-981

dotinurad

Phase Ⅲ

Gout and hyperuricemia(pediatric indication)

Oral

Co-development with Fujiyakuhin <Japan>

MD-711

treprostinil

Phase Ⅱ / Ⅲ

Pulmonary hypertension
associated with interstitiallung disease

Inhalant

Licensed-in from United Therapeutics

Licensed-in from United Therapeutics
In-house development <Japan>

RECs
High purity mesenchymal stem cells or RECs (Rapidly Expanding Cells) are isolated from bone marrow aspirate andpurified by a unique method established by PuREC Co., Ltd. (hereinafter “PuREC” ). These cells have superior
proliferative, differentiation, and migratory capacities compared to mesenchymal stem cells isolated by conventional
methods.
Mochida Pharmaceutical and PuREC are conducting collaborative research into new therapies for spinal diseases
with Hokkaido University.
An investigator-initiated clinical trial in patients undergoing surgery for lumbar spinal stenosis began at Hokkaido
University in April 2022. The therapy being studied targets lumbar intervertebral disc herniation in patients with lumbar
spinal stenosis, and involves filling the cavity created after discectomy with RECs and alginate gel.
We are also involved in collaborative research with PuREC and Shimane University into new therapies for arthritic
disorders utilizing RECs.

Mochida Pharmaceutical Group Integrated Report 202218

2 Business Activities

Production

Licensing Activities
Most of our activities are being conducted in alliance with partners including academia-industry cooperation and industry
collaboration in Japan and overseas. We promote the in-licensing activity of development programs and developed products
in our strong areas and focused fields, the in-licensing and out-licensing of useful products which contribute to the society,including unique drug formulations with additional value which meet customer needs as well as medical needs.
We are also leveraging our alliances to globally expand our EPA drug with high purity in China, Thailand, Vietnam andthe United States. In Thailand, the subsidiary of Meiji Seika Pharma Co., Ltd. obtained approval to import and market our
EPA drug for the treatment of hypertriglyceridemia in October 2020 and commenced sales in April 2021. In Vietnam, an
alliance partner of Meiji Seika Pharma is in the process of applying for approval to import and market our EPA drug.

Mochida Pharmaceutical Group’s medical products are mainly manufactured by Mochida Pharmaceutical Plant Co., Ltd.
(“MPP”). The Head Office Plant in Ohtawara, Tochigi Prefecture manufactures injectable, solid (tablets, capsules, etc.) andsemi-solid (creams, ointments, gels, etc.) medicines.
Whilst paying attention to safety, we continuously strive to maintain stable operation, stable supply and appropriatequality. We also pursue reliable and efficient drug manufacturing, meeting diverse needs through state-of-the-art
manufacturing facilities and cutting-edge technologies, all of which are compliant with global standards.

Intellectual Property (IP) Management

MPP’s production facilities meet requirements underJapanese Good Manufacturing Practice (JGMP) andinternational guidelines such as the pharmaceuticals Good
Manufacturing Practice guidelines provided by the
Pharmaceutical Inspection Convention and Pharmaceutical
Inspection Co-operation Scheme (PIC/S GMP). In addition,
computer-integrated systems control all the processing
stages, from the receipt of raw materials to final shipping,to ensure that all products are manufactured to the highest
standards of quality.

In our business activities, we endeavor to obtain, protect and utilize IP rights, including patents, in anticipation of global
commercialization, licensing, collaborative research and other technical alliances. We also regularly conduct searching andevaluation of third-party’s IP rights from the viewpoint of respecting their rights, and work to prevent IP risks in ourbusinesses. We also carry out various IP-related assessments, especially when making important decisions, for example
when deciding whether to move to the next stage of drug development.

[ Major Alliances ]Alliance Partner

Year ofConclusion

Country

Subjects

Bayer AG

Germany

Dinagest, a therapeutic agent for endometriosis

1992

Lundbeck A/S

Denmark

Lexapro , an antidepressant

2001

®

United Therapeutics Corporation

U.S.

Treprost ®, a therapeutic agent for pulmonary arterial hypertension

2007

Shire Pharmaceuticals Group(now part of Takeda)

U.K.

Lialda ®, a therapeutic agent for ulcerative colitis

2009

Gedeon Richter’s biosimilars, including Teriparatide BS MOCHIDA

2010

Gedeon Richter Plc.

Hungary

LG Chem Ltd.

South Korea

Biosimilar Etanercept BS MA

2012

LG Chem Ltd.

South Korea

Biosimilar Adalimumab BS MA

2014
2016

EA Pharma Co., Ltd.

Japan

Goofice ®, a treatment for chronic constipation

FUJI YAKUHIN Co., Ltd.

Japan

Urece , a treatment of gout and hyperuricaemia

2017

United Therapeutics Corporation

U.S.

MD-711, a therapeutic agent for pulmonary arterial hypertension

2017

EA Pharma Co., Ltd.

Japan

Movicol ®, a treatment for chronic constipation

2017

Pfizer Japan Inc.

Japan

MD-120, an antidepressant2019

Idorsia Pharmaceuticals Ltd.

Switzerland®

ACT-541468, a treatment for insomnia

2019
2020
2020
2021

Kidswell Bio Corporation

Japan

Regenerative medicines for the treatment of rare and intractable diseases in thegastrointestinal area such as isolated hypoganglionosis

PuREC Co., Ltd.

Japan

Tripartite collaborative research, bringing industry and academia together, into the useof high-purity mesenchymal stem cells (RECs - Rapidly Expanding Cells) and ultrapurified alginate

Production of High Quality Pharmaceuticals

Mochida Pharmaceutical Plant Co.,Ltd. (Ohtawara, Tochigi)

State-of-the-art Drug Manufacturing
Technologies
Like research & development, pharmaceuticalmanufacturing processes demand a high level oftechnological capability. We utilize decades ofmanufacturing know-how to provide technologically highvalue products such as the enzyme/protein preparations
and biological products at which we excel and products
which are considered difficult to manufacture such as
freeze-dried injectables.

Freeze dryers and automatic guided vehicles (AGV)

Packaging to Meet Healthcare Needs
In our production activities, we constantly strive to meethealthcare needs, and have introduced a definitive totalquantity confirmation system with material code displays
and a unified bar code system, to increase the efficiency of
drug management. We also consider the healthcare
settings in which our products are used and are focusing
on initiatives such as the use of plastic bottles made from
one type of material to facilitate sorting and disposal andthe development of container designs with different shapes
to prevent medical errors.

Tablet press for the production of solid dosage forms

Contracted Manufacturing
Besides manufacturing Mochida Pharmaceutical Group’s
products, MPP is also actively involved in contracted
manufacturing for other companies. Leveraging theexperience built up as the manufacturing subsidiary of apharmaceutical company, MPP reliably manufactures andsupplies high quality products at reasonable prices,
accommodating a wide variety of product specifications
and scale requirements.
19

Mochida Pharmaceutical Group Integrated Report 2022

Sterility test

Mochida Pharmaceutical Group Integrated Report 2022

20

2 Business Activities

Quality Control and Safety Management
Drugs affect human life and health. Accordingly, in the various processes from drug manufacturing to their distribution anduse, pharmaceutical companies are required to exercise quality control and post-marketing safety management by methods
in compliance with the Ministerial Ordinance on Standards of Quality Assurance for Drugs, Quasi-drugs, Cosmetics andMedical Devices (GQP Ministerial Ordinance) and the Ministerial Ordinance on Standards for Post-Marketing Safety Control
of Drugs, Quasi-drugs, Cosmetics, Medical Devices, and Regenerative Medicine Products (GVP Ministerial Ordinance) issued
by the Ministry of Health, Labour and Welfare.
In Mochida Pharmaceutical Group, the RA, QA and PV divisions strive to ensure reliability through management andevaluation of the quality of products handled, collection, analysis and evaluation of safety information, and other necessary
measures. These divisions also support business activities related to the stable supply of drugs by, for example, working toensure appropriate manufacturing control and quality control and working to manage market shipments.

Sales and Information Provision Activities
Appropriate Information Provision Activities
Pharmaceuticals achieve the desired effects only when used correctly. Pharmaceutical companies are required to provide
healthcare professionals with accurate information about pharmaceuticals quickly, to collect and evaluate information about
efficacy, safety and adverse drug reactions from doctors who have prescribed them and relay this information back tohealthcare professionals. Mochida Pharmaceutical contributes to the treatment of patients by providing healthcare
professionals with information through information provision activities by medical representatives, medical and pharma
seminars, dissemination of information about prescription drugs online, and active use of webinars and other digitalmarketing tools.

Four Targeted Areas
Above all, we are currently putting effort into new drugs, concentrating our resources on four targeted areas: cardiovascular
medicine, especially treatments for lifestyle diseases such as hyperlipidemia, hypertension, and hyperuricemia; obstetrics andgynecology, including treatments for endometriosis and dysmenorrhea, and pregnancy test kits; psychiatry, with emphasison antidepressants; and gastroenterology, including treatments for ulcerative colitis and chronic constipation.

Cardiovascular medicine

Cardiovascular medicine
Urece ®, a selective urate reabsorption inhibitor (SURI) released in 2020, is a therapeutic agent for gout and hyperuricemia.
Urece ® is expected to be more efficient at lowering serum uric acid levels than existing uricosuric agents because it
selectively inhibits URAT1, a transporter presents in the proximal tubules of the human kidney which promotes thereabsorption of uric acid, whilst having a small effect on other transporters.
We are also making our presence felt in the cardiovascular field as a leading manufacturer of highly purified EPA drugs.
In addition to Epadel, a high-purity EPA drug, which, through various mechanisms, slows atherosclerotic plaque progression,
we launched Epadel EM, a new self-emulsifying formulation of Epadel, in September 2022. Epadel EM is a new formulationof Epadel for the treatment of hyperlipidemia. It uses self-emulsifying formulation technology in order to improve
gastrointestinal absorption. As the world’s first high-purity EPA drug that can be given in a single daily dose, we expect
Epadel EM to be able to help improve the QOL of patients.
With these high-purity EPA drugs and other products such as Atelec ®, a calcium channel blocker with a long-acting
hypotensive effect, and Treprost ®, a therapeutic product for pulmonary arterial hypertension, we are taking on the
cardiovascular field.
Gastroenterology
In the gastroenterology field, we are focusing on Lialda ®, a treatment for ulcerative colitis, launched in 2016 and Goofice ®
and Movicol ®, both treatments for chronic constipation released in 2018. Lialda ® is a drug delivery system (DDS) formulationof mesalazine for oral administration. It is designed to continuously release the active ingredient mesalazine to andthroughout the colon. Approved as a once-daily oral therapeutic agent in both active and remission phases of ulcerative
colitis and efficacious, Lialda ® improves patient adherence and has been well received by gastroenterologists who treat
ulcerative colitis.
Goofice ® is the world’s first bile acid transporter inhibitor, indicated for the treatment of chronic constipation. Goofice ®
inhibits the bile acid transporter that regulates reabsorption of bile acids thereby increasing the flow of bile acids to the colon.
The dual action of moisture secretion and bowel movement promotion enhances natural defecation. Other advantages
include that Goofice ® is administered once daily and the dosage may be adjusted according to patient symptoms.
Movicol ® is a polyethylene glycol preparation. The drug increases the moisture in the stool thereby raising the volumeof stool to promote defecation. Overseas, Movicol ® has been widely used in both children and adults.

