Plain-text annual report
Astellas Pharma Inc.
2-5-1, Nihonbashi-Honcho,
Chuo-ku, Tokyo 103-8411, Japan
https://www.astellas.com/en/
Please direct inquiries concerning Annual Report 2018 to:
Astellas Pharma Inc. Corporate Communications
TEL: +81-3-3244-3202
FAX: +81-3-5201-7473
Issued in September 2018
For the Year Ended March 31, 2018
ANNUAL REPORT 2018
Contents
Business Philosophy/Editorial Policy
CEO Message
Corporate Strategy and
Corporate Governance
Astellas’ Value Creation Process
Mid-Term Strategy
Feature: Focus Area Approach
CFO Message
CSR-Based Management
Contribution to the Sustainable Development Goals
Corporate Governance
Risk Management
Directors
Interview with an Outside Director
Business Review
Executive Committee
Executive Messages
Research and Development
Research and Development
R&D Topics during the Year
CSR Activities in Research and Development
Manufacturing to Sales and Procurement
Overview of Main Products
CSR Activities from Manufacturing to Sales
2
3
8
9
11
15
17
19
22
23
28
29
31
34
35
36
39
43
47
49
53
CEO Message
Interview with an
Outside Director
The CEO explains the management strategy
for sustainable growth.
P3
An outside Director talks about the effectiveness
of the Board of Directors and other topics.
P31
Mid-Term Strategy/
Feature: Focus
Area Approach
P11
Top management explains each strategy.
Executive
Messages
P36
Business Philosophy
Raison D’être
Contribute toward improving the
health of people around the world
through the provision of innovative and
reliable pharmaceutical products
Mission
Sustainable enhancement of
enterprise value
For details, please visit the following website:
Web
https://www.astellas.com/jp/en/
about/philosophy
Editorial Policy
To enable deeper stakeholder understanding of Astellas’ efforts to
continue to create value for sustainable growth, the Company has
published this annual report as an integrated report.
In this report, we have attempted to provide disclosure while
taking note of the Guiding Principles and Content Elements of the
international integrated reporting framework of the International
Integrated Reporting Council (IIRC). We have also referred to GRI
Standards* published by the Global Reporting Initiative and
Environmental Reporting Guidelines (Fiscal Year 2012 Version) issued
by Japan’s Ministry of the Environment.
In creating the report, we have sought to make an effective tool
for communicating with our many stakeholders. We have therefore
used charts and photographs, and endeavored to use plain language
that is easy to read.
Astellas has adopted the International Financial Reporting
Standards (IFRS), effective from fiscal 2013. Information in this report is
based on IFRS unless otherwise indicated. The monetary amounts
stated in this report have been rounded off to the nearest unit, and
the number of shares has been rounded down to the nearest whole
number. Unless otherwise noted, percentage changes and other
ratios involving the previous fiscal year have been rounded off to the
second decimal place.
* For the GRI Standards Content Index, please visit the following website:
https://www.astellas.com/jp/en/investors/ir-library/annual-report
Scope of the Report
Period covered
Fiscal 2017 (April 1, 2017 - March 31, 2018)
* As much as possible, we have used the latest information available at the time of
* The period and scope of coverage may vary depending on the subject. We have
noted each such case individually.
* The figures indicated in the field of Environment represent the results for fiscal 2017
(April 1, 2017 to March 31, 2018) in Japan and the calendar year 2017 (January 1 to
December 31, 2017) for overseas operations as a combined total.
Organizations covered
Astellas Pharma Inc. and its consolidated subsidiaries in Japan and overseas (referred to
* The Americas includes North America and Latin America, and EMEA includes Europe,
the Middle East, and Africa.
* In the field of Environment, this report covers all the business sites in Japan and
production sites overseas that are subject to the former Environmental Action Plan, and
it covers all the business sites that are subject to the new Environmental Action Plan.
Note: In the information about pharmaceutical products in this report, market size,
market share and product ranking are sourced from the following data.
Copyright © 2018 IQVIA.
Calculated based on IQVIA MIDAS 2018Q1 MAT
Reprinted with permission
statements are based on management’s current assumptions and beliefs in
publication.
Cautionary Note
In this annual report, statements made with respect to current plans, estimates,
strategies and beliefs and other statements that are not historical facts are
forward-looking statements about the future performance of Astellas. These
light of the information currently available to it and involve known and
unknown risks and uncertainties. A number of factors could cause actual results
to differ materially from those discussed in the forward-looking statements.
Such factors include, but are not limited to: (i) changes in general economic
conditions and in laws and regulations relating to pharmaceutical markets, (ii)
the inability of Astellas to market existing and new products effectively, (v) the
inability of Astellas to continue to effectively research and develop products
accepted by customers in highly competitive markets, and (vi) infringements of
Astellas’ intellectual property rights by third parties. Information about
pharmaceutical products (including products currently in development) which
is included in this annual report is not intended to constitute an advertisement
or medical advice.
currency exchange rate fluctuations, (iii) delays in new product launches, (iv)
in the report as “Astellas”)
Improvement in the Quality and Efficiency of Operations
55
56
59
Recent Initiatives
Our People, Our Organization
Ethics and Compliance
We introduce the strategy and policies of
the new mid-term strategic plan.
Access to Health
Social Contribution
Environmental Preservation
Stakeholder Engagement
Financial Information and Data
Financial Summary
Financial Review
Consolidated Financial Statements
Notes to Consolidated Financial Statements
Independent Auditor’s Report
Investor Information
Corporate Data/Principal Subsidiaries and Affiliates
1
63
67
69
73
74
75
77
86
91
152
153
154
Directors
We introduce Directors under the new
management system.
P29
Astellas Pharma Inc. ANNUAL REPORT 2018 Contents
Business Philosophy/Editorial Policy
CEO Message
Corporate Strategy and
Corporate Governance
Astellas’ Value Creation Process
Mid-Term Strategy
Feature: Focus Area Approach
CFO Message
CSR-Based Management
Corporate Governance
Risk Management
Directors
Interview with an Outside Director
Business Review
Executive Committee
Executive Messages
Research and Development
Research and Development
R&D Topics during the Year
CSR Activities in Research and Development
Manufacturing to Sales and Procurement
Overview of Main Products
CSR Activities from Manufacturing to Sales
Recent Initiatives
Our People, Our Organization
Ethics and Compliance
Access to Health
Social Contribution
Environmental Preservation
Stakeholder Engagement
Financial Information and Data
Financial Summary
Financial Review
Consolidated Financial Statements
Notes to Consolidated Financial Statements
Independent Auditor’s Report
Investor Information
Corporate Data/Principal Subsidiaries and Affiliates
2
3
8
9
11
15
17
19
22
23
28
29
31
39
43
47
49
53
55
56
59
63
67
69
73
34
35
36
74
75
77
86
91
152
153
154
Contribution to the Sustainable Development Goals
CEO Message
Interview with an
Outside Director
The CEO explains the management strategy
for sustainable growth.
P3
An outside Director talks about the effectiveness
of the Board of Directors and other topics.
P31
Improvement in the Quality and Efficiency of Operations
We introduce the strategy and policies of
the new mid-term strategic plan.
Top management explains each strategy.
Mid-Term Strategy/
Feature: Focus
Area Approach
P11
Executive
Messages
P36
Cautionary Note
In this annual report, statements made with respect to current plans, estimates,
strategies and beliefs and other statements that are not historical facts are
forward-looking statements about the future performance of Astellas. These
Business Philosophy
Raison D’être
Contribute toward improving the
health of people around the world
through the provision of innovative and
reliable pharmaceutical products
Mission
Sustainable enhancement of
enterprise value
For details, please visit the following website:
Web
https://www.astellas.com/jp/en/
about/philosophy
Editorial Policy
To enable deeper stakeholder understanding of Astellas’ efforts to
continue to create value for sustainable growth, the Company has
published this annual report as an integrated report.
In this report, we have attempted to provide disclosure while
taking note of the Guiding Principles and Content Elements of the
international integrated reporting framework of the International
Integrated Reporting Council (IIRC). We have also referred to GRI
Standards* published by the Global Reporting Initiative and
Environmental Reporting Guidelines (Fiscal Year 2012 Version) issued
by Japan’s Ministry of the Environment.
In creating the report, we have sought to make an effective tool
for communicating with our many stakeholders. We have therefore
used charts and photographs, and endeavored to use plain language
that is easy to read.
Astellas has adopted the International Financial Reporting
Standards (IFRS), effective from fiscal 2013. Information in this report is
based on IFRS unless otherwise indicated. The monetary amounts
stated in this report have been rounded off to the nearest unit, and
the number of shares has been rounded down to the nearest whole
number. Unless otherwise noted, percentage changes and other
ratios involving the previous fiscal year have been rounded off to the
second decimal place.
* For the GRI Standards Content Index, please visit the following website:
https://www.astellas.com/jp/en/investors/ir-library/annual-report
Scope of the Report
Period covered
Fiscal 2017 (April 1, 2017 - March 31, 2018)
* As much as possible, we have used the latest information available at the time of
Directors
We introduce Directors under the new
management system.
P29
statements are based on management’s current assumptions and beliefs in
publication.
light of the information currently available to it and involve known and
unknown risks and uncertainties. A number of factors could cause actual results
to differ materially from those discussed in the forward-looking statements.
Such factors include, but are not limited to: (i) changes in general economic
conditions and in laws and regulations relating to pharmaceutical markets, (ii)
currency exchange rate fluctuations, (iii) delays in new product launches, (iv)
the inability of Astellas to market existing and new products effectively, (v) the
inability of Astellas to continue to effectively research and develop products
accepted by customers in highly competitive markets, and (vi) infringements of
Astellas’ intellectual property rights by third parties. Information about
pharmaceutical products (including products currently in development) which
is included in this annual report is not intended to constitute an advertisement
or medical advice.
* The period and scope of coverage may vary depending on the subject. We have
noted each such case individually.
* The figures indicated in the field of Environment represent the results for fiscal 2017
(April 1, 2017 to March 31, 2018) in Japan and the calendar year 2017 (January 1 to
December 31, 2017) for overseas operations as a combined total.
Organizations covered
Astellas Pharma Inc. and its consolidated subsidiaries in Japan and overseas (referred to
in the report as “Astellas”)
* The Americas includes North America and Latin America, and EMEA includes Europe,
the Middle East, and Africa.
* In the field of Environment, this report covers all the business sites in Japan and
production sites overseas that are subject to the former Environmental Action Plan, and
it covers all the business sites that are subject to the new Environmental Action Plan.
Note: In the information about pharmaceutical products in this report, market size,
market share and product ranking are sourced from the following data.
Copyright © 2018 IQVIA.
Calculated based on IQVIA MIDAS 2018Q1 MAT
Reprinted with permission
2
Astellas Pharma Inc. ANNUAL REPORT 2018 CEO Message
3
Astellas Pharma Inc. ANNUAL REPORT 2018
Kenji Yasukawa
Representative Director,
President and CEO
We will achieve sustainable growth by producing
medical solutions that provide VALUE to patients.
Astellas’ Evolution to Realize Its VISION
Driving Transformation to Overcome the Patent Cliff and Achieve Sustainable Growth
In the next few years, Astellas will face the expiration of patents for several major
products. I believe that the main responsibility handed to me as the new President
and CEO of Astellas is to overcome the impact on business performance due to the
expiration of patents for these products and return Astellas to a growth trajectory.
The patent cliff is an issue that we cannot avoid as long as we remain specialized in
the innovative drug business. Under these conditions, in order for Astellas to
achieve sustainable growth, it will be crucial for us to continuously create VALUE by
seeing changes in the environment as opportunities and driving evolution. In fiscal
2018, we launched a new strategic plan. By steadily executing the plan, we will
seek to return Astellas to a trend of medium- to long-term core operating profit
growth after reaching a low point in fiscal 2019.
Continuously Create VALUE by Accurately Capturing Changes in the Environment
The business environment surrounding Astellas is changing at unprecedented
speed. Changes in the environment that will have a negative impact on Astellas
include higher hurdles for obtaining new drug approval and receiving insurance
reimbursement, as well as increased pressure to reduce medical expenditures
through measures such as reducing drug prices. Meanwhile, some changes in the
environment will be positive for Astellas. Examples include the enhancement and
expansion of systems to more quickly evaluate innovation, such as the priority
review for new drugs, and an increase in modalities that can be applied to drug
discovery in step with advances in science and technology. In addition, progress
on digital technologies and engineering technologies will spur integration with
different industries and provide new medical solutions for patients. In anticipation
of these changes in the business environment, we will create medical solutions
that leverage innovative medicines and Astellas’ strengths. Moreover, we will
continuously identify business opportunities from many different perspectives.
Creating New Assets Based on the Focus Area Approach
Ever since I was appointed as Chief Strategy Officer (CSTO) in 2012, I have been
involved in the formulation and execution of corporate strategy from medium- and
long-term perspectives and promoting reforms in order to achieve Astellas’
sustainable growth. When I was appointed as CSTO, we had adopted the “Global
Reference Mid-Term Strategy
Feature: Focus
Area Approach
P11
P15
4
Astellas Pharma Inc. ANNUAL REPORT 2018 Category Leader”* (GCL) model. Under this business model, we sought to establish
a competitive edge in key therapeutic areas such as urology, transplantation and
immunology and inflammation. It is certainly true that this business model was
instrumental in creating many products that have supported Astellas to this day.
These achievements notwithstanding, the GCL model had kept Astellas narrowly
focused on the same areas even after it had become difficult to create medicines
that would surpass its existing drugs in those same areas. This made it difficult for
Astellas to explore new opportunities. In addition, we had suffered setbacks such
as missing out on valuable opportunities to make use of external resources due to
our insistence on doing everything in-house. In order to put Astellas on a
sustainable growth path, we needed to extensively revise the R&D strategy we had
formulated based on the GCL model. As our first step, we decided to reform
Astellas’ research system in May 2013. Guided by the 3B philosophy of “Best
Science, Best Talent, and Best Place,” we developed a framework focused on
proactively gaining access to external resources. In 2015, we formulated a new
VISION, and shifted from our traditional approach of developing drugs only in a
limited number of therapeutic areas to the new “Focus Area” approach of conducting
drug discovery from multiple perspectives, irrespective of therapeutic area. Under
the Focus Area approach, we will seek to understand the latest biology and
intensively invest in areas backed by effective modalities for utilizing the latest
biology. By doing so, we will build a portfolio where there is a high probability of
success and where we can establish competitive superiority. This Focus Area
approach is the foundation of Astellas’ new R&D strategy. We have started to
develop new assets based on the Focus Area approach including new technologies
and modalities such as next-generation vaccines and cell therapy. These assets,
which had previously been in the upstream research stage of the VALUE chain,
have steadily advanced as a result of the activities of Strategic Plan 2015-2017, and
some of those assets have now entered the development phase. To ensure that the
Focus Area approach is implemented through to the downstream stages of our
VALUE chain all at once, we have embraced “Evolving How We Create VALUE – With
Focus Area Approach –” as one of the three strategic goals of the new Strategic
Plan 2018 formulated this year. We have been making a Company-wide effort to
drive the Focus Area approach forward. At the same time, we have identified the
organizational capabilities that will be needed to push ahead with the Focus Area
approach and have started taking steps to strengthen those capabilities.
Strategic Plan 2018
Strategic Plan 2018, a Clear Roadmap for Realizing Our VISION
With Strategic Plan 2018, we first clarified what we mean by “VALUE for patients”
within our VISION and then presented a common definition of VALUE for all
members of Astellas (please refer to the formula on the next page). In essence, our
activities can be summarized as maximizing the “Outcomes that matter to patients,”
the numerator of the formula, and minimizing the “Cost to the healthcare system
of delivering those outcomes,” the denominator of the formula. By gaining a true
5
* A business model for establishing competitive
advantage by creating medicines with innovative
VALUE and delivering them to patients in
therapeutic areas with high unmet medical needs,
covering several areas such as urology,
immunology and oncology.
