Medium-Term Management Plan | Management Strategies and Policies | For Our Shareholders and Investors

Management Policy
Management Vision
Financial and Capital Strategy
Non-Financial Strategies
Promotion of Sustainability
Basic Policy for Sustainability
Materiality Map

ASKA Pharmaceutical Holdings' Medium-Term Management Plan 2025

Management Policy

In order to remain a company that is trusted by society, we will continue to contribute to healthcare by transforming into a leading company in the specialty areas within our domestic pharmaceutical business, and by creating pharmaceutical products that meet social needs through innovations. Furthermore, building upon our current business, we are aiming to become a “Total Healthcare Company” by conducting business operations domestically as well as internationally across the entire healthcare market of Prevention, Testing and Diagnostics, Treatment, and post-treatment.

Management Vision

Become a Total Healthcare Company with a Strong Foundation as a Specialty Pharma Company

Four Visions

1. Expand business scope centered on pharmaceutical products
2. Improve business operations through promoting open innovations
3. Become the top domestic company regarding our specialty areas for pharmaceutical products
4. Continue to be a company that holds Society’s trust

Target Figures

Sales (consolidated)	Operating profit rate (Consolidated)	ROE (Return on Equity)
70 billion yen	8%	8%

Progress Chart

Seven Strategies

1. Enhancing Corporate Value by Strengthening Initiatives in the Specialty Areas

Contribute to improving women's QOL as a leading company in the field of obstetrics and gynecology
Promote awareness activities within the thyroid field and contribute to the treatment of potential patients

2. Continuous Creation of New Drugs through Advanced Drug Discovery

Leverage open innovations to continuously create new drugs
Promote and enhance global alliance activities as well as In-and-Out-licensing activities

3. Overseas Operations

Develop and provide high-quality pharmaceuticals within Asia, and strengthen our presence

4. Providing New Value to Realize “Total Healthcare”

Strengthen animal reproduction, immunity, and nutrition to support the health of companion animals
Take on new business challenges within the Testing and Diagnostic business, etc.

5. Improving Operational Efficiency, managing Costs, and Reinforcing Our Financial Base

Promote cost efficiency
Promote operational efficiency by engaging in DX

6. Foster an Organizational Culture that Emphasizes thorough Compliance and Accountability

Ensure company compliance and enhance trustworthiness from society
Achieve a high quality and stable supply chain at any given time
Strengthen corporate governance under the HD system

7. Develop Human Resources to Realize Growth Strategies

Develop and attract human resources that are capable of responding to new business opportunities as well as the changing environment
Create an environment in which a diverse range of talent can thrive, including women, professionals at every stage of their work journey and active seniors. “ASKA Pharmaceutical Holdings aims to achieve its financial targets and to contribute to the realization of SDGs by addressing social issues through its business activities.”

（7 Strategies）Medium-Term Management Plan 2025: Results of the 3rd year, and Future Efforts

Strategies	Results of the 3rd year	Future efforts
①	Achieved No. 1 sales in the Ob/Gyn area RIFXIMA received approval for the pediatric indication Signed an agreement with SUSMED for joint R&D and marketing of therapeutic apps	Contribute to women’s health through new approaches Further penetration of RIFXIMA
②	Initiated Ph I/II for AKP-022 (relugolix combination tablets) Preparation for filing LF111 to authorities Signed a joint research agreement to develop a new treatment for preeclampsia with Red Arrow Therapeutics	Expansion of development pipeline Progress in the Development of AKP-022 (relugolix combination tablets) Creation of in-house seeds
③	Executed capital increase to Hataphar (Vietnam) Hataphar's new plant WHO-GMP approval filed	Step up collaboration Preparation for PIC/S GMP acquisition
④	Established CVC fund and started investment Started selling training videos on women's health Launched new feed additives Launched two new hormone measurement kits	Further investment in and promotion of areas peripheral to pharmaceuticals Fast-track launch of the Femtech business Promote the development of new products for veterinary use Early expansion of hormone measurement kits
⑤	Continuation of cost reduction measures (Cost of sales ratio:FY2020 54.0％→ FY2023 51.2％) Rethinking of unprofitable product portfolio	Continued response to cost increases due to external factors
⑥	Continued review of quality management system Continued implementation of compliance training	Maintenance of quality culture
⑦	Expansion of flexible work styles through various measures Recognized as the “White 500” enterprise for three consecutive years as ASKA HD, six consecutive years as ASKA Pharmaceutical Expansion of education and training programs Creation of work support grant and coverage of cancer insurance for employees	Strengthen HR development through Next-Generation Leader Development Program Continue making investments that draw out the value of human resources

Financial and Capital Strategy

Recognition of Changes in the Business Environment and Progress of Medium-Term Management Plan 2025

We will need to continue with the implementation of the strategies of the medium-term management plan, increasing profitability while improving capital efficiency through appropriate capital allocation. The Group will maintain a balance of investing in growth and improving capital efficiency as we strive to enhance our corporate value.

