July 24, 2017
Company name:

Mitsubishi Tanabe Pharma Corporation

Representative:

Masayuki Mitsuka
President and Representative Director

Code number:

4508, First Section, Tokyo Stock Exchange

Contact:

Yoshifumi Mifune, General Manager,Corporate Communications Department
TEL: +81-6-6205-5211

Mitsubishi Tanabe Pharma to Acquire NeuroDerm Ltd.
Mitsubishi Tanabe Pharma Corporation (“MTPC”) announced today that it has entered into
definitive agreement with NeuroDerm Ltd. (Nasdaq: NDRM) (“NeuroDerm”) pursuant to which
MTPC will acquire all of the outstanding shares of NeuroDerm, for a total diluted equity value of
US$1.1 billion (US$39.00 per share in cash). The offer is subject to customary conditions, including
approval by NeuroDerm’s shareholders and receipt of applicable regulatory approvals. The merger
will be conducted through a reverse triangular merger in which MTPC’s wholly-owned merger
subsidiary established in Israel solely for the purpose of the acquisition process (“SPC”) will merge
into NeuroDerm, after which NeuroDerm will become the surviving entity. Upon the closing of thetransaction, NeuroDerm will become a wholly-owned subsidiary of MTPC.

1. Objective and background of the acquisition
NeuroDerm is a clinical-stage pharmaceutical company that develops novel
formulation technology and drug-device combinations for Parkinson’s disease. Its
lead product candidate, ND0612 has commenced phase III clinical trials in the U.S.
and Europe, and the product is expected to launch in FY2019. Given theimportance of controlling blood levels of levodopa in the treatment of Parkinson’s
disease, ND0612 is expected to be used to treat advanced stage Parkinson’s disease,and will be used in patients for whom oral levodopa is no longer effective in thecontrol of motor complications. NeuroDerm is the first to develop liquid levodopa
and carbidopa in the world. ND0612 can be continuously subcutaneously
administered over a 24-hour period through a convenient small belt-worn pump.
In its “Medium-Term Management Plan 16–20: Open Up the Future,” MTPC
stated that it will strive, through in-house sales, to rapidly build a foundation forsustained growth in the U.S., the world’s largest pharmaceutical market.
As a first step toward advancing its franchise in the U.S., MTPC is expected tolaunch Radicava, an FDA approved treatment option for amyotrophic lateral1sclerosis (ALS) in the U.S. market in August 2017. Additionally, the acquisition ofND0612 through this transaction is intended to enable MTPC to achieve its U.S.
sales target of 80 billion yen by FY2020, which is part of its Medium-Term
Management Plan. MTPC will expand its product pipeline in the central nervous
system disease area and advance its goal of providing patients with innovative
drugs to address unmet medical needs.

2. Overview of NeuroDerm Ltd.
(1)

Company name

NeuroDerm Ltd.

(2)

Address

Ruhrberg Science Building, 3 Pekeris Street, Rehovot 7670212, Israel(3)

Representative

Oded S. Lieberman, PhD, Chief Executive Officer and Director(4)

Business description(5)

CapitalUSD 49 thousand (as of March 31, 2017)(6)

Date of establishment

March 18, 2003

(7)

Development of treatments for CNS disorders including Parkinson’s
diseaseScopia Capital Management LP and affiliates

16.6%

Major shareholders andRobert Taub

12.3%

shareholding ratios

Uwe Wascher

11.4%(as of July 17, 2017)

Shmuel Cabilly

10.0%

Others(8)(9)

Relationship between
MTPCCapital relationship

N.A.

Personnel relationship

N.A.

Business relationship

N.A.

NeuroDerm’s consolidated operating results and consolidated financial position for the past three years

Accounting period

Fiscal year ended

Fiscal year ended

Fiscal year ended(Unit : thousands of USD)

December 31, 2014

December 31, 2015

December 31, 2016

Total shareholder’s equity

39,46997,056

149,570

Total assets

43,914

100,868

156,063---

Operating loss

13,381

17,97033,092Net loss

29,864

15,60932,496

12.97

0.82

1.48

Net sales

Basic and diluted net loss per
ordinary share (USD)

Ordinary income is not indicated since NeuroDerm prepares its financial statements using
International Financial Reporting Standards as issued by the International Accounting Standards
Board, which does not include items that correspond to ordinary income.

2

Pipeline Products of NeuroDermProducts

Generic Name

Expected Indication

Stage

ND0612

Levodopa / Carbidopa

Advanced Parkinson’s

P3Continuous SC pump /patch pumpdiseaseApomorphine

SevereContinuous SC pump

Parkinson’s disease

Nicotine and Opipramol

CNS Disease

TransdermalCognition disorders

ND0701

ND0801

P2P23. Number of shares to be acquired, purchase price, and the status of ownership of shares before andafter the acquisition0(1)

Number of shares already acquired(Number of voting rights: 0)(Percentage of voting rights: 0%)(2)

Number of shares to be acquired

26,345,938 shares (as of July 21, 2017)(Number of voting rights: 26,345,938)
NeuroDerm ordinary shares: USD 1,117 million (Approx.

(3)

Transaction consideration

JPY 124.1 billion), USD 39.00 per share
Advisory costs, etc. (estimate): JPY 1.1 billion
Total (estimate): JPY 125.2 billion(4)

Number of shares held after thetransfer

26,345,938 shares(Number of voting rights: 26,345,938)(Percentage of voting rights: 100.0%)

Transaction consideration represents aggregate amount payable for the acquisition of ordinary sharesand stock options. Number of shares to be acquired may increase due to the exercise of stockoptions.
Calculated at the rate of 111.13 USD/JPY as of July 21, 2017.
NeuroDerm share price USD 33.20 (Nasdaq Closing Price as of July 21, 2017)3

4. Transaction schedule
July 2017

MTPC established a local SPC for acquisition in Israel.

July 24, 2017

Definitive Agreement between NeuroDerm, MTPC and MTPC’s SPC.

September 2017 (plan)

NeuroDerm’s shareholders’ meeting. Approval by NeuroDerm’s shareholders.

October 2017 (plan)

SPC to merge with NeuroDerm, after which NeuroDerm will become thesurviving entity.

October 2017 (plan)

NeuroDerm to become a wholly-owned subsidiary of MTPC upon merger.

MTPC and SPC have entered into voting agreements with three directors of NeuroDerm, who
beneficially own in aggregate approximately 34% of the outstanding ordinary shares of NeuroDerm,
pursuant to which the three directors have agreed to vote to approve the merger at NeuroDerm’sshareholders’ meeting.

5. Outlook
MTPC is currently examining the potential impact of the acquisition on MTPC’s
consolidated business results. Additional guidance will be presented after theacquisition procedures have been completed.
End(Reference)
Transaction structure4