CORPORATE REPORT
2023
Business Philosophy
The goal of the Nippon Chemiphar Group is to make a difference in society by providing pharmaceutical drugs and health-related services to help people become and remain healthy.
Nippon Chemiphar has operated as a pharmaceutical company since its founding in 1950.
Throughout the years, we have consistently developed, manufactured, and sold distinctive, original pharmaceutical formulations. Since the year 2000, we have made generics a pillar of our business and conducted related development, manufacturing, and sales operations in-house.
We implement initiatives associated with drug discovery themes that target the development of innovative drugs, and diagnostic products that contribute to speedy diagnoses. We are also actively taking on the challenge of multifaceted development, using the alkalization therapy expertise we have cultivated over many years.
NIPPON CHEMIPHAR CORPORATE REPORT 2023
Contents
Our value creation story | 2 | Business Overview | 10 |
Value Creation Strategy | 4 | Pharmaceutical Products | 11 |
Message to Our Stakeholders | 6 | ESG Initiatives for a Sustainable Society | 20 |
Financial Highlights | 9 | Corporate Data | 33 |
- Scope of Report
This report contains information regarding the Nippon Chemiphar Group's business strategy, financial situation, and corporate social responsibility-related activities.
- Reporting period: FY2022 (April 1, 2022-March 31, 2023)
- Reporting companies: Nippon Chemiphar Co., Ltd. and its
Group companies
Note Regarding Forward-looking Statements
Statements made in this corporate report with respect to current plans, estimates, strategies and beliefs, and other statements of Nippon Chemiphar are forecasts for the Company's future performance. These forecasts are based on information currently available to management. Consequently, they are subject to known and unknown risks and uncertainties and may differ significantly from actual results. Items that may influence forward-looking statements and forecasts include changes in the economy, changes in the business and competitive environment for Nippon Chemiphar's business, revisions to the Pharmaceutical Affairs Law and related legislation, and other items not limited to the above.
Cover painting
Provided by Paralym Art,* an association that assists artists with disabilities to achieve economic independence by supporting their business.
Title: Niji to Hansen (Rainbow and Sailboats)
About the artist: Magari Ohishi lives in Kobe City, Hyogo Prefecture. He is known for his landscape and still life paintings. The rainbow in this work uses five colors, but was painted in such a way as to suggest that seven colors have been used. The different shapes of the sails represent the individuality of each ship, while the different directions in which each ship is sailing represent the welcoming of diversity.
- Welfare service for people with disabilities or intractable diseases who, due to reasons associated with age or physical strength, have difficulty working at companies or other conventional places of business. Through this support, individuals can receive training involving light work or other forms of employment.
Nippon Chemiphar's Three Plus 1 Principal Goals
Since 2000, Nippon Chemiphar has promoted a basic management strategy based on three goals: establishing a strong presence in the generics business; becoming a leader in the field of alkalization therapy; and pursuing in- house drug discovery and development.
To attain these three goals, we are working to increase our earning capacity through the generic drugs business; deploying multilaterally the additional business foundation we are building by leveraging our alkalization therapy expertise, cultivated through Uralyt; and striving to secure further growth, over the medium to long term, through in-house drug discovery and in-licensing of new drugs.
We believe that these efforts will enable us to maximize the value of our corporate Group and achieve sustainable growth as we combine businesses that are advancing on different time horizons, as well as expand overseas the results that these businesses generate in Japan.
Goal 1: Generic drugs
Strengthen profit structures while pursuing added value and efficiency using a quality-based approach
Diagnostics
FY2022 topics related to our three principal goals
Generic drugs and diagnostics
- • In addition to further strengthening our quality assurance system, we have introduced two- and three-shift operations at both domestic and overseas factories to address the industry-wide need to ensure stable supplies
Diagnostics
-
We increased the production capacity of our
DropScreenTM reagent, and initiated promotional support on the part of our pharmaceutical sales department, resulting in domestic installations of DropScreen measuring equipment topping 500 units
Goal 2: Alkalizer
Apply multilaterally expertise related to alkalization therapy
Goal 3: New drug development
Globally develop unique new drugs internally created as well as in-licenced
Plus 1: Overseas Business
Generate sustainable growth by expanding results of goal-related efforts overseas
▶
▶
▶
Alkalization therapy
- Phase 2 clinical trials of our pipeline drug DFP-17729 have ended, and the data is currently being analyzed
- We expect to bring the drug to market in FY2026
Drug discovery and development
- We signed a licensing agreement for the development of NC-2500 in China
- Specific out-licensing negotiations are ongoing with overseas companies for NC-2600
- NC-2800is currently in phase 1 clinical trials
- Favorable phase 2 results for DFP-14323 were presented at an academic conference
Overseas business
- In Vietnam, we have obtained approval for Rebamipide tablets
- We are applied there for another product, with administration and dosage that differ from those in Japan
- Having conducted market research on sales in the Middle East and Africa, we are narrowing down possible target countries and partners
Nippon Chemiphar Corporate Report 2023 1
History of value creation
For the past 73 years, Nippon Chemiphar has remained true to the time-honored traditions we have inherited. Keeping pace with the times, we have courageously remedied issues requiring attention, and spared no effort in taking on new challenges. In a word, our history is one of "immutability."
