Terumo CorporationMay 8, 2015

Q&A Session at the Financial Results Briefing
for the Fiscal Year Ended March 31, 2015
Outlined below are the principal Q&As from the financial results briefing of May 8, 2015. Certain
details have been expanded or modified to provide readers with a deeper understanding of Terumo
Corporation’s performance and activities.
Q1: In FY2014 guidance, despite forecasting an impact of JPY6.2 billion from reimbursement pricecuts, the actual impact was JPY4.7 billion. Can you please explain why?
A1: In the Cardiac & Vascular Company, we strategically did not reduce the actual selling prices forour highly competitive products so much, compared to the amount of reimbursement price cuts.
Q2: Was there a change in the hospital utilization rate in Japan? What is the current utilization rate?
A2: In 1H FY2014, there was a decline in the hospital utilization rate mainly reflecting an increasein the cost burden for senior citizens due to revisions to the healthcare insurance system.
Moving into the 2H, the decline in the utilization rate slightly leveled off. Although we are still
under price pressure, we will increase sales and maintain profitability by accelerating shift tothe differentiated products.
Q3: What progress have you made since adopting business-led management? What is the goal of
the recently-announced plan to introduce CXO system to enhance the global business
infrastructure?
A3: In the Cardiac & Vascular Company, we are seeing positive results from a shift to business-ledmanagement. In addition to the recent improvement in profit, we are also making progress withintroducing medium/long-term growth initiatives. In the General Hospital Company, we would
like to strive to achieve some results in FY2015 by making efforts including enhancing humanresource development. In the Blood Management Company, we have already establishedcomprehensive global management, but we are currently facing the major challenge of dealing
with the decline in selling prices. In FY2015, it is the task of management to minimize theimpact of these selling price declines. We will introduce the CXO system to strengthen ourglobal headquarter functions as we have acquired overseas companies. The ultimate goal is toachieve a rapid transformation into a true global company. In FY2014 we strengthened ourbusiness operations by introducing business-led management. In FY2015 we will reinforce ourglobal headquarter functions.
Q4: In the whole blood collection related products business, we see a decline in selling prices and atendency to purchase from a single supplier. Do you expect these trends to continue goingforward? What is the impact to the sales of blood component collection systems?
The information contained in this report does not constitute an inducement to engage in any investment activity related to Terumo. The opinions and projections contained inthis report are based on our assessments when the material was being prepared. The accuracy of this information cannot be guaranteed and the information may be subject tochange without notice. Please be advised that Terumo or any party providing this information will not accept any liability for any damages that result from the use of thisinformation.

Terumo Corporation
May 8, 2015
A4: Selling prices declined substantially, mainly in the United States. We began to see the impact tosales of whole blood collection related products and blood component collection systems in 4Q
FY2014. In FY2015, we anticipate considerable negative impact from large-scale contracts for
products for which selling prices have declined. There is a little possibility that selling prices
will decline further going forward but we believe that the decline should be minimal. We look
for selling prices to level off in and after FY2016. Some customers are starting to purchasefrom multiple suppliers, rather than relying on a single source, given the potential risk to stablesupply. We think the trend will differ by region and customer on a case-by-case basis.
Q5: In FY2015, operating income growth appears to be slightly weak compared to the sales growth.
Was there negative impact aside from TCVS-related costs, the decline in selling prices forblood management products, and foreign exchange rate changes?
A5: There is no primary factor. However, we dare to say one of the factors is that the profit
improvement in the General Hospital Company is lower than we initially expected.
Q6: In FY2015, why do you plan to increase in research and development expenses by JPY5.6
billion and an increase in depreciation and amortization by JPY4.3 billion? Do you expect theseexpenses to remain at the same level in FY2016?
A6: In the Cardiac & Vascular Company, we are strengthening our research and development
platform in the fields of interventional systems and neurovascular intervention, mainly at
MicroVention, Inc., our subsidiary on the West Coast in the U.S. In 4Q FY2014, we have beensmoothly moving forward with development. In FY2015, we plan to continue in this direction.
Moreover, in the General Hospital Company and Blood Management Company, we estimate
development expense will slightly increase. In FY2015, we forecast R&D ratio of 6.7%. InFY2013, our investments for building new factories and facilities expansion peaked. Given
these facilities are starting operations, depreciation and amortization expenses will increase
going forward.
Q7: I believe Terumo’s policy is to reduce costs by accelerating production transfer outside Japan.
Do you plan to slow your production transfer overseas?
A7: We do not change our policy to accelerate production transfer outside Japan. We are currently
examining where and how we increase the production. At present, we are exporting products
produced in China to Japan. However, given the rising value of the renminbi and growing laborcosts, we will likely have to switch to selling this product in China or exporting to neighboring
countries around China.
Q8: It seems that you could have forecast for the most part of the impact from foreign exchange rateexchanges, the decline in selling prices of blood management products, and the increase in
The information contained in this report does not constitute an inducement to engage in any investment activity related to Terumo. The opinions and projections contained inthis report are based on our assessments when the material was being prepared. The accuracy of this information cannot be guaranteed and the information may be subject tochange without notice. Please be advised that Terumo or any party providing this information will not accept any liability for any damages that result from the use of thisinformation.

Terumo Corporation
May 8, 2015
R&D, depreciation and amortization expenses to a certain degree? How accurate are theforecasts in the mid-term plan?
A8: Although our R&D expenses for FY2015 appears large in comparison with the scale of R&D
expense in FY2014, averaged out, our R&D expenses do not increase so much. The increase indepreciation and amortization reflects fluctuations in foreign exchange rates but this is not a
substantial deviation from our mid-term plan. As we explained at our financial announcement
briefing for FY2013, the goal in our mid-term plan focuses on improving profitability, rather
than specific sales and profit targets. In FY2014, we wrote off assets of certain business, andstill continue to make efforts to improve our profitability. We would like you to review ourinitiatives from that point of view.
Q9: Do you believe you will achieve an operating profit margin of 20% (before amortization of
goodwill and other intangibles) in FY2016?
A9: At present, this 20% target is not within range. Our first step is to make efforts to outperform
FY2015 guidance as much as possible. We will strive to achieve the target with taking
medium/long-term initiatives.
(End)

The information contained in this report does not constitute an inducement to engage in any investment activity related to Terumo. The opinions and projections contained inthis report are based on our assessments when the material was being prepared. The accuracy of this information cannot be guaranteed and the information may be subject tochange without notice. Please be advised that Terumo or any party providing this information will not accept any liability for any damages that result from the use of thisinformation.