CareNet, Inc.

Briefing Materials for Financial Results
for the Three Months Ended March 31, 2024

Katsuhiro Fujii, President

Contents

1. Business Model
2. Financial Results for the Three Months
Ended March 31, 2024

2

Business Model【Contents】
1. Business Model

2. Financial Results for the Three Months Ended March 31, 2024

1. Business Model

Corporate Profile
Name

CareNet, Inc.

Address

Sumitomo Fudosan Chiyoda Fujimi Bldg., 8-19, Fujimi 1-chome Chiyoda-ku, Tokyo, Japan

EstablishedJuly 1996

Employees

350 (as of March 31, 2024)

Businessactivities

Medical contents services for doctors and medical professionals,
Medical and pharmaceutical business support for pharmaceutical companies

Business Activities

Corporate Philosophy

Improvement of future medical care by
information technology and imaging

Striving to create a sustainable healthysociety in the digital age

CareNet distributes practical information that isuseful in routine clinical practice to doctors andother medical professionals via the Internet andprovides pharmaceutical companies with solutions
for the effective communication of pharmaceutical

CareNet contributes the creation of a sustainable
society that is healthy and offers comfortableworking environments for both the recipients andproviders of medical care by constantly evolving ourbusinesses through technology and enthusiasm.

information.
41. Business Model

Our Business Model■ CareNet develops a variety of businesses that utilize the “doctor platform” oriented around CareNet.com.
CareNet.com
Fee payment

Providepharmaceuticalinformation

PharmaceuticalDX businessPharmaceuticalcompanies

Supportbusiness/marketing

Fee payment
Medicalplatformbusiness

Fee payment

Hospitals

Doctors

Management
support

Medicalprofessionals

Provide medical
education contents

Introduce doctors

Outplacement
servicecompanies

The “Pharmaceutical DX business” is engaged in the service of providing doctors with information on the proper use of therapeutic drugs under contract withpharmaceutical companies, using our doctor platforms such as “CareNet.com.” Its business model relies on obtaining service income from pharmaceuticalcompanies, and it is our main business that accounts for about 90% of the total net sales of the CareNet Group (the “Group”).

The “Medical platform business” is engaged in the service of providing fee-based medical education videos to our member doctors and medical professionals.
Since becoming the first company in Japan to provide specialized information programs for doctors, we have built an extensive track record in producing medical
education programs. The business also provides information services for supporting job changes and opening businesses through group companies, with a viewto helping our member doctors’ career advancement and work-life balance improvement.
5

1. Business Model

Pharmaceutical DX BusinessBusiness model for the Pharmaceutical DX business■ CareNet has endeavored to spread the proper use of new medicine from pharmaceutical companies
through use of the doctor platform. We have partnerships with over 70 pharmaceutical companies, growing
this into the core business of the Company.
Doctor platform (CareNet.com, etc.)
Consignment
contract

Provide information
Facility DB

Doctormembers

Responses/logs

CareNet.com

Pharmaceuticalcompanies

Doctor DB

Reports on results

Main services of the Pharmaceutical DX businessIT solution for connecting doctors and pharmaceutical companies: MRPlus®
One of our core services that broadcasts video content created from the perspective that the involvement of doctors is needed to target other doctors, enabling
the analysis of doctors’ responses while creating opportunities for engagement with MRs. More than 50 pharmaceutical companies have adopted this service.

Online livestreams of seminars by Key Opinion Leaders (KOLs1) available nationwide: Online seminars
Busy doctors can watch KOL seminars without having to leave the office. Online livestreaming is a very effective way to quickly broadcast information about newtreatments nationwide. Over 500 seminars are conducted annually, and this is a core service together with MRPlus®.
Besides the above, through our group companies, CRO, SMO, and CSO, which dispatch professionals, we provide high-quality service in tandem with the doctor
platform.
1 KOL is an abbreviation for key opinion leader. KOLs refer to doctors who have wide influence in the medical industry. As part of sales promotion activities for their products, pharmaceutical companies reachout to KOLs, who are medical experts, in order to spread the latest pharmaceutical information. KOLs include doctors who are authorities in academic societies, professors at university hospitals, anddirectors of large hospitals.