Reference Mid-Term Strategy
P11
Feature: Focus
Area Approach
P15
P17
CFO Message
Executive Messages P36
Research and
Development
P39
Astellas Pharma Inc. ANNUAL REPORT 2018 Common Definition of VALUE
VALUE* =
Outcomes that matter
to patients
Cost to the healthcare
system of delivering those
outcomes
* Source: BCG “Value in Healthcare” seminar
* POC (Proof of Concept): Verification of clinical
efficacy
understanding of this system and its components, I believe that we will increase
our understanding of all stakeholders in the healthcare sector, beginning with
patients, and identify products and services that will most effectively and efficiently
meet their needs, enabling us to prioritize efforts to deliver those kinds of products
and services.
We then set strategic goals to bridge the gap between where we stand now
and where we are headed.
Strategic Goal 1: Maximizing Product VALUE and Operational Excellence
We will continue to pursue operational excellence to establish competitive
advantages, along with maximizing the VALUE of highly strategic products and
late-stage pipeline projects. By doing so, we will free up funds for growth
investments and direct those funds to the Focus Area approach, a strategic goal
with a longer-term perspective.
We will strive to maximize sales of XTANDI and mirabegron. Concurrently, we
will intensively allocate resources to six key post-POC* pipeline projects
(enzalutamide, gilteritinib, enfortumab vedotin, zolbetuximab, roxadustat, and
fezolinetant), with the aim of obtaining approvals for these products as planned.
In Japan, we will also endeavor to constantly launch and maximize the VALUE of
new products.
By working to improve the quality and efficiency of operations, we will
continue to build a business platform that can flexibly address the fast-changing
business environment.
Strategic Goal 2: Evolving How We Create VALUE – With Focus Area Approach -
We will build a platform through the optimal combination of biology and modality,
with the aim of obtaining POC for early-stage projects. Moreover, we will create
high-quality assets by applying this platform to various diseases with high unmet
medical needs. In addition, in order to acquire outstanding external innovation, we
will strengthen our network with external innovators, through such means as
partnerships with startups and academia, from our base in Boston, U.S.A.
Strategic Goal 3: Developing Rx+ Programs
We have established Rx+ Business Accelerator, a new department to promote the
development of products and services (Rx+ programs) that combine Astellas’
strengths in the prescription pharmaceutical (Rx) business developed over the years
with technologies and knowledge from different fields. Going forward, this
department will play a pivotal role in accelerating the commercialization of specific
Rx+ programs, including collaboration with external partners.
6
Astellas Pharma Inc. ANNUAL REPORT 2018 Human Resource Development, Compliance and CSR
Strengthening People and Organizations Is Essential to VALUE Creation
Reference Our People,
Our Organization
Ethics and
Compliance
P56
P59
To realize our VISION, it is essential to strengthen our management strategies and
the people and organizations that underpin those strategies.
I believe that it is crucial for every employee working at Astellas to take
ownership of their duties based on an understanding of the Astellas Way and our
HR Vision, which defines our aspirations for our human resources and for our
organization, with a view to creating VALUE and earning the trust of society. In
addition, guided by the Astellas Group Code of Conduct, we will undertake
relevant issues in order to continue delivering VALUE to patients and gain the trust
of the public.
Moreover, Astellas is a consistent supporter of the United Nations Global
Compact, and has incorporated and implemented its 10 principles covering the
four fields of human rights, labor, the environment and anti-corruption in its daily
business activities.
To Our Stakeholders
Continuously Produce and Deliver Innovative Medical Solutions
Guided by Astellas’ VISION of turning innovative science into VALUE for patients,
Astellas aims to pursue cutting-edge science to produce medical solutions that
provide VALUE to patients. Moreover, we will achieve sustainable growth by
continuously generating VALUE for patients and society as a whole.
Kenji Yasukawa
Representative Director,
President and CEO
7
Astellas Pharma Inc. ANNUAL REPORT 2018 Corporate Strategy and Corporate Governance
Pursuing Cutting-Edge Science to
Realize Our VISION
Astellas’ VISION is to turn innovative science into value for patients.
Strategic Plan 2018 will serve as a roadmap for realizing this VISION.
In order to realize sustainable growth, we will pursue cutting-edge science and
create medical solutions that will provide value to patients.
8
Astellas Pharma Inc. ANNUAL REPORT 2018 Astellas’ Value Creation Process
Astellas stands on the forefront of healthcare change, turning innovative science into value
for patients. By repeating this cycle continuously, we are pursuing the sustainable growth
of enterprise value.
Corporate Governance
Create innovative new drugs and
medical solutions by leveraging our core
capabilities with a central focus on our innovative
drug business
Focus Areas
View business opportunities
from multiple perspectives
Drivers
Principles of Activity
Core capabilities
Astellas Way
Earning trust from
patients and
other stakeholders
Focus
our resources on
identified areas
Redefine
the focus when appropriate
Expand
into new opportunities
CSR-Based Management
Enhance the sustainability of society and the Company
by fulfilling social responsibility
Innovative
science
Value for
patients
Dialogue
with
stakeholders
Sufficient funds
to create
innovation
Returns to
stakeholders
Generate funds
to sustain
growth
9
Corporate Strategy and Corporate GovernanceAstellas Pharma Inc. ANNUAL REPORT 2018 Corporate Governance
Create innovative new drugs and
medical solutions by leveraging our core
capabilities with a central focus on our innovative
drug business
Focus Areas
View business opportunities
from multiple perspectives
Drivers
Principles of Activity
Core capabilities
Astellas Way
Earning trust from
patients and
other stakeholders
Focus
our resources on
identified areas
Redefine
the focus when appropriate
Expand
into new opportunities
CSR-Based Management
Enhance the sustainability of society and the Company
by fulfilling social responsibility
Innovative
science
Value for
patients
Dialogue
with
stakeholders
Sufficient funds
to create
innovation
Returns to
stakeholders
Generate funds
to sustain
growth
Our Approach to
the Value Creation
Process
Focus Areas
Principles of
Activity
Drivers
Astellas’ raison d’être is to “contribute toward improving the health of people around the world
through the provision of innovative and reliable pharmaceutical products.”
Based on this, we aim to stand on the forefront of healthcare change, turning innovative science
into value for patients. The keys to our success will be our Focus Areas, Principles of Activity, and
Drivers, which describe where we should create value and how we should act to realize that
value. Guided by this approach, we will create innovation with a central focus on the innovative
drug business.
This process originates with advances in science, and Astellas then allocates sufficient funds
and implements measures to satisfy the requests and expectations of stakeholders. By creating
value for patients, through this process, we will generate funds to sustain the next phase of
growth and provide returns to stakeholders.
Astellas will continue to follow this cycle to achieve sustainable growth of enterprise value.
Amid continuing evolution in the healthcare industry, Astellas needs to identify business
opportunities more flexibly and efficiently than ever in order to achieve further growth. We will
define our Focus Areas by adding multiple perspectives to our conventional viewpoint of
therapeutic areas. We will factor in a consideration of new technologies and treatment
approaches, product development feasibility and new possibilities for commercialization, market
trends and changes in pharmaceutical laws and regulations. Our goal is to identify areas of unmet
need and find new business opportunities.
In a fast-changing business environment, it is crucial to have the flexibility to reexamine business
fields as needed—even those that have been carefully selected as opportunities at some point in
the past. Astellas aims to drive further evolution by having all employees remain mindful of the
three-step process of Focus our resources on identified areas, Redefine the focus when appropriate,
and Expand the focus for the next generation of activity, as they carry out their activities.
One of the drivers for Astellas to achieve sustainable growth is its core capabilities, which
constitute the source of its competitive edge. It is vital to carefully identify our essential
capabilities and enhance them until they are among the world’s best. At the same time, when
there are outstanding capabilities outside the Company, we will proactively form partnerships. By
combining optimal capabilities, both internal and external, we enhance our productivity and
creativity to maximize our value creation capabilities. Moreover, in the Astellas Way*, we have
defined a shared set of values to be embraced by all our employees as part of efforts to foster a
corporate culture to help realize our business philosophy. At the same time, we remain
committed to understanding the requests and expectations of a multitude of stakeholders,
including patients, and transforming that understanding into value.
* For details on the Astellas Way, Five Messages for One Astellas—Patient Focus, Ownership, Results, Openness, and Integrity—please
refer to P56.
Astellas’ Currently Identified Core Capabilities
Capability to
create new drugs
Capability to
deliver new drugs
Commercial
presence
Partnership
Operational
foundation
Corporate
Governance
Reference
P23-P27
CSR-Based
Management
Reference
P19-P21
10
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Mid-Term Strategy
Strategic Goals for Sustainable Growth
Strategic
Plan
2018
Strategic Goal
1
Strategic Goal 2
Strategic Goal 3
Maximizing Product VALUE and Operational Excellence
Evolving How We Create VALUE - With Focus Area Approach –
Developing Rx+ Programs
Review of Strategic Plan 2015-2017
Strategic Plan 2018
Under Strategic Plan 2015-2017, we produced solid results on
three strategic priorities: Maximizing product VALUE,
creating innovation and pursuing operational excellence.
With regard to maximizing product VALUE, we made
three major achievements: (1) We increased sales of
XTANDI, along with advancing the development of
expanded indications; (2) We maximized the VALUE of the
OAB franchise by driving early market penetration of
mirabegron (Betanis/Myrbetriq/BETMIGA); and (3) We
continuously launched new products in Japan.
In creating innovation, we produced results in three
major areas: (1) We made steady progress on late-stage
development programs such as gilteritinib, enfortumab
vedotin, and roxadustat; (2) We upgraded and expanded
the pipeline through the acquisition of Ganymed
Pharmaceuticals AG and Ogeda SA; and (3) We advanced
unique development programs that harness diverse
treatment modalities and biology, such as cell therapy, to
the clinical development stage.
In pursuing operational excellence, we transferred our
global dermatology business and long-listed products
manufactured and marketed in Japan. Meanwhile, we
directed investments to priority areas, including
establishing a global management structure.
Basic Policy
In its VISION formulated in 2015, Astellas made a
commitment to stand “on the forefront of healthcare
change to turn innovative science into VALUE for patients.”
Guided by this VISION, Astellas seeks to create medical
solutions that deliver VALUE to patients through the
pursuit of cutting-edge science.
Under Strategic Plan 2018, Astellas will work to
overcome the impact of the expiry of patents for core
products that it will face from 2019 to 2020 to achieve
sustainable growth. To this end, Astellas will strive to
achieve three strategic goals: (1) Generate profit by
maximizing product VALUE and operational excellence,
along with using the funds generated through this process
for (2) Evolving how we create VALUE through the Focus
Area approach. Moreover, Astellas will (3) tackle the
challenge of developing new businesses (Rx+ programs) that
go beyond conventional prescription pharmaceuticals (Rx).
11
Corporate Strategy and Corporate GovernanceAstellas Pharma Inc. ANNUAL REPORT 2018 Fiscal 2020 Financial Guidance
Strategic Goal 1
Indicators
Fiscal 2020 Guidance
Net sales
Fiscal 2017 level
R&D investment
More than ¥200.0 billion
Core operating
profit
Core Operating Profit margin 20%
Core EPS
Exceed Fiscal 2017 level
Core Operating Profit*
2018.3
2019.3
2020.3
2021.3
For illustrative purposes only
* For the definition of financial results on a core basis, please refer to P74.
Financial Guidance for Fiscal 2020
Astellas aims to return to a medium- to long-term core
operating profit growth trend after fiscal 2019.
Net sales in fiscal 2020 are forecast to remain at mostly
the same level as fiscal 2017. Astellas plans to allocate
more than ¥200.0 billion a year to R&D investments for
medium- and long-term growth, after setting clear
priorities for those investments. In order to ensure both a
certain level of profit and adequate R&D investment, we
will thoroughly review the cost structure from a zero-basis,
in addition to maximizing product VALUE. Through these
measures, we are targeting a core operating profit margin
of 20% in fiscal 2020. At the same time, we aim to achieve
core EPS exceeding the fiscal 2017 level by working to
enhance capital efficiency.
Maximizing Product VALUE and Operational
Excellence
Maximizing Product VALUE
Astellas will work to maximize product VALUE by
intensively allocating resources to XTANDI, mirabegron
and six key post-POC pipeline projects.
With regard to XTANDI, particularly its indication for
metastatic castration-resistant prostate cancer, Astellas will
strive to further increase penetration of XTANDI amongst
urologists, along with establishing it as the first choice of
therapy by utilizing extensive data based on the clinical
experience accumulated since its launch. Moreover, we
aim to expand the patient base and duration of therapy for
XTANDI by expanding indications to earlier stages of
prostate cancer.
In the OAB franchise, Astellas will work to mitigate the
impact of the loss of exclusivity of VESIcare by shifting
sales resources to mirabegron. We will continue to educate
the public on mirabegron’s clinical profile featuring a
balance of efficacy and safety, with the aim of expanding
market share.
In addition to maximizing the VALUE of these
products, we will preferentially direct management
resources to six key post-POC pipeline projects in order to
obtain approval of these products as planned and support
growth from fiscal 2020 onward.
Global Sales (March 2018 to March 2021)
XTANDI
CAGR (%)
High single digit
Mirabegron (Betanis/Myrbetriq/BETMIGA)
CAGR (%)
Low teens
Six Key Post-POC Pipeline Projects
• enfortumab vedotin
• enzalutamide (label expansion)
• fezolinetant
• gilteritinib
• zolbetuximab
• roxadustat
12
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Pursuing Operational Excellence
Strategic Goal 2
Astellas will review all activities from a zero-basis from
many different angles, without relying on past precedent.
Specifically, Astellas will preferentially allocate
management resources to functions and activities that
establish its competitive advantage over other companies,
while terminating investment in areas that will not lead to
growth or the establishment of competitiveness. In
addition, Astellas will work to further evolve the operating
model by leveraging cutting-edge technologies such as
robotic process automation (RPA) and artificial intelligence
(AI), and through globalization of organizations and
functions and the standardization of operating processes.
Astellas anticipates an improvement of more than
¥30.0 billion in core operating profit to be generated from
new initiatives in fiscal 2020.
Evolving How We Create VALUE
- With Focus Area Approach -
In order to achieve further growth, Astellas will need to
identify business opportunities even more flexibly and
efficiently than before. With this in mind, in its VISION,
Astellas has established Focus Areas that reflect many
different perspectives, without limiting itself to therapeutic
areas, and has set out to find business opportunities in
each of these areas.
Under Strategic Plan 2018, Astellas will evolve how it
creates VALUE from the Therapeutic Area approach to the
Focus Area approach. The goal of the Focus Area approach
is to create innovative pharmaceuticals for diseases with
high unmet medical needs by allocating management
resources to fields that have been carefully narrowed from
many different perspectives, including elucidation of
pathophysiology through advances in science (biology)
and the utilization of treatment modalities and
Our Approach to Operational Excellence
Focus Area Approach (Research to Pre-POC)
Capability
Focus on differentiating
capabilities and competitive
necessities
Operating model
evolution
Review operational process
and organization
Biology
Well-characterized
pathophysiology
Modality/
Technology
Versatile
technology
• Improve quality/
efficiency of operations
• Optimize cost
structure
Technological excellence
Utilize cutting-edge
technology such as process
automation, AI
Priority/Competitiveness
Resource allocation to
functions and activities driving
competitive advantage
Disease
Disease with high unmet medical needs
13
Corporate Strategy and Corporate GovernanceAstellas Pharma Inc. ANNUAL REPORT 2018 technologies (modality/technology). Astellas will identify
unique combinations of biology and modality/technology
based on emerging science and translate this into
innovative solutions for patients with high unmet medical
needs through continuous efforts to ensure development
progress and market access. By doing so, Astellas will
continuously identify innovative new drug candidates as it
upgrades and expands its development pipeline.