Gastroenterology

Product Name
International Nonproprietary Name (INN)
Main Indications

Epadel EM

Urece ®

icosapent
Hyperlipidemia

dotinurad
Gout and hyperuricemia

Lialda ®
mesalazine
Ulcerative colitis

Movicol ®LD

Epadelicosapent
Arteriosclerosis obliterans, Hyperlipidemia(World’s first high purity EPA drug)

21

Mochida Pharmaceutical Group Integrated Report 2022

Goofice ®

Atelec ®

Atedio ®

cilnidipine
valsartan/cilnidipine
Hypertention

Treprost ®
treprostinil
Pulmonary arterial hypertension (PAH)

elobixibat
Chronic constipation

Movicol ®HDmacrogol 4000, sodium chloride,sodium bicarbonate, potassium chloride
Chronic constipation

Mochida Pharmaceutical Group Integrated Report 2022

22

2 Business Activities

Psychiatry
Our core product in the psychiatry field is Lexapro ®, a selective serotonin reuptake inhibitor (SSRI). We launched Lexapro ®
as an antidepressant in 2011, and obtained approval for an additional indication of social anxiety disorder in 2015. Low levelsof neurotransmitters (specifically serotonin) are thought to be one of the causes of depression. Lexapro ® increases levels ofserotonin in the brain by selectively inhibiting the reuptake of serotonin. This improves the transmission of messages between
neurons, alleviating depression and reducing anxiety. With Lexapro ® and other products such as Tecipul, a tetracyclic
antidepressant, and Grandaxin, an autonomic nerve regulator, we are working to improve the QOL of patients in thepsychiatric field.
Obstetrics and Gynecology - Supporting women’s health throughout every stage of their lives In the obstetrics and gynecology field, which is one of our targeted areas, we are focusing on Dinagest, indicated forendometriosis, the reduction of pain caused by adenomyosis and the treatment of dysmenorrhea, and we conduct
information provision activities, including about pregnancy test kits. Additionally, we are working to provide women withcomprehensive health support at every stage of their lives by proposing use of our products to treat constipation anddepression which negatively affect women’s QOL.
Dinagest was launched as treatment for endometriosis in 2008. In 2016, we obtained approval for the additional
indication of reduction of pain caused by adenomyosis, offering a treatment option for adenomyosis for the first time.
In 2020, we launched Dinagest Tablets 0.5mg specifically for dysmenorrhea, helping improve the QOL of patients
suffering from dysmenorrhea.
Also, at the request of the Japan Society of Obstetrics and Gynecology, we also offer the Heparin Calcium Subcutaneous
Injection MOCHIDA, enabling patients undergoing fertility treatment to administer injections themselves at home. We willcontinue making our presence felt in the obstetrics and gynecology field by contributing more widely to women’s health.
Psychiatry

Biomaterials BusinessIn addition to the current mainstay pharmaceutical and healthcare businesses, we are focusing on the biomaterials business,
which is positioned as one of the pillars of the next generation. In particular, we are promoting and developing various
projects in the biomaterials business based on alginate, which has numerous potential applications in the medical andbiotechnological field.
Looking at the development pipeline, dMD-001, a treatment for articular cartilage lesions developed as a medical
device, is in the therapeutic confirmatory study stage. In addition, dMD-002, a treatment for cavernous nerve injury, is in thetherapeutic exploratory study stage. (As of August 1, 2022)
Furthermore, we are also examining the feasibility of alginate as a pharmaceutical material, for example, as a scaffold
for intervertebral disc (IVD) repair using alginate gelation technology and as a tissue adhesion preventive device using an
alginate sheet.

[ Medical device ]
Code

As of August 1, 2022

Stage

Indications

Formulation

Remarks

dMD-001

sodium alginate

Name

Therapeutic confirmatory study

Articular cartilage lesion―

In-house development <Japan>

dMD-002

sodium alginate

Therapeutic exploratory study

Cavernous nerve injury―

In-house development <Japan>

Obstetrics and Gynecology

Properties and potential applications of alginate- Initiatives for the realization of “Vision for 2031” -Lexapro ®

Dinagest

Gonacard W

escitalopram
Depression and depressive symptoms,
Social anxiety disorderdienogest
Endometriosis, Pain caused byadenomyosis, Dysmenorrhea

hCG
Pregnancy test kit

23

Mochida Pharmaceutical Group Integrated Report 2022

Sodium alginate is a high polymeric substance derived from brown algae. It becomes a highly viscousaqueous solution, and it becomes a gel with calcium ions, which are divalent cations, being added. This
property can be used to process the material into various forms and hardness during gelation.

●

Possible applications of alginate in the biotechnological and medical fields include 2D and 3D culture, celland tissue preservation, scaffolds for tissue regeneration, encapsulation of secretory cells, and sustained
release of drugs.

●

We are working on various applications of endotoxin-free sodium alginate that can be used in livingorganisms. Alginate, which is a polysaccharide, can be a nutrient source for cells. It has also been shownthat when a gel is formed on the affected area, the alginate gel remains in the area for a certain period oftime because no enzymes exist in
the body to break it down and it
has little impact on cells due to its
Versatile shape
Application
similarity to biologicalcomponents. The relationship of● 2D and 3D cultures
alginate to native cells when
● Cell and tissue preservation
High viscosity
Bead-shaped
implanted in a wound or othersolution
capsules● Scaffolds for tissue regenerationsites is also currently being● Encapsulation of secretory cells
studied: we expect further● Sustained release of drug
potential applications.

Heparin Calcium Subcutaneous
Injection MOCHIDA
heparin calcium
Thromboembolism, infertility

Generic Drugs
Mochida Pharmaceutical Group is working on the genericdrug business, focusing on lines with strong businesspotential such as authorized generic drugs and biosimilars
in cooperation with Mochida Pharmaceutical Sales Co.,
Ltd. and other business partners.
Mochida Pharmaceutical Sales Co., Ltd. (“MPS”) is
the company which handles generic drugs within MochidaPharmaceutical Group. In its activities associated withgenerics, MPS focuses on quality assurance, the provisionof information and reliable supply and also gives
consideration to the prevention of medical errors, thesafety of healthcare professionals, and improvement ofpatient adherence. Going forward, MPS will continue toplay a central role in developing and providing genericdrugs which meet the needs of patients and healthcare
professionals.

●

Authorized generic in the obstetrics andgynecology field

String-shaped

Sheet

Teriparatide BS MOCHIDA

Mochida Pharmaceutical Group Integrated Report 2022

24

2 Business Activities

Healthcare Business

Activities in the Healthcare BusinessAs a member of Mochida Pharmaceutical Group, Mochida Healthcare Co., Ltd. (MHC) has developed high value-added skincare products under the motto “farsighted, innovative research.” We will continue developing innovative products using thecapabilities we have fostered through the development of pharmaceuticals.

Major Product lines
Major product lines include the Collage series, which provides total skin care for sensitive skin, the Collage Furfur series
developed from skin research, which are the first haircare and bodycare products in Japan to contain an antimycotic(antifungal) agent, Skina Babe, which is the first skin care product that babies experience, and the Skina series of easy
hygiene products for the bedridden.

Development
To deliver high-performance, value-added dermatological skin careproducts, MHC gains an understanding of needs throughmake its products widely available to customers with sensitive skinand other skin problems.
Going forward, MHC aims to raise awareness of its skincare

communication with physicians, pharmacists, and nurses andproducts among care facilities, etc. in the hope of being able toconducts product development based on dermatology clinical trials.

contribute to skincare in the care domain.

MHC is committed to developing products that make an
impression on customers, striving for “Japan-first” products, uniqueproducts in Japan, and “No.1” products, rather than run-of-the-millproducts that can be found anywhere.

Scientific Information
MHC has established a free call and email based counselling
service, which customers can use to make inquiries about products

Haircare and bodycare products containing

participates in relevant academic societies and seminars to gather

Total skin care for sensitive skinantimycotic (antifungal) agent

To deliver high quality products, MHC manufactures its products

the latest information about skincare and also provides scientificCollage series

Collage Furfur series

based on a strict quality control system, mainly at the Saitama Plant

information about products to hospitals, pharmacies, and drugof Mochida Pharmaceutical Plant Co., Ltd.

stores.

In 1980, before the expression “sensitive skin” was incommon use, we succeeded in developing Collage Cream,
Japan’s first basic skin care product containing natural
soluble collagen (S-Collagen), through repeated testing incooperation with dermatologists. Focusing on lowirritating, fragrance-free, color-free products for delicate
skin, we continued to launch dermatological skin careproducts one after another as a pioneer of skin careproducts for sensitive skin.
Focusing on sensitive skin for half a century, MHC
now offers gentle, high-performance basic skin careproducts such as the Collage Repair series, which, through“far-sighted care* 1” and “routine care* 2,” achieves“sensitive skin management* 3,” and the Collage B.K. Ageseries for those with “sensitive, dry aging skin* 4,” which
provides “anti-aging skincare* 5.”
MHC also has an extensive line-up of products tocater for different customer lifestyles and needs, including
the Collage Soap series of nonirritating soap formulated foreach specific skin type and use, and Collage D Medi
Power series of moisturizing products for dry skin (including
people with atopic eczema).

Collage Repair series

25

and skincare regimes or give feedback directly. MHC also actively
Production

Collage B.K. Age series

Mochida Pharmaceutical Group Integrated Report 2022

Collage Furfur, Japan’s first medicated shampoo
containing an antimycotic (antifungal) agent (miconazole
nitrate), was developed based on the novel concept ofcaring for the scalp, given that dandruff is triggered by thegrowth of fungus on the scalp.
MHC currently offers a lineup of hair care products
containing an antimycotics for different scalp problems,
offering Collage Furfur Next Shampoo and Rinse fordandruff or an itchy scalp, Collage Furfur Premium
Shampoo for scalp odor, and Collage Furfur Scalp
Shampoo for excess sebum. MHC’s products have been
welcomed by people worried about scalp issues such as
dandruff, an itchy scalp, scalp odor and excess sebum.
Meanwhile, MHC provides Collage Furfur Soap, abodywash containing an antimycotics, for those sufferingfrom skin problems, and Collage Furfur Hair Growthseries* 6 containing a female hormone* 7 for women worried
about hair thinning and hair loss.

*1 A daily skin care regimen to prevent skin roughness and dryness(applies to quasi-drugs only)*2 Routine skin care, usually morning and night*3 A consistent skincare regimen for sensitive, dry skin
*4 Aging skin with a tendency to become dry and sensitive*5 Age-appropriate moisturizing and skin care regimen*6 Does not contain an antimycotics*7 Ethinylestradiol

Collage Soap series

Collage D Medi Power series

When manufacturing products, MHC is constantly aware of
the need to maintain a stable supply of products and the need toreassess manufacturing practices, including raw materials andcontainers, in light of environmental concerns.

Marketing
MHC strives to gain an understanding of skincare-related consumer
trends and market conditions through paper-based and online
surveys, and other means. Taking the feedback and requests ofDistribution and Sales

people suffering with skin problems and sensitive skin seriously,

Precisely because MHC’s products have been developed through

MHC also engages in information provision and promotional

close collaboration with dermatologists, MHC wants its products toactivities to ensure that information about its products and skincare

be recommended by experts at the point of sale. With this in mind,

is readily available.

MHC gives top priority to pharmacies and drug stores which have

MHC’s website features not only product data but also

pharmacists and beauty advisors working at them. MHC puts effort

skincare tutorials in which medical professionals explain how people

not only into store sales but also into mail order sales, aiming to

can care for their skin properly.

The first skincare babies experience

Easy hygiene products for the bedridden

Skina Babe series

Skina seriesSpecial care is needed when bathing a baby with soap assoapy hands are slippery. Skina Babe bath lotion for babies
was developed in response to calls from obstetricians andgynacologists for a less slippery, safer bath lotion forwashing babies without using soap. Today, more than 50
years after its launch, Skina Babe still enjoys wide
popularity.
Furthermore, in 2018, we launched Skina Babe Milky
Lotion, which protects the skin from birth by providing veryrich moisture.

The Skina series is a series of hygiene products for those
who are bedridden either in hospital or at home. We
developed hygiene products for washing the skin withoutwater in 1970, after listening to nurses working on hospitalwards and striving to develop products only apharmaceutical company could develop. Wanting to put
smiles on the faces of carers and patients alike, MHC hascontinued providing these popular products for many years.
Today, MHC offers an extensive line-up of products
for different scenarios, including dilution type products anddry shampoo.

Collage Furfur series

Skina Babe series

Skina series

Mochida Pharmaceutical Group Integrated Report 2022

26

3 GovernanceCorporate Governance
Basic Policy on Corporate GovernanceAs part of Mochida Pharmaceutical Group policy on reinforcing corporate governance, important management decisions are
discussed thoroughly by the Management Policy Meeting, if necessary, and are then made through discussion by the Board
of Executive Managing Officers and the Board of Group Management, both of which meet on a weekly basis.
Mochida Pharmaceutical’s Board of Directors includes Outside Directors, and the executive officer system has also
been introduced to clearly separate the functions of the Board of Directors into management decision-making and thesupervision of business operations so as to expedite management decision-making and business operations.
For the purpose of strengthening objectivity and accountability for the nomination of Members of the Board, Executive
Officers and Audit & Supervisory Board Members and for the determination of remuneration for Members of the Board andExecutive Officers, Mochida Pharmaceutical has established the Nomination and Compensation Advisory Committee, amajority of which comprises Outside Directors, as a voluntary advisory body to Representative Directors, and our corporate
decisions on such nomination and compensation are made in light of the opinions of said Committee.
Mochida Pharmaceutical maintains, operates and evaluates its internal control system based on resolutions by the
Board of Directors under the Companies Act and on the Financial Instruments and Exchange Act. Specifically, we maintain acompanywide risk management system based on the “Mochida Pharmaceutical Group Risk Management Rules” to manage
major risks affecting our overall business, as part of our internal control system based on the Companies Act.
As measures for reinforcing compliance, we maintain our compliance system by establishing the “Code of Conduct ofMochida Pharmaceutical Group” and seeking to embody the spirit of the code through regular meetings of the Ethics andCompliance Committee, which includes outside experts, and the performance of internal checks and awareness-raising
activities, and also by establishing the Corporate Ethics & Compliance. Regular training programs on compliance for ourgroup officers and employees are regularly provided.
Mochida Pharmaceutical Group will continuously strive to ensure thorough compliance, and to respond rapidly tovarious changes in the business environment, while incorporating appropriate advice from our attorneys, certified public
accountants and other experts.
In addition, we will further examine our actions to address sustainability issues at the Sustainability Committee
established in March 2022 as an advisory body to the Representative Directors so as to promote sustainability activities
across Mochida Pharmaceutical Group.