61. Business Model

Medical Platform Business
Main service: CareNeTV
On-demand clinical videos for self-study by medical professionals

6,223

Paying members(As of March 31, 2024)About 20 years producing medical education programs
As Japan’s first TV station specializing in content for
medical professionals (satellite broadcasting ended inMarch 2011, switching to Internet distribution), CareNet hasabundant experience in producing medical education
programs, and CareNeTV delivers programs that cater tothe specific learning needs of medical professionals.

Complete lineup of programsMore than 2,000 programs are available, with approx. 10
new programs being released every month. Packed withuplifting and useful information from leading lecturers whoare active on the front lines of clinical practice! Designed
around programs for improving clinical skills in everythingfrom primary care to specialized fields, video content isavailable for a variety of genres, including preparation for
medical specialist exams, presentations, English, andstatistics.
Fee

Monthly/5,500 yen

PPV/330 yen 7

1. Business Model

CareNet.com
Medical information website used by more than 450,000 medical professionals
Members

456,468

Doctors who aremembers

226,265(As of March 31, 2024)“Medical contents” for immediate use in the field
An abundant selection of content is available for immediate use inclinical settings, including videos of procedures, patient
instructions, and explanations of relevant guidelines.

International research and news on medical care
Carefully selected articles published in leading international
journals are summarized in Japanese and are made available
together with the latest medical news in Japan to facilitate quick
and easy understanding of the current state of medical care.

8Financial Results for the Three Months
Ended March 31, 2024
【Contents】
1. Business Model

2. Financial Results for the Three Months Ended March 31, 2024

2. Financial Results for the Three
Months Ended March 31, 2024

Financial Year 2024 Plans■FY2024 marks the first year to start expanding investment in business development towards medium- tolong-term growth in accordance with the “Vision 2026” disclosed in February 2024.
■ Net sales for the fiscal year ending December 31, 2024, is expected to increase mainly due to growth in
the existing business of Pharmaceutical DX. Meanwhile, due to increased investment in development,etc. for expanding sales and profit in new business, profit is expected to decline year over year.

(Million yen)
Fiscal year ended Fiscal year ending
December 31, 2023 December 31, 2024
Results
Forecast

YoY change

Net sales

10,235

11,60013.3%

Operating profit

2,428

2,200-9.4%

Ordinary profit

2,467

2,200-10.8%

Profit attributable toowners of parent

1,510

1,500-0.7%

10

2. Financial Results for the ThreeMonths Ended March 31, 2024

The Three Months Ended March 31, 2024 - Financial Results Summary■

Owing to growth in both Pharmaceutical DX business and Medical Platform business, net
sales for the first quarter period increased by 5.6% year over year.
■ In accordance with Vision 2026, we started to invest in development this year. As a result,expenses have increased both in price cost and in selling, general and administrative
expenses, leading to profit decline.
(Million yen)

Consolidated Statements of Income
Q1 2023 Q1 2024

Consolidated Balance Sheets

YoYchangeQ1 2024

YoYchange

2,526

2,667

5.6%

Current assets

10,642-9.6%

Cost of sales

934

1,087

16.3%

Non-currentassets

2,862

19.2%

Gross profit

1,592

1,580-0.8%

Total assets

13,505-4.7%

Selling, generaland administrative
expenses877

1,034

17.9%

Current liabilities

2,087-14.8%

Operating profit

715545-23.7%

Non-currentliabilities

216-1.0%

Ordinary profit

715

563

-21.2%

Total liabilities

2,303-13.6%

Total net assets

11,201-2.6%

Total liabilities andnet assets

13,505-4.7%

Net sales

Profit attributableto owners ofparent

457

310

-32.1%

11Trends in Company-wide Performance (1)2. Financial Results for the Three
Months Ended March 31, 2024

Net sales(Million yen)
第1四半期
1Q

第2四半期
2Q

第3四半期
3Q

12,00010,000

Full year9,327

Full year
8,004

第4四半期
4Q
Full year
10,235

2,964

8,000

2,882

6,000

Full year
5,304

4,000

2,118

2,000

2,051
1,759
1,340
YoY
YoY
YoY
YoY
1,023 change 2,058 change 2,222 change 2,526 change 2,667

2,368
1,817

1Q
2,667

2,487

821 +150.7%

0

2,257

2,171+8.0%

Net sales for the first quarter period
increased by 5.6% year over year
to 2,667 million yen, owing to
growth in both Pharmaceutical DX
business and Medical Platformbusiness.