Strategic Goal 3
Developing Rx+ Programs
In addition to growth in the prescription pharmaceutical
(Rx) business, Astellas recognizes that it is crucial to
constantly look for new business opportunities where it
can leverage its current strengths.
In order to promote the Focus Area approach, Astellas
Mindful of this, Astellas has commenced initiatives to
will establish research sites that incorporate outstanding
external innovation and bolster collaboration with
biotechnology startups and academia, based on the
concepts of Best Science, Best Talent and Best Place. At the
same time, Astellas will also focus on developing human
resources with a discerning eye for innovative science.
Astellas will generate high-quality programs by
promoting the Focus Area approach, which seeks to drive
innovation by flexibly combining biology, modality/
technology and disease, while constantly embracing
innovative science.
develop Rx+ programs. Rx+ programs refer to new
products and services that create new revenue streams
separate from Astellas’ core prescription pharmaceutical
products. Rx+ programs will be developed by combining
Astellas’ expertise and experience in medical drugs with
technology and knowledge from different fields.
Through the Rx+ programs, Astellas will create new
treatment solutions that replace conventional therapy or
add new VALUE, and medical solutions that contribute
positively to the entire patient journey, encompassing
prevention, diagnosis, treatment and post-treatment care
and management.
Pipeline Assets Based on the Focus Area Approach
Healthcare Solutions Beyond Rx Business
Biology
Modality/
Technology
Disease
Cancer
immunology
Antibody
Oncology
ASIM*
New
generation
vaccine
Immunology
Regeneration
Cell therapy
Ophthalmology
Mitochondria
Small
molecule
Muscle
disease
Examples
(clinical)
ASP8374/
PTZ-201
(Cancer)
ASP4070
(JP red cedar pollen allergy)
ASP0892
(Peanut allergy)
ASP7317
(Dry AMD*)
MA-0211
(Duchenne muscular
dystrophy)
Gene therapy
P
a
t
i
e
n
t
j
o
u
r
n
e
y
T
r
e
a
t
m
e
n
t
s
u
p
p
o
r
t
D
i
a
g
n
o
s
i
s
/
P
r
e
v
e
n
t
i
o
n
/
T
r
e
a
t
m
e
n
t
+ M edical solutio ns
+ Treatment solutions
* ASIM: Antigen-specific immuno-modulation, AMD: Age-related macular degeneration
Healthcare technology
Medical drugs
New technology
14
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018
Feature
Focus Area Approach
Initiatives from Research to POC*
Case
1
Advancing Cell Therapy
Astellas began its drug discovery initiatives through an approach combining the biology of
regeneration and the modality of cell therapy, applying it to explore treatments in the field of
ophthalmic diseases. We will expand this approach to other diseases in the future.
* Proof of Concept (POC): Verification of clinical efficacy
Commenced R&D in Ophthalmology
Introducing New Modalities to Expand
Target Diseases
If cells abandon their original functions resulting in
diseases, administering cells could be a treatment. In
focusing on regeneration as biology closely related to
pathophysiology and treatment, Astellas has commenced
R&D based on the new modality of cell therapy.
Astellas is first trying to apply this approach to the
field of ophthalmology. In theory, the field of
ophthalmology is suitable for cell therapy due to three
main reasons: (1) The loss or dysfunction of cells is clearly
connected with the resulting diseases, (2) The small size of
eye tissue requires transfusion of only a relatively small
number of cells, and (3) The intraocular region is isolated
from immune reactions of the body. Notably, there are
significant unmet medical needs for the treatment of
diseases in the posterior segment of the eye, which can
lead to vision loss. Currently, Astellas is developing
ASP7317 for dry age-related macular degeneration (AMD)
and Stargardt’s macular degeneration. ASP7317 is a project
derived from Ocata Therapeutics, Inc., which was acquired
in 2015. ASP7317 is currently in the Phase 2 stage.
Expansion of the Focus Area Approach
Ocata Therapeutics was one of the world’s frontrunners in
the fundamental technology for establishing fully
differentiated cells from pluripotent stem cells. Ocata
Therapeutics has now changed its name to the Astellas
Institute for Regenerative Medicine (AIRM) with further
strengthened capabilities. We also plan to invest in
manufacturing facilities at AIRM in anticipation of the
commercialization of cell therapy.
Moving forward, Astellas will also expand its approach
of combining regeneration and cell therapy to fields
beyond ophthalmology. In the course of expanding into
other therapeutic areas, one challenge will be to suppress
the immunological rejection of transplanted cells. To
resolve this issue, Astellas acquired Universal Cells, Inc. in
February 2018. Universal Cells’ proprietary Universal Donor
Cell technology uses genome editing to prevent the
expression of polymorphic human leukocyte antigen
(HLA) molecules, thereby suppressing immune reactions
caused by mismatched HLA at transplantation. By
combining the technologies of AIRM and Universal Cells,
Astellas will expand the scope of cell therapy from eye
diseases to a variety of other diseases.
Biology
Modality/Technology
Disease
Cell therapy
Cell therapy
Immuno-related
diseases/
others
Expansion
Ophthalmology
Regeneration
Ophthalmology
Regeneration
15
Corporate Strategy and Corporate GovernanceAstellas Pharma Inc. ANNUAL REPORT 2018 Case
2
Tackling the Challenge of Muscle Diseases
Astellas is pursuing drug discovery in the field of muscle diseases based on a variety of approaches,
beginning with improving the function of skeletal muscle by activating molecular motors and mitochondria.
Targeting Muscle Diseases in Collaboration
with Biopharmaceutical Companies
Recent scientific advances have identified new targets for
drug development in the muscle disease area. It is also a
field with high unmet medical needs. Aiming to alleviate
declines in skeletal muscle function in muscle diseases,
Astellas first focused on the approach of strengthening the
function of molecular motors involved in muscle
contractions from a perspective of biology.
To advance R&D with this approach, Astellas is
collaborating with Cytokinetics, Inc., a U.S.-based
biopharmaceutical company that has been developing a
compound called reldesemtiv. Reldesemtiv is expected to
improve muscle contraction ability by activating troponin,
which constitutes molecular motors in fast skeletal muscle.
Currently, reldesemtiv is in Phase 2 clinical trials for spinal
muscular atrophy (SMA), amyotrophic lateral sclerosis (ALS)
and chronic obstructive pulmonary disease (COPD). A
Phase 1b study in elderly subjects with limited mobility is
also under way.
Expansion to Mitochondria-Related Diseases
In the course of advancing research in muscle diseases,
Astellas has also focused on mitochondria function.
Mitochondria are vitally important organelles responsible
for energy metabolism. They are found in almost every cell
in the human body. Mitochondrial abnormalities are
believed to play a role in various symptoms and diseases,
such as muscle dysfunction, metabolic disorders,
neurodegeneration, and visual disorders, as well as cancer,
cardiovascular disorders, and renal failure.
In 2013, Astellas entered into an R&D collaboration
with Mitokyne, Inc. (currently Mitobridge, Inc.), which
conducts cutting-edge mitochondria research. MA-0211
for Duchenne muscular dystrophy and MA-0217 for acute
kidney injury reached the Phase 1 clinical trial stage in only
three years. In January 2018, Astellas acquired Mitobridge,
which had generated many projects in the preclinical
stage and achieved extensive results. Looking ahead,
Astellas will accelerate R&D in mitochondria-related
diseases, with the aim of delivering innovative new drugs
to patients as early as possible.
Expansion of Focus Area Approach
Muscle disease
Muscle disease
Mitochondria
Muscle disease
Mitochondria
Expansion
Expansion
Molecular
motor
Small molecule
Molecular
motor
Small molecule
Molecular
motor
Small molecule
Kidney disease/
others
16
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 CFO Message
We will thoroughly review all activities
from a zero-basis to strategically allocate
our investments in growth opportunities
and to improve core operating profit by
more than ¥30.0 billion in fiscal 2020.
Chikashi Takeda Chief Financial Officer
Pursuing Operational Excellence
As with its previous three-year strategic plan, Astellas has
adopted “maximizing operational excellence” as a crucial
strategic theme for Strategic Plan 2018.
Together with taking steps to address various themes,
we will also review all activities from a zero-basis. Activities
that were assessed positively in the past are still subject to
changes in the business environment and various
assumptions underlying each of those activities. For
example, we will strengthen activities and capabilities that
differentiate Astellas from its competitors and lead to a
competitive advantage. For activities that do not produce
those results, we will explore options such as cancelling or
outsourcing activities. In order to maximize effectiveness
and efficiency, we will comprehensively review the
operational process and organization as well as various
rules and other operational aspects.
We will maximize the use of the latest technologies
such as real-world data (RWD), robotic process automation
(RPA), and artificial intelligence (AI). Concurrently, we
will enhance our capabilities to take full advantage of
those technologies.
In order to generate profits as we invest in growth, we
will need to strictly prioritize our activities and allocate
17
management resources accordingly. Therefore, we will
manage our activities even more strictly than before.
Let me present several recent examples of the
numerous initiatives we have undertaken so far. We have
reviewed Astellas’ essential capabilities, organization and
other attributes, with a focus on Japan and Europe, and
have conducted a sizable reorganization of various
functions. We have also been making preparations to
develop a globally unified operating model centered on
administrative functions. Naturally, this encompasses the
use of technology. We have made initial investments and
incurred expenses upon implementing these initiatives.
However, over the medium and long terms, these
initiatives will enable us to reap even greater benefits at a
lower cost than now.
We have rigorously adopted a policy of preferentially
allocating management resources to products in a growth
phase and the key post-POC pipeline, as well as areas that
offer prospects for future growth, in conjunction with
reducing the allocation of management resources to areas
such as products that have reached a mature phase. We
have devised our plan for fiscal 2018 based on this blueprint.
Guided by Strategic Plan 2018, we expect to deliver an
improvement in core operating profit of over ¥30.0 billion
in fiscal 2020 through future initiatives focused on raising
the efficiency of operations.
Corporate Strategy and Corporate GovernanceAstellas Pharma Inc. ANNUAL REPORT 2018 Capital Allocation
I believe that our shareholders expect us to enhance
Astellas’ corporate value by investing in business
opportunities. We will continue to preferentially allocate
resources to business investments. At the same time, we
are well aware that dividends are another important
matter of concern for shareholders. With this in mind, we
will strive to steadily increase dividends. During the three-
year period from fiscal 2018, particularly fiscal 2019, our
earnings performance is expected to come under pressure
due to patent expiry of major products. However, we will
seek to continuously increase dividends. Moreover, we will
implement share buybacks flexibly as the occasion arises,
with the primary goal of enhancing capital efficiency and
earnings per share. In May 2018 , we announced plans to
conduct our largest-ever share buyback by acquiring up to
¥100.0 billion of our own shares.
Business Investments and Shareholder Returns
Business investments
Shareholder returns
Top priority is investment
for business growth
Aiming for steady dividend
increase during
FY2018-FY2020
Flexible share buybacks
Details of Shareholder Returns
Dividends per share*1 (left axis)
Profit for the year*2 (right axis)
(yen)
40
30
20
10
0
(billion yen)
(billion yen)
250
200
150
100
50
0
36
38
2006.3
2007.3 2008.3 2009.3 2010.3 2011.3 2012.3 2013.3 2014.3 2015.3 2016.3 2017.3
2018.3
2019.3
(Forecast)
Total dividends
39.3
42.3
55.2
56.9
58.2
57.7
57.7
59.4
60.6
66.0
68.5
71.3
72.1
75.1
Acquisition of
own shares
46.2
219.9
81.8
123.4
27.0
Total return ratio (%)
82
200
77
106
70
–
85
–
74
49.4
30.0
58.2
119.3
91.4
129.9
118
100
92
97
74
123
*1 The Company conducted a stock split of common stock at a ratio of 5 for 1 with an effective date of April 1, 2014. Figures are calculated based on the number of shares
issued after the stock split (excluding treasury shares) on the assumption that the stock split was conducted at the beginning of fiscal 2005.
*2 From fiscal 2013, figures are in accordance with International Financial Reporting Standards (IFRS).
18
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 CSR-Based Management
Create and protect value for both Astellas and society by fulfilling social responsibility
Astellas’ Interaction with Society
Enhance
the sustainability
of society
CSR-based
management
Society
Astellas
Trust from society
Enhance
the sustainability
of Astellas
Raison D’être
Contribute toward improving the health of people
around the world through the provision of
innovative and reliable pharmaceutical products
Mission
Sustainable enhancement
of enterprise value
Fulfilling Our Social Responsibility Means
Realizing Our Business Philosophy
Value Creation and Protection for Both Astellas
and Society
Astellas recognizes its corporate social responsibility (CSR)
is its responsibility for any impacts that its decisions and
business activities have on society and the environment.
Astellas is helping to enhance the sustainability of
society by fulfilling its social responsibilities as a
pharmaceutical company by, for example, providing
pharmaceutical products that satisfy unmet medical
needs. We believe that we earn trust from society for both
the Company and our products as a result of these
activities, and that this trust enhances our sustainability.
This positive cycle will lead to the realization of our
mission, “sustainable enhancement of enterprise value”
through fulfillment of our raison d’être “contribute toward
improving the health of people around the world through
the provision of innovative and reliable pharmaceutical
products.” For Astellas, fulfilling our social responsibility
means realizing our business philosophy.
CSR for Astellas has two aspects: value creation and value
protection.
Value Creation Through its business activities, Astellas is
creating value for society by addressing social issues such
as unmet medical needs, and by returning profits to
stakeholders. By reinvesting the profit we gain through
business activities, we strengthen our capabilities in
research and development. In addition, by winning trust
from government and business partners in each country,
we create new business opportunities. This process creates
value for Astellas.
Value Protection Astellas seeks to preserve biodiversity
by reducing the environmental burden associated with its
business activities, while maintaining social order by
ensuring compliance and preventing corruption. These
activities will lead to the protection of value for society. In
addition, Astellas protects its enterprise value by
mitigating reputation risk and elevating its corporate
brand through these activities.
19
Corporate Strategy and Corporate GovernanceAstellas Pharma Inc. ANNUAL REPORT 2018 Updating of the CSR Materiality Matrix
Astellas discloses its CSR Materiality Matrix (see next page)
that identifies and prioritizes material issues in CSR activities,
and uses this materiality matrix to guide its CSR activities.
In fiscal 2017, we reviewed the CSR Materiality Matrix in full
in order to respond to the changing needs of society.
In conducting the review, we spoke with diverse
stakeholders (investors, patient groups, doctors,
employees, consultants, and academics) in Japan and
overseas; examined their feedbacks from a variety of
perspectives; deliberated on and approved matters at the
CSR Committee*, Executive Committee (EC) and Board of
Directors; and decided to update the CSR Materiality Matrix.
In this update, we have newly added “tax compliance”
and “environmental impacts of pharmaceuticals” in order
to respond to the needs of society. Moreover, based on
their growing importance, we have moved “customer
satisfaction” and “protection of personal and confidential
information” to the upper-right quadrant. We have also
renamed or combined material issues in order to properly
express each material issue.
* The CSR Committee discusses policies and plans for important activities in fulfilling
the Company’s social responsibilities. The committee is chaired by the Chief
Administrative Officer & Chief Ethics & Compliance Officer, and comprises the
heads of the relevant divisions in Japan, the Americas, EMEA and Asia & Oceania.
Activities and Monitoring of Material Issues
In Astellas, divisions related to each material issue draw up
annual and medium-term CSR-focused action plans, and
work to resolve the material issues. The CSR Committee
monitors activities and results, along with the status of
progress made.