Overview of the corporate governance system and reasons for adopting such system
Mochida Pharmaceutical Group has the Board of Directors and the Audit & Supervisory Board as corporate organizations
under the Companies Act. The Board of Directors is composed of 10 Members of the Board, including three Outside
Directors. The Audit & Supervisory Board is composed of five Audit & Supervisory Board Members, including three Outside
Audit & Supervisory Board Members.
As reasons for adopting the current corporate governance structure, considering Mochida Pharmaceutical’s size andbusiness nature, we judge that at this point in time, the most suitable governance structure to pursue management efficiency
and to ensure the appropriate function of checking the management simultaneously requires: (1) management decisionmaking by the Board of Directors with a reasonable number of members, comprising inside Members of the Board withthorough knowledge of Mochida Pharmaceutical and its business and Outside Directors with abundant knowledge andexperience in specialized fields, and (2) a system for checking the management by Audit & Supervisory Board Members
including Outside Audit & Supervisory Board Members.

Corporate Governance StructureMembers of the Board

Board of Excecutive
Managing Officers

Ethics and Compliance Committee
Nomination and Compensation
Advisory Committee
Corporate Ethics &Compliance

Basic Sustainability Policy
Mochida Pharmaceutical Group aims to grow as a unique and globally recognized life and healthcare group via meeting
medical and healthcare needs in accordance with its corporate philosophy; “Actively contributing to human health and wellbeing in the field of medicine, continuously committed to the development of innovative products.”
For enhancing the value of corporate sustainability, we will strive to provide value as a pharmaceutical company“contributing to human health and well-being” under appropriate corporate governance in accordance with the Code of
Conduct of Mochida Pharmaceutical Group. We will also contribute to realize a sustainable society while making efforts tolessen our impact on the global environment.

[ Main Expertise and Careers of Members of the Board and Audit & Supervisory Board Members ]NameMochida Pharmaceutical has established the Internal Audit Department as an internal audit organization. The Internal
Audit Department implements internal audits of the business operations of Mochida Pharmaceutical Group in its entirety fromthe viewpoint of compliance and risk management, reports the results of such audits and provides advice to the Board of
Executive Managing Officers and the Board of Directors and reports such results to the Audit & Supervisory Board Members.
The Audit & Supervisory Board comprises two Full-Time Audit & Supervisory Board Members and three Outside Audit &Supervisory Board Members, making a total of five members. To secure lawfulness and transparency of management
decision-making and business operations, in accordance with fiscal year auditing policy and plans, each Audit & Supervisory
Board Member strives to smoothly communicate with Members of the Board, including Outside Directors, the Internal Audit
Department and others, collect the relevant information and improve the auditing environments. Each Audit & Supervisory
Board Member also attends meetings of the Board of Directors and other pivotal meetings, and examines business
operations and assets at the headquarters, main business offices and subsidiaries of Mochida Pharmaceutical, including
supervision and verification of the internal control system, the independence of the Accounting Auditor, and theappropriateness of audits performed by the Accounting Auditor.
The Internal Audit Department, Audit & Supervisory Board Members, and Accounting Auditor work closely to ensure
the effectiveness of the audits.
27

Mochida Pharmaceutical Group Integrated Report 2022

Sustainability Committee

Corporate
Management

Research andDevelopment

International
Experience

Naoyuki Mochida

○

○

○

Chu Sakata

○

○

○

Junichi Sakaki○

Kiyoshi Mizuguchi○

Yutaka Kawakami○○

Finance,
Accounting○○

Legal Affairs,
Compliance○○Pharmacist○

Pharmacist
Pharmacist

○

○

○

○

Tomoo Kugisawa
Nana Otsuki○

Tomoaki Sonoda○

Audit &
Masayoshi Takeda
Supervisory
Kyosuke Wagai
Board
Akiko Suzuki
Members

○
○

○

○

○

○

○

Ichiro Takahashi

Certification

Pharmacist○

Yoshiharu Hashimoto

Yoshifumi Miyata

IT○

Keiichi Sagisaka
Membersof theBoard

Business
Strategy,MarketingAttorney-at-law
Certified public accountant

○
○
○

○

○
○

Certified public accountant○

Attorney-at-law○(Note) The list above does not cover all the experience, Knowledge, and capability, etc., of each Member of the Board of the Company and each Audit & Supervisory Board Member /candidate.

Mochida Pharmaceutical Group Integrated Report 2022

28

3 GovernanceAnalysis and evaluation of the effectivenessof the Board of Directors[ Details of Main Meetings Held ]Meeting

Composition

Details
13 meetings held
Attendance rate of Members of the Board
including Outside Directors was 96%.

Board of Directors

10 Members of the Board (including 2 Outside Directors)

Audit & Supervisory Board

16 meetings held
The attendance rate of Audit & Supervisory
5 Audit & Supervisory Board Members (including 3 Outside Audit & Supervisory Board Members)
Board Members including Outside Audit &Supervisory Board Members was 100%.

Board of Executive Managing
Officers

Executive Managing Officers and higher ranking positions at Mochida Pharmaceutical

53 meetings held

Board of Group Management

Executive Managing Officers and higher ranking positions at Mochida Pharmaceutical, andpresidents of subsidiaries

41 meetings held

Ethics and Compliance
Committee

4 Members of the Board (including 1 Outside Director), 2 Audit & Supervisory Board Members(including 1 Outside Audit & Supervisory Board Member and 1 advisor) and 1 outside expert

1 meeting held

Nomination and Compensation
Advisory Committee

3 Members of the Board (including 2 Outside Directors)

4 meetings held
Attendance rate of Members of the Board
including Outside Directors was 100%.

Management Policy Meetings

Executive Managing Officers and higher ranking positions at Mochida Pharmaceutical

104 meetings held

Executive Officer Meeting

Executive Officers and higher ranking positions

12 meetings held

Directors & Officers’ Compensation

Functions, Role, etc. of Outside Directors and Outside Audit & Supervisory Board Members
In Mochida Pharmaceutical’s standards and policies on independence of Outside Directors, we appoint individuals who haveno special interests in the company, who have extensive knowledge and experience in management, legal affairs or anotherspecialist area, and who can be expected to incorporate deep management insights into Mochida Pharmaceutical’s
management and operations. In Mochida Pharmaceutical’s independence standards and policies on independence for
Outside Audit & Supervisory Board Members, we appoint individuals who have no special interests in the company, whohave a considerable degree of knowledge and experience of finance and accounting or extensive knowledge and experienceof corporate management, legal affairs or another specialist area, and who can be expected to incorporate deep
management insights into the audits on Mochida Pharmaceutical.
[ Reasons for the Appointment of Outside Directors and Outside Audit & Supervisory Board Members and Expected Role, andDetails of Major Activities ]Name

Reasons for Appointment and Expected Role

Attendance atmeetings of theBoard of Directors(13 times in total)

Attendance atmeetings of the
Audit &
Supervisory Board(16 times in total)

Tomoo
Kugisawa

As an attorney-at-law, Tomoo Kugisawa is an expert in corporate legal affairs and incorporates deep management
insights into Mochida Pharmaceutical’s management and operations. He is expected to fulfil the management
supervisory function by using such deep insights to make appropriate remarks and comments at meetings of the Boardof Directors.
Tomoo Kugisawa is a member of the Nomination and Compensation Advisory Committee, which is an advisory bodyto the Representative Directors.

13

－

Nana
Otsuki

Nana Otsuki worked for many years as an analyst at financial institutions, has extensive specialist knowledge andexperience gained as a university professor and has also held many public offices. She is expected to fulfill the
management supervisory function by using such deep insights to make appropriate remarks and comments at meetingsof the Board of Directors.

11*－

Tomoaki
SonodaTomoaki Sonoda has extensive specialist knowledge and experience gained as a university professor in accounting. He
is expected to fulfill the management supervisory function by using deep management insights to make appropriate
remarks and comments at meetings of the Board of Directors.
Tomoaki Sonoda is a member of the Nomination and Compensation Advisory Committee, which is an advisory bodyto the Representative Directors.

(New
appointment)－

Kyosuke
Wagai

As a certified public accountant, Kyosuke Wagai has extensive specialist knowledge and experiences of audits, etc. andincorporates deep management and audit insights into Mochida Pharmaceutical’s audits. He is expected to fulfil the
management supervisory function by using such deep insights to make appropriate remarks and comments at meetingsof the Board of Directors.

13

16

Akiko
SuzukiAs an attorney-at-law, Suzuki Akiko is an expert in corporate legal affairs, and incorporates deep management insights
into Mochida Pharmaceutical’s audits. She is expected to fulfill the management supervisory function by using suchdeep insights to make appropriate remarks and comments at meetings of the Board of Directors.

13

Yoshifumi Miyata has gained extensive experience (including management experience) working at financial institutions,etc. and has also served as an Outside Audit & Supervisory Board Member at another company (manufacturingindustry). He is expected to fulfil the management supervisory function by using such deep insights to make appropriate
remarks and comments at meetings of the Board of Directors.

11*

Yoshifumi
MiyataMochida Pharmaceutical Group Integrated Report 2022

Members of the Board
Mochida Pharmaceutical has set a total amount ofcompensation, etc. for Members of the Board approved at a
General Meeting of Shareholders, and the decision (approvedby the meeting of the Board of Directors on June 29, 2021) on
the policy for determining the details of compensation, etc. of
individual Members of the Board (hereinafter, the “determination
policy”) was made based on the opinion of the Nomination andCompensation Advisory Committee, which is made up of amajority of independent Outside Directors, in order to ensure
fairness and transparency. Mochida Pharmaceutical has
decided (by resolution of the Board of Directors) to delegate
matters such as the monthly compensation of individual
Members of the Board, and the payment timing, payment
method and individual amounts of bonuses, etc. to theRepresentative Directors (President and Vice President) todecide through discussion, taking the determination policy andopinion of the Nomination and Compensation Advisory
Committee into consideration. These matters were delegated to
the Representative Directors based on the judgment that theRepresentative Directors are the right people to determine thedetails of individual compensation, etc. by evaluating contributionof Members of the Board and wider performance, while taking
into account the performance of the Group as a whole.
Compensation for Members of the Board consists of fixedmonthly compensation and bonuses, which are performancebased. The percentages of fixed compensation (monthly
compensation) and performance-based compensation (bonus)
have been set at a level the company deems appropriate inorder to incentivize Members of the Board to strive for
improvement in corporate value.

Audit & Supervisory Board Members
Mochida Pharmaceutical has set a total amount of compensation,etc. for Audit & Supervisory Board Members approved at a
General Meeting of Shareholders and allocations to each Audit& Supervisory Board Member are determined throughconsultation between the Audit & Supervisory Board Members.
Compensation for Audit & Supervisory Board Members
consists of fixed monthly compensation and bonuses, which
are performance-based. The performance-based compensation(bonus) is determined based on the duties each Audit &Supervisory Board Member is expected to perform, considering
the consolidated results and reflecting on the contribution of theparticular Audit & Supervisory Board Member.
The compensation of Outside Audit & Supervisory Board
Members consists of fixed monthly compensation.
In addition, a fixed amount of the monthly compensation
is paid as stock-based compensation through contribution to ashareholders’ association for Members of the Board and Audit& Supervisory Board Members Officers and continuous
acquisition of the Company’s shares. Audit & Supervisory Board
Members are generally required to hold such acquired sharesthroughout their term of office.

[ Total amount of compensation, total amount of compensation for eligible Members of the Board and Audit & Supervisory Board Members by type and number ]16

11** Nana Otsuki and Yoshifumi Miyata attended all 11 meetings of the Board of Directors and the Audit & Supervisory Board which have been held since June 29, 2021, when they
assumed office.

29

Every year, Mochida Pharmaceutical conducts a survey
targeting all Members of the Board and all Audit & Supervisory
Board Members including Outside Directors and Outside Audit& Supervisory Board Members and the Board of Directors
analyzes and evaluates the effectiveness of the Board of
Directors as a whole based on the survey results.
The results of the surveys targeting Audit & Supervisory
Board Members are used as reference.
Results of analysis and evaluation in FY2021 confirmedthat the Board of Directors functioned effectively.
We will continue making improvements to maintain andincrease the effectiveness of the Board of Directors in light of
the analysis and evaluation results, such as continuing to holdmore substantive discussions on the direction of management
including corporate strategy.