Growth Investments

As the core of the Group is the pharmaceutical business, we recognize that R&D investment is a source of future earnings and is vital for increasing corporate value. In drug discovery research, we are promoting open innovation and utilizing external resources. In business development, we are strengthening our strategy of in-licensing drugs under development and enhancing our pipeline in specialty areas and fields of expertise. Aiming to become a total healthcare company, we will actively invest in promising business fields, not only in pharmaceutical products, while also pursuing capital alliances with other companies and M&A.
Furthermore, one of the Group’s medium-term management plan strategies is to “Develop Human Resources to Realize Growth Strategies.” To enhance our specialty and ability to create, we are working toward various goals such as developing and acquiring human resources who can respond to new businesses and changes in the environment, and creating a workplace environment where diverse human resources can play an active role. Achieving sustainable corporate value enhancement depends on linking management and human resources strategies. With this in mind, we view human resources, the most important of all management resources, as a form of capital, and work to maximize their capabilities through autonomous learning, which leads to value creation.

Assessment of Financial Soundness

We view ensuring the stability of our financial base as an important management issue for the Group. On the other hand, from the viewpoint of capital efficiency, the Group judges appropriately whether or not to continue cross-shareholdings. We strive to reduce the holding of shares determined not to have sufficient meaning as appropriate.
We will also continue working to balance equity and interest-bearing debt while ensuring a stable financial base and enhancing capital efficiency by thoroughly examining investment projects and properly controlling risks and costs.

Policy for Returns to Shareholders

The Group regards the return of profits to shareholders as an important management issue. We aim to return appropriate profits to our shareholders by achieving strong results and continuously improving our corporate value. Our basic policy regarding dividends is to maintain stable dividends while considering necessary management resources such as internal reserves for long-term business development and future funding needs.
We will also continue working to balance equity and interest-bearing debt while ensuring a stable financial base and enhancing capital efficiency by thoroughly examining investment projects and properly controlling risks and costs.

Continue to take initiatives to swiftly achieve a PBR of above 1x

1. Growth strategy

Implementation of growth strategy
Optimal cash allocation

2. Strengthen shareholder returns

Dividend payout benchmark ratio of 30% from FY2024
Minimum annual dividend of 30 yen per share

Dividends and Dividend Payout Ratio

3. Strengthen IR activities

Creation of dialogue opportunities
Expansion of information disclosures

Non-Financial Strategies

”We aim to achieve our financial targets and contribute to the realization of the SDGs by addressing social issues through our business activities.”

Promotion of Sustainability

The ASKA Pharmaceutical Holdings Group pursues ESG management so that it can solve social issues through its business. In this, we are guided by the corporate philosophy, “Contribute toward the improvement of people’s health and progress in society through the development of innovative products.”
The Group has identified 11 material issues (most important issues). Of these, ”contribution to women’s health“ and ”contribution to animal health“ are particularly relevant material issues for the Company and are being promoted by the entire Group. We will also work to address climate change by reducing CO₂ emissions through expanded use of solar power generation and the introduction of clean energy, and strengthen our human capital by developing and acquiring human resources capable of responding to new businesses and changes in the business and social environment, and by creating a working environment in which a diverse range of human resources, including women, career professionals, and seniors, can play an active role.
In April 2023, we established a new Sustainability Promotion Section in the Corporate Planning Department with the aim of further accelerating our efforts. We will continue to meet the expectations of our stakeholders by placing sustainability at the center of our management, striking a balance between maximizing the economic value of the Company and enhancing its social value.

Atsushi Maruo
Senior Managing Member of the Board of Directors,
Representative Director, in charge of Sustainability
ASKA Pharmaceutical Holdings

Basic Policy for Sustainability

The Company has established CSR guiding principles and works for the ongoing growth for the Group as a whole and to contribute to society. As a trusted company, we will increase profitability through sound business practices and fulfill our social responsibilities as a good corporate citizen.

