February 28, 2023
To whom it may concern,
Company Name:

Nichi-Iko Pharmaceutical Co., Ltd.
(Securities Code: 4541, TSE Prime Market)

Representative:
Contact:

Yuichi Tamura, President & CEO
Susumu Kanda, Director and Executive Vice
President(Tel. 076-432-2121)

Notice Regarding Change in the Company’s Consolidated Subsidiary(Second-Tier Subsidiaries) (Share Transfer)
Nichi-Iko Pharmaceutical Co., Ltd. (Toyama-shi, Toyama; President & CEO: Yuichi Tamura; the “Company”)
hereby gives notice that, at the meeting of the Board of Directors held today, the Company resolved to transfer all ofthe shares of Sagent Pharmaceuticals (Wyoming, USA; Chief Executive Officer: Dr. Peter Kaemmerer; “Sagent”)
and Omega Laboratories Ltd. (Quebec, Canada; President: Bruce Levins; “Omega”) held through its consolidated
subsidiary Sagent Pharmaceuticals, Inc. (Delaware, USA; Chief Executive Officer: Dr. Peter Kaemmerer; “Sagent
Holding Co.”) to Ellimist Singapore Pte. Ltd. (Singapore; Director : Gopi Devarakonda and Mohammed Tawfiq;“Ellimist”), which Dr. Ravi Penmetsa, a businessperson in Republic of India, substantially controls through his assetmanagement company, and that today Sagent Holding Co. entered into an Equity Purchase Agreement (the “EquityPurchase Agreement”) pertaining to the Share Transfer with Ellimist..
Details
1. Reason for the Share Transfer
As described in the “58th Annual Securities Report” released on June 30, 2022, due to an overall revision in thefiscal year ending March 2022 of the development plans for biosimilars (follow-up products to biopharmaceuticals)
and orphan drugs (drugs for rare diseases), in which the Company has been making ongoing investments in our North
American business, we accrued impairment losses of JPY 6.612 billion at Sagent Holding Co. and its consolidated
subsidiaries (the “Sagent Group”) in relation to goodwill accrued from investments in our North American businessand intangible assets concerning the development of biosimilars and orphan drugs. In addition, we conducted
impairment testing under International Financial Reporting Standards (IFRS), and as a result of considering the future
recoverability of fixed assets, including goodwill, earnings that had been anticipated could no longer be expected, sowe accrued impairment losses of JPY 28.530 billion on the fixed assets of Sagent Group, including goodwill.
In addition, as described in the “Notice Regarding Accrual of Inventory Asset Valuation Losses and Impairment
Losses, and of Foreign Exchange Losses” and the “Report for the Third Quarter of the 59th Fiscal Year” released onFebruary 14, 2023, in the consolidated cumulative third quarter of the fiscal year ending March 2023, the Company
accrued a JPY 49.768 billion impairment loss regarding goodwill, tangible fixed assets, and intangible assets owned

by the Sargent Group, and had negative equity of JPY 52.101 billion as of the end of the third quarter consolidated
accounting period of the fiscal year ending March 2023.
Because of this challenging business climate and financial condition, as described in the “Notice Regarding
Convening of Creditors’ Meeting for Resolution of Proposed Business Turnaround Plan in Business Turnaround ADR,
Completion of Business Turnaround ADR, and Financial Support including Debt Forgiveness” released on December
28, 2022, the Company is committed to a fundamental business turnaround based on the proposed businessturnaround plan that was consented to by all of the financial institutions with whom it has transactions that are thecreditors subject to the specified certified dispute resolution procedures under the Act on Strengthening Industrial
Competitiveness.
As part of that, in order to establish a firm earnings structure and fundamentally improve the Company’s financial
condition for its future re-growth and its sustained growth, the Company reviewed and considered the rebuilding of
the businesses in its group and has now decided to sell Sagent and Omega to Ellimist. through the Share Transfer andto exit its North American business.

2. Outline of Subsidiary Transferring Shares (Sagent Holding Co.)
(1)NameSagent Pharmaceuticals, Inc.

(2)

Location

1209 Orange Street, Wilmington, New Castle, 19801, Delaware, USA(3)

Name and title ofrepresentative

Dr. Peter Kaemmerer (CEO)Holding company of the Sagent Group (manufacture and sale of generic(4)

Business details(5)

Stated capital

USD 10(6)Incorporation

2011

pharmaceuticals, mainly injectables)

3. Outline of Second-Tier Subsidiaries to be Changed(1) Outline of Sagent
(1)

Name

Sagent Pharmaceuticals(2)

Location

2120 Carey Avenue, Cheyenne, Wyoming 82001, USA(3)

Name and title ofrepresentative

Dr. Peter Kaemmerer (CEO)(4)

Business details

Manufacture and sale of generic pharmaceuticals, mainly injectables(5)

Stated capital

USD 100(6)

Incorporation

2006

(7)

Major shareholders andshareholding ratios
Relationship between(8)

the Company andSagent

Sagent Pharmaceuticals, Inc. 100.0%
Capitalrelationship

It is a wholly-owned subsidiary of Sagent Holding Co.