Fixed compensation (monthly compensation) is apredetermined amount of base compensation plus an additionalamount based on the position or skills etc. of Members of theBoard and it is paid on a monthly basis.
Performance-based compensation (bonus) is an amountbased on monthly compensation adjusted to reflect acomprehensive evaluation of the company’s key performanceindicators (consolidated net income and consolidated operating
income; hereinafter “consolidated results”) as well as thecontribution of each Members of the Board. More specifically,
two separate bonuses are paid: the winter bonus, which is
calculated based on the monthly compensation, and thesummer bonus, which is the amount calculated based onmonthly compensation adjusted to reflect the consolidated
results and individual performance.
Such consolidated results is evaluated by the consolidated
results for the relevant fiscal year in comparison with pastconsolidated results including the consolidated results for theprevious fiscal year.
The compensation of Outside Directors consists of fixedmonthly compensation.
In addition, a fixed amount of the monthly compensation
determined according to each position of Members of the Board
is paid as stock-based compensation through contribution to ashareholders’ association for Members of the Board and Audit &Supervisory Board Members and continuous acquisition of theCompany’s shares. Members of the Board are generally required
to hold such acquired shares throughout their term of office.

Classification of Members of theBoard/Audit & Supervisory Board
Members

Total amount ofcompensation

Total amount of compensation by type (millions of yen)

Number of eligible
officers (persons)(millions of yen)

Fixedcompensation

Performance-based
compensation

Non-monetary compensation of the
Performance-based compensation

Members of the Board (excluding
Outside Directors)

287

176

111

－

8

Audit & Supervisory Board Members(excluding Outside Audit &Supervisory Board Members)

44

29

15

－

2

Outside Officers

43

43

－

－

7

Mochida Pharmaceutical Group Integrated Report 202230

3 GovernanceBusiness Risks

Compliance

Mochida Pharmaceutical Group enacted Risk Management Rules applicable to Mochida Pharmaceutical Group and alsoestablished the Risk Management Committee composed of the Heads of Divisions, the presidents of subsidiaries and otherrelevant members, putting in place a structure for recognizing risks which might have a considerable adverse impact on
Mochida Pharmaceutical Group’s business and management (major risks) and for considering, assessing and discussing
measures and policies for addressing such risks.

Mochida Pharmaceutical Group is working to promote compliance through the structure and activities described below.
In addition, the Group provides training to those in Pharmaceutical Business Division on a regular basis to encourage fair competition.

[ Major Risks and Risk Description ]Major Risks

Risk Description

Risks associated withresearch anddevelopment

Researching and developing pharmaceuticals and other products requires a huge amount of capitaland time. However, development may be suspended or delayed due to reasons such as a failure toprove the initially anticipated efficacy or the emergence of unforeseen adverse drug reactions in theprocess. This may necessitate further development attempts or additional trials or lead to the loss of
future revenue opportunities or other consequences and earnings may be lower than initiallyanticipated as a result.

Risks associated withproduction andprocurement

Mochida Pharmaceutical Group does its best to ensure the quality of its products, including in its
supply chain requirements, in accordance with regulations based on applicable laws. However, thequality issues such as defects of products produced at Mochida Pharmaceutical Group plants or
the delay or suspension of supply of products or raw materials by a specific supplier on which theGroup depends due to some factor, despite the procurement management divisions and theimplementation of procurement management, could lead to the recall of products, the delay orsuspension of shipments or supply shortages, the revocation of a license, the suspension ofoperations or other administrative disposition, decreased revenue or other consequences, and theGroup’s operating results and financial position may be severely impacted as a result.

Risks associated withbusiness alliances

Mochida Pharmaceutical Group forms business alliances with other companies across all its
operations, including joint research, development and marketing and the in-licensing and outlicensing of products. Future circumstances may put an end to such alliances, affecting the revenue
outlook and resulting in lost opportunities and causing earnings to be lower than initially forecast or
expected.

Risks associated withlaws and regulations
and system reforms

The research and development, manufacture and marketing of pharmaceuticals is subject topharmaceutical-related laws and regulations and other regulations (including measures to reduce
healthcare costs such as healthcare system reforms, encouragement of the use of generics and
NHI drug price reductions) and any changes such as tighter regulation could severely impact theGroup’s operating results and financial position. Failure to comply with such regulations could leadto the recall of our products, revocation of our license, the suspension of our business operations orother administrative disposition or a claim for compensation against us and decreased revenue due
to a loss of trust, and our operating results and financial position could be severely impacted.

Risks associated withadverse drug reactions

Mochida Pharmaceutical Group does its best to ensure the reliability of clinical trials and the qualityof products, in accordance with strict regulations based on pharmaceutical-related laws andregulations concerning the quality and safety of pharmaceuticals, and endeavors to mitigate
associated risks by taking out insurance to cover damage compensation claims. However, theunforeseen adverse drug reactions could lead to the recall of products, the suspension of sales andmarketing, litigation and compensation for damages, decreased revenue due to a loss of trust andother consequences, and our operating results and financial position could be severely impacted.

Risks associated withbusiness continuity

31

In case major natural disasters or accidents could seriously affect or damage MochidaPharmaceutical Group’s plants, laboratories, branches, offices and other sites (including the
shutdown or failure of information systems) or events such as epidemic could lead to the stagnationof business activities and/or supply shortages caused by the suspension of operations at plants, theGroup’s operating results and financial position could be seriously impacted as a result.

Mochida Pharmaceutical Group Integrated Report 2022

Ethics and Compliance Committee
The Ethics and Compliance Committee is composed of the
President of Mochida Pharmaceutical, the officer in charge ofcorporate ethics and compliance, and outside experts andis chaired by the President. The Ethics and Compliance
Committee carries out internal checks and awareness-raising
activities striving to materialize the spirit of the Code of Conduct
of Mochida Pharmaceutical Group into Group activities.

Ethics and Compliance Committee Working
Group
The Committee is composed of general managers ofoperations, presidents of subsidiaries and other relevant
members and chaired by the officer in charge of corporate
ethics and compliance, and it is responsible for the review
of internal rules and systems for preventing fraud and improper
conduct, and for raising issues with and reporting to the Ethics
and Compliance Committee. Each member is responsible
for ethics and compliance within their area of operations,
including compliance with the Code of Conduct (including
compliance training) and prevention of improper conduct.

Establishment of compliance-related units
We have established the Internal Audit Department and the
Corporate Ethics & Compliance independent from ourbusiness units and business subsidiaries, to promote theobservation of compliance.

Communication of message from the President
We distribute a message from the President to employees
in the form of video news. The video news distributed inautumn each year always focus on latest incidents of
non-compliance such as corporate misconducts of othercompanies and the President himself always stresses theimportance of compliance.

Compliance training and awareness-raising
activities
The Group provides compliance training to meet all training
needs, for example, the Corporate Ethics & Complianceprovides ethics and compliance training to employees uponentry to our company and upon appointment to a managerial
post as well as rank-based, companywide and officersoriented training, all related to ethics and compliance, and thestaff in charge of ethics and compliance within each business
unit provide ethics and compliance training in consistency
with the operational characteristics of such business unit. We
also endeavor to raise awareness of compliance, by, forexample, disseminating information about compliancethrough the intranet on a regular basis.

Corporate ethics and compliance helpline
We install a hotline via which any officer or employee(including who has left the company within one year) who
has discovered an actual or potential non-complianceincident or issue may make whistleblowing reports or seek
advice. Through the hotline, any officer and employee mayeither report to or consult with the staff or the officer incharge of corporate ethics and compliance within thecompany or directly report to or consult with an outside
lawyer or other expert. We have also established standards
for handling whistleblowing reports within MochidaPharmaceutical Group and take appropriate measures toensure that anyone making a whistleblowing report orseeking advice does not suffer disadvantageous treatment.

Initiatives concerning medical and healthresearch involving human subjects
We have enacted “Ethical rules on life science and medical
research involving human subjects” to ensure that life scienceand medical research involving human subjects respects humandignity and human rights and is conducted appropriately with
understanding and cooperation of society. In accordance withthese rules, we established the Research Ethics Committee.

Ethical response to the treatment oflaboratory animals
Mochida Pharmaceutical has established guidelines inaccordance with the “Basic guidelines for the conduct ofanimal experiments in implementing agencies under thejurisdiction of the Ministry of Health, Labour and Welfare”
and gives due consideration to animal dignity and theprinciples of the 3Rs*. In terms of inspection and evaluation
by an independent third party, we undergo onsite
inspections by the Center for Accreditation of Laboratory
Animal Care and Use in Japan Health Science Foundationand have obtained accreditation.
*Replacement: methods which avoid or replace the use of animals; Reduction: methods
which minimize the number of animals used for experiment; and Refinement: methods
which minimize suffering and improve welfare of animals

Mochida Pharmaceutical Group Integrated Report 2022

32

3 Governance

Officers
Members of the Board

Executive Officers
Hitoshi Mizuno
Executive Managing Officer
Officer in charge of Biomaterials Business and Headof Biomaterials Business Division

Masaaki Naotsuka
Representative Director,
Senior Executive Vice President

Representative Director, President

Naoyuki Mochida

Member of the Board,
Senior Executive Managing Officer

Chu Sakata

Member of the Board,
Senior Executive Managing Officer

Keiichi Sagisaka

Member of the Board,
Executive Managing Officer

Junichi Sakaki, Ph.D.

Kiyoshi Mizuguchi, Ph.D.

Apr. 1981 Joined the Company

Apr. 1982 Joined the Mitsubishi Bank, Ltd.

Apr. 1980 Joined the Company

Mar. 1993 Joined Ciba-Geigy AG

Apr. 1982 Joined the Company

May 1986 Earned an MBA from Indiana University in the U.S.

May 2007 General Manager of Syndicated Finance Division and the Global Head

Apr. 2003 Head of Metropolitan Branch Office

Jul. 2005 General Manager, Research Strategy and Alliances at Novartis

Apr. 2003 Head of Development Research

Apr. 1988 Joined Ajinomoto Co., Inc.

of Syndication at the Bank of Tokyo-Mitsubishi UFJ, Ltd. (BTMU)

Apr. 2005 Head of Tokyo Branch Office

Apr. 1991 Joined the Company

Feb. 2009 Regional Head for the Middle East at BTMU

Jun. 2007 Executive Officer

Apr. 1996 General Manager, Head of the Clinical Development Planning

Jun. 2011 Advisor of the Company

Apr. 2008 Deputy Head of Pharmaceutical Business DivisionJun. 2011 Member of the Board, Executive Officer and Assistant Officer,

Jun. 2009 Head of Pharmaceutical Business Division

Department
Apr. 1997 General Manager, Head of the Finance Department

Apr. 2012 Head of Planning & Administration Division

Jan. 1998 Senior Executive Managing Officer, Head of the Corporate Planning

Jun. 2012 Executive Officer, Planning & Administration, Head of Planning &Administration Division

Jan. 1999 Representative Director, President (to the present)

Jun. 2013 Member of the Board, Executive Managing Officer

Apr. 2010 Vice-Chairman of Mochida Memorial Foundation for Medical andJun. 2016 Representative Director, Senior Executive Managing Officer, Supervisor

Pharmaceutical Research

for Planning & Administration, Audits and Corporate Ethics

Jun. 2016 Chairman of Mochida Memorial Foundation for Medical andPharmaceutical Research (to the present)

Jun. 2017 Assistant to President, Senior Executive Managing Officer,

Jun. 2013 Member of the Board, Executive Managing Officer, PharmaceuticalBusiness, Head of Pharmaceutical Business Division

Director, Chemistry Department, Tsukuba Research Laboratories
Jul. 2009 Joined the Company General Manager, Head of Research Planningand Management Department
Apr. 2010 Head of Discovery Research
Jun. 2012 Executive Officer, Deputy Head of Business Development Division

Apr. 2015 Executive Managing Officer, Pharmaceutical Business

Jun. 2014 Member of the Board, Executive Officer, Business Development

Jun. 2016 Member of the Board, Senior Executive Managing Officer (to theJun. 2016 Member of the Board, Executive Managing Officer

present)

Executive Officer
Head of Business Development DivisionJun. 2012 Executive Officer, Head of Clinical Research and Development

Division
Jun. 2015 Member of the Board, Executive Officer
Jun. 2017 Member of the Board, Executive Managing Officer, Research andDevelopment (to the present)
Jun. 2021 Executive Managing Officer, Supervisor for Mochida Pharmaceutical

Plant (to the present)

Oct. 2018 Executive Managing Officer, Business Development and Biomaterials

Jun. 2021 Senior Executive Managing Officer, Pharmaceutical Business andMochida Healthcare (to the present)

Operations in general (to the present)

Taiji Hayano
Executive Officer
Head of Clinical Research and Development Division

Kazunari Nakao
Executive Officer
Head of Research Division

Kenji Miyajima

Business (to the present)

Executive Officer
Head of Pharmaceutical Business DivisionJun. 2021 Member of the Board, Senior Executive Managing Officer (to the present)
Jun. 2022 Senior Executive Managing Officer, Business Development andJun. 2021 Representative Director, Senior Executive Vice President (to the present)

Tomokazu Matsusue

Apr. 2010 General Manager, Head of Clinical Research Department

Dec. 2006 Joined Banyu Pharmaceutical Co., Ltd.

Jun. 2010 Member of the Board, Executive Officer

Planning & Administration

Jun. 1997 Member of the Board

Department

Pharma K.K.

