Morgan Stanley Japan Equity Conference‘Value Creation; Eisai Way’Ken Fujiyoshi
Director, Investor Relations

Eisai Co., Ltd.
September 14, 20051

Safe Harbor Statement•

Materials and information provided during this presentation may contain so-called“forward-looking statements”. These statements are based on current expectations,forecasts and assumptions that are subject to risks and uncertainties which could cause
actual outcomes and results to differ materially from these statements.

•Risks and uncertainties include general industry and market conditions, and generaldomestic and international economic conditions such as interest rate and currency
exchange fluctuations. Risks and uncertainties particularly apply with respect toproduct-related forward-looking statements. Product risks and uncertainties include, but
are not limited to, technological advances and patents attained by competitors,
challenges inherent in new product development, including completion of clinical trials;
claims and concerns about product safety and efficacy; obtaining regulatory approvals;
domestic and foreign healthcare reforms; trends toward managed care and healthcare
cost containment, and governmental laws and regulations affecting domestic and foreign
operations.

•Also, for products that are approved, there are manufacturing and marketing risks anduncertainties, which include, but are not limited to, inability to build production capacity
to meet demand, unavailability of raw materials, and failure to gain market acceptance.

•The Company disclaims any intention or obligation to update or revise any forwardlooking statements whether as a result of new information, future events or otherwise.

Value Creation
Patient Value
Shareholder Value
Employee Value3

Patient Value
Fulfillment of unmet medical needs

Stable supply of quality products
Provision of pharmaceutical productsafety and efficacy information
4

Pipeline Policy
1. Area Focus

Neurology
GIOncology and Critical Care
Area Focus

2. First-in-class drug
3. Active businessdevelopment
First-in-classBusiness
Development

5Filling Pipeline in Neurology Area
E20

γ se012cretasemodu
laAwith Focus on
Neurodegenerative
Diseasegilect

Alz
heim
caliv
Cer onia Disea er’stsedysMul
scle tiple
rosispsy
pile

Neurology MildParkDis inson’seaseanE2gr yne eps
Zo i EpiltAnon orvel ulat
Ino el modannCh
Na007

Er
cula asa
V entidemcogimp nitiveairm
ent

Acetylcholine Esterase
Inhibitor

E2007tuliBot
epric
A

14 in
E20nus tox

torerainMig ylaxis)ph(ProA

MAO gilec
t-B inhibitor
E2007ranylaxis)
gehZonne (Proprai
7 tagonist
0Mig
0E2 ptor An
eceArPAM

6

Enrichment of Oncology Compounds
Meet Needs for Cancer Treatment
by Various Approaches
Tumor Regression

Tumor
Suppression

Life-span
Prolongation

Novel
Mechanism

Novel
Anti-mitoticAntiAngiogenesis

PreventionofRecurrence

E7070

E7389

E7820

E0167

Cell Cycle G1 Phase
Targeting Agent
US, EU and JP
Phase II

E7107

Novel Anti-tumor Agent
Derived FromFermentation
Pre-clinicalMicrotubule GrowthSuppressor
USPhase II

Integrin Alpha-2
Expression Inhibitor
US
Phase I

E7974

E7080

Hemiasterlin TypeTubulin Polymerization
Inhibitor

US
Phase I

VEGF Receptor
Tyrosine Kinase Inhibitor
US, EU and JP
Phase I

Prevention of Hepatocellular
Carcinoma Recurrenceby Vitamin K2

JP, Phase II/III7

Seamless Value Chain- Efficiency and Productivity in terms ofCreating Patient Value ent ofmlliflalFu
M e d ictemUn
Needs

Discovery Development Manufacturing

SalesLogistics&Marketing

Pharmacovigilance

Stable SupplyofQuality ProductsPatients

Provispharm ion ofac e u t
produ ical
ct
safetyan d ef
inform ficacy
ation

8

Shareholder Value
GrowthReturn to shareholders
Investor Relations
9

Future Growth Drivers
1. Pipeline - All first-in-class type of drugs
E2007 : AMPA Receptor Antagonist
E7389 : Microtubule Growth Suppressor
E5564 : Endotoxin Antagonist
E5555 : PAR-1 Receptor Antagonist
E2012 : γ Secretase Modulator
2. Global Opportunities (FY2000 - FY2004)