Supplying High-Quality Pharmaceuticals
1. All employees conduct business with integrity guided by our corporate philosophy.
2. We provide a stable supply of high-quality pharmaceuticals with excellent efficacy and safety profiles.
Ensuring Compliance
1. We are thoroughly committed to corporate ethics and to compliance with all laws and regulations.
2. We maintain fair relationships with stakeholders and conduct transactions that are fair, transparent, and based on free competition.
3. Regarding the protection of personal information, we manage the information in compliance with our privacy policy.
Respecting Human Rights
1. We respect the human rights of all people affected by our business practices.
2. We respect the diversity of our employees and strive to foster a safe and comfortable corporate culture.
Contributing to Communities and Society
1. As a good corporate citizen, we communicate with the local community and broader society while striving to contribute to the world.
Preserving the Environment
1. We participate in the realization of a sustainable society through environmental preservation and by practicing environmental management.

Materiality Map

Mapping of Material Issues

The Group aims to become a total healthcare company with a strong foundation as a specialty pharma company. To contribute to solving social issues and building a sustainable society, we established the ESG Committee in 2021. In 2023, we revised our material issues in response to the changing business and social environment and identified 11 most important issues as our material issues. We recognize “contribution to women’s health” and “contribution to animal health” as distinctive material issues for the Company.
By focusing on these and other group-wide materiality initiatives in accordance with the Medium-Term Management Plan, we will contribute to the realization of a sustainable society and aim to achieve sustainable growth through the creation of social value and to enhance corporate value from a medium- to long-term perspective.

Company-wide Action Plan and KPIs for Material Issues

ESG	Material Issues	Company-wide Action Plan	KPIs
E	Environmental protection and continuous reduction of environmental impact	Environmental protection, continuous reduction of environmental impact, and promotion of environmental management	1. Reduction of CO₂ emissions: Reduction of 46% from FY2013 (FY2030) 2. Reduction of total waste 3. Improvement in recycling rates 4. Promotion of environmental measures 5. Environmentally conscious business operations 6. Reduction of the use of natural resources 7. Reduction of emissions of environmentally harmful substances (reduction of the impact of nitrogen on the environment by promoting low-protein feed)
S	Human resource development	Development of human resources to realize growth strategies	1. Number of in-house recruitment system and interdepartmental transfers (number of career challenges) 2. Number of elective training courses taken: Next-generation leader training Number of selective 　training courses taken: Training to promote the advancement of women (career development of female employees)/other selective training as a measure to support the autonomous learning of employees Expenditures per employee (for education) 3. Promote the implementation of internal and external hierarchical training/selective training (career development of female employees)
	Employee engagement	Creation of an environment that promotes　understanding of the organization, sympathy, and　motivation to take action, and achievement of work-life　balance that respects the health and diversity of our　employees	1. Optimization of working hours: Promotion of the use of annual paid leave as planned, guidance for promotion of the use of annual leave, provision of annual leave (taken hourly), etc. 2. Health management initiatives 3. Promotion of various working styles: telecommunicating, telework, flextime, short-time work, etc. 4. Implementation of regular stress checks and surveys for engagement 5. Promotion of women’s advancement in active roles (FY2024 target): Percentage of female managers (15%) Percentage of female medical representatives (20%) 6. Promotion of active roles for diverse human resources 7. Measures to support development of the next generation: Maternity leave 　(utilization rate 100%) / Childcare leave for male employees (utilization rate 100%) 8. Support for medical representatives to take maternity leave and childcare leave (implementation of reintegration programs, social gatherings, etc.)
	Creation of innovative products	Expansion of pipeline through open innovation	1. Promotion of in-house research themes 2. Reinforcement of alliance activities
	Expanding access to healthcare	Contributions to specialty areas by taking advantage of our own strengths	1. Provision of comprehensive information on specialty areas (Ob/Gyn, thyroid) 2. Promotion of accurate information and raising disease awareness 3. Early identification of diseases through activities to promote testing and diagnostics 4. Early detection of disease through non-invasive measurement kit
	Contribution to women’s health	Total support for women’s health	1. Contribution to women’s healthcare by providing products for each of women’s life stages 2. New initiatives for women’s healthcare 3. Promotion of the advancement of women through activities to raise awareness on health and diseases 4. Sexual education initiatives for younger generation 5. Activities to raise awareness among families and partners about women’s health issues
	Contribution to animal health	Contribution to creation of a society where people and animals can coexist	1. Promotion of animal welfare 2. Development and provision of products useful for maintaining the health of companion animals 3. Development and provision of non-invasive measurement kit products using body hair 4. Promotion of biodiversity
	Stable supply of high-quality products	Ensuring product quality and stable procurement and supply	1. Reinforcement of supply chain management 2. Implementation of appropriate GMP audits 3. Implementation of appropriate GQP (ensuring that a quality assurance system is in place)
	Promotion of proper use of products	Ensuring safety and providing information on proper use	1. Implementation of appropriate clinical trials (GCP compliance) 2. Adequate implementation of GVP and RMP 3. Compliance with GVP and guidelines for activities for provision of sales information 4. Dissemination of materials and knowledge to promote proper use, and strengthening product education for medical representatives, etc. 5. Prompt provision of latest information through website
G	Corporate governance	Establishment of corporate system for continuous growth	1. Fostering corporate culture and climate that respect healthy business ethics 2. Ensuring real equality of shareholders 3. Social contribution activities that lead to solving social issues 4. Constructive dialogue with stakeholders 5. Appropriate disclosure and explanation of management strategy, performance, financial condition, capital policy, etc.
G	Secure compliance with laws and regulations, enforcement of compliance	Thorough maintenance of compliance and fostering an organizational climate that emphasizes reliability	1. Compliance system mainly promoted by Group Compliance Promotion Committee 2. Continuous implementation of preventive measures against serious incidents