Executive Managing Officer
Officer in charge of Mochida Pharmaceutical Plant

Supervisor for Biomaterials Business (to the present)

Takeshi Mochida
Executive Officer
Deputy Head of Clinical Research and Development
Division and General Manager, Head of ClinicalDevelopment Planning and Management Department

Reiko Nakano
Executive Officer
Deputy Head of Business Development Division

Member of the Board,
Executive Managing Officer

Member of the Board,
Executive Managing Officer

Outside Director

Outside Director

Outside Director

Yutaka Kawakami, Ph.D.

Yoshiharu Hashimoto

Tomoo Kugisawa

Nana Otsuki, Ph.D.

Tomoaki Sonoda, Ph.D.

Apr. 1985 Joined Eisai Co., Ltd.

Apr. 1985 Joined the Mitsubishi Bank, Ltd.

Apr. 1998 Joined Pfizer Japan, Inc.

Jan. 2009 General Manager of Yotsuya Commercial Banking Office at the Bank

Oct. 2003 Transferred to the Office of Pharmaceutical Industry Research of theJapan Pharmaceutical Manufacturers Association
Oct. 2005 Director of Clinical Submissions Department at Pfizer Japan Inc.
Dec. 2012 Joined the Company Deputy Head of Clinical Research andof Tokyo-Mitsubishi UFJ, Ltd. (BTMU)May 2011 General Manager of Osaka Corporate Banking Division No. 2 ofOsaka Corporate Banking Group at BTMU
Jun. 2013 Vice President, Head of Business Development Unit at Sharp

Fuji Law Office
Apr. 1995 Partner at Tokyo Fuji Law Office (to the present)
Apr. 2005 Professor at Omiya Law School
Jun. 2006 Outside Corporate Auditor at OG Corporation
Jun. 2012 Outside Director of the Company (to the present)
Apr. 2019 Visiting professor at Chuo University Law School (to the present)

Corporation

Development Division

Apr. 1987 Registered as an attorney -at - law (to the present) and joined Tokyo

Dec. 2005 Managing Director at UBS Securities Japan Co., Ltd.

Apr. 2004 Certified public accountant (to the present)

Jun. 2011 Managing Director at Merrill Lynch Japan Securities Co., Ltd.

Apr. 2006 Professor at Keio University Faculty of Business and Commerce (toSep. 2015 Professor in Division of Management at Graduate School of Management,
Jan. 2016
Sep. 2016
Apr. 2017

Jun. 2015 Executive Officer

Jun. 2016 Full - time Corporate Auditor at Mitsubishi UFJ Capital Co., Ltd.

Jun. 2017

Jun. 2017 Head of Clinical Research and Development DivisionJun. 2017 Joined the Company

Jun. 2018

Apr. 2019 Head of RA, QA and PV Division (to the present)

Jun. 2017 Full -Time Audit & Supervisory Board Member

Jun. 2019 Member of the Board, Executive Officer, RA, QA and PV (to theJun. 2019 Member of the Board, Executive Officer, Planning & Administration

Sep. 2019
Oct. 2019and Technonet, Head of Planning & Administration Division (to thepresent)
Jun. 2022 Member of the Board, Executive Managing Officer (to the present)

Apr. 2021

present)

Jun. 2021

Jun. 2022 Member of the Board, Executive Managing Officer(to the present)

Sep. 2022

Nagoya University of Commerce & Business (to the present)
Executive Officer at Monex, Inc.
Member of Operating Committee of Agricultural and Fishery
Co-operative Savings Insurance Corporation
Member of Fiscal System Council of Ministry of Finance (to the present)
Outside Director of Credit Saison Co., Ltd. (to the present)
Outside Audit & Supervisory Board Member of Tokio Marine
Holdings, Inc. (to the present)
Outside Director of Nishogakusha (to the present)
Member of Regulatory Reform Promotion Council (to the present)
Expert Director at Monex, Inc.
Outside Director of the Company (to the present)
Senior Fellow of Pictet Asset Management (Japan) Ltd. (to the present)

Yoshitaka Hosaka, Ph.D.
Executive Officer
Deputy Head of Pharmaceutical Business Division

Shinji Ninomiya

the present)
Oct. 2009 Member of Contract Surveillance Committee, Ministry of Internal

Affairs and Communications (to the present)

Executive Officer
Deputy Head of Pharmaceutical Business Division

Apr. 2018 Visiting Professor at Musashino University (to the present)
Jan. 2020 Member of Third Bidding Surveillance Commission, Ministry of

Finance (to the present)

Junichi Makino
Executive Officer
General Manager, Head of Human Resources
Department

Jun. 2022 Outside Director of the Company (to the present)

Masaaki Yokosuka
Executive Officer
General Manager, Head of Legal & ComplianceDepartment

Audit & Supervisory Board Members

Full-Time Audit &Supervisory Board Member

Full-Time Audit &Supervisory Board Member

Ichiro Takahashi

Masayoshi Takeda

Outside Audit &Supervisory Board Member

Kyosuke Wagai

Apr. 1985 Joined Nippon Sheet Glass Co., Ltd.
Jun. 2008 Joined the Company

Sep. 1982 Registered as a certified public accountant (to the present)

Jun. 2010
Apr. 2013
Jun. 2013
Jun. 2014

Apr. 2015 Head of Finance & Accounting Department

Jul. 1991 Partner at Deloitte Touche Tohmatsu LLC

Sep. 1990 Joined the Company

Jun. 2016 Executive Officer

Jul. 2010 Executive Board Member of the Japanese Institute of Certified Public

Sep. 1998 Joined Tokyo Eiwa Law OfficeJun. 2016
Apr. 2017
Jun. 2017
Apr. 2019
Jun. 2019

Department
General Manager, Head of Legal Department
General Manager, Head of General Affairs Department
Executive Officer
Head of Planning & Administration Division and General Manager,
Head of General Affairs Department
Head of Planning & Administration Division and General Manager,
Head of Human Resources Department
Executive Officer, Planning & Administration, Head of Planning &Administration Division and General Manager, Head of Human
Resources Department
Executive Officer, Planning & Administration, Head of Planning &Administration Division
Member of the Board, Executive Officer
Executive Officer, Planning & Administration and Technonet, Head ofPlanning & Administration Division
Full - time Audit & Supervisory Board Member (to the present)

Mochida Pharmaceutical Group Integrated Report 2022

Jun. 2022 Full - time Audit & Supervisory Board Member (to the present)

Oct. 1977 Joined Tohmatsu Awoki & Co

Accountants (JICPA)
Jun. 2016 Outside Audit & Supervisory Board Member of the Company (to thepresent)
Jul. 2016 Audit & Supervisory Board Member of JICPA
Jun. 2017 Outside Audit & Supervisory Board Member at Tokyo Electron

Limited (to the present)
Jun. 2017 Representative Director and Chairman at XBRL Japan Inc. (to thepresent)

Outside Audit &Supervisory Board Member

Akiko Suzuki

Apr. 1980 Joined the Company
Apr. 2009 General Manager, Head of Marketing and Sales Administration

Apr. 2015

33

Outside Audit &Supervisory Board Member

Apr. 1974 Registered as an attorney -at - law (to the present)

Joined Anderson Mōri & Rabinowitz

Sep. 2002 Joined Tokyo Office of Oh-Ebashi LPC & Partners

Partner (Member of the LPC)
Jun. 2019 Outside Audit & Supervisory Board Member of the Company (to thepresent)

Yoshifumi Miyata
Apr. 2006 Executive Officer and General Manager of Financial Institution

Relations Department at the Dai - ichi Mutual Life Insurance
Company.
Apr. 2009 Managing Executive Officer of the Dai - ichi Mutual Life Insurance

Company
Jun. 2010 Outside Audit & Supervisory Board Member of Tsugami Corporation
Jun. 2012 Representative Director and Vice-President of Trust & Custody

Services Bank, Ltd.
Oct. 2018 Outside Director at Wellness Communications Corporation (to thepresent)
Jun. 2021 Outside Audit & Supervisory Board Member of the Company (to thepresent)

Mochida Pharmaceutical Group Integrated Report 2022

34

4 Environment and Society

Environment[ Trend of CO2 Emissions ]
17,90018,79018,731

Consideration for the Environment

17,592(tons)

16,694

16,887[ Trend of Energy Consumption ]
370

375

FY2017FY2018(terajoules)

362

354

359

FY2019FY2020

FY2021-46%
reduction
9,660

Mochida Pharmaceutical Group stipulates “always taking environmental impacts into consideration when conducting
business activities” as a basic stance in the Code of Conduct of Mochida Pharmaceutical Group and we are focusing on
what we can do to contribute to the realization of a sustainable society.

0

Environmental Management
Mochida Pharmaceutical Group has established theEnvironmental Measures Committee as an organization which
examines important matters related to the environment. The
Committee formulates a medium- and long-term environmental
action plan for Mochida Pharmaceutical Group, examines
measures to address environmental issues which affect theGroup, makes recommendations to management, and promotes
environmental activities at each business site. The committee also
formulates a training schedule and conducts environmental
training and awareness-raising activities for the further promotion
and integration of environmental activities.
The Head Office Plant of Mochida Pharmaceutical Plant
Co., Ltd., which is the Mochida Pharmaceutical Group’s
production center, was awarded ISO 14001 certification by theInternational Standards Organization for its environmental
management system and implements activities to protect theenvironment on an ongoing basis.

FY2013 FY2017(Base year)

FY2018FY2019FY2020

FY2021

FY2030(Target)

FY2050(Target)Sites covered: H ead Office, Gotemba site, Fujieda site and every
other business site of Mochida PharmaceuticalCo., Ltd., Head Office Plant of MochidaPharmaceutical Plant Co., Ltd., and Saitama Plant
of Mochida Pharmaceutical Plant Co., Ltd.
CO2 emissions: T otal amount of energy-related CO2 emissions
from fuel and electricity consumption

Sites covered: Head Office, Gotemba site, Fujieda site and every
other business site of Mochida PharmaceuticalCo., Ltd., Head Office Plant of MochidaPharmaceutical Plant Co., Ltd., and Saitama Plant
of Mochida Pharmaceutical Plant Co., Ltd.
Energy consumption: Total consumption of all types of energy
including electricity, fuel oil (until FY2019),
gasoline, LNG and city gas

Gas-fired once-through boilers(Head Office Plant of Mochida Pharmaceutical Plant Co., Ltd.)Heat pumps(Head Office Plant of Mochida Pharmaceutical Plant Co., Ltd.)ISO14001 renewal audit certificate

Environmental Initiatives
Climate Change Countermeasures
Mochida Pharmaceutical Group has set a target of reducing carbon emissions by 46% from FY2013 levels by FY2030, andreaching carbon neutrality by 2050. We are working to reduce CO2 emissions and improve energy efficiency across MochidaPharmaceutical Group as a whole, to fulfil our social responsibility and help realize a low-carbon society. In FY2021, we
continued our efforts to replace our commercial fleet with hybrid vehicles and installed LED lighting and more efficient air
conditioning systems at all sites.
In addition, the Sustainability Committee considered, in collaboration with the Environmental Measures Committee andRisk Management Committee, the need for Mochida Pharmaceutical Group to disclose information about the impact of risks
and opportunities associated with climate change on its business activities and earnings, etc. in accordance with therecommendations of the Task Force on Climate-related Financial Disclosure (TCFD). We plan to assess the risks andopportunities associated with climate change and reflect the results of this assessment in our management strategies andrisk management, and we will work to gain an understanding of the financial impact of climate change and disclose climatechange-related information.

Opening of New Head Office Building
The new Head Office building, which went into operation in September 2022, is anenvironmentally sustainable building, which uses the site conditions to reduce theenvironmental impact of air conditioning and deploys energy efficient lighting and airconditioning systems.
Accordingly, in the “Building-Housing Energy-efficiency Labeling System (BELS)”
evaluation, the building received a top-level BELS 5-star rating and was certified as “ZEB
Ready” on the grounds that it is a building that achieves energy savings of greater than 50%.
We are making progress with our energy saving activities through the operation of thisoffice.

35

Mochida Pharmaceutical Group Integrated Report 2022

Mochida Pharmaceutical Group Integrated Report 2022

36

4 Environment and Society

Reduction and recycling of waste

Water resources and water quality

Prevention of air pollution

Proper management of chemical substances

Mochida Pharmaceutical Group is working on the reduction
and recycling of waste generated in its business activities.
We promote the 3Rs (Reduce, Reuse, Recycle) and arecommitted to reducing the amount of waste we generate
to 582 tons or lower by FY2030, increasing our waste
recycling rate to 98% or higher, and maintaining a plastic
waste recycling rate of 65% or higher.

Mochida Pharmaceutical Group strives to comply with laws
and regulations and water standards agreed with each
local government and is working to use water resources
efficiently and to manage wastewater properly. In addition,
Mochida Pharmaceutical Plant Co., Ltd. has completely
replaced the below ground drainage system with an above
ground drainage system at its Head Office Plant to prevent
soil contamination due to leakages.