Determination Process of Material Issues in CSR Activities
Step1
Identify Issues
Astellas’ material issues are identified with reference to various principles and guidelines (such
as ISO 26000, the UN Global Compact’s ten principles, Sustainable Development Goals and the
SASB* Materiality Map), communications with stakeholders, and evaluation items for socially
responsible investment (SRI) indices, etc.
* SASB: A U.S. non-profit organization exploring industry-specific standards for corporate sustainability disclosure. SASB has
prepared industry-specific materiality maps by evaluating the materiality of sustainability topics.
Step2
Step3
Prioritize
We will prioritize Astellas’ material issues from the dual perspectives of their societal
significance and their relevance to our business.
Review
• Dialogue with stakeholders
• Deliberating on and approving
matters at the CSR Committee,
EC and Board of Directors
Astellas’ material issues will be periodically reviewed and verified. They will be modified
depending on the attainment level of initiatives implemented and/or any changes in the
needs of society. In conducting this review, we spoke with stakeholders in Japan and overseas,
examined the review, and decided to update the CSR Materiality Matrix after deliberating on
and approving matters at the CSR Committee, EC and Board of Directors.
20
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Material Issues in CSR Activities
(CSR Materiality Matrix)
For more details, please refer to
Web
https://www.astellas.com/en/sustainability/materiality
Important
Very Important
Most Important
• Water
management
• Climate
change and
energy
V
e
r
y
H
g
h
i
S
o
c
i
e
t
a
l
i
S
g
n
i
f
i
c
a
n
c
e
• Biodiversity
• Philanthropic
community
support
i
H
g
h
High
• CSR procurement
• Development of innovative products and
• Continuous stable supply
• Stakeholder engagement
• Transparency of corporate
activities
• Tax compliance
• Human rights in labor
medical solutions
• Access to Health*
• Responsible R&D
• Responsible marketing and ethical
advertising
• Product pricing
• Proper use of products
• Product quality assurance and
product safety
• Anti-counterfeit
• Diversity and inclusion
• Health, safety and welfare of employees
• Compliance and ethical business practices
• Protection of personal and confidential
information
• Customer satisfaction
• Reduction of environmental
• Board independence and effectiveness
burden
• Environmental impacts of
pharmaceuticals
• Patient assistance and advocacy
• Advancement of medical
science
• Talent development
• Recruitment and retention of employees
• Fair appraisal and competitive reward
Relevance to Astellas’ Business
Very High
* Access to Health: Astellas understands that some people find it difficult to receive the healthcare they need due to the lack of available treatments, poverty, challenges in
healthcare systems and limited healthcare information. Astellas recognizes this problem as the Access to Health issue and is working to improve Access to Health by engaging
in various initiatives.
21
Corporate Strategy and Corporate GovernanceAstellas Pharma Inc. ANNUAL REPORT 2018
Contribution to the Sustainable Development Goals
Adopted by the United Nations General Assembly in
2015, the Sustainable Development Goals (SDGs) are a
set of collective targets for the world to achieve by 2030.
Referring to the SDG Compass, Astellas identifies
issues for priority action, based on the evaluation of
SDG-related impacts across the entire value chain. Going
forward, Astellas plans to contribute to the attainment
of the SDGs through various business activities, focusing
primarily on “Goal 3: Good Health and Well-Being.”
Focus on Improving Access to Health in
Four Areas
In regard to “Goal 3: Good Health and Well-Being” under
the SDGs, Astellas is addressing this goal from the
viewpoint of improving Access to Health. There are many
people with insufficient access to the healthcare they
need due to the lack of available treatments, poverty,
challenges in healthcare systems and limited healthcare
information. Astellas recognizes this problem as the Access
to Health issue. Astellas has identified four areas where it is
working to address Access to Health issues by making full
use of the strengths and technology that it has. The four
areas are (1) Creating innovation, (2) Enhancing availability,
(3) Strengthening healthcare systems, and (4) Improving
health literacy. In doing so, Astellas will make maximum
use of its partnerships in the manner of Goal 17.
In creating innovation, Astellas is working to create
innovative medicines and medical solutions in disease
areas with low treatment satisfaction and to deliver them
to patients around the world. Moreover, Astellas has been
conducting collaborative research with partners aimed at
creating drugs for the treatment of tuberculosis, malaria,
and neglected tropical diseases (leishmaniasis and Chagas
disease) and developing the rice-based oral vaccine
MucoRice against infectious diseases such as cholera and
enterotoxigenic Escherichia coli (E. coli). Astellas is also
working closely with partners to develop a pediatric
formulation of praziquantel tablets for the treatment
of schistosomiasis.
To help enhance availability, we have established
programs to assist patients facing severe financial
constraints with the cost of dispensing pharmaceutical
products. We also support patients by not filing or
enforcing patents in countries facing significant economic
challenges. As part of strengthening healthcare systems
and improving health literacy, Astellas has participated in
the Access Accelerated global partnership. This initiative
aims to contribute to achieving the SDG of reducing
premature mortality from non-communicable diseases by
one-third by 2030. In other SDG-related initiatives, Astellas
is supporting the ACTION ON FISTULATM program in Kenya.
Examples of Astellas’ Activities for Achieving SDGs
Examples of activities to achieve each goal
Goals aimed at by contributions
SDGs
Theme
Examples of Astellas’ activities
Goal 3
Good Health and
Well-Being
Creation of innovative medicines and healthcare solutions;
collaborative research and development into treatments and
vaccines for tuberculosis, malaria, neglected tropical diseases, etc.
Goal 5
Gender Equality
Greater proportion of women in managerial roles in Japan
Goal 6
Goal 8
Goal 9
Clean Water and
Sanitation
Decent Work and
Economic Growth
Industry Innovation and
Infrastructure
Reduced water usage; management of wastewater
Cultivation of productive workplaces; employee training and
education; promotion of occupational health and safety
Continuously executing a high level of investment in R&D
Goal 12
Responsible Consumption
and Production
Eco-conscious production
Goal 13
Climate Action
Reduction of greenhouse gas emissions
Goal 15
Life on Land
Maintenance/preservation of biodiversity
Goal 17
Partnerships for the Goals
Participating partner in Global Health Innovative Technology
(GHIT) Fund
22
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Corporate Governance
The Company’s raison d’être is to contribute to
improving the health of people around the world
through the provision of innovative and reliable
pharmaceutical products. The Company aims to
sustainably enhance enterprise value as its mission.
With this business philosophy, we work to ensure
and strengthen the effectiveness of corporate
governance from the following perspectives:
1) Ensuring transparency, appropriateness and agility of
management and
2) Fulfillment of our fiduciary duties and accountability
to shareholders and appropriate collaboration with all
stakeholders.
Transition to a Company with an Audit &
Supervisory Committee
Following a resolution of the June 2018 Annual Shareholders’
Meeting, the Company transitioned from a Company with an Audit &
Supervisory Board to a Company with an Audit & Supervisory
Committee. As the management environment grows increasingly
global and more complex, the Company is working to further
enhance discussions of management strategy and other issues by its
Board of Directors and to further strengthen the oversight function of
the Board of Directors by transitioning to a company with an Audit &
Supervisory Committee, which makes it possible to delegate a
significant portion of the executive decision-making authority of the
Board of Directors to the Executive Directors. Furthermore, the
Company will improve the speed of decision-making in business
execution and enhance management agility.
Corporate Governance System
Characteristics
• The Company adopts the organizational structure of a “Company
with an Audit & Supervisory Committee.” Outside Directors
constitute the majority of the Board of Directors and the Audit &
Supervisory Committee.
• The Board of Directors determines corporate management policies
and corporate strategies, and serves a business execution oversight
function.
• As part of its business execution structure, the Company has
established the Executive Committee to discuss material matters,
and also appoints Executive Officers responsible for managing their
respective divisions and functions. The Board of Directors
established the Corporate Decision Authority Policy to clarify the
responsibility and authority for the execution of business by the
President and CEO and the Executive Officers.
• As advisory bodies to the Board of Directors, the Company established
the Nomination Committee and the Compensation Committee, each
of which are composed of a majority of outside Directors.
23
Corporate Governance System
The Company recognizes the Annual Shareholders’ Meeting as
an important forum for constructive dialogue with shareholders.
Election/Dismissal
Election/Dismissal
Financial
Auditor
Audit &
Supervisory Committee
• The Financial Auditor
and the Company’s
Audit & Supervisory
Committee
Members maintain
close cooperation by
meeting regularly
and as needed,
verifying their annual
auditing plans as
well as sharing the
results of audits and
important audit
information.
(
c
o
o
r
d
n
a
t
i
o
n
i
)
Role
• The Audit & Supervisory Committee is
the only deliberation and decision-
making body for forming opinions
regarding the audits by Audit &
Supervisory Committee Members.
Where necessary, the Audit &
Supervisory Committee provides its
opinions to Directors or the Board of
Directors.
Composition
• The Audit & Supervisory Committee is
comprised entirely of Directors who are
Audit & Supervisory Committee
Members, with the Committee
Chairman determined by a vote of the
Audit & Supervisory Committee. To
further enhance the independence and
neutrality of the auditing system,
outside Directors comprise a majority of
Audit & Supervisory Committee
Members. At least one of the Committee
Members shall be an individual with
appropriate knowledge regarding
financial and accounting matters.
Five Directors who are Audit & Supervisory
Committee Members, of whom a majority
of three are independent outside Audit &
Supervisory Committee Members (four
male, one female).
Administration
• As a general rule, meetings are held
once a month, with extraordinary
meetings held as necessary
Annual Shareholders’ Meeting
The following measures are taken to invigorate the meeting for shareholders and encourage the exercise of voting rights.
(1) Early dispatch of the Annual Shareholders’ Meeting convocation notice.
It is also published before dispatch on the Timely Disclosure Network (TDnet) provided by the Tokyo Stock Exchange and on the Company’s website.
(2) The date of the Annual Shareholders’ Meeting is set to avoid dates when meetings of other companies are concentrated.
(3) Adoption of an electronic voting platform (a platform run by ICJ, Inc., a firm in which the Tokyo Stock Exchange and others have invested).
(4) Providing an English translation of the convocation notice.
Election/Dismissal
Board of Directors
Role
• By determining basic corporate management policies and corporate strategies, and performing an
oversight function over business execution, the Board of Directors ensures that management is
transparent and appropriate. By resolution of the Board of Directors, a significant portion of
decision-making over important business execution matters has been delegated to the Executive
Directors. The Board has also established the Corporate Decision Authority Policy, clarifying the
business execution reponsibility and authority of the respective Executive Officers and ensuring
management agility.
Composition
the Board.
• The Board comprises an appropriate number of Directors, in consideration of diversity and balance
from the perspectives of expertise and experience, and is chaired by the Director and Chairman of
Audit,
etc.
• The Board is comprised of a majority of outside Directors to enable it to make decisions from a
broader viewpoint and oversee business execution objectively.
10 Directors, of whom a majority of 6 are independent outside Directors (eight male, two female).
• As a general rule, meetings are held once a month, with extraordinary meetings held as necessary.
Role
Administration
Audit
Directors
Responsibilities
• As members of the Board of Directors, Directors participate in management decision-making through
resolutions to the Board, in addition to overseeing the performance of duties of other Directors.
• To fully exercise their expected capabilities, Directors are expected to contribute to the sustained
enhancement of the Company’s corporate value by collecting the information necessary for the
execution of their duties and engaging actively in discussions.
• Outside Directors are expected to enhance the appropriateness of management by overseeing the
execution of business based on their independent standpoint, while utilizing their individual
experience and knowledge to offer advice from a standpoint different from that of internal Directors.
Election
• Directors who are not Audit & Supervisory Committee Members are subject to election every year via
resolution of the Annual Shareholders’ Meeting. Directors who are Audit & Supervisory Committee
Members are subject to election once every two years via resolution of the Annual Shareholders’ Meeting.
Nomination Committee
Role
• Discusses matters concerning the election
and dismissal of Executive Officers, etc., and
reports the results to the Board of Directors.
Composition
• This committee is composed of members
elected by the Board of Directors.
• The majority of members are outside
• This committee is chaired by an outside
Directors.
Director.
Compensation Committee
• Discusses matters concerning remuneration,
bonuses and other profits on assets received
as compensation for the execution of duties
of Directors, Executive Officers and others
(excluding individual remuneration for
Directors who serve as members of the
Audit & Supervisory Committee), and
reports the results to the Board of Directors.
Composition
• This committee is composed of members
elected by the Board of Directors.
• The majority of members are outside
• This committee is chaired by an outside
Directors.
Director.
Report
Direction
Proposal/Report
Election/Dismissal, Supervision
Report
Direction
Audit functions
President
Executive Committee
This Committee discusses matters important to management of the
Group overall, and is chaired by the Representative Director and President.
Election/Dismissal
Proposal/Report
Direction/Supervision
Officers responsible for each function/Corporate Executives/Functional Heads
Internal audit
Report
Business execution/Direction/Supervision
Divisions
Business execution
Corporate Strategy and Corporate GovernanceAstellas Pharma Inc. ANNUAL REPORT 2018
Corporate Governance System
The Company recognizes the Annual Shareholders’ Meeting as
an important forum for constructive dialogue with shareholders.
Election/Dismissal
Election/Dismissal
Financial
Auditor
Audit &
Supervisory Committee
• The Financial Auditor
and the Company’s
Audit & Supervisory
Committee
Members maintain
close cooperation by
meeting regularly
and as needed,
verifying their annual
auditing plans as
well as sharing the
results of audits and
important audit
information.
(
c
o
o
r
d
i
n
a
t
i
o
n
)
Role
• The Audit & Supervisory Committee is
the only deliberation and decision-
making body for forming opinions
regarding the audits by Audit &
Supervisory Committee Members.
Where necessary, the Audit &
Supervisory Committee provides its
opinions to Directors or the Board of
Directors.
Composition
• The Audit & Supervisory Committee is
comprised entirely of Directors who are
Audit & Supervisory Committee
Members, with the Committee
Chairman determined by a vote of the
Audit & Supervisory Committee. To
further enhance the independence and
neutrality of the auditing system,
outside Directors comprise a majority of
Audit & Supervisory Committee
Members. At least one of the Committee
Members shall be an individual with
appropriate knowledge regarding
financial and accounting matters.
Five Directors who are Audit & Supervisory
Committee Members, of whom a majority
of three are independent outside Audit &
Supervisory Committee Members (four
male, one female).
Administration
• As a general rule, meetings are held
once a month, with extraordinary
meetings held as necessary
Report
Direction
Audit functions
Annual Shareholders’ Meeting
The following measures are taken to invigorate the meeting for shareholders and encourage the exercise of voting rights.
(1) Early dispatch of the Annual Shareholders’ Meeting convocation notice.
It is also published before dispatch on the Timely Disclosure Network (TDnet) provided by the Tokyo Stock Exchange and on the Company’s website.
(2) The date of the Annual Shareholders’ Meeting is set to avoid dates when meetings of other companies are concentrated.
(3) Adoption of an electronic voting platform (a platform run by ICJ, Inc., a firm in which the Tokyo Stock Exchange and others have invested).
(4) Providing an English translation of the convocation notice.
Election/Dismissal
Board of Directors
Role
• By determining basic corporate management policies and corporate strategies, and performing an
oversight function over business execution, the Board of Directors ensures that management is
transparent and appropriate. By resolution of the Board of Directors, a significant portion of
decision-making over important business execution matters has been delegated to the Executive
Directors. The Board has also established the Corporate Decision Authority Policy, clarifying the
business execution reponsibility and authority of the respective Executive Officers and ensuring
management agility.
Composition
• The Board comprises an appropriate number of Directors, in consideration of diversity and balance
from the perspectives of expertise and experience, and is chaired by the Director and Chairman of
the Board.
• The Board is comprised of a majority of outside Directors to enable it to make decisions from a
broader viewpoint and oversee business execution objectively.