We will continue to strive to develop, manufacture, and sell generic drugs that can be used safely by patients and medical institutions, and continue to take on the challenge of developing new products and new drugs to increase the Group's value.
Main product developments and business strategies
1951 | 1957 | 1976 | 1988 | 1993 | 2000 | 2001 | 2007 | 2020 | 2020 |
Manufacture and | Begin marketing | Expand into the | The need for urinary | Launch Soleton tablets (an analgesic/anti- | Full-scale entry | Launch allergy-specific IgE measurement | Three Principal | Launch DropScreen, an allergy screening | Sign a licensing agreement with Delta- |
market our products, | imported drugs. | clinical diagnostics | alkalinization | inflammatory agent) developed in-house. The | into the generic | device DiaPack 2000 and dedicated | Goals established | test kit. It allows 41 items to be measured with | Fly Pharma for DFP-17729, a cancer |
Nalpyrin and Nalbron | business, in | is recognized | product has few side effects. | drug business. | measurement reagent IgE NC. | as a longer-term | a single drop of blood. Of compact design, | microenvironment improving agent. Supports | |
(injectable solutions, | anticipation of | in response | Change policy from | strategy that divides | the kit occupies a space about the size of an | development at Delta-Fly Pharma with our | |||
pain relievers, and | 1958 | the increasing | to increased | being a new drug | our growth prospects | A3 sheet of paper, allowing it to be used for | expertise in alkalinization. | ||
antipyretics for use | Launch sales of | importance of pre- | complications in | manufacturer to a | into three stages. | in-hospital allergy testing. | |||
by doctors). | medication clinical | patients with gout | manufacturer that | This remains our | |||||
Donpyline tablets | |||||||||
tests in the future. | and hyperuricemia | handles both new | basic strategy to this | 2021 | |||||
(therapeutic agent | |||||||||
for neuralgia and | due to changes in | drugs and | day. In 2015, we add | Sign a joint development agreement and | |||||
living conditions. | generic drugs. | overseas business | |||||||
rheumatism), | option agreement for NC-2800 with Sumitomo | ||||||||
1983 | Launch alkalizing | as Plus 1. | |||||||
manufactured in- | Pharma. NC-2800 is a compound discovered | ||||||||
house. | Advance into the | agent Uralyt-U. | 2003 | at Nippon Chemiphar's drug discovery | |||||
cosmetics and health | 1995 | Launch Pravastan, the | research laboratories. It has the potential | ||||||
food fields. | Market Calvan tablets (for hypertension). | first in-house developed | to become a revolutionary antidepressant/ | ||||||
generic drug. | antianxiety drug with superior efficacy and | ||||||||
safety. | |||||||||
Conclude a licensing agreement with | |||||||||
Measuring device A-1 | Delta-Fly Pharma for antitumor drug DFP- | ||||||||
14323. Development targeting lung cancer | |||||||||
Specific IgE measuring | is underway, and we are strengthening the | ||||||||
2005 | pipeline in the oncology field. | ||||||||
kit ST-1 | |||||||||
License out NC-2400 (lipid metabolism | |||||||||
improving agent) to Cerenis. | |||||||||
Business development centered on pharmaceuticals for doctors, Starting in 1950 and business expansion against
the backdrop of Japan's universal health insurance system.
Since 1980, have been restoring trust and launching new drugs
Following an incident of data falsification, new | Since 2000, expanding | Sale of generic drugs increases, resulting from government |
drugs are launched as we strive to regain trust. | generic drugs | policy promoting their use. |
Since 2015, pursuing new drug and new product development and overseas expansion funded by earnings from generics business.
Business timeline
(Sales, bn yen) 40
1950
Establish Hitachi Chemical Co., Ltd. (as Chemiphar was formerly known) with the main business being the manufacture and sale of pharmaceuticals
301970
Company changes name to Nippon Chemiphar Co., Ltd.
1973
Establish laboratory in
Misato City, Saitama Prefecture
201976
- Transferred to the Tokyo Stock Exchange's First Section
-
Establish Japan Sopharchim
Co., Ltd. to ensure a stable supply of fine chemicals.