In efforts to prevent air pollution, Mochida Pharmaceutical
Group completed the switch from fuel oil to LNG and city
gas in FY2019. This move reduced the Group’s particulatematter, oxides of nitrogen and sulfur (NOx and SOx)emissions to zero. We will continue striving to comply withlaws and regulations and the standards agreed with each
local government.

The Gotemba and Fujieda sites, the Head Office Plant of
Mochida Pharmaceutical Plant Co., Ltd., and the Saitama
Plant of Mochida Pharmaceutical Plant Co., Ltd. fullyrecognize the impact that the chemical substances needed
to develop and manufacture pharmaceuticals andhealthcare products have on human health and theecosystem, and they use and manage chemical
substances properly.

[ Trends of Amount of Waste Generated and Recycling Rate ](tons)[ Trends of Water Consumption and Amount of Wastewater ](thousand m 3)

99.0%

99.1%

99.2%

99.5%

99.3%

382

373
343

515 510508 504

502 498

463 461

354

347

328

341

354
322

323

Environment Action Plan (Targets and results)
Mochida Pharmaceutical Group conducts environment activities in line with environmental targets for each fiscal year set
based on a medium-term plan. In FY2021, we continued working to protect the environment in line with the fiscal-yeartargets we had set.

464 461[Environmental Action Plan]
FY2021
Environmental Policy
Target
FY2017FY2018

Total amount generated

FY2019FY2020

Amount recycled

FY2021
Recycling rate

Sites covered: H ead Office, Gotemba site, Fujieda site and every
other business site of Mochida Pharmaceutical Co.,
Ltd., Head Office Plant of Mochida Pharmaceutical
Plant Co., Ltd., and Saitama Plant of MochidaPharmaceutical Plant Co., Ltd.
However, data for FY2020 and FY2021 excludes
Head Office of Mochida Pharmaceutical Co., Ltd.
Amount recycled: T otal amount of waste generated which was
the subject of reuse, material recycling or
thermal recycling (heat recovery and residueuse)

FY2017FY2018FY2019Water consumption

FY2020

FY2021

FY2022 Target

FY2030 Target

Result16,880t-CO2 or less

16,887t-CO2

16,690t-CO2 or less

9,660t-CO2 or lessWaste generated

582 t or less

464t

498 t or less

582 t or lessWaste recycling
ratio

98% or more

99.3%

98% or more

98% or more

Plastic waste
recycling ratio

65% or more

73.8%

65% or more

65% or more

Reduction of CO2 emissions

Amount of wastewater

Sites covered: H ead Office, Gotemba site, Fujieda site and every
other business site of Mochida PharmaceuticalCo., Ltd., Head Office Plant of MochidaPharmaceutical Plant Co., Ltd., and Saitama Plant
of Mochida Pharmaceutical Plant Co., Ltd.
However, data for FY2020 and FY2021 excludes
Head Office of Mochida Pharmaceutical Co., Ltd.
Water consumption: Total of extraction of groundwater and water
purchased from public water supply

Reduction andrecycling of waste

Sites covered: Head Office, Gotemba site, Fujieda site and every other business site of Mochida Pharmaceutical Co., Ltd., Head Office Plant of
Mochida Pharmaceutical Plant Co., Ltd., and Saitama Plant of Mochida Pharmaceutical Plant Co., Ltd.
However, rented buildings including Head Office and every other business site of Mochida Pharmaceutical Co., Ltd. are notincluded in the waste data.

Activities to revitalize forests
In 2013, to commemorate the 100th anniversary of its
founding, Mochida Pharmaceutical Group joined a partner
program implemented by Kanagawa Prefecture to revitalize
forests. Under the program, we lease an area of forest in
Kanagawa Prefecture, which we named Mochida Memorial
Forest, and employees volunteer to take part in activities todevelop the forest such as tree thinning, pruning and clearing
underbrush. We will continue focusing on the revitalization ofWaste training (Fujieda site)

forests and are committed to passing on the blessings of theforest to the next generation.

37

Mochida Pharmaceutical Group Integrated Report 2022

Mochida Pharmaceutical Group Integrated Report 2022

38

4 Environment and Society

Society
Relationship with Employees
Mochida Pharmaceutical Group respects the personality
and individuality of employees and aims to realize diverse
work styles and improve the skills of individual employees.
We also strive to maintain and improve workplace safety
and health. In order to grow as a life and healthcare group,
we will develop the human resources to drive innovation.

Human resource development
Strengthening our human resource management system
We are strengthening our human management system andworking on changes to the personnel programs that
underpin it. We have considered a framework for reflecting
the role and contribution of individuals in their treatment
and new programs for encouraging diverse humanresources to actively participate and plan to put the new
system into operation from FY2023. The Group will also
clarify the role of each position as part of wider
reorganization and this clarification will also help speed up
the appointment process. We will also conduct a review of
our treatment of elderly persons with expertise. At thesame time, we will focus on securing the human resources
required to expand our operations overseas.

Use of diverse human resources
Female participation and career advancement in theworkplace
We believe that the participation and advancement of
women in the workplace is an issue we should especially
focus on and we are working to hire and train women andincrease the ratio of female managers. We are also
developing programs to support women in their various life
stages. In addition, we have established a working groupto support women’s health consisting mainly of female
employees. The group identifies issues and considers
measures to help women to stay in good health and actively
participate. Under an action plan based on the Act on the
Promotion of Female Participation and Career Advancementin the Workplace, Mochida Pharmaceutical has set a target
ratio of female managers of 12% or higher (FY2021FY2025). Aiming to be a company that empowers womenin the workforce, we are working to develop female
employees and to change mindsets, including preparing
career plans for female candidates and increasing thenumber of female candidates attending training.

Child care and nursing care
Mochida Pharmaceutical Group has been working toTraining and developing employees
realize workplaces which make it easier for employees to
Mochida Pharmaceutical Group sees the development ofbalance child care and nursing care with work. We havehuman resources as an important issue, and provides
increased support for child care and nursing care, having
training by rank and by job and focuses on enhancing
thus far implemented initiatives such as longer child care
employees’ skills and cultivating leaders. In addition, we
leave, introducing some paid childcare leave, introducing
have introduced and operate a self-development support
nursing care leave that exceeds the statutory requirements,
system aimed at encouraging employees to use theirintroducing a reduced working hour system, establishinginitiative and nurturing a challenging spirit, and training
leave for maternity hospitalization, more widespread use of
programs in Japan and study abroad programs for coreaccumulated paid leave for child care and nursing care,human resources.
expanding flextime to those working shorter working hours
due to child care, introducing telework, and revising childcare leave regulations as a measure to prevent maternity
harassment.
We are also focusing on[ Groupwide Training Structure ]encouraging employees to take childOpen application
Tiered program
Job-specific program
Self-development
care leave, setting target percentages
basis
for those taking child care leave of 90%
Manager training
New manager training,or higher for women and 30% or higherFor
deputy general manager
managers
training, general
for men (FY2021-FY2025).
manager training, etc.
In recognition of our efforts to
Support for
Domestic training
Assessment training
self-development
Business unit-specificand overseas
supportchildcare at the workplaces ofand acquisition oftraining
study program
Leadership training
qualifications
MochidaPharmaceutical, Mochida
For general
Mid-level employee
employees
Healthcare and Mochidatraining
Pharmaceutical Plant, we received the
New employee training
Minister of Health, Labour and Welfare’s
39

Mochida Pharmaceutical Group Integrated Report 2022

Aiming to be a great place to work

“Kurumin” certification, which isawarded to companies that meet thestandards of the Act on Advancementof Measures to Support Raising NextGeneration Children.
Employment of persons with disabilities
Mochida Pharmaceutical Group is working to expand
employment of persons with disabilities. MochidaPharmaceutical’s employment ratio of persons withdisabilities stood at 2.6% in FY2021 (the legal employment
quota for persons with disabilities is 2.3%), and all such
employees play an active part in various departments.
Promotion of mid-career recruitment
Mochida Pharmaceutical Group believes that therecruitment of mid-career professionals with the skills,
knowledge and experience it needs will help to increase its
corporate value. The ratio of mid-career hires increases
year by year and many mid-career hires play an active partin a wide variety of departments.
Employment of elderly persons
With the regular retirement age set at 60, we haveintroduced a system under which all employees who havereached mandatory retirement age and wish to continue
working are reemployed until the age of 65. Throughinitiatives such as changing the treatment of elderly
employees in FY2013 to increase their motivation to workand changing their treatment in FY2020 in response toenactment of the Act on Improvement of Personnel
Management and Conversion of Employment Status forPart-Time Workers and Fixed-Term Workers, we have put
in place a system which gives elderly persons even more
motivation to work. Mochida Pharmaceutical Group also
gives 55-year-old employees the opportunity to reassess
their future plans including their professional lives andmanagement of their assets through the provision of life
plan seminars and support for diverse work styles.

[ Diversity of human resources ]FY2019 FY2020 FY2021
Ratio of new female recruits (%)

54.8

64.3

63.2

Ratio of female managers (%)

11.0

  9.8

10.8

Ratio of female employees who tookchildcare Leave (%)

100.0

100.0

100.0

Ratio of male employees who tookchildcare leave (%)

30.6

14.0

65.4

Ratio of disabled employees (%)

  2.2

  2.4

  2.6

Ratio of mid-career hires* (%)

25.0

32.3

35.6

Promoting work style reform
Mochida Pharmaceutical Group is constantly working toachieve work-life balance and diverse, flexible working
styles. We have also put in place an environment which
increases employee motivation and enables more efficient
work styles, taking action in response to the Act on the
Arrangement of Related Acts to Promote Work Style
Reform (including limiting overtime working hours andgaining an understanding of working hours for healthmanagement of managers and supervisors), encouraging
employees to use flextime, introducing a discretionary
working system, expanding the scope of telework, anddeveloping and enhancing communication tools. In
FY2021, we extended the flextime system to those whowork outside the office.
We also developed more comfortable officeenvironments in a bid to further improve productivity
through initiatives such as the reconstruction of the Head
Office building (operations at the new Head Office building
began in September 2022) and the introduction of digitaltechnologies.
Creating a rewarding workplace
Personnel staff conduct interviews with employees in an
attempt to obtain feedback about their work andworkplace, listen to their requirements and give advice on
any concerns or issues raised. We are also implementing
initiatives to increase job satisfaction and become an evenbetter place to work, including conducting an employee
survey to assess employee engagement and use thefindings in various measures to strengthen engagement.
Creating a workplace free of discrimination andharassment
We work to maintain a healthy work environment throughhuman rights training designed to prevent any harassment
including sexual harassment, power harassment andmaternity harassment.
We are also implementing initiatives to increase job
satisfaction and become an even better place to work,
including conducting an employee survey to assess
employee engagement and use the findings in various
measures to strengthen engagement.

*Percentage of people employed as mid-career employees that became permanent
employees in accordance with the Comprehensive Promotion of Labor Measures Act
Announced: March 31, 2022.

Mochida Pharmaceutical Group Integrated Report 202240

4 Environment and Society

Respect for human rights
Mochida Pharmaceutical Group sets out rules such as that
officers and employees will respect each others’ humanrights and will not engage in behavior such as unfair
discrimination, sexual harassment or power harassment in
its code of conduct. We work continuously and assiduously
to raise awareness about human rights, including
appointing persons in charge of raising awareness abouthuman rights in all our operations and providing all
employees with training to raise awareness about humanrights once a year. In addition, every year, we issue a callto employees and their families for slogans to raiseawareness about human rights, providing them with theopportunity to reflect on human rights issues as somethingwhich concerns them.

Pharmaceutical Group and, as well as holding health andsafety committee meetings at each site, we are working toprevent occupational accidents and ensure workplace
health and safety.
Mental health and health consultations
Based on the “Guidelines for Maintaining and Improving
Worker’s Mental Health” issued by the Ministry of Health,Labour and Welfare, Mochida Pharmaceutical Group
strives to enhance the structure and systems for supporting
employees from four standpoints: selfcare, care provided
by Human Resources Department, care provided by onsite
occupational health professionals, and care utilizing outside
resources.
1. Selfcare
Mental health training (for all employees)
Stress checks to assess mental health (carried out
annually)Establishment of internal and external consultation
service
2. Care provided by Human Resources Department
Mental health training (training for newly appointed
managers and manager training, etc.)
Personnel interviews
3. Care provided by onsite occupational healthprofessionals
Health consultations provided by occupational healthphysicians
Mental and physical health consultations provided bypublic health nurses
Support for employees returning to work from leave
provided by personnel staff and introduction of aprovisional return-to-work system
4. Care utilizing outside resourcesReferral to outside consultation service, counselling
facility or specialist●●

One of our entries was selected as a human rights
slogan award winner
Every year, the Industrial Federation for Human
Rights, Tokyo issues a call for human rights slogans
to help raise awareness about human rights from its
member companies. In FY2021, the entry of an
employee from Mochida Healthcare was selected asaward winner from a total of 360,000 entries in theworkplace category.
A single breath
The time to hear someone out
The time to have room in your heart

●

●

●

●

●

●

Occupational health and safety
Health and safety
Aiming to create a workplace where employees can workwith peace of mind, we have built a structure for managing
and promoting health and safety across Mochida●

Relationship with Society
Information about diseases
Mochida Pharmaceutical provides a wide range of
information to increase patient understanding of illness. We
produce guides for patients explaining diseases and giving
them lifestyle tips, and we distribute them through medical
institutions. We also established an information site about
diseases on our website for patients and the general public
as part of our commitment to activities that will contributeto “improvement in the QOL of patients and their families”
and “support for the different stages of a woman’s life.”