10 Directors, of whom a majority of 6 are independent outside Directors (eight male, two female).
Administration
• As a general rule, meetings are held once a month, with extraordinary meetings held as necessary.
Audit,
etc.
Audit
Directors
Responsibilities
• As members of the Board of Directors, Directors participate in management decision-making through
resolutions to the Board, in addition to overseeing the performance of duties of other Directors.
• To fully exercise their expected capabilities, Directors are expected to contribute to the sustained
enhancement of the Company’s corporate value by collecting the information necessary for the
execution of their duties and engaging actively in discussions.
• Outside Directors are expected to enhance the appropriateness of management by overseeing the
execution of business based on their independent standpoint, while utilizing their individual
experience and knowledge to offer advice from a standpoint different from that of internal Directors.
Election
• Directors who are not Audit & Supervisory Committee Members are subject to election every year via
resolution of the Annual Shareholders’ Meeting. Directors who are Audit & Supervisory Committee
Members are subject to election once every two years via resolution of the Annual Shareholders’ Meeting.
Nomination Committee
Role
• Discusses matters concerning the election
and dismissal of Executive Officers, etc., and
reports the results to the Board of Directors.
Composition
• This committee is composed of members
elected by the Board of Directors.
• The majority of members are outside
Directors.
• This committee is chaired by an outside
Director.
Compensation Committee
Role
• Discusses matters concerning remuneration,
bonuses and other profits on assets received
as compensation for the execution of duties
of Directors, Executive Officers and others
(excluding individual remuneration for
Directors who serve as members of the
Audit & Supervisory Committee), and
reports the results to the Board of Directors.
Composition
• This committee is composed of members
elected by the Board of Directors.
• The majority of members are outside
Directors.
• This committee is chaired by an outside
Director.
Report
Direction
Proposal/Report
Election/Dismissal, Supervision
President
Executive Committee
This Committee discusses matters important to management of the
Group overall, and is chaired by the Representative Director and President.
Election/Dismissal
Proposal/Report
Direction/Supervision
Officers responsible for each function/Corporate Executives/Functional Heads
Internal audit
Report
Business execution/Direction/Supervision
Divisions
Business execution
24
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018
Progress in Enhancing Effectiveness of
Corporate Governance
Since Astellas’ launch in April 2005, we have worked to
increase the speed of execution by delegating authority to
the management team, in the belief that prompt and
accurate decision-making will result in the enhancement
of enterprise value. In the year following our launch, the
Company appointed a majority of outside Directors to its
Board of Directors, and subsequently established the
Nomination Committee and Compensation Committee,
part of our ongoing efforts at structural reform.
With the implementation of Japan’s Corporate
Governance Code in June 2015, we also took the
opportunity to further enhance the Company’s corporate
governance structure. In September 2015, the Company
formulated its Corporate Governance Guidelines as the
basis for implementing the individual principles of the
Code.* Beginning in June 2018, the Company has also
transitioned to a Company with an Audit & Supervisory
Committee. Through these efforts, the Company is working
Major Corporate Governance Reforms Implemented to Date
to enhance the effectiveness of its corporate governance.
* By December 2018, the Company plans to disclose via its Corporate Governance
Report the status of implementation of the Corporate Governance Code
principles that were revised effective June 2018.
Start of Efforts to Evaluate the Effectiveness of
the Board of Directors
As a means of considering issues and making
improvements to further enhance the role of the Board of
Directors, the Company has conducted an analysis and
evaluation of the effectiveness of the Board of Directors
since the fiscal year ended March 31, 2016. The results of
the evaluation for the fiscal year ended March 31, 2018 are
as shown below.
The Chairman of the Board of Directors conducted a
survey based on a questionnaire to all Directors and Audit
& Supervisory Board Members, primarily concerning the
Date
April 2005
Launch of
Astellas
Change
Objective
New Board of Directors launched
• Board of Directors comprised of 4 Executive Directors, 2 non-Executive Directors and 2 outside Directors
• Board of Directors specialized in supervising the execution of business and decision-making regarding
Ensure management transparency
and appropriateness
legal and most important matters
Authority delegated to the management team
• To the extent legally allowable, delegate as much authority as possible to the management team
Ensure management agility
June 2006
Outside Directors represent a majority of the Board of Directors
• 9 Directors, of whom 5 are outside Directors
Reduction in number of Directors
• 7 Directors, of whom 4 are outside Directors
Ensure management transparency
and appropriateness
Ensure management agility
June 2007
June 2010
Established the Nomination Committee and the Compensation Committee
• 5 committee members, of whom 3 are outside Directors
Ensure management transparency
and appropriateness
Shortened term of appointment for Directors
• Term of appointment shortened from two years to one year
Elimination of advisor system
• Prior to that, counselor system also eliminated
Clarify management
responsibilities
Ensure management transparency
June 2011
Change in chairmanship of the Nomination and the Compensation Committees
• Each Committee chaired by outside Director
Ensure management transparency
and appropriateness
June 2015
Increase outside Audit & Supervisory Board Members
• From 2 to 3, resulting in outside members representing a majority of the total of 5 Audit & Supervisory
Board Members
Strengthen independence and
neutrality of the auditing system
Transition to a Company with an Audit & Supervisory Committee
• 6 out of 10 Directors are outside Directors (3 out of the 5 Audit & Supervisory Committee Members are
outside Directors)
• Delegation of decision-making authority for business execution from the Board of Directors to
Executive Directors
• The Board of Directors discusses corporate management policies, strategies, etc.
Strengthen the supervisory
function and ensure management
mobility
June 2018
25
Corporate Strategy and Corporate GovernanceAstellas Pharma Inc. ANNUAL REPORT 2018 oversight function of the Board of Directors. Based on the
results of this survey, the Board of Directors performed its
analysis and evaluation.
The Board of Directors was found to function
appropriately, with highly transparent and lively
discussions by the Directors, including independent
outside Directors. The overall effectiveness of the Board of
Directors was assessed to be sufficiently ensured.
The Board of Directors consists of a majority of outside
Directors and has engaged in free, open and constructive
discussions, having fostered a climate in which those
outside Directors are able to actively participate in discussion.
Aiming to achieve optimization of the Board of
Directors’ capabilities, which was recognized as an issue in
the fiscal year ended March 31, 2017, the Company
decided to transition to a Company with an Audit &
Supervisory Committee structure, and by clearly
distinguishing between oversight and execution, has
established a framework for discussing matters that should
be addressed by the Board of Directors.
As an organ for discussing important matters
regarding the business of the Astellas Group, the Company
has established an Executive Committee, and has
appointed Executive Officers responsible for managing
their respective departments and functions. The
responsibility and authority for the execution of business
by the organ described above, the President and the
Executive Officers are clearly stipulated in the Corporate
Decision Authority Policy.
In order to build an optimal management system
capable of speedy and precise decision-making, we have
been promoting a system, under which we manage each
division and function of Drug Discovery Research, Medical
& Development, and Pharmaceutical Technology based on
their respective functions from a global viewpoint across
geographical regions, while the Sales & Marketing
Divisions are managed on a regional basis.
Regarding staff functions also, Astellas is working to
strengthen its global management functions. As part of
these efforts, in April 2017, we established Legal and
Intellectual Property functions in each region on a global
level. Furthermore, in April 2018, we established Finance,
Human Resources, and Internal Auditing functions in
departments in the same manner.
To ensure that the process for selecting successors to
In order to develop a system for more appropriate
the President and CEO maintains a high level of
transparency and acceptability, the Board of Directors has
been overseeing deliberations of the Nomination
Committee and making appropriate resolutions based on
proposals of the Nomination Committee.
To ensure it functions more effectively, the Board of
Directors will continue to improve on the issues below
which are present even in the new system.
• To carry out Strategic Plan 2018, the Board of Directors
will monitor the constantly changing internal and
external environmental trends and engage in more
effective discussion of strategy.
• The Board of Directors will oversee whether appropriate
measures have been taken against risks identified by the
framework for systematic risk evaluation that were
strengthened in the fiscal year ended March 31, 2018.
execution of business, the Company has established
various committees comprising cross-functional members.
These committees include the Corporate Disclosure
Committee where matters including disclosure of
corporate information are discussed, the CSR Committee
that discusses policies and plans of important activities for
the purpose of fulfilling the Company’s social
responsibilities (such as issues on the environment, health
and safety, and social contribution activities), the Global
Benefit Risk Committee to discuss benefit and risk
information of products as well as measures to deal with
such benefit and risk, the Global Compliance Committee
where matters including global compliance policies and
plans are discussed, and the Global Risk Management
Office to promote identifying global risks and
implementing optimum risk management.
Efforts Aimed at Enhancing Business Execution
The Company has established a global management
structure, and continues to work to strengthen it.
Please refer to the following URL for the Corporate Governance Report
and Corporate Governance Guidelines
Web https://www.astellas.com/jp/en/investors/
ir-library/governance
26
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 *1 Regarding stock compensation, the Company has introduced a performance-
linked stock compensation scheme, a medium- to long-term incentive plan
known as the executive remuneration BIP (Board Incentive Plan) trust. Three
consecutive business years are defined as a single eligible period, and for the
first year of each eligible period, a ceiling of ¥5.5 million on the amount
contributed to the BIP Trust as compensation to Directors (excluding outside
Directors and Directors who serve as Audit & Supervisory Committee Members)
was approved at the 13th Term Annual Shareholders’ Meeting held on June 15,
2018.
*2 A ¥5.6 million annual ceiling on remuneration for Directors (excluding Directors
who serve as Audit & Supervisory Committee Members) was approved at the
13th Term Annual Shareholders’ Meeting held on June 15, 2018. This excludes,
however, bonuses and stock compensation, the amount of and ceilings for
which were approved separately at the Annual Shareholders’ Meeting.
*3 An annual ceiling of ¥2.6 million on compensation for Directors who serve as
members of the Audit & Supervisory Committee was approved at the 13th
Term Annual Shareholders’ Meeting held on June 15, 2018.
Remuneration for Directors in Fiscal 2018
Category
Total amount
of
remuneration
(¥ million)
Type of remuneration (¥ million) Number
Basic
remuneration
Bonus
Stock
compensation
of
eligible
Directors
Directors
(excluding
outside
Directors)
Outside
Directors
Total
Audit &
Supervisory
Board
Members
(excluding
outside Audit
& Supervisory
Board
Members)
Outside Audit
& Supervisory
Board
Members
358
159
124
58
415
58
217
—
124
74
—
74
88
88
—
—
3
6
9
2
3
5
Total
131
131
43
43
—
—
—
—
*1 The above basic remuneration and stock compensation include amounts paid to
three Directors (including two outside Directors) who resigned as of the
conclusion of the 12th Term Annual Shareholders’ Meeting held on June 19, 2017.
*2 The above stock compensation lists amounts recorded as expenses in the fiscal
year ended March 31, 2018, based on J-GAAP.
A System of Remuneration for Directors That
Contributes to Sustainable Enhancement in
Enterprise Value
The compensation paid to Directors of the Company is
designed to enable the Company to attract and retain
talent, and maintain sufficient compensation standards
and systems to meet the duties and responsibilities of the
positions. The Company has improved the objectivity of
decisions on remuneration levels by using survey data
issued by outside research companies and other measures.
Remuneration for internal Directors who are not
members of the Audit & Supervisory Committee is
composed of fixed basic remuneration, bonuses and stock
compensation. The Company appropriately links
remuneration with business performance. To increase the
awareness of contribution to the sustainable growth of
business results and enterprise value, the Company has
introduced a performance-linked stock compensation
scheme which grants Company stock in line with the
degree to which medium-term performance targets are
achieved. Medium-term performance targets include
predetermined goals for sales, core operating margin, core
ROE, etc., over a three-year time span*1.
Remuneration for outside Directors and internal
Directors who serve as Audit & Supervisory Committee
Members consists solely of fixed basic remuneration.
Remuneration for Directors who are not members of
the Audit & Supervisory Committee*2 is determined by
resolution of the Board of Directors within a total ceiling
amount approved by the Annual Shareholders’ Meeting,
while remuneration for Directors who serve as Audit &
Supervisory Committee Members*3 is determined through
deliberations of the Audit & Supervisory Committee
Members within a total ceiling amount approved by the
Annual Shareholders’ Meeting. Through the deliberations
of the Compensation Committee, the Company enhances
the transparency and objectivity of the deliberation
process for remuneration for Directors (excluding
individual remuneration for Directors who serve as Audit &
Supervisory Committee Members).
27
Corporate Strategy and Corporate GovernanceAstellas Pharma Inc. ANNUAL REPORT 2018 Risk Management
Identifying and Mitigating Risks Relating to the
Performance of Business Activities
Pharmaceutical companies that expand their business
globally are expected to follow numerous regulations with
a high level of compliance; Astellas must also address
numerous risks that could impact our business results,
performance and public perception. Astellas established a
holistic approach to risk management through the
creation of a Global Risk Management program. Separate
Regional Risk Management programs in each of the
Company’s four regions support the Global Risk
Management program. The purpose of these global and
regional programs are to identify, prioritize and manage
risks to the Company achieving its objectives from a
preventive standpoint.
The Global Risk Management program are supervised
by a global, cross-functional team. The Global Risk
Management program utilizes a four-phased approach,
which is repeated annually: 1. Risk Identification, 2. Risk
Prioritization, 3. Risk Mitigation Plan Development, and 4.
Risk Mitigation Plan Implementation.
Global Risk Management Program Structure
The EC reviews and approves risks identified through
the Global Risk Management program. The EC assigns risk
owners to each identified global risk. The risk owners are
responsible for developing and implementing risk
mitigation plans. Risk owners update these plans
throughout the year and mitigation plan progress is
reported to the EC. The risks managed by the program are
reflective of Astellas’ footprint as global pharmaceutical
company and the sector the Company operates in.
Through maintaining the Global Risk Management
program, Astellas has a framework for identifying and
addressing risk. This program has enhanced the Company’s
cross-functional awareness and transparency about the
risks facing the Company as well as the activities being
undertaken to mitigate these risks.
At the regional level, the Regional Risk Management
programs operate in a similar format to the global program.
The Global Risk Management program factors the results
of the regional programs into its risk identification process
to ensure regional concerns and priorities are considered
appropriately. In addition, the Global Risk Management
program takes on risks identified by the Regional Risk
Management Program when necessary.
Assigns Risk Owners
Board of Directors
Provides updates
Executive Committee
Risk Owners
1. Sets program strategy
2. Provides input on risks
3. Approves identified risks
4. Approves mitigation plans
Provides updates on identified risks
and mitigation plans
Provides updates on
risk mitigation plans
Global Risk Management Team / Secretariat
Provides Regional Risk Management results
Americas Regional
Risk Management Program
Asia & Oceanic Regional
Risk Management Program
EMEA Regional
Risk Management Program
Japan Regional
Risk Management Program
28
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Directors
Directors who are not Audit & Supervisory Committee Members
1980: Joined Fujisawa Pharmaceutical Co., Ltd.
2003: Director, Corporate Planning,
Fujisawa Pharmaceutical Co., Ltd.
2005: Vice President, Corporate Planning,
Corporate Strategy Division, the Company
2005: Corporate Executive, Vice President,
Corporate Planning, Corporate Strategy,
the Company
2006: Corporate Executive of the Company and
President & CEO, Astellas US LLC and
President & CEO, Astellas Pharma US, Inc.
2008: Senior Corporate Executive of the Company and
President & CEO, Astellas US LLC and
President & CEO, Astellas Pharma US, Inc.