10
1977
Establish Ibaraki Factory in Makabe-gun, Ibaraki Prefecture (Nihon Pharmaceutical Industry's current Tsukuba Factory)
1979
Establish office in London to collect information on overseas products for market research.
1982
Clinical trial data submitted with application for approval of three new drugs is found to have been partially falsified. The then-Ministry of Health and Welfare orders an 80-day freeze on Chemiphar's manufacture and import of all pharmaceuticals.
1986
Safety Research Institute for Chemical Compounds Co., Ltd. becomes a subsidiary
2002
The Ministry of Health, Labor and Welfare's medical fee revisions for the first time include measures to promote the use of generic drugs.
2007
A quantitative target for generic drugs (30% or more) is set for the first time in the basic policy of the government's economic and fiscal reforms.
2010 | 2015 |
Nihon Pharmaceutical Industry | Establish Nippon Chemiphar Vietnam |
Co., Ltd. becomes a subsidiary | Co., Ltd. (NC-VN) in Vietnam. |
2014 | 2017 |
Establish West Japan Logistics Center | |
Third plant at NPI's Tsukuba | in Kobe City, Hyogo Prefecture, thus |
factory comes on line. | having one base each in both East and |
West Japan. |
2018
NC-VN factory starts exporting to Japan.
Net sales1
0
FY 1950 | 1970 | 1975 | 1980 | 1985 | 1990 | 1995 | 2000 | 2005 |
2 Nippon Chemiphar Corporate Report 2023
Sale of generic drugs2
2010
Notes 1. Sales are presented on a consolidated basis since FY1999.
2. We have disclosed sales of generic drugs since FY2004.
20152020 2022
Nippon Chemiphar Corporate Report 2023 3
Value Creation Strategy
Nippon Chemiphar Group's Value Creation Strategy
Business Model
Market demands
Generic drugs that
lead to lightened burdens on patients and public nance
Creation of breakthrough drugs
Manufacture and stable supply of high-quality pharmaceutical drugs
Greater safety of, and convenience in, pharmaceutical drugs
Input*
Human capital
Employees: 872 people (consolidated)
Financial capital
Consolidated net assets: ¥48 billion
Intellectual capital
R&D: ¥2 billion
Manufactured capital
Factories: Japan, abroad
Social and relationship capital
Work with business partners
Natural capital
Pharmaceutical Products Segment
Others Segment
Pharmaceutical products
Generic drugs (pp.11,12)
- Develop value-added formulations that reect medical needs
- Improve quality assurance and our stable supply system
Proprietary products and new drugs (p.10)
- Expand product lineup by in-licensing items from other companies
Alkalizer (p.13)
- Utilize cultivated technologies and expertise to expand application to conditions other than hyperuricemia
In-house drug discovery and development (p.14)
- Develop and out-license items in our internal development pipeline
- Improve development accuracy through use of new technologies and collaboration with external partners
- Expand into new elds by in-licensing promising pipeline products
Diagnostics (p.17)
- Expand the use of DropScreen, create additional reagents
Overseas expansion of pharma ceutical products business overseas (p.18)
- Reduce manufacturing costs by using our Vietnam factory
- Market abroad products made at the Vietnam factory and preempt overseas developments
- Develop pharmaceutical products and clinical diagnostics abroad
Contracted testing (p.10)
- Use a comprehensive one-stop system to provide total support for non-clinical and clinical trials
Strengths
Integrated system to develop, manufacture, and market generic drugs
Factories in Japan and abroad attain advanced manufacturing technology, become cost competitive
Broader information delivery, data gathering resulting from marketing new drugs
Expertise in alkalizers and citrate preparations
Venture-based drug discovery research targeting early out-licensing to domestic and overseas companies
Adoption of new technologies, collaboration with specialists in various disciplines and elds
Offered value
Increased patient QOL
Extended healthy life spans
Reduced patient burdens, limited healthcare expenses
Employees nd
fulllment in personal growth through work
Stable, sustainable shareholder returns
Safeguarding of global environment
Community
Energy use (crude oil equivalent) 6,524kl
- Quality assurance and stable supply (p.12) • Corporate governance (p. 26)
- Compliance and risk management (p. 29) • Initiatives to reduce environmental impact (p. 20)
- Contribution to local communities (p. 23)
Our corporate philosophy, principles of conduct, support for employee abilities, and training system (p. 24)
involvement
* Based on the IIRC framework for | Sustainable growth in corporate value through value creation cycle |
FY2022 results. | |
4 Nippon Chemiphar Corporate Report 2023 | Nippon Chemiphar Corporate Report 2023 5 |
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Nippon Chemiphar Co. Ltd. published this content on 25 August 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 25 August 2023 01:55:04 UTC.