POC Success
POC Success
POC Success
Phase I
Pre-Clinical

49.7% of Net Sales, 59.0% of Operating Income Attributed to Overseas

Net Sales
CAGR 21.7%
Overseas Operating Income*CAGR 37.9%
Consolidated Net SalesCAGR 10.2%
Consolidated Operating Income
CAGR 10.2%d
3. Strong Current Products (FY2000 - FY2004)
Aricept
CAGR 23.0%
Aciphex/Pariet
CAGR 24.7%‘Active New Indications
Formulations Research’10* Operating income before Royalty deduction

Proof of Concept Success-Three First-in-class compounds-• E2007: Oral AMPA receptor antagonist– Ph IIb study in Parkinson’s disease demonstrated clinically meaningful
efficacy (OFF time reduction) and good safety– Target NDA/MAA in 2Q FY2007– Ph IIb studies ongoing in migraine prophylaxis and epilepsy, in
preparation for multiple sclerosis• E7389: Microtubule growth suppressor– Considerable objective tumor responses were observed in Breast andNon-small cell lung cancers. – those patients had been treated withchemotherapies including taxanes– No severe neurotoxicities have been observed– Aiming Subpart-H submission in FY2006• E5564 (eritoran): Endotoxin antagonist– A placebo-controlled Ph IIb study in patients with severe sepsis showed
more than 5% decrease in mortality in high-dose E5564-treated group,with clear dose response– Good tolerability was demonstrated– Global Ph III study to be initiated in FY2005– Target NDA/MAA in FY2008

11

Opportunities in Key Areas/Countries¥11.9 B

¥38.3 BEU market coverage
83% (Euro volume)

Asia Sales

EU Sales¥4.6 B

CAGR: 26.8%¥14.3 B

CAGR: 27.9%

FY2000FY2004

FY2000FY2004The most successful Japanesepharma company in China,
rapid growth in Korea,
outperforming the market growth inJapan in recent years
Japan Sales¥241.0 B

Start full marketing &sales activity in India
Consecutive doubledigit growth since1996 in US¥214.5 B¥101.8 B
USSales
CAGR: 20.5%
FY2000¥268.3 B

CAGR: 2.7%

(September 2005)

FY2000FY2004

Operating Income Before
Net Sales (Overseas)
Royalty Deduction (Overseas)¥264.7 B¥51.3 B
¥120.7 B¥14.2 B

CAGR: 21.7%

FY2000FY2004

CAGR: 37.8%

FY2000FY2004

FY2004

12Financial Performance & Forecast(billions of yen, %)FY2005 1Q
Results%

FY2005YOY

Forecast%

YOY

111575.0

100.0

108

Net Sales

135.8 100.0

Cost of Sales

24.1

17.7

100

103.0

17.9

105

111.7
R&D Expenses
19.9
SG&A Expenses
69.3

82.3

113

82.1

109

14.7

110

15.5

114

51.1

112

472.0
89.0
292.0

50.8

108

Operating Income

22.5

16.5

120

91.0

15.8

105

Ordinary Income

23.4

17.2

120

180.0

31.3

109

Net Income

14.9

11.0

120

58.0

10.1

104

EPS (Yen)

52.2

121

203.0

Gross Margin105
13

Raising the Dividend on Equity [DOE] ratio(DPS: Yen)

Shareholders Return (Dividend)

10080
60

DPS

= Dividends Per ShareDOE= Dividends On Equity( ROE x Dividend Payout Ratio)

2.0

2.4

2.5

3.7

20
ROE (%)
Dividend Payout （％）

DOE (%)

54.8
80

2.6

4356

4023(DOE: %)2293236

FY2000FY2001

FY2002

FY2003

FY2004

FY2005(est.)