2009: Senior Corporate Executive, Chief Strategy Officer and
Chief Financial Officer (CSTO & CFO), the Company
2011: Representative Director,
President and CEO, the Company
2018: Representative Director, Chairman of the Board, the
Company (present post)
1975: Fellow, Department of Internal Medicine, School of
Medicine, Keio University
1980: Assistant Professor, Department of Preventive
Medicine and Public Health, School of Medicine,
Kitasato University
1983: Associate Professor, Department of Preventive
Medicine and Public Health, School of Medicine,
Kitasato University
1994: Professor, Department of Preventive Medicine and
Public Health, School of Medicine, Kitasato University
2004: Chairperson, School of Medicine, Kitasato University
2006: Dean, School of Medicine, Kitasato University
2009: Vice President, Kitasato University
2010: Executive Trustee, The Kitasato Institute
2012: Professor Emeritus, Kitasato University (present post)
2015: Director, the Company (present post)
Yoshihiko Hatanaka
Representative Director,
Chairman of the Board
Yoshiharu Aizawa
Outside Director
1986: Joined the Company
2005: Vice President, Project Management, Urology, the
Company
2010: Corporate Executive of the Company and Therapeutic
Area Head, Urology, Astellas Pharma Europe B.V.
2010: Corporate Executive of the Company and Therapeutic
Area Head, Urology, Astellas Pharma Global
Development, Inc.
2011: Corporate Executive, Vice President, Product & Portfolio
Strategy, the Company
2012: Corporate Executive, Chief Strategy Officer (CSTO), the
Company
2012: Senior Corporate Executive, Chief Strategy Officer
(CSTO), the Company
2017: Senior Corporate Executive, Chief Strategy Officer and
Chief Commercial Officer (CSTO & CCO), the Company
2017: Representative Director, Executive Vice President, the
Company
2018: Representative Director, President and CEO, the
Company (present post)
1974: Joined Marubeni Corporation
1997: General Manager, Power Project Dept.-I,
Marubeni Corporation
1998: General Manager, Power Project Dept.-III,
Marubeni Corporation
1999: Deputy General Manager, Power Project Div.; General
Manager, Power Project Dept. I, Marubeni Corporation
2001: Senior Operating Officer, Utility Infrastructure Div.;
General Manager, Overseas Power Project Dept.,
Marubeni Corporation
2002: Corporate Vice President, Chief Operating Officer, Plant,
Power & Infrastructure Div., Marubeni Corporation
2005: Corporate Senior Vice President, Chief Operating
Officer, Plant, Power & Infrastructure Projects Div.,
Marubeni Corporation
2006: Corporate Senior Vice President,
Member of the Board, Marubeni Corporation
2007: Corporate Executive Vice President,
Member of the Board, Marubeni Corporation
2009: Senior Executive Vice President,
Member of the Board, Marubeni Corporation
2013: Vice Chairman, Marubeni Corporation
2015: Corporate Adviser, Marubeni Corporation (present post)
Chairman, Marubeni Power Systems Corporation
Kenji Yasukawa
Representative Director,
President and CEO
Mamoru Sekiyama
Outside Director
Expected Role
Yoshiharu Aizawa has been engaged in medical treatment while successively holding important
posts at Kitasato University as a medical scientist, and has abundant specialized knowledge and
experience. He currently plays a key role in the management of the Company from an independent
standpoint as an outside Director. The Company is confident that he will draw on his abundant
specialized knowledge and experience in management of the Company in the future as well.
Attendance at Meetings of the Board of Directors during Fiscal 2017: 16/17 times
2017: Director, the Company (present post)
Expected Role
Mamoru Sekiyama has been engaged in corporate management as a business manager of a
general trading company over many years and has abundant global experience and extensive
insight. He currently plays a key role in the management of the Company from an independent
standpoint as an outside Director. The Company is confident that he will continue to apply his
abundant specialized knowledge and experience to the management of the Company.
Attendance at Meetings of the Board of Directors during Fiscal 2017: 14/14 times
1987: Public Prosecutor, Yokohama District Public Prosecutors Office
2002: Coordinator, Legislative Division, Criminal Affairs Bureau, Ministry of Justice
2005: Counselor, Legislative Division, Criminal Affairs Bureau, Ministry of Justice
2005: Public Prosecutor, Supreme Public Prosecutors Office
2007: Deputy Director of Public Peace Department, Tokyo District Public Prosecutors Office
2008: Deputy Director of Trial Department, Tokyo District Public Prosecutors Office
2009: Trial Director, Yokohama District Public Prosecutors Office
2010: Registered as an attorney-at-law (Dai-ichi Tokyo Bar Association): Lawyer honorary member, Tokyo Seiwa Law Office (present post)
2017: Director, the Company (present post)
1984: Joined Fujisawa Pharmaceutical Co., Ltd.
1999: Director of Planning, Medical Supply Business, Fujisawa
Pharmaceutical Co., Ltd.
2006: Assistant to Senior Vice President,
Corporate Finance & Accounting and
Project Leader of J-SOX Project, the Company
2013: Vice President, Internal Auditing, the Company
2014: Assistant to President and CEO, the Company
2014: Audit & Supervisory Board Member, the Company
2018: Director who is an Audit & Supervisory Committee
Member, the Company (present post)
1983: Joined the Company
2012: Vice President, Clinical and Research Quality Assurance,
QA, RA and Pharmacovigilance Department, the
Company
2016: Assistant to President & CEO, the Company
2016: Audit & Supervisory Board Member, the Company
2018: Director who is an Audit & Supervisory Committee
Member, the Company (present post)
Tomokazu Fujisawa
Director who is an Audit &
Supervisory Committee
Member
Hiroko Sakai
Director who is an Audit &
Supervisory Committee
Member
1984: Public Prosecutor,
Tokyo District Public Prosecutors Office
1985: Public Prosecutor,
Yamagata District Public Prosecutors Office
1988: Public Prosecutor,
Niigata District Public Prosecutors Office
1990: Public Prosecutor,
Tokyo District Public Prosecutors Office
1992: Registered as an attorney-at-law
(Tokyo Bar Association)
1993: Partner, SANNO LAW OFFICE (present post)
2005: Visiting Professor, University of Tsukuba Law School
2015: Audit & Supervisory Board Member, the Company
2018: Director who is an Audit & Supervisory Committee
Member, the Company (present post)
1985: Joined Tohmatsu & Aoki Audit Corporation
(current Deloitte Touche Tohmatsu LLC)
1997: Joined Deloitte Tohmatsu Consulting Co., Ltd. (current
ABeam Consulting Ltd.)
1999: Global Partner for manufacturing industry and Managing
Director in Kyushu area, Deloitte Tohmatsu Consulting Co.,
Ltd. (current ABeam Consulting Ltd.)
2003: Joined DENTSU INC.
2008: Established Uematsu & Co. : Managing Director, Uematsu
2011: President & Representative Director, SU Consultant Co.,
2015: Outside Audit & Supervisory Board Member, Kamakura
& Co. (present post)
Ltd. (present post)
Shinsho, Ltd.
2016: Outside Director and Audit & Supervisory Committee
Member, Kamakura Shinsho, Ltd. (present post)
2016: Audit & Supervisory Board Member, the Company
2018: Director who is an Audit & Supervisory Committee
Member, the Company (present post)
Hitoshi Kanamori
Outside Director who is
an Audit & Supervisory
Committee Member
Expected Role
Noriyuki Uematsu
Outside Director who is
an Audit & Supervisory
Committee Member
Expected Role
Hitoshi Kanamori possesses expertise in corporate law by virtue of his long experience as an
Noriyuki Uematsu has thorough knowledge of corporate consulting and auditing by virtue of his
attorney-at-law. He currently plays a key role in the supervision and auditing of the Company’s
many years of experience as a certified public accountant and is also engaged in corporate
management from an independent standpoint as an outside Director who is an Audit & Supervisory
management as a business manager of a consulting company relating to business accounting and
Committee Member. The Company is confident that he will continue to leverage his abundant
tax accounting services. He currently plays a key role in the supervision and auditing of the Company’s
specialized knowledge and experience to supervise and audit the Company’s management.
management from an independent standpoint as an outside Director who is an Audit & Supervisory
Attendance at Meetings of the Board of Directors during Fiscal 2017: 16/17 times
Attendance at Meetings of the Audit & Supervisory Board during Fiscal 2017: 13/14 times
Committee Member The Company is confident that he will continue to draw on his abundant
specialized knowledge and experience in supervising and auditing the Company’s management.
Attendance at Meetings of the Board of Directors during Fiscal 2017: 17/17 times
Attendance at Meetings of the Audit & Supervisory Board during Fiscal 2017: 14/14 times
1987: Assistant Professor, Faculty of Economics, Nagoya City University
1990: Associate Professor, Faculty of Economics, Nagoya City University
1993: Associate Professor, School of Commerce, Waseda University
1996: Professor, School of Commerce, Waseda University
1997: Senior Research Officer, Ministry of Finance, Institute of Fiscal and Monetary Policy (current Policy Research Institute); Special Officer for Research, Minister’s Secretariat
1999: Professor, School of Commerce, Waseda University
2005: Professor, School of Commerce, Waseda University; Professor, Graduate School of Accountancy, Waseda University
2010: Professor, School of Commerce, Waseda University; Dean, Graduate School of Accountancy, Waseda University
2013: Dean, Graduate School of Accountancy, Waseda University
2016: Professor, Graduate School of Accountancy, Waseda University (present post)
2018: Director who is an Audit & Supervisory Committee Member, the Company (present post)
Expected Role
After successively holding important posts such as Public Prosecutor at the Supreme Public Prosecutors Office, Keiko Yamagami has been engaged in corporate legal affairs
as an attorney-at-law. She currently plays a key role in the management of the Company from an independent standpoint as an outside Director. The Company is confident
that she will continue to apply her abundant specialized knowledge and experience to the management of the Company.
Attendance at Meetings of the Board of Directors during Fiscal 2017: 14/14 times
Hiroo Sasaki
Outside Director who is
an Audit & Supervisory
Committee Member
Expected Role
Hiroo Sasaki has held important positions at Waseda University, including at the graduate level, in economics and other fields. While Dean of Waseda University’s Graduate
School of Accountancy, he was also involved in the school’s management. Having researched normative economics, he is deeply knowledgeable about vocational ethics and
research ethics and has experience with practical handling of these ethical issues. The Company is confident that he will leverage his abundant specialized knowledge and
experience to supervise and audit the Company’s management from an independent standpoint as an outside Director who is an Audit & Supervisory Committee Member.
Keiko Yamagami
Outside Director
29
Corporate Strategy and Corporate GovernanceAstellas Pharma Inc. ANNUAL REPORT 2018 1980: Joined Fujisawa Pharmaceutical Co., Ltd.
2003: Director, Corporate Planning,
Fujisawa Pharmaceutical Co., Ltd.
2005: Vice President, Corporate Planning,
Corporate Strategy Division, the Company
2005: Corporate Executive, Vice President,
Corporate Planning, Corporate Strategy,
the Company
2006: Corporate Executive of the Company and
President & CEO, Astellas US LLC and
President & CEO, Astellas Pharma US, Inc.
2008: Senior Corporate Executive of the Company and
President & CEO, Astellas US LLC and
President & CEO, Astellas Pharma US, Inc.
2009: Senior Corporate Executive, Chief Strategy Officer and
Chief Financial Officer (CSTO & CFO), the Company
2011: Representative Director,
President and CEO, the Company
2018: Representative Director, Chairman of the Board, the
Company (present post)
1975: Fellow, Department of Internal Medicine, School of
Medicine, Keio University
1980: Assistant Professor, Department of Preventive
Medicine and Public Health, School of Medicine,
Kitasato University
1983: Associate Professor, Department of Preventive
Medicine and Public Health, School of Medicine,
Kitasato University
1994: Professor, Department of Preventive Medicine and
Public Health, School of Medicine, Kitasato University
2004: Chairperson, School of Medicine, Kitasato University
2006: Dean, School of Medicine, Kitasato University
2009: Vice President, Kitasato University
2010: Executive Trustee, The Kitasato Institute
2012: Professor Emeritus, Kitasato University (present post)
2015: Director, the Company (present post)
1986: Joined the Company
2005: Vice President, Project Management, Urology, the
Company
2010: Corporate Executive of the Company and Therapeutic
Area Head, Urology, Astellas Pharma Europe B.V.
2010: Corporate Executive of the Company and Therapeutic
Area Head, Urology, Astellas Pharma Global
2011: Corporate Executive, Vice President, Product & Portfolio
2012: Corporate Executive, Chief Strategy Officer (CSTO), the
Development, Inc.
Strategy, the Company
Company
(CSTO), the Company
2012: Senior Corporate Executive, Chief Strategy Officer
2017: Senior Corporate Executive, Chief Strategy Officer and
Chief Commercial Officer (CSTO & CCO), the Company
2017: Representative Director, Executive Vice President, the
Company
2018: Representative Director, President and CEO, the
Company (present post)
1974: Joined Marubeni Corporation
1997: General Manager, Power Project Dept.-I,
Marubeni Corporation
1998: General Manager, Power Project Dept.-III,
Marubeni Corporation
1999: Deputy General Manager, Power Project Div.; General
Manager, Power Project Dept. I, Marubeni Corporation
2001: Senior Operating Officer, Utility Infrastructure Div.;
General Manager, Overseas Power Project Dept.,
Marubeni Corporation
2002: Corporate Vice President, Chief Operating Officer, Plant,
Power & Infrastructure Div., Marubeni Corporation
2005: Corporate Senior Vice President, Chief Operating
Officer, Plant, Power & Infrastructure Projects Div.,
Marubeni Corporation
2006: Corporate Senior Vice President,
Member of the Board, Marubeni Corporation
2007: Corporate Executive Vice President,
Member of the Board, Marubeni Corporation
2009: Senior Executive Vice President,
Member of the Board, Marubeni Corporation
2013: Vice Chairman, Marubeni Corporation
2015: Corporate Adviser, Marubeni Corporation (present post)
Chairman, Marubeni Power Systems Corporation
2017: Director, the Company (present post)
Yoshiharu Aizawa
Outside Director
Mamoru Sekiyama
Outside Director
Expected Role
Expected Role
Yoshiharu Aizawa has been engaged in medical treatment while successively holding important
Mamoru Sekiyama has been engaged in corporate management as a business manager of a
posts at Kitasato University as a medical scientist, and has abundant specialized knowledge and
experience. He currently plays a key role in the management of the Company from an independent
standpoint as an outside Director. The Company is confident that he will draw on his abundant
specialized knowledge and experience in management of the Company in the future as well.
general trading company over many years and has abundant global experience and extensive
insight. He currently plays a key role in the management of the Company from an independent
standpoint as an outside Director. The Company is confident that he will continue to apply his
abundant specialized knowledge and experience to the management of the Company.
Attendance at Meetings of the Board of Directors during Fiscal 2017: 16/17 times
Attendance at Meetings of the Board of Directors during Fiscal 2017: 14/14 times
1987: Public Prosecutor, Yokohama District Public Prosecutors Office
2002: Coordinator, Legislative Division, Criminal Affairs Bureau, Ministry of Justice
2005: Counselor, Legislative Division, Criminal Affairs Bureau, Ministry of Justice
2005: Public Prosecutor, Supreme Public Prosecutors Office
2007: Deputy Director of Public Peace Department, Tokyo District Public Prosecutors Office
2008: Deputy Director of Trial Department, Tokyo District Public Prosecutors Office
2009: Trial Director, Yokohama District Public Prosecutors Office
2010: Registered as an attorney-at-law (Dai-ichi Tokyo Bar Association): Lawyer honorary member, Tokyo Seiwa Law Office (present post)
2017: Director, the Company (present post)
Directors who are Audit & Supervisory Committee Members
1984: Joined Fujisawa Pharmaceutical Co., Ltd.
1999: Director of Planning, Medical Supply Business, Fujisawa
Pharmaceutical Co., Ltd.