Major Material Issue Initiatives Achievements

This section introduces the results of our efforts for material issue KPIs that are of particular interest to our stakeholders.
Our ESG Committee will oversee material issue initiatives and drive improvements.

E: Environmental protection and continuous reduction of environmental impact
Company-wide Action Plan			Environmental protection, continuous reduction of environmental impact, and promotion of environmental management
SDGs

KPIs	FY2023 activity report
Reduction of CO₂ emissions: Reduction of 46% from FY2013 (FY2030)	◎CO₂ emissions in FY2023 ・Calculated greenhouse gas emissions of CO₂ generated from energy use: 11,038t-CO₂ ・Adjusted greenhouse gas emissions: 9,004t-CO₂ (84% of previous year) ◎CO₂-free electricity purchase (16% of the electricity purchased at Iwaki Factory is purchased from alternative clean energy sources. : CO₂ emissions reduced by 538t) ◎Conversion to renewable energy through purchase of non-fossil certificates for annual electricity consumption at the head office building. (CO₂ emissions reduced by 366t) ◎Progress of solar power installation at Iwaki Factory: Started operation in June 2024. (Estimated annual CO₂ emissions reduced by 440t) ◎Held company-wide energy management meeting and confirmed annual targets and mid- to long-term targets.
Reduction of total waste	◎Total amount of waste from Iwaki Factory in FY2023: 159t (Recycling amount: 151t, Final disposal amount: 8t) ※ FY2020: 128t, FY2021: 153t, FY2022: 137t ◎Total amount of waste in FY2023: 31.4t (Compared to FY2022: 36%) ※ 68% of the planned annual waste amount of 45.9 tons for FY2023 submitted to Minato City
Improvement in recycling rates	◎Recycling rate at Iwaki Factory: approx. 95% (FY2023) ※ FY2020: 67%, FY2021: 58%, FY2022: 79% ◎Recycling rate at head office: 75.8% (FY2023) ※ Amount of recycled: 23.8 tons, total amount of waste: 31.4 tons
Promotion of environmental measures	◎Posted "Initiatives to Achieve a Decarbonized Society" on the website. ◎Head office's efforts ・Promoted the purchase of green products. (Ratio of green products purchased in FY2023: 65%) ◎Iwaki Factory's efforts ・Participated in Iwaki City Adopt Program and conducted monthly environmental beautification campaigns as planned. ・As in previous years, Iwaki Factory began operating the ISO 14001 environmental management system in June. ◎Shonan Research Center's efforts: ・Promotion of A/C night mode ・Fluorocarbon inspection ・Installation of air purifiers in each room/periodic cleaning (July)
Environmentally conscious business operations	◎Shonan Research Center maintains a system for promoting environmental preservation, in accordance with the "Agreement on Environmental Preservation" between Fujisawa City/Kamakura City, which Shonan iPark has concluded. ◎Selection of environmentally friendly VAIO PCs as next-generation client PCs. ◎Participated in "Renewable Energy 100 Declaration Re Action" ◎Disclose scenario analysis based on TCFD proposal. ◎Posted "Water Resource Initiatives" on the website.
Reduction of the use of natural resources	◎Promoted reduction of use of phosphate ore, a natural resource, by marketing the feed additive Phytase.
Reduction of emissions of environmentally harmful substances (reduction of the impact of nitrogen on the environment by promoting low-protein feed)	◎Promote low-protein feed by spreading the use of feed-use amino acids.