Personnel

Two of the Company’s officers or employees serve as

relationshipdirectors of Sagent.

Transactional

The Company conducts certain transactions with Sagent.

relationship(9)

Operating results and financial position of Sagent in the most recent three-year period (unit: millionUSD)

Accounting period

Fiscal year ended

Fiscal year ended

Fiscal year ended MarchMarch 2020

March 2021

2022

Consolidated net assets

657604362

Consolidated total assets

978

1,000

760

65,71660,37636,223

Consolidated sales

288

299

312

Consolidated operating profit−8−64−243

Profit before tax−8−62−245−4−53−239−402−5,339−23,941

Consolidated net assets per share(unit: USD)

Net profit for the current period
attributable to owners of parent
Basic earnings per share (unit:USD)(2) Outline of Omega(1)

NameOmega Laboratories Ltd.

(2)

Location

11177 Hamon Street, Montreal, Quebec Canada, H3M 3E4(3)

Name and title ofrepresentative

Bruce Levins (President)(4)

Business details

Manufacture and sale of generic pharmaceuticals, mainly injectables(5)

Stated capital

CAD 1,321,000(6)Incorporation

1958

(7)

Major shareholders andshareholding ratios

Sagent Pharmaceuticals, Inc. 100.0%
CapitalRelationship between(8)

the Company andOmega

relationship
Personnel
relationshipTransactional
relationship(9)

It is a wholly-owned subsidiary of Sagent Holding Co.
Not applicable.
The Company conducts certain transactions with Omega.

Operating results and financial position of Omega in the most recent three-year period (unit: millionCAD)

Accounting period

Fiscal year ended

Fiscal year ended

Fiscal year ended March

March 2020

March 2021

2022

Net assets

119

122

124

Total assets

185

186

188

Net assets per share (unit: CAD)

119,239

122,413

123,842

Sales

48

58

68

Operating profit−13

3

Profit before tax

−34

3−2

3

2−2,400

3,174

2,134

Net profit for the current period
attributable to owners of parentBasic earnings per share (unit:CAD)
4. Outline of the Counterparty of the Share Transfer
(1)

Name

Ellimist Singapore Pte. Ltd.

(2)

Location

8 Cross, # 24-03/04, Manulife Tower, Singapore, 048424

Name and title ofGopi Devarakonda (Director)

representative

Mohammed Tawfiq (Director)(4)

Business details

Consulting and marketing support for pharmaceutical businesses(5)Stated capitalNot disclosed(6)

Incorporation

February 15, 2019(7)

Net assets

Not disclosed(8)

Total assets

Not disclosed

(3)

(9)

Major shareholders andshareholding ratios

KP Advisory Services LLP - 50%
CapitalRelationship between(10)

the Company andEllimist

Not applicable.

relationship
Personnel

Not applicable.

relationshipTransactional

Not applicable.

relationship
5. Number of Transferred Shares, Transfer Price, and Status of Shareholding Before and After Transfer(1) Sagent
(1)
(2)
(3)

Number of shares held

10,000 shares

before change(Ratio of voting rights holding: 100.0%)

Number of transferredshares

10,000 shares

Number of shares held

0 sharesafter change(Ratio of voting rights holding: 0.0%)

Number of shares held

1,000 shares

before change(Ratio of voting rights holding: 100.0%)(2) Omega
(1)

(2)
(3)

Number of transferredshares

1,000 shares

Number of shares held0 shares

after change(Ratio of voting rights holding: 0.0%)(Note) The final transfer price is planned to be decided after implementing a price adjustment based on a combined
enterprise value of USD 100 million for both Sagent and Omega.
6. Schedule(1)

Date of the resolutionof the Board ofFebruary 28, 2023

Directors(2)

Execution date of theEquity PurchaseFebruary 28, 2023

Agreement(3)

Closing date of theShare TransferFebruary 28, 2023 (planned)

7. Future Outlook
In conjunction with the Share Transfer, it is expected that a combined share transfer loss of (approximately) USD
124 million for both Sagent and Omega will be accrued in the fourth quarterly consolidated accounting period for thefiscal year ended March 2023.
Furthermore, at the time that the announcement was made in the “Notice Regarding Convening of Creditors’Meeting for Resolution of Proposed Business Turnaround Plan in Business Turnaround ADR, Completion of Business
Turnaround ADR, and Financial Support including Debt Forgiveness” dated December 28, 2022, it was confirmedthat debt forgiveness for a total of JPY 55,784,651,484 will be provided by all 15 financial institutions with whom
the Company has transactions, and going forward, there may be debt forgiveness of up to JPY 42,715,348,516 inaddition to that amount.
The effect the Share Transfer will have on the Company’s consolidated results forecast for the fiscal year ending
March 2023 will be promptly announced when the details have been finalized.
End