+5.6%+13.7%FY2020 2021年12月期
FY2021 2022年12月期
FY2022 2023年12月期
FY2023 2024年12月期
FY20242020年12月期
1Q

2Q

3Q

4Q

Full year

Fiscal year ended
December 31, 2020

821

1,023

1,340

2,118

5,304

Fiscal year ended
December 31, 2021

2,058

1,759

1,817

2,368

8,004

Fiscal year ended
December 31, 2022

2,222

2,051

2,171

2,882

9,327

Fiscal year ended
December 31, 2023

2,526

2,487

2,257

2,964

10,235

Fiscal year ending
December 31, 2024

2,667

12Trends in Company-wide Performance (2)2. Financial Results for the Three
Months Ended March 31, 2024

Operating profit(Million yen)
第1四半期
1Q
3,000

第2四半期
2Q

第3四半期
3Q

Full year
2,851

Full year
2,532

Full year
2,428

563

2,500

518
2,000
1,500

Full year
1,510

473
500

0574
271

189

417

662

537

1,000
YOY
change+349.2%

849

692

788

626

第4四半期
4Q

YoY
change
-1.3%

838

603
YoY
change-14.7%

715

1Q
545
YoY
change-23.7%

545

FY2020 2021年12月期
FY2021 2022年12月期
FY2022 2023年12月期
FY2023 2024年12月期
FY20242020年12月期
1Q

2Q

3Q

4Q

Full year

Fiscal year ended
December 31, 2020

189271

574

473

1,510

Fiscal year ended
December 31, 2021

849

537

626

518

2,532

Fiscal year ended
December 31, 2022

838

662

788

563

2,851

Fiscal year ended
December 31, 2023

715

603

417

692

2,428

Fiscal year ending
December 31, 2024

545

Although profit in ePromotion
services, which account for thelargest portion of the Company’ssales, remained steady, operating
profit for the first quarter period
decreased year over year to 545
million yen, due to the aggressive
investment in development basedon Vision 2026.

13Progress by Segment

2. Financial Results for the Three
Months Ended March 31, 2024

Segment Performance – Pharmaceutical DX Business (1)Net Sales(Million yen)
第1四半期
1Q

第2四半期
2Q

第3四半期
3Q

第4四半期
4Q

12,00010,000

Full year
7,425

8,000

Full year
4,816

6,000

Full year
8,473

Full year
9,178
2,688

2,698

2,222

2,064

1,945

1,671

1Q
2,401

4,000

1,996

2,000

1,813
1,600
1,218
YoY
YoY
YoY
YoY
879 change
1,932 change 2,016 change 2,299 change 2,401

2,125722 +167.6%

0+4.3%+14.0%+4.4%The
pharmaceuticalindustry
continues to be in a cost sensitiveenvironment and is more focusedon cost efficiency in orderingpromotional activities.
To continue and accelerate growth,
it is required to improve theperformance of existing businessand to provide new added-value
through new services.

FY2020
FY2021 2022年12月期
FY2022 2023年12月期
FY2023 2024年12月期
FY20242020年12月期
2021年12月期
1Q

2Q

3Q

4Q

Full year

Fiscal year ended
December 31, 2020

722

879

1,218

1,996

4,816

Fiscal year ended
December 31, 2021

1,932

1,600

1,671

2,2227,425

Fiscal year ended
December 31, 2022

2,016

1,813

1,945

2,698

8,473

Fiscal year ended
December 31, 2023

2,299

2,125

2,064

2,688

9,178

Fiscal year ending
December 31, 2024

2,401

ePromotion, the Company’s coreservice, is progressing as planned.
In addition, owing to theperformance of group companies
including CareNet Partners, Inc.,
net sales for the first quarter
period increased by 4.4% year
over year to 2,401 million yen.

15

2. Financial Results for the Three
Months Ended March 31, 2024

Segment Performance – Pharmaceutical DX Business (2)Segment profit(Million yen)
第1四半期
1Q

2Q
第2四半期

Full year
4,207

5,000

Full year
3,837

4,000

第3四半期
3Q

4Q
第4四半期

Full year
3,941

1,230

3,000

Full year
2,669

1,121

1,117863

1,039

2,000

858

789

879

863

738

1,000

YoY

1,234

1Q
944

YoY

YoY

YoY

-0.6%

-6.9%

-4.2%

441 change 1,064change 1,058change 985 change 944

0371 +186.8%

FY2020 2021年12月期
FY2021 2022年12月期
FY2022 2023年12月期
FY2023 2024年12月期
FY20242020年12月期
1Q