6.9
29.2
2.0

10.3
23.3
2.4

10.9
22.7
2.5

12.4
20.9
2.6

12.6
29.0
3.7

12.2
39.4
4.8

114

‘Corporate Value Enhancement
throughCommunication with
Shareholders’15

U.S. Operation Update
Hajime Shimizu
Chairman and CEOEisai, Inc.
September 14, 200516

Performance of Eisai(millionsInc.
of dollars, %)FY2003

FY2004

%

1,734

100.0

2,001

100.0

115

267

Aricept®

777

44.8

907

45.3

117

130

Aciphex®

933

53.8

968

48.4

104

35--104

5.2-

104

Operating Income

88

5.1

96

4.8

109

8

Net Income

53

3.1

62

3.1

115

8

Operating Income

301

17.4

402

20.1

133

101

Total Revenue

Zonegran®

(Pre-royalty deduction)

Results%

Increase

Results

YOY

17Performance of Eisai(millionsInc.
of dollars, %)FY2005 1Q

FY2004 1Q
Results%

Total Revenue

418100.0Aricept165

Aciphex

Results%

117491

100.0

118

73

39.5

102219

44.5

132

54

226

54.1

119235

47.8

104

8

Zonegran

235.4－336.7145

10Operating Income

143.4

172

28

5.7

196

14Net Income

92.2

164

18

3.8

205

9

Operating Income

69

16.6

132

95

19.4

138

26

(Pre-royalty deduction)

YOY

YOY

Increase

18

Eisai Inc.’s Continuing Growth•Rasagiline Deal Signing•Rufinamide Deal Signing•Zonegran Acquisition•Aciphex Approval (GERD Sx)•Aciphex Approval (H. pylori)•Cerebyx Deal Signing•Aciphex sNDA (GERD Sx)•E7070 IND$1,462 M•E2101 IND•Aciphex Launched•Aciphex IND (H. pylori)•E5564 IND•E1010 IND•Aricept NDA$1,710 M$1,228 M$874 M•Aciphex NDA$515 M•Aricept Launched$1,997 M

Net Sales$313 M$212 M$32 M
FY 1995

FY1996

FY1997

FY1998FY1999FY2000FY2001

FY2002

FY2003

FY200419

Sales of Major Products(billions of yen, %)FY2003
Product Name

Aricept®
Alzheimer’s
DiseaseTreatment

Area
Total
Japan

US
$ million
EuropeAsia
TotalAciphex®/
Pariet®

JapanProton Pump
Inhibitor$ million

USEurope
Asia

FY2004Results

Results

141.6
28.4
87.9
777
22.8
2.5
129.0
14.6
105.5
933
7.3
1.6

162.9
35.1
97.6
907
27.2
2.9
132.3
19.4
104.1
968
6.8
2.1

YOY (%) Inc./Dec.

115

21.3

123

6.7

111

9.7

117

130

120

4.5

118

0.4

103

3.3

133

4.8

99(1.4)1043592(0.6)

133

0.5
20

Sales of Major Products(billions of yen, %)Product Name

Aricept
Alzheimer’s
Treatment

FY2004 1Q

FY2005 1Q

Total

US

34.4
8.9
18.1

41.7
9.9
23.5

121
111
1307.31.0
5.4$ million

16521913254Europe

7.30.9
34.1
6.3
25.3

110
136
113
195
102

0.6
0.2
3.8
3.10.4Japan

YOYIncrease

Area(Decrease)

Aciphex/Pariet

Total

US

6.7
0.7
30.3
3.2
24.8

Proton Pump
Inhibitor$ million

226

235

1048

Europe1.8

1.8

99(0.0)

Asia

0.5

0.7

163

3Asia
Japan

21

Aricept and Aciphex/Pariet Lifecycle Management
Products

Aricept
Alzheimer’s
Treatment

Aciphex/ParietProton Pump
Inhibitor

Indications・Formulations

Status

Vascular dementia

Plan to submit additional data toFDA and resubmit in EU (FY2005)

SevereAlzheimer’s disease

Filed in August 2005 (US)Plan to file in 3Q FY2005 (EU, JP)

Mild cognitive impairment(MCI)

Phase III (US)

Sustained releaseformulation

Phase I (US)H. Pylori eradication

Filed in March 2005 (Japan)

Non-erosive GERD

Phase III (Japan)

Extended releaseformulation

Phase I (US)22

Entry Strategy•

Eisai chose a strategy of a partnering to enter the US
market and commercialize its key products.