41

Mochida Pharmaceutical Group Integrated Report 2022

Information page about diseases
https://www.mochida.co.jp/patient/

Provision of supplies to healthcare
professionals
To support healthcare professionals dealing with COVID-19
patients, Mochida Healthcare donated 3,000 units of its
Collage D Medi Power Moisturizing Handcream to theJapan Visiting Nurse Foundation in November 2021.

Humanitarian support for Ukraine
In March 2022, Mochida Pharmaceutical donated 5 million
yen through the Japanese Red Cross Society in responseto the humanitarian crisis in Ukraine and to support relief
activities in neighboring and other countries which arewelcoming refugees from Ukraine.

Relationship with Local Community
Gotemba site (Gotemba, Shizuoka Prefecture)
Participation in activities of Gotemba City Water Quality
Preservation Council
Every year in June, which is Environment Month, theGotemba site takes part in the cleaning activities organized
by Gotemba City Water Quality Preservation Council,
cleaning up the surrounding roads. The Gotemba site also
takes part in the “amago salmon release party” organizedby the Gotemba City Water Quality Preservation Council
every October.
Blood donation activities
Every year, the Gotemba site cooperates with the blood
donation activities organized by the Japanese Red Cross
Society.
In FY2020, the blood donation campaign took placein June and September. At the Shizuoka Prefecture Blood
Donation Promotion Convention in 2022, the Gotemba site
received a letter of appreciation from the Minister of Health,Labour and Welfare in recognition of its steadfast
cooperation with blood donations for many years.

Fujieda site (Fujieda, Shizuoka Prefecture)
Activities to clean up around Fujieda site and the banksof Oi River
Adjacent to the Oi River, which is officially classified as aClass 1 river, the Fujieda site takes part in Oi River Cleanup
Activities, including weeding and picking up litter on thebanks near the site, to coincide with Environment Month inJune and River Conservation Month in July.
Blood donation activities
Every year, the Fujieda site cooperates with the blood
donation activities organized by the Japanese Red Cross
Society.
In FY2021, the blood donation campaign took placein June.

Head Office Plant of MochidaPharmaceutical Plant Co., Ltd.
(Ohtawara, Tochigi Prefecture)

Communication with the local community to protect theenvironment
The Head Office Plant of Mochida Pharmaceutical Plant
Co., Ltd. sees communication with the local community asimportant for protecting the environment and reports any
changes in the water quality of rivers and groundwateraround the plant and the plant’s initiative to protect theenvironment to the local government (Ohtawara City) andto representatives of local residents. In FY2021, the plant
distributed hard copies of its reports.
Clean-up activities around the plant
Once a month, plant employees pick up litter around theplant, especially in the adjacent area and the area
bordering the city road, inspect plants and take measures
as necessary and maintain good communication with thelocal residents.
Hosting plant visits
The Head Office Plant welcomes pharmacy students on
visits to give them an insight into the special feature of apharmaceuticals plant so that they can use this knowledge
when making career choices in the future. In FY2021, the
COVID-19 pandemic prevented any visits.
Blood donation activities
Every year, the Head Office Plant cooperates with theblood donation activities organized by the Japanese Red
Cross Society.
In FY2021, the blood donation campaign took placein July.

Mochida Pharmaceutical Group Integrated Report 202242

5 Corporate Information

Consolidated Financial Statements
Consolidated balance sheets

Consolidated statements of income(Millions of Yen)FY2020(Millions of Yen)FY2021

FY2020(As of March 31, 2021) (As of March 31, 2022)

Cash and time deposits

54,487

48,415

Notes and accounts receivable

28,766―

Accounts receivable

Electronically recorded monetaryclaims - operating

FY2021

Current liabilities

Current assets―

31,676

Notes and accounts payable

8,477

10,656

Electronically recorded obligations operating

1,245

1,243

Income taxes payable

2,061

1,652

Provision for bonuses

2,496

2,663

787

171

423

―

Marketable securities

8,999

13,499Other provisions

Merchandise and finished goods

14,404

15,110

Other current liabilities

13,641

13,470Total current liabilities

28,71029,856Work in process

1,759

1,355

Raw materials and supplies

6,442

6,662

Long-term liabilities

Other current assets

3,508

4,727

Retirement benefits liability

Total current assets

118,793

121,448

Other long-term liabilities
Total long-term liabilities

Fixed assets

Total liabilities

Property, plant and equipment
Buildings and other structures, net

4,939

4,769

(Millions of Yen)FY2020(As of March 31, 2021) (As of March 31, 2022)

Liabilities

Assets

4,652

4,270

1,453

365

6,106

4,636

34,81634,493

Net assets

102,995

110,179

Net income

Cost of sales

48,20350,626

Other comprehensive income, net of tax

Gross profit

54,791

59,553

Selling, general and administrative
expenses

42,788

Unrealized gain on available-forsale securities

45,161

Operating income

12,003

14,392Other income
Interest income

32

Dividend income

254

284

Real estate rent

77

82

Others71

85

Total other income

405

455

Interest and charge (commission)
expense41

43

Foreign exchange losses

102

―

3

5

148

48

12,26014,799Gain on sales of fixed assets

5―

Settlement received

27―

Compensation income

2―

Gain on sales of investment securities

―

526

Land

5,092

4,990

Paid-in capital

7,229

7,229

Recurring income

Construction in progress

472

2,302

Capital surplus

1,871

1,871

Extraordinary gains

Others, net

748

707

Total property, plant andequipment
Intangible fixed assets

13,299646

14,528713

Investments and other assets
Investments in securities

20,272

16,474

Deferred income taxes

3,198

3,691

Others

5,580

6,283

Total investments and other assets

29,051

26,449Total fixed assets

42,99841,691

Total assets

161,791

163,139

Total other expenses

121,668△ 8,857△ 9,617

Total shareholders’ equity

116,532

121,153

Accumulated other comprehensive income
Unrealized gain on available-for-salesecurities

10,311Remeasurements of defined benefit
plans

131

184

10,442

7,493

126,974

128,646
163,139

Total accumulated othercomprehensive income
Total net assets
Total liabilities and net assets

161,791

7,308

Insurance claim income―

38

Total extraordinary gains

35

564

113

5

Impairment losses―

107

Loss on disaster

142

22

Removal expenses for fixed assets

139

535

―

100

Loss on sales and disposal of fixed
assetsTotal extraordinary losses

Mochida Pharmaceutical Group Integrated Report 2022

(From April 1, 2021
to March 31, 2022)

8,587

10,5692,787△3,002Remeasurements of defined benefit
plans, net of tax

37

53

Total other comprehensive income,net of tax

2,824△ 2,949

Total comprehensive income

11,412

7,619

11,412

7,619

Total comprehensive income attributable to:
Owners of parent

Extraordinary losses

Settlement expenses

43

FY2021(From April 1, 2020
to March 31, 2021)

Other expenses

1,759

116,288

FY2020Net sales

2,047

Retained earnings

FY2021(From April 1, 2021
to March 31, 2022)

OthersTreasury shares(Millions of Yen)

(From April 1, 2020
to March 31, 2021)

Machinery and equipment andtransportation equipment, net

Shareholders’ equity

Consolidated statements of comprehensive
income395

771

Income before income taxes

11,90014,591

Income taxes - current

3,144

3,215

Income taxes - deferred

168

807

Total income taxes

3,312

4,022

Net income

8,587

10,569Profit attributable to owners ofparent8,587

10,569

Mochida Pharmaceutical Group Integrated Report 2022

44

5 Corporate Information

Consolidated statements of changes in net assets

Consolidated statements of cash flows

FY2020 (From April 1, 2020 to March 31, 2021)
Accumulated other comprehensive
incomeShareholders’ equity

Paid-in
capitalBalance at beginning of
year

7,229

Capitalsurplus

1,871

Retainedearnings

110,800

Treasuryshares△6,854

Total
shareholders’equity113,047

Total
Unrealized gain
Remeasurements accumulated
on availableotherof defined benefit
for-salecomprehensive
plans
securities
income
7,524

93

7,617

FY2020Total net
assets120,665

Changes in the fiscal year:
Dividends from surplus△3,100△3,100△ 3,100

8,587

8,587

8,587

△ 2,003△2,003――

Profit attributable to ownersof parent△2,003Purchase of treasury shares
Cancellation of treasury shares

Net changes of items otherthan shareholders’ equity
Total
Balance at end of year

2,787

37

2,824

―

5,487

△2,003

3,484

2,787

37

2,824

6,308

116,288△8,857

116,532

10,311

131

10,442

126,974

FY2021 (From April 1, 2021 to March 31, 2022)

(Millions of Yen)

Accumulated other comprehensive
incomeShareholders’ equity

Balance at beginning of
year

7,229

Capitalsurplus

1,871

Retainedearnings

116,288

Treasuryshares△8,857

Total
shareholders’equity116,532

Total
Unrealized gain
Remeasurements accumulated
on availableotherof defined benefit
for-salecomprehensive
plans
securities
income10,311

131

10,442

Total net
assets

126,974

Changes in the fiscal year:△3,444

Dividends from surplus
Profit attributable to ownersof parent△3,444

10,569Purchase of treasury shares△0Cancellation of treasury shares△1,744

Balance at end of year45

△3,444

11,90014,591

Payments into time deposits

Depreciation and amortization

2,742

2,689

Settlement received△27―

Proceeds from withdrawal of time
deposits△16,500△10,900

18,50016,500Loss (gain) on sales ofinvestment securities

―

△526

Purchase of short-term investment
securities△6,000△10,500

Insurance claim income―△38

Proceeds from sales of short-term
investment securities

107

5

Impairment losses―

107

Loss on disaster

142

Removal expenses for fixed assets

Loss (gain) on sale and disposal of
fixed assets

5,000

6,000

Payment for purchases of tangible andintangible fixed assets△1,935△ 2,988

22

Proceeds from sales of property, plantand equipment

204

0

139

535

Payment for removal of fixed assets

△153

△ 108

―

100

―

538

160

166

Proceeds from sales of investment
securities
Purchase of investment securities

―

△540

Other

5

△8

△ 880

△2,007

Dividends paid

△3,103△3,445Purchase of treasury shares△2,008△2,511

Cash flows from investing activities:

Increase (decrease) in retirement
benefits liability△92Interest and dividend income

△257

△287

41

43

Interest and charge (commission)
expense△305

Decrease (increase) in notes andaccounts receivable-trade△740△2,486

Decrease (increase) in inventories

2,466

△521

Decrease (increase) in othercurrent assets△1,342

Increase (decrease) in notes andaccounts payable-trade
Increase (decrease) in othercurrent liabilities△0△5,112△5,956△899

Effect of exchange rate changes oncash and cash equivalents△931△3,9342,176

Net increase (decrease) in cash andcash equivalents

3,195

△472

1,176

△1,658Cash and cash equivalents at
beginning of year

37,791

40,987

Cash and cash equivalents at end ofyear

40,98740,515

Other△1,378△790

Subtotal

11,104

12,925Interest and dividends received

257

286

△ 2,504△2,504

Interest and commission paid

△36

△36

1,744

―

―

Settlement package received

27―

Settlement paid

―

△100

53

△ 2,949△2,949

△0

5,380

△ 759

4,620

△ 3,00253△ 2,949

1,671

7,229

1,871

121,668△ 9,617

121,153

7,308

184

7,493

128,646

Payments for contract loss

Income taxes paid
Net cash provided by operating
activities

Cash flows from financing activities:

Net cash used in financing activities△2,504△ 3,002

Net cash used in investing activities△0

10,569―

Mochida Pharmaceutical Group Integrated Report 2022

(From April 1, 2021
to March 31, 2022)

10,569Net changes of items otherthan shareholders’ equity
Total

Income before income taxes

FY2021(From April 1, 2020
to March 31, 2021)

Cash flows from operating activities:

Increase (decrease) in provision
for bonuses

1,871

FY2020(From April 1, 2021
to March 31, 2022)

Settlement expenses―(Millions of Yen)FY2021(From April 1, 2020
to March 31, 2021)

2,824

7,229

Paid-in
capital(Millions of Yen)

(Millions of Yen)―

△2,000△2,154△3,616

9,198

7,459

Other

Mochida Pharmaceutical Group Integrated Report 2022

46

5 Corporate Information

Share Information (As of March 31, 2022)
Current Share Status○ Number of shares(i) Total number of authorized share
120,000,000 shares(ii) Total number of shares issued and outstanding40,160,000 shares○ Number of shareholders
6,745

Corporate Data (As of June 29, 2022)

Distribution by Type of Shareholder
Japanese individual
investors and others

32.85 %

Japanese financial
institutions

22.68 %
Japanese securities
companies

0.55 %
Treasury shares

6.45 %
Foreign entities

Major Shareholders (top 10)
Name of Shareholder

8.66 %
Number of
Shares Held(thousand)Mochida Memorial Foundation for Medical
and Pharmaceutical Research

Other Japanese
corporations

28.81%

Percentageof Shares
Held (excluding

5,688

treasury shares)

15.14

The Master Trust Bank of Japan, Ltd. (Trustaccount)

3,671

9.77

MUFG Bank, Ltd.