2006: Assistant to Senior Vice President,
Corporate Finance & Accounting and
Project Leader of J-SOX Project, the Company
2013: Vice President, Internal Auditing, the Company
2014: Assistant to President and CEO, the Company
2014: Audit & Supervisory Board Member, the Company
2018: Director who is an Audit & Supervisory Committee
Member, the Company (present post)
1983: Joined the Company
2012: Vice President, Clinical and Research Quality Assurance,
QA, RA and Pharmacovigilance Department, the
Company
2016: Assistant to President & CEO, the Company
2016: Audit & Supervisory Board Member, the Company
2018: Director who is an Audit & Supervisory Committee
Member, the Company (present post)
Yoshihiko Hatanaka
Representative Director,
Chairman of the Board
Kenji Yasukawa
Representative Director,
President and CEO
Tomokazu Fujisawa
Director who is an Audit &
Supervisory Committee
Member
Hiroko Sakai
Director who is an Audit &
Supervisory Committee
Member
1984: Public Prosecutor,
Tokyo District Public Prosecutors Office
1985: Public Prosecutor,
Yamagata District Public Prosecutors Office
1988: Public Prosecutor,
Niigata District Public Prosecutors Office
1990: Public Prosecutor,
Tokyo District Public Prosecutors Office
1992: Registered as an attorney-at-law
(Tokyo Bar Association)
1993: Partner, SANNO LAW OFFICE (present post)
2005: Visiting Professor, University of Tsukuba Law School
2015: Audit & Supervisory Board Member, the Company
2018: Director who is an Audit & Supervisory Committee
Member, the Company (present post)
1985: Joined Tohmatsu & Aoki Audit Corporation
(current Deloitte Touche Tohmatsu LLC)
1997: Joined Deloitte Tohmatsu Consulting Co., Ltd. (current
ABeam Consulting Ltd.)
1999: Global Partner for manufacturing industry and Managing
Director in Kyushu area, Deloitte Tohmatsu Consulting Co.,
Ltd. (current ABeam Consulting Ltd.)
2003: Joined DENTSU INC.
2008: Established Uematsu & Co. : Managing Director, Uematsu
& Co. (present post)
2011: President & Representative Director, SU Consultant Co.,
Ltd. (present post)
2015: Outside Audit & Supervisory Board Member, Kamakura
Shinsho, Ltd.
2016: Outside Director and Audit & Supervisory Committee
Member, Kamakura Shinsho, Ltd. (present post)
2016: Audit & Supervisory Board Member, the Company
2018: Director who is an Audit & Supervisory Committee
Member, the Company (present post)
Noriyuki Uematsu
Outside Director who is
an Audit & Supervisory
Committee Member
Hitoshi Kanamori
Outside Director who is
an Audit & Supervisory
Committee Member
Expected Role
Hitoshi Kanamori possesses expertise in corporate law by virtue of his long experience as an
attorney-at-law. He currently plays a key role in the supervision and auditing of the Company’s
management from an independent standpoint as an outside Director who is an Audit & Supervisory
Committee Member. The Company is confident that he will continue to leverage his abundant
specialized knowledge and experience to supervise and audit the Company’s management.
Attendance at Meetings of the Board of Directors during Fiscal 2017: 16/17 times
Attendance at Meetings of the Audit & Supervisory Board during Fiscal 2017: 13/14 times
Expected Role
Noriyuki Uematsu has thorough knowledge of corporate consulting and auditing by virtue of his
many years of experience as a certified public accountant and is also engaged in corporate
management as a business manager of a consulting company relating to business accounting and
tax accounting services. He currently plays a key role in the supervision and auditing of the Company’s
management from an independent standpoint as an outside Director who is an Audit & Supervisory
Committee Member The Company is confident that he will continue to draw on his abundant
specialized knowledge and experience in supervising and auditing the Company’s management.
Attendance at Meetings of the Board of Directors during Fiscal 2017: 17/17 times
Attendance at Meetings of the Audit & Supervisory Board during Fiscal 2017: 14/14 times
1987: Assistant Professor, Faculty of Economics, Nagoya City University
1990: Associate Professor, Faculty of Economics, Nagoya City University
1993: Associate Professor, School of Commerce, Waseda University
1996: Professor, School of Commerce, Waseda University
1997: Senior Research Officer, Ministry of Finance, Institute of Fiscal and Monetary Policy (current Policy Research Institute); Special Officer for Research, Minister’s Secretariat
1999: Professor, School of Commerce, Waseda University
2005: Professor, School of Commerce, Waseda University; Professor, Graduate School of Accountancy, Waseda University
2010: Professor, School of Commerce, Waseda University; Dean, Graduate School of Accountancy, Waseda University
2013: Dean, Graduate School of Accountancy, Waseda University
2016: Professor, Graduate School of Accountancy, Waseda University (present post)
2018: Director who is an Audit & Supervisory Committee Member, the Company (present post)
Keiko Yamagami
Outside Director
Expected Role
After successively holding important posts such as Public Prosecutor at the Supreme Public Prosecutors Office, Keiko Yamagami has been engaged in corporate legal affairs
as an attorney-at-law. She currently plays a key role in the management of the Company from an independent standpoint as an outside Director. The Company is confident
that she will continue to apply her abundant specialized knowledge and experience to the management of the Company.
Attendance at Meetings of the Board of Directors during Fiscal 2017: 14/14 times
Hiroo Sasaki
Outside Director who is
an Audit & Supervisory
Committee Member
Expected Role
Hiroo Sasaki has held important positions at Waseda University, including at the graduate level, in economics and other fields. While Dean of Waseda University’s Graduate
School of Accountancy, he was also involved in the school’s management. Having researched normative economics, he is deeply knowledgeable about vocational ethics and
research ethics and has experience with practical handling of these ethical issues. The Company is confident that he will leverage his abundant specialized knowledge and
experience to supervise and audit the Company’s management from an independent standpoint as an outside Director who is an Audit & Supervisory Committee Member.
30
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Interview with an Outside Director
I will facilitate discussions to further enhance
the effectiveness of Astellas’ corporate
governance, with an aim toward continuously
evolving approach to the best possible form.
Mamoru Sekiyama
Outside Director
Mr. Sekiyama joined Marubeni
Corporation in 1974. After holding key
posts including Senior Executive Vice
President, Member of the Board and
Vice Chairman, he currently serves as
Corporate Adviser to Marubeni
Corporation. He has served as an
outside Director at Astellas since 2017.
Q: Could you please share your perspectives on the Strategic Plan 2018 from your standpoint as an outside Director?
A: I believe that the key elements of Strategic Plan 2018 are the plan’s transparent formulation
process and its system for monitoring progress.
As an outside Director, I would like to discuss two key points concerning Astellas’ Strategic Plan 2018.
My first point concerns the process of formulating the management plan. Strategic Plan 2018 was
formulated based on open discussions in meetings of the Board of Directors. My second point is that a
system for monitoring progress regularly and in great detail has been embedded into meetings of the
Board of Directors, in order to ensure that Astellas steadily achieves its strategic goals.
When formulating Strategic Plan 2018, the Board of Directors held a series of extensive discussions
on the plan, beginning at the draft stage. The outside Directors were supplied with extensive
information on external conditions and the business environment, which served as the basis for the
discussions. Therefore, we, the outside Directors, were able to participate in the discussions based on a
strong understanding of Astellas’ current circumstances and the opportunities it should pursue. In
addition, information on dialogues held between management and shareholders and investors in the
fiscal year ended March 31, 2018 was shared with the outside Directors. Accordingly, the outside
Directors were able to take the expectations and demands of the capital markets into consideration in
the discussions, and the results of those discussions were reflected in Strategic Plan 2018 to the fullest
extent possible. Enhancing the effectiveness of discussions in the Board of Directors is a priority shared
by many companies. I believe that Astellas has been able to conduct in-depth discussions and
formulate Strategic Plan 2018 based on a strong understanding of such priorities.
Under Strategic Plan 2018, Astellas has set three strategic goals and has developed a narrative for
creating innovation by achieving each of those goals. With regard to the Focus Area approach and the
Rx+ business philosophy, I believe that Astellas has developed a convincing narrative for attaining
future asset growth underpinned by extensive discussion. Meanwhile, the success of Strategic Plan
2018 will depend on whether the management team is able to monitor progress and flexibly address
new business issues that arise along the way. This is something I understand very well from my
experience as a business leader. In those roles, I made various decisions on investments according to
management strategies and monitored the progress of those investment projects.
31
Corporate Strategy and Corporate GovernanceAstellas Pharma Inc. ANNUAL REPORT 2018 In this respect, with the start of Strategic Plan 2018, Astellas has adopted a system of monitoring
the degree of achievement of its strategic goals for the business reports submitted to the Board of
Directors. This clearly shows that Astellas understands the importance of monitoring progress toward
the goals of Strategic Plan 2018. I have every expectation that Astellas will further enhance the
reporting framework, thereby enabling it to monitor progress on Strategic Plan 2018 and identify new
business issues in a more timely and accurate manner than before. In addition, even when there is a
change in investment projects, I believe that the effectiveness of the Board of Directors will be
increased further by enabling the Board to identify signs of changes as early as possible, make flexible
decisions, and respond to those changes appropriately.
Q: What actions must Astellas take to further enhance the effectiveness of the Board of Directors?
A: I believe that it is crucial for Astellas to further increase and enhance discussions on
strategies and related matters amongst the Board of Directors.
The business environment is changing so rapidly that even a slight delay in decision-making can end
up giving competitors an insurmountable lead. Business leaders must have the ability to make
decisions rapidly and the execution skills needed to go all-out and get things done at critical moments.
In these circumstances, the Board of Directors has an important role to play in enhancing discussions
from many different points of view and supporting appropriate risk-taking by business leaders.
Meanwhile, a business environment in a state of constant flux can quickly render strategies
obsolete—even strategies that appeared ideal when they were first approved. In such an environment,
it is increasingly important to conduct monitoring in order to identify any signs of change at the
earliest opportunity. I have already discussed this point earlier. When changes are identified, it is also
important for the Board of Directors to hold discussions with a view to reexamining the risks and the
appropriateness of strategies, and to flexibly revise the strategies as needed. This is another
responsibility of the Board of Directors.
In the fiscal year ended March 31, 2018, Astellas evaluated the overall effectiveness of the Board of
Directors. This evaluation identified the following two issues: (1) To carry out Strategic Plan 2018, the
Board of Directors will monitor the constantly changing internal and external environmental trends
and engage in more effective discussion of strategy, and (2) The Board of Directors will oversee whether
appropriate measures have been taken against risks identified by the framework for systematic risk
evaluation that were strengthened in the fiscal year ended March 31, 2018. I believe that it is crucial to
enhance the effectiveness of the Board of Directors by giving consideration to those issues.
Q: In your view, what is the significance of Astellas’ transition to a company with an Audit & Supervisory Committee?
A: I believe that this is the best possible structure for improving discussions on strategies and
related matters.
Pursuant to a resolution passed at the Annual Shareholders’ Meeting held in June 2018, Astellas has
transitioned to a company with an Audit & Supervisory Committee.
Operating as a company with an Audit & Supervisory Committee structure enables the delegation
of a significant portion of the Board of Directors’ decision-making authority for business execution to
Executive Directors, and allows the agenda of Board of Directors meetings to be set more flexibly. This
change in the organizational blueprint of the Company to further enhance discussions on
management strategy and related issues amongst the Board of Directors is an initiative to address the
issues identified in the evaluation of effectiveness.
In my view, the ideal corporate governance structure varies from company to company and with
the company’s circumstances. Astellas selected this structure as a corporate governance model that
better fits its situation, after carefully considering various factors from many different angles, such as
32
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 the environment surrounding the Company, its VISION, the steady execution of Strategic Plan 2018,
and accountability to stakeholders. I believe that this is a very positive change in structure.
Going forward, Astellas will continue to explore ways to further enhance its corporate
governance. We, the outside Directors, will renew our awareness on a daily basis and continue to
contribute positively to ensuring the effective functioning of this structure and its continued evolution
and development.
Q: What kinds of attributes did you rate highly in nominating Kenji Yasukawa as the new President and CEO?
A: I find great promise in Mr. Yasukawa’s expansive perspective and expertise,
as well as his ability to make decisions promptly and appropriately.
Every year, Astellas discusses successor candidates for president and succession planning in the
Nomination Committee. The nomination of Mr. Yasukawa was made appropriately through a highly
transparent and acceptable process.
Mr. Yasukawa has an expansive perspective that allows him to make decisions based on a holistic
view of the entire Company, backed by his wide range of professional experience working in the
development department and Product & Portfolio Strategy, as well as a strong understanding of
science. He also has an extensive network both inside and outside the Company. Over the past few
years, Mr. Yasukawa has demonstrated leadership in the execution of Strategic Plan 2015-2017 and the
formulation of Strategic Plan 2018 as Chief Strategy Officer (CSTO) of the Company.
Therefore, I nominated Mr. Yasukawa as the successor to the President based on my belief that he
will be able to make prompt and bold decisions guided by a strong understanding of Astellas as a
whole. Another key reason for my nomination is that I believe Mr. Yasukawa will be able to fulfill
Astellas’ accountability to stakeholders on matters including decision-making processes. This is an
attribute that was emphasized strongly by Chairman of the Board Yoshihiko Hatanaka, who previously
served as President and CEO.
Q: What are your expectations for Astellas and Mr. Yasukawa going forward?
A: I expect Astellas and Mr. Yasukawa to continuously transform the Company
to realize its VISION.
Strategic Plan 2018 sets forth specific strategies for Astellas to overcome the impact of the expiry of
the patent periods for core products from 2019 onward and to create a new growth trajectory. In the
course of executing those strategies, Astellas will need to demonstrate an even greater ability to
respond to change than before.
I believe that the ability to respond to change comes from diversity. Homogeneous groups tend
to present risks when they are exposed to headwinds. However, organizations that can place their
confidence in people who have completely different ways of thinking or people who may have
different opinions than the views of decision makers, are able to surmount challenging situations with
flexibility and strength.
Earlier, I noted that “Business leaders must have the ability to make decisions rapidly and the
execution skills needed to go all-out and get things done at critical moments.” In my view, Mr.
Yasukawa possesses these qualities, as well as the flexibility needed to embrace different opinions.
Astellas is an enterprise that achieves growth through transformation. Guided by the leadership of
Mr. Yasukawa, I expect Astellas to drive relentless evolution in order to achieve its strategic goals and
make steady strides toward realizing its VISION: “Astellas is on the forefront of healthcare change to turn
innovative science into value for patients.”
33
Corporate Strategy and Corporate GovernanceAstellas Pharma Inc. ANNUAL REPORT 2018 Business Review
Achieve a Sustainable Increase in
Enterprise Value and Fulfill Social
Responsibilities through Business Activities
In all of its value chains, Astellas will make steady strides toward the strategic goals laid out
in Strategic Plan 2018. By doing so, Astellas will seek to achieve a sustainable increase in
enterprise value, while fulfilling its social responsibilities.
Astellas Pharma Inc. ANNUAL REPORT 2018 34
Executive Committee (as of July 2018)
The Executive Committee discusses important matters of management across Astellas. It is chaired by the Representative
Director, President and CEO, and comprises top management and General Counsel as standing members. Extended
members include the officers responsible for research, development and pharmaceutical technology capabilities together
with the officers responsible for each region, and these members participate in any necessary discussions at the request of
the chairman.
Standing Members
Fumiaki Sakurai
Chief Administrative Officer &
Chief Ethics & Compliance Officer
Linda Friedman
General Counsel
Chikashi Takeda
Chief Financial Officer
Yukio Matsui
Chief Commercial Officer
Bernhardt Zeiher, M.D.
Chief Medical Officer
Kenji Yasukawa, Ph. D.