•Co-promote agreements with Pfizer and Janssen
enabled the company to target key customer
segments while avoiding excessive up-front
expenditure in infrastructure and allowing growth ofthe business in a sensible fashion.

•Some of our peer Japanese companies adopted
different strategies however.
23

Learning from Experience

ALLIANCES• Co-promote structures were pursued that allowed Eisai toleverage the capabilities and draw upon the expertise ofmarket leading companies.
• Specific franchises have been targeted that build uponorganizational scientific and market expertise.
Co-promotes

FRANCHISE

Neurology

GI

PfizerJanssenTeva

for Aricept

for Aciphex

for Rasagiline

1994

1997

2003

Aricept

ZonegranRasagiline

1997

2004

E2007

Aciphex1999

Oncology &Critical Care

CerebyxE7389

E5564

2002

24

Continuing US Investment
1987 - 1996: Pre-launch•Build research, clinical development, and production infrastructure•Establish sales/marketing capabilities
1987-1989:

Eisai Res. Inst. - Basic Research (MA)

$18M

1988:

Eisai America Inc - Clinical Development (NJ)

$1M

1992 – 1993:

Eisai Corp. NA - US Holding Co. (NJ)

$1M

1994 – 1996:

Eisai Merrimack Valley - Process Research (MA)$20M

1995 – 1996:

Eisai Inc– Sales & marketing (NJ)

$20M

1995 – 1996:

Eisai Inc ( RTP) - Production (NC)

$21M

25

Continuing US Investment
1997-2001: Launch Stage• Major investment in promotional spend• Co-promotions leverage partner expertise and resources
1997:

Eisai Inc– Sales & Marketing (NJ)

$26M

1997:

Eisai Inc ( RTP) - Production (NC)

$16M

1997 – 1998:

Eisai Res. Inst.- Basic Research (MA)

$27M

26

Continuing US Investment
2002…: Operational and Infrastructure Enhancement• Focus on Growth• Improved efficiencies and organizational structures• Continuing expansion
Basic Research:

Growth toward 250 employees; $65M+ capital investment

Clinical Development:

New subsidiary formation (329 employees - US/UK)

Sales & Marketing:

250 Medical Reps (FY2002); 634 Medical Reps (FY2004)

Production:Increased capacity (70%); packaging capability added;
possible addition of cytotoxics facility

Distribution:Aricept (FY2002); Aciphex (FY2003); Zonegran (FY2004)27

Eisai Research Institute has begun construction ofa 150,000 sq. ft. research building in Andover, Mass.
This building expansion will include a new laboratory
facility consisting of chemistry, biology, drug safety
disposition and pharmacology research facility, withconference areas, offices and library. Special
support spaces include highly automatedlaboratories and a large conference room. Project isscheduled for completion in Summer 2006.
Source: Andover Townsmen, Andover, MA28

Steady Expansion of Sales Capabilities• Eisai has continually expanded its sales capabilities inorder to effectively engage key customer segments,
compete in managed markets, and fulfill our goal of
becoming independently capable.
FY1996• Medical Reps
(80)

FY1998• Medical Reps
(180)
• Managed Care

FY2002

FY2004• Medical Reps
• Primary Care Team(250)(400)• Hospital Team (16) • Neurology Team(100)• Managed Care
• CNS Team(100)• Hospital Team
(18: Reps + DMs)
• Enhanced
Managed CareCapabilities (16)• Total (634)

FY2005…
• Hospital• LTC• Oncology

29