2Q

3Q

4Q

Full year

Fiscal year ended
December 31, 2020

371

441

738

1,117

2,669

Fiscal year ended
December 31, 2021

1,064

789

863

1,121

3,837

Fiscal year ended
December 31, 2022

1,058

879

1,039

1,230

4,207

Fiscal year ended
December 31, 2023

985

863

858

1,234

3,941

Fiscal year ending
December 31, 2024

944

While profit in ePromotion, theCompany’s core service, remained
steady, segment profit for the firstquarter period decreased by 4.2%
year over year to 944 million yen,
due to increased costs associatedwith business development andpersonnel hiring, etc.
Through continuous development
investment, the Company aims toachieve medium- to long-term
growth as stated in Vision 2026.

16

2. Financial Results for the Three
Months Ended March 31, 2024

Doctors who are Members■

Continuing from the previous fiscal year, the number of doctors who are members has beensteadily increasing, reaching 226,000 as of March 31, 2024.
Number of doctor members
260,000

250,000

240,000

224,568
220,000

226,265

209,413

193,946

200,000

181,352
180,000

153,705

160,000

140,000

132,730

138,895

144,457

120,000～～020162016年

20172017年2018
2018年

2019
2019年

2020
2020年

2021
2021年

2022
2022年

2023 March
31, 2024
2023年
2024年
3月末

2025
2025年

(Plan)(計画)

17

2. Financial Results for the Three
Months Ended March 31, 2024

Segment Performance – Medical Platform Business (1)Net sales(Million yen)
第1四半期
1Q

第2四半期
2Q

第3四半期
3Q

Full year
1,057

1,200

Full year
854

1,000
800
600

第4四半期
4Q

Full year
487

200

121
122
144

098

400

183

Full year
578

159

125

192

225

146
146
YoY
change+27.6%

276

238
YoY
change+64.8%

1Q
265

361
YoY

YoY

265
227 change
206 change+16.7%+10.2%FY2020 2021年12月期
FY2021 2022年12月期
FY2022 2023年12月期
FY2023 2024年12月期
FY20242020年12月期
1Q

2Q

3Q

4Q

Net sales in this segment for the firstquarter period increased by 16.7%
year over year to 265 million yen
mainly due to sales contribution fromthe management support businessfor hospitals which was acquired lastyear.

Full year

Fiscal year ended
December 31, 2020

98

144

122

121487

Fiscal year ended
December 31, 2021

125

159

146

146578

Fiscal year ended
December 31, 2022

206238225

183854

Fiscal year ended
December 31, 2023

227361

192

276

1,057

Fiscal year ending
December 31, 2024

265
18

2. Financial Results for the Three
Months Ended March 31, 2024

Segment Performance – Medical Platform Business (2)Segment profit(Million yen)
第1四半期
1Q

第2四半期
2Q

第3四半期
3Q

Full year
228

300
250

83

200

150
100
50
0-50
△50

Full year
29
38
28

17-55

Full year111
1642
26 YoYYoYchange+52.9%

26

Full year
264
1712
168

88

87

change+234.6%

-30

第4四半期
4Q

YoY
change-25.3%

65

YoYchange-64.6%

1Q
2323

△100-100
2020年12月期
2021年12月期2024年12月期
FY2020
FY2021 2022年12月期
FY2022 2023年12月期
FY2023
FY2024
1Q

2Q

3Q

4Q

Segment profit of the Medical Platformbusiness for the first quarter period
decreased year over year to 23 million
yen, due to aggressive investment in
new business development andpersonnel hiring in the doctor career
service and in the media business.

Full year

Fiscal year ended
December 31, 2020

1728

38-55

29

Fiscal year ended
December 31, 2021

2626

42

16111

Fiscal year ended
December 31, 2022

8788

83-30

228

Fiscal year ended
December 31, 2023651681217264

Fiscal year ending
December 31, 2024

2319This material contains projections, plans, management targets, and other forwardlooking statements, etc., relating to CareNet, Inc. (the “Company”).
These statements are drawn from assumptions (information and forecasts currently

available to the Company), and it is possible that such assumptions are inaccurate
and that actual results produced may differ from those mentioned in said
statements.

Furthermore, information and data other than that concerning the Company has
been quoted from public sources, and the Company offers no guarantee regarding
the accuracy of such information.

CareNet, Inc.
Inquiries regarding IR: ir@carenet.co.jp

20