1,786

4.76

Princess Takamatsu Cancer Research Fund

1,683

4.48

1,614

Nippon Suisan Kaisha Ltd.

1,200

3.19

Naoyuki Mochida

1,164

3.10

Kazue Mochida

987

2.63

Custody Bank of Japan, Ltd. (Trust Account)

963

2.56

Takeshi Mochida

949

2.53

Sites and Research Laboratories

Founded: April 16, 1913
Incorporated: April 28, 1945
Representative: Naoyuki Mochida, President
Main Business: Sale, import and export ofpharmaceuticals, etc.
Paid-in Capital: ¥7,229 million
Head Office: 7, Yotsuya 1-chome, Shinjuku-ku, Tokyo
160-8515, Japan*
TEL +81-3-3358-7211
Number of Employees: 1,280 (Consolidated: 1,544)

Branche Offices
Sapporo, Sendai, Kanto Koshinetsu, Metropolitan, Chubu,
Kansai, Hiroshima, Fukuoka(As of March 31, 2022)

Distribution by Number of Shares Held

0.07 %

654 shareholders
Treasury shares

4.37 %

4,933 shareholders
10 trading units or more

5.77 %

1,024 shareholders

1 shareholder
100 trading units
or more4.30

6.74 %

1,000 trading units
or more89 shareholders

76.60 %

44 shareholders(Note) The Company holds 2,590 thousand shares of treasury stock, not included in theabove.

Group Companies
Mochida Pharmaceutical Plant Co., Ltd.

Mochida Healthcare Co., Ltd.

Operations Commenced: April 1, 2005
Representative: Tadashi Morikawa, President
Main Business: Manufacture of pharmaceuticals andhealthcare products
Paid-in Capital: ¥500 million (wholly owned by MochidaPharmaceutical)
Head Office Plant: 431, Nakadawara, Ohtawara, Tochigi
324-0062, Japan
TEL +81-287-24-1111
Sites: Saitama Plant / Tokyo Site

Operations Commenced: April 1, 2004
Representative: Shinji Akita, President
Main Business: Manufacture and sale of healthcare
products
Paid-in Capital: ¥100 million (wholly owned by MochidaPharmaceutical)
Head Office: PAXXS Bldg., 2-12 Ichigayahonmuracho,
Shinjuku-ku, Tokyo 162-8451, Japan
TEL +81-3-5229-3940
Sites: Sapporo Sales Office, Sendai Sales Office, Higashi
Nihon Branch Office, Yokohama Sales Office,Nagoya Sales Office, Nishi Nihon Branch Office,Hiroshima Sales Office, Fukuoka Sales Office,Saitama Plant

Mochida Pharmaceutical Sales Co., Ltd.

The new Head Office building that was being reconstructed
was completed and began operating on September 26, 2022.
Based on the concept of a “connecting office,” the new
Head Office building was designed as an office which will
create various connections, leading to innovation. We will
strengthen cooperation between operations and increasebusiness efficiency through integration of head office functions
that were temporarily relocated to Ichigaya, Shinjuku andsurrounding sites into the new building.
The new building also boasts an environmentally
sustainable design.*


Other Operating Sites
Asahikawa, Hakodate, Aomori, Morioka, Akita, Koriyama,
Kawagoe, Takasaki, Utsunomiya, Mito, Tsuchiura, Niigata,
Matsumoto, Kofu, Tama, Chiba, Matsudo, Yokohama,
Atsugi, Shizuoka, Hamamatsu, Hokuriku, Kyoto, Osakakita, Sakai, Kobe, Yonago, Okayama, Yamaguchi,
Takamatsu, Matsuyama, Tokushima, Kochi, Kitakyushu,
Nagasaki, Kumamoto, Oita, Miyazaki, Kagoshima,
Okinawa
Research Laboratories
Research Center (Gotemba), Pharmaceutical Laboratory(Fujieda)

1 trading unit or more
Less than 1 trading unit

6.45 %

Mizuho Trust & Banking Co., Ltd.,
Retirement Benefit Trust (Mizuho Bank
Account)
Re-trust Trustee: Custody Bank of Japan,
Ltd.

Mochida Pharmaceutical Co., Ltd.

Operations Commenced: June 2, 2014
Representative: Kazumasa Fukuchi, President
Main Business: Sale of pharmaceuticals
Paid-in Capital: ¥10 million (wholly owned by MochidaPharmaceutical)
Head Office: PAXXS Bldg., 2-12 Ichigayahonmuracho,
Shinjuku-ku, Tokyo 162-8451, Japan
TEL +81-3-5229-3929

Technonet Co., Ltd.
Head Office: 7, Yotsuya 1-chome, Shinjuku-ku, Tokyo
160-8515, Japan*
TEL +81-3-3353-7511

Technofine Co., Ltd.
Head Office: 342, Gensuke, Fujieda, Shizuoka 426-8640,
Japan
TEL +81-54-636-7032*See page 36 for more details.
*We began operating at this address on September 26, 2022.

47

Mochida Pharmaceutical Group Integrated Report 2022

Mochida Pharmaceutical Group Integrated Report 202248

5 Corporate Information

Our History
1900
1913

2000
Mochida was established by Ryokichi Mochida in Hongo,
Bunkyo-ku, Tokyo.

Started producing pharmaceuticals.
Started producing and marketing Ogoko, an ophthalmic
ointment.

1977

1979
1980

Started producing and marketing Luestin, an injectable
antiluetic.

1929

Developed Thrombrin, Japan’s firstorgan-derived hemostatic agent.

1981

Completed and launched Pelanin, the first
estrogen preparation developed in Japan.

1935

Launched Testinon, a male hormone preparation.

1945

Mochida Pharmaceutical Co., Ltd. was incorporated.

1951

Launched Sprase, the first hyaluronidase
preparation developed in Japan.

1952

Launched Estropan, a complex natural female functional
hormone.

1956

Succeeded in producing Thrombin, a hemostatic enzyme, inJapan.

1985

1960

Launched Partan, a hemostatic drug that contributes touterine contraction.

1986

1963

Listed on the Second Section of the Tokyo Stock Exchange(TSE).

1964

Nobuo Mochida was appointed president.

Established the Mochida Memorial Foundation for Medical
and Pharmaceutical Research.

1984

Launched Arasena-A, a treatment for viral encephalitis.
Their Imperial Highnesses Prince and Princess Takamatsu
visited Fuji Central Research Laboratory.

49

Completed and relocated to the new headquarters officebuilding in Yotsuya.

Mochida Pharmaceutical Group Integrated Report 2022

Launched Liquid Thrombin Mochida
Soft Bottle, a hemostatic agent.
Launched the Collage S seriesof basic skin products.

Launched Tramcet® tablets,
an analgesic.

2014

Mochida Pharmaceutical Sales Co., Ltd.
commenced operations.

Mochida Medical Systems Co., Ltd. commenced
operations.

2004

Mochida Medical Systems Co., Ltd.
commenced operations as Mochida Siemens Medical
Systems Co., Ltd.
(Excluded from affiliated companies accounted for by theequity method in 2009.)

2005

Renewed and relaunched the Collage
Skincare series.

Mochida Healthcare Co., Ltd. commenced
operations.
Launched Epadel S 900, a stick-type
EPA preparation.

Mochida Pharmaceutical Plant Co., Ltd. commenced
operations.

Launched Atedio® tablets for treatmentof hypertension.

Launched Treprost ®, a therapeutic agent for pulmonary
arterial hypertension.

2016

Launched Lialda®, a treatment
for ulcerative colitis.

2017

Launched Calprotectin MOCHIDA,
an in-vitro diagnostic agent for
ulcerative colitis.

2018

Launched Doxil®, an anticancer agent.

Launched biosimilar Etanercept
BS MA.

2006

Launched Collage Furfur Liquid Soap.

Launched Collage Furfur
Premium Shampoo.

2007

Commenced co-promotion of Diovan®,an antihypertensive.
(Agreement terminated end of 2008.)

Launched the Collage Soap series of low-irritating soap
formulated for each specific skin type.
Launched Isoprinosine®, a chemotherapeutic agent.

Launched Beselna, the first treatment for condyloma
acuminatum developed in Japan.

Launched natural-type interferon preparations
IFN α MOCHIDA 500 and IFN β MOCHIDA.

Susumu Watanabe appointed president.

Listed on the First Section of the TSE.

2003

Results of JELIS (EBM study for Epadel ) announced byAmerican Heart Association (AHA).

1990

Completed and started operating the Saitama Plant.

Launched biosimilar Filgrastim
BS MOCHIDA.

Launched Florid®-F injection for thetreatment of deep-seated mycoses.

Took part in “Life” Theme Pavilion at Japan
World Exposition and exhibited DNA structure model.

Launched Neutrogena, soap for sensitive skin.

Launched the Collage B.K.AGE
series.

Launched Goofice®, a treatment
for chronic constipation.

Launched Tecipul, a tetracyclic antidepressant.

Completed and started operating
the Shizuoka Plant.

Obtained the certification of ISO 14001 for Ohtawara Plant.

Launched the Collage Whitening series, the first whitening
skincare products for sensitive skin developed in Japan.

1989

Established the Medical Electronics
and Equipment Division.

Launched a switch-OTC versionof Epadel.

Launched Miraclid, the world’s first ulinastatin preparation.

Launched Grandaxin, an autonomic
nerve regulator.

1988

2013

Launched Arasena-A Cream, an antiviral agent.

Launched the Vitacollage series of health supplements.

Ei Mochida was appointed president.

Launched Gonavislide, a pregnancy test kit.

Launched Skina Babe, baby bath oil.

1976

Signed an agreement with Hayashibara
Biochemical Laboratory, Inc. for joint researchof interferon.

1983

2008

1991

Completed Ohtawara Plant.

1992

Launched Arasena-A Ointment, the first
topical antiviral agent developed in Japan.

1996

Commenced JELIS (EBM study for Epadel).

1997

Launched Atelec®, a calcium channel blocker.

1999

Naoyuki Mochida appointed president.

Launched Dinagest, a treatment
for endometriosis.

Launched Movicol ®, a treatment
for chronic constipation.

2019

Launched Divigel ® transdermal estrogen gel.

2009

Launched Gonastick W,
a pregnancy test kit.
Launched Collage Furfur
Next Shampoo and Rinse whichcontain antimycotic ingredients.

2011

Launched Lexapro®,an anti-depressant.

2012

Launched EPA preparations Epadel S 300 and 600.

Launched Fastic®, a fast-acting postprandial
antihyperglycemic agent.

Launched low-dose oral contraceptives Ortho 777-28 andOrtho M-21.

Launched glucoriina, a food for specified health uses
(FOSHU).

Launched the Collage Repair series.
Launched biosimilar Teriparatide BS
MOCHIDA.

2020

Launched Collage White Peel, an enzyme powder facewash.

Launched Epadel Capsule 300, the world’s
first high-purity EPA preparation.

Established the Paramedical Division and entered thequasi-drugs business.

1975

Launched Collage Cream, the first basic skin care productcontaining soluble collagen developed in Japan.

Completed and opened the Fuji Central ResearchLaboratory (Gotemba).

Launched Kimotab, an anti-inflammatory
enzyme preparation.

Launched Uronase, a fibrinolytic enzyme preparation.

2002

Launched Gonastick 25, a pregnancy test kit.

Launched Spurecur ®, a GnRH derivative preparation.

1982

Launched Gonavis, Japan’s first
immunological pregnancy test kit.

1972

Launched Rocornal, a circulatory
function activator.

2001

Launched Medilaser-S, the first carbon
dioxide laser surgical unit produced
in Japan.

1932

1970

Launched, SONOVISTA, the firstultrasonic diagnostic scanner
developed in Japan.

Launched Gonacard W,
a pregnancy test kit.
Launched Urece®, a treatmentof gout and hyperuricemia.

2021

Launched biosimilar
Adalimumab BS MA.

2022

Launched Epadel EM,
a self-emulsifying formulation ofhighly purified EPA

Launched Collage Furfur, the first shampoo containing
antimycotic ingredients developed in Japan.

Mochida Pharmaceutical Group Integrated Report 202250

https://www.mochida.co.jp

2022.10