S: Human resource development
Company-wide Action Plan			Development of human resources to realize growth strategies
SDGs

KPIs	FY2023 activity report
Number of in-house recruitment system and interdepartmental transfers (number of career challenges)	◎In-house recruitment: 18 sectors opened for recruitment in October 2023.
Number of elective training courses taken : Next-generation leader training Number of selective training courses taken : Training to promote the advancement of women (career development of female employees)/ other selective training as a measure to support the autonomous learning of employees Expenditures per employee (for education)	◎Conducting various training programs to develop human resources: ・MR presentation training (Total 31 participants /3 times) ・Facilitation training (Total 9 participants /1 time) ・Elective training: APPLE Program (1st period) was implemented to 15 participants.(Scheduled to continue through the 5th fiscal period) ・Selective training (63 participants /4 types) ・Hierarchy-specific training (Total 14 times /11 types) ・ESG Workshop (40 participants /1 time)
Promote the implementation of internal and external level specific training/selective training (career development of female employees)	◎Various training programs for human resource development: ・Leadership training (34 participants /2 times) ・Department director workshops (Total 8 participants /1 time) ・Next Leadership training (30 participants /1 time) ◎Measures to support employees' autonomous learning: ・Correspondence education: 132 cases (69 case of 1st half, 63 case of 2nd half) ・External seminars: 200 cases ・TOEIC exam support: 68 participants ・Udemy Business: Created 8,437 hours of autonomous learning opportunities across the Company ・flier: Created 52,135 autonomous learning opportunities across the Company

S: Contribution to women’s health
Company-wide Action Plan			Total support for women’s health
SDGs

KPIs	FY2023 activity report
Contribution to women’s healthcare by providing products for each of women’s life stages	◎Promotion of clinical trials and preparation of applications for various development products in the field of gynecology. In addition, information on clinical trial data was disclosed (7 items). ◎Promote activities to expand product lineups by women's life stages.
New initiatives for women's healthcare	◎Promote around-the-pill initiatives through CVC establishment and investment, investment in women's wellbeing funds, and direct startup investment. ◎Two new initiatives were launched to contribute to the pharmaceutical periphery by utilizing FemTech. ・Signed "Agreement for joint development and marketing of therapeutic applications in the field of obstetrics and gynecology" with SUSMED. ・Started to sales 'Training videos on women's health'.
Promotion of the advancement of women through activities to raise awareness on health and diseases	◎Co-sponsored a seminar on "Pregnancy and the Thyroid Gland" at the Annual Meeting of the Japanese Thyroid Society. ◎The Comfortable Menstruation Project ・Jointly held a luncheon seminar in 96th Japan Society for Occupational Health, "Dealing with Menstrual Problems as a Key to Improving Productivity in the Workplace". ・An article titled "Neglecting Women's Health Issues is Costly for Companies" was also published in Nikkei Medical Online and Nikkei Business (2 articles in total).
Sexual education initiatives for younger generation	◎Exhibited information sharing materials for patients at the Contraception and STD Prevention Seminar for Instructors (SRH Seminar) (8 times, 1,110 attendees in total) ◎Mint⁺ teens ・Published 2 articles on the correct way to cope with menstruation, mainly for high school students. ・Posted on Instagram: 14 feeds ◎Mint⁺ ・Complete revising of FY2023 edition of the Health and Physical Education Supplementary Material for High School Students (PDF). (Booklets provided: 170,000 copies / 429 schools)
Activities to raise awareness among families and partners about women’s health issues	◎Mint⁺: 4 articles including "Preconception Care for Your Own and Your Family's Health Starting Today" and “Not just for women! Get to know the male menopause” (average monthly users: approx. 300,000 / PV: approx. 400,000) ◎Conducted online seminar “Aging in a wonderful way! Menopause and Women's Health” and “Why do we need pre-conception care now?”

S: Contribution to animal health
Company-wide Action Plan			Contribution to creation of a society where people and animals can coexist
SDGs

KPIs	FY2023 activity report
Promotion of animal welfare	◎Shonan Research Center Initiatives: ・Disclose ethical considerations in research on the Company's website (continued) ・Conducted animal experiments at AAALAC-certified facilities in compliance with company regulations and Shonan iPark's animal experimentation rules. (continued) ・Consider introducing an animal experiment management system to ensure proper review of animal experiment plans. (Scheduled to be operational in 2024.)
Development and provision of products useful for maintaining the health of companion animals	◎Trilostane tablets "ASKA": ・Awareness-raising activities are conducted by producing/distributing videos on case studies of administration and precautions for pet nurses when handling the preparations. ・Planning and sponsorship of a booklet on the use of Trilostane in dogs with co-morbidities.
Development and provision of non-invasive measurement kit products using body hair	◎Conducted clinical trials using small animal body hair
Promotion of biodiversity	◎Promoted a biodiverse environment by providing a diverse range of products that target animals, including livestock/poultry, pets, and farmed fish.

Materiality