Representative Director,
President and CEO
Naoki Okamura
Chief Strategy Officer
Extended Members
Nobuaki Tanaka
President, Japan
Sales & Marketing
Masatoshi Kuroda
President, Asia &
Oceania Business
Percival Barretto-Ko
President,
Americas Operations
Dirk Kosche
President, Europe,
Middle East and
Africa Operations
Akihiko Iwai
President, Drug
Discovery Research
Mitsunori Matsuda
President, Pharmaceutical
Technology
35
Business ReviewAstellas Pharma Inc. ANNUAL REPORT 2018 Executive Messages
Speaking with the CSTO Strategic Plan 2018
Delivering on Corporate Strategy by Setting
Clear Priorities and Enhancing Monitoring
Naoki Okamura
Chief Strategy Officer (CSTO)
Q: How will you execute the strategies laid out in Strategic Plan 2018?
A: We have started implementing systems to monitor our progress toward the achievement of
our strategic goals.
Strategies are only meaningful when they are executed appropriately. Concurrently with the
formulation of Strategic Plan 2018, Astellas has built and started implementing systems to monitor the
degree of achievement of its three strategic goals.
We will track our progress toward those goals more comprehensively by monitoring the
allocation of management resources against the strategic goals as well as the number of projects
based on the Focus Area approach, which holds the key to realizing Astellas’ vision. In order to succeed
with the Focus Area approach, we must obtain the necessary resources to invest in this approach. To
this end, we will continue to maximize product value and operational excellence, along with properly
monitoring our progress toward these goals. In doing so, we intend to steadily deliver a higher level
of performance.
Q: Why did you set forth “Developing Rx+ programs” as a strategic goal in Strategic Plan 2018?
A: We believe that “Developing Rx+ programs” is a key element of driving sustainable growth
and realizing Astellas’ VISION.
Under Strategic Plan 2018, we have set clear management priorities. In the process, we have set forth
“Developing Rx+ programs” as one of our strategic goals. This also signals how we view the current
business environment.
Advances in digital technologies and other areas are rapidly and dramatically reshaping the
structure of the industry and business environment. Against this backdrop, Astellas recognizes that it
must establish new businesses and core business models from a long-term perspective by applying
the strengths developed in its traditional core business, the prescription pharmaceutical (Rx) business.
By pursuing innovative science, we will create optimal medical solutions (Rx+) that provide value to
patients in fields beyond the Rx business, thereby achieving additional growth. Doing so is inseparable
from realizing Astellas’ VISION.
36
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Speaking with the CMO Creating Future Value
Expanding Our Pipeline with a Transition
to the Focus Area Approach
Bernhardt Zeiher, M.D.
Chief Medical Officer (CMO)
Q: What were the key pipeline achievements from 2015-2017 and what are the key priorities for enhancing the pipeline
moving forward?
A: Astellas continues to progress our key mid- and late-stage projects while expanding our
pipeline in line with our corporate strategy.
Under Strategic Plan 2015-2017, we significantly advanced our mid- to late-stage pipeline and built
capabilities in new technology platforms and treatment modalities to support our future focus.
In oncology, we are delivering new value to patients across a spectrum of different cancers with
additional indications for enzalutamide, potential new treatment options in acute myeloid leukemia,
advanced bladder cancer, gastric cancer, and three early-phase immuno-oncology antibodies.
In medical specialties, we are exploring the biology underpinning many diseases, and our pipeline
includes potential treatments in women’s health, urology and nephrology, immunology and
neuroscience, while also advancing new areas of discovery research in areas such as regenerative
medicine, stem cell therapies and muscle diseases.
We are always exploring opportunities to grow our robust pipeline through business
development activities that align with our strategy.
Q: How will a full transition to the Focus Area approach improve R&D productivity?
A: We will improve R&D productivity by leveraging our strengths and investing new resources
into innovative science.
We will create value for patients by focusing on the science of innovative biologies and modality/
technology platforms first, then seek to apply them across a broad range of diseases. This transition,
however, requires us to change our mindset and capabilities.
Previously, most of our early development programs came from internal discovery research that
we supplemented with later stage licensing or acquisitions. An increased emphasis on early stage
collaborations with academia or biotechs requires a more flexible approach, including using external
resources to perform some early-stage studies. An increased emphasis on novel biologies also requires
deeper capability in translational science.
We will of course maintain a disciplined approach to early development, investing against key
milestones or, in select programs, taking a more aggressive “fast track” approach.
37
Business ReviewAstellas Pharma Inc. ANNUAL REPORT 2018 Speaking with the CAO & CECO Sustainable Enhancement of
Corporate Value and Compliance
Promoting Initiatives to Fulfill the Demands
and Expectations of Diverse Stakeholders
Fumiaki Sakurai
Chief Administrative Officer & Chief Ethics & Compliance Officer (CAO & CECO)
Q: What kinds of actions are you taking to solve social issues?
A: We are focusing on improving Access to Health by making the most of Astellas’ strengths.
Improving Access to Health is a particularly crucial social issue that we should be addressing as a
pharmaceutical company. We continue to make contributions to improving Access to Health by
harnessing our technologies, expertise and resources in each of the following four areas: (1) Creating
innovation, which is the basis of our core business, (2) Enhancing availability of innovative medicines,
(3) Strengthening healthcare systems, and (4) Improving health literacy. In the course of solving social
issues, Astellas will make maximum use of partnerships as necessary.
Going forward, Astellas will continue to further expand opportunities to contribute to improving
Access to Health, as it seeks to generate value for society and sustainably increase corporate value.
Q: What kinds of measures are you implementing to strengthen the compliance program?
A: We are continuing to build a globally consistent compliance program encompassing
emerging countries and continuing to foster a corporate culture based on the highest ethical
standards and integrity.
Astellas is strongly committed to the ongoing strengthening of its compliance program, as highlighted
by the globalization of the Ethics & Compliance function in April 2016.
The goal of strengthening the compliance program is to promote ethics and compliance in a
globally consistent manner, including in emerging countries. Specific measures have included
establishing the Astellas Group Code of Conduct and various global policies, as well as upgrading and
expanding the internal whistleblowing system and online training system on a global basis. We have
also increased personnel numbers by assigning full-time compliance staff independent of business
departments to almost all countries where Astellas has a sales office. Moreover, we are doing more
than merely establishing compliance policies and processes. We are also taking steps that continue to
foster a corporate culture based on the highest ethical standards and integrity—one that serves as a
strong foundation for those policies and processes.
38
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Research and Development
Research and Development
Research and Development
Astellas aims to create a continuous stream of innovative
medicines. We will focus on steady progress of six key
post-POC pipeline projects that are expected to contribute
to midterm growth, and will pursue cutting-edge science
with efficient drug discovery approaches.
Core Strategy of Research and Development
Astellas sets targets of research and development (R&D)
from multiple perspectives through the Focus Area
approach and works to create innovative medicines to
fulfill high unmet medical needs based on the concepts of
Best Science, Best Talent (optimal personnel), and Best
Place (optimum environment).
We determine the priorities of development
candidates at the early stages and optimize resource
allocation according to priorities. These efforts have
achieved results in reduction of the time for R&D and
improvement of cost efficiency.
Key Post-POC Pipeline Projects
XTANDI (generic name: enzalutamide)
XTANDI is marketed worldwide for the treatment of
metastatic castration-resistant prostate cancer (CRPC)*.
Development is ongoing to expand the indication to
earlier stages of prostate cancer.
In September 2017, Phase 3 PROSPER trial in patients
with non-metastatic CRPC had achieved its primary
endpoint. Astellas submitted regulatory applications based
on these data in the U.S. and Europe. The U.S. Food and
Drug Administration (FDA) granted approval for non-
metastatic CRPC in July 2018.
Two Phase 3 trials (ARCHES and EMBARK) are also
ongoing in patients with metastatic hormone-sensitive
prostate cancer (HSPC) and non-metastatic HSPC.
* In Japan, XTANDI has been approved for CRPC.
In late-stage development, we allocate management
Maximizing the Value of Enzalutamide in Prostate Cancer
resources extensively to six key post-POC* projects. We aim
to characterize the therapeutic potential of these projects
in development. In Strategic Plan 2018, the potential
annual sales expected for these projects are described in
the table below.
* POC (“Proof of Concept”): Verification of clinical efficacy
Initial diagnosis
Active surveillance
Radiation
Surgery
Salvage therapy
Definitive
Therapy
Potential Size of Key Post-POC Pipeline
Potential size*1
(at peak, billion yen)
400 – 500
200 – 300
100 – 200
50 – 100
Key post-POC pipeline*2
• XTANDI (enzalutamide)
• fezolinetant
• zolbetuximab
• enfortumab vedotin
• gilteritinib
* Not disclosed for roxadustat
*1 Sales amount in the case of successful development in the patient segments
currently being evaluated. Some patient segments under evaluation may not
be included in the potential size because development is still in an early stage.
*2 Target diseases listed in the current pipeline list (P45) are included in the
projection. XTANDI also includes sales for indications that have already
been approved.
EMBARK
M0 HSPC*1
Hormone or
Castration-Sensitive
ARCHES
M1 HSPC*2
Recurrent
M1 HSPC*2
Newly-diagnosed
PROSPER
M0 CRPC*3
PREVAIL
M1 CRPC*4 (first-line)
Castration-Resistant
AFFIRM
M1 CRPC*4 (second and later lines)
*1 M0 HSPC: Non-metastatic hormone-sensitive prostate cancer
*2 M1 HSPC: Metastatic hormone-sensitive prostate cancer
*3 M0 CRPC: Non-metastatic castration-resistant prostate cancer
*4 M1 CRPC: Metastatic castration-resistant prostate cancer
39
Business ReviewAstellas Pharma Inc. ANNUAL REPORT 2018 Gilteritinib
Gilteritinib is a FLT3/AXL inhibitor which is being
developed for acute myeloid leukemia (AML). Gilteritinib
inhibits both FLT3, a receptor-type tyrosine kinase known
to be involved in cancer cell proliferation, and AXL, which
is reported to be associated with resistance to some forms
of chemotherapy.
AML is a cancer that is most commonly experienced
in elderly people with the incidence rate increasing with
age. In 2017, the numbers of newly diagnosed AML
patients were around 17,500 in the U.S., 13,200 in western
Europe, and 5,600 in Japan*. The prognosis of relapsed or
refractory FLT3-mutation positive (FLT3mut+) AML is poor
with low response rates to salvage therapy. Resistance to
current AML treatment and ineligibility of high-intensity
induction chemotherapy for elderly patients due to an
excessive physical burden also make challenges in AML
treatment. A promising new treatment has been awaited
in AML treatment landscape.
Development Progress of Gilteritinib in Each Region
Development stage
Regulatory designation
Japan
Filed in Mar. 2018
• SAKIGAKE designation
• Orphan Drug designation
U.S.
Filed in Mar. 2018
(PDUFA* date: Nov. 2018)
• Fast Track designation
• Orphan Drug designation
Europe Phase 3
• Orphan designation
* PDUFA: Prescription Drug User Fee Act
Astellas is conducting the multiple Phase 3 trials to
evaluate efficacy and safety of gilteritinib in AML patients
at various therapeutic stages. In March 2018, a new drug
application (NDA) for marketing approval of gilteritinib
was submitted in Japan and the U.S. for the treatment of
adult patients with FLT3mut+ relapsed and refractory AML
based on the interim analysis data from the ongoing
Phase 3 ADMIRAL trial. In this patient population,
gilteritinib has been granted for SAKIGAKE designation in
Japan and Fast Track designation in the U.S. Astellas has
been working to accelerate development of gilteritinib by
utilizing the various expedited regulatory pathways in
each region. The status of filing and regulatory designation
is shown in the table in this page.
* Annual Incidence in 2017 in U.S., EU5 and JP. CancerMPact (Synix Inc./Kantar Health)
Gilteritinib in AML Treatment Landscape
AML patients
FLT3-mutation positive ~30%
High-intensity
induction chemotherapy
Phase 1
Ongoing
Low-intensity
chemotherapy
LACEWING
Ongoing
Chemotherapy
consolidation
Transplantation
Maintenance therapy
Maintenance therapy
GOSSAMER
Ongoing
MORPHO
Ongoing
Salvage therapy
ADMIRAL
Ongoing
Filed in Japan and U.S.
40
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Research and Development
Enfortumab Vedotin
Zolbetuximab
Enfortumab vedotin is an antibody drug conjugate*1
(ADC) targeting Nectin-4, a cell adhesion molecule. While
it is stable in blood, it is designed to kill only the targeted
cancer cells after its internalization into cancer cells
expressing Nectin-4.
Astellas is developing enfortumab vedotin as a
treatment for urothelial cancer. In Japan, the U.S. and
Europe, approximately 233,000*2 new patients are
diagnosed with urothelial cancer annually. It is reported
that some patients are confirmed for metastasis at the
time of initial diagnosis of urothelial cancer and the five-
year survival rate is low. A high recurrence rate is reported
even if diagnosed and treated at an early stage. A
promising new treatment is awaited.
Currently, aiming for earlier approval in each region,
Phase 2 and Phase 3 trials in patients with locally advanced
or metastatic urothelial cancer previously treated with a
checkpoint inhibitor (CPI) are ongoing. Enfortumab
vedotin is also being evaluated for the various usage in
urothelial cancer including combination therapy with a CPI
or monotherapy.
The U.S. FDA has granted Breakthrough Therapy
designation to enfortumab vedotin for patients with
locally advanced or metastatic urothelial cancer who were
previously treated with CPIs.
*1 Antibody drug conjugate (ADC): ADCs are monoclonal antibodies that are
designed to selectively deliver cytotoxic agents to cancer cells.
*2 Annual Incidence in 2017 in U.S., EU5 and JP. CancerMPact (Synix Inc./Kantar
Health)
Development Progress of Enfortumab Vedotin in Locally
Advanced or Metastatic Urothelial Cancer
Clinical trial
Patient segment
Progress
Phase 3
Phase 2
Patients with prior CPI treatment
(platinum-pretreated)
Patients with prior CPI treatment
Cohort 1: Platinum-pretreated
Cohort 2: Platinum naïve
Cisplatin ineligible
Started in Jul. 2018
Started in Oct. 2017
Phase 1b
Combination with CPI
Started in Nov. 2017
Phase 1
Metastatic urothelial cancer patients
Patients with renal insufficiency
Patients with prior CPI treatment
Ongoing
Data presented at
medical conferences
Zolbetuximab is an antibody that targets Claudin 18.2, a
transmembrane protein that forms a tight junction
connecting and binding two adjoining cell membranes.
Claudin 18.2 is expressed locally in stomach cells for
normal cells. Claudin 18.2 is expressed in various cancer
types including gastrointestinal adenocarcinomas and
pancreatic, biliary duct, ovarian and lung cancers.
Gastric cancer is the fourth leading cause of cancer
death worldwide*1. Moreover, the overall five-year survival
rate for metastatic gastric and gastroesophageal junction
(GEJ) cancer is under 20%*2. Gastric and GEJ cancer is one
of the malignancies with the highest unmet medical
needs. Chemotherapy and anti-HER2 antibodies are widely
used for the treatment of metastatic or recurrent gastric
and GEJ cancer. However, other therapeutic options are
awaited especially in HER2-negative patients with a lack of
effective targeted therapies.
Astellas is developing zolbetuximab as a treatment for
gastric and GEJ cancer. Two Phase 3 trials are planned to
evaluate zolbetuximab in combination with (1)
mFOLFOX6*3, which is commonly used as the first-line
therapy in Europe and the U.S, and with (2) CAPOX*4, the
preferred regimen in Asia, including China. The former
study was initiated first.
*1 World Health Organization Fact Sheet, 2018
*2 Pennathur et al, 2013; Sahin et al, 2008
*3 mFOLFOX6: Fluorouracil, leucovorin, oxaliplatin
*4 CAPOX: Capecitabine, oxaliplatin
Development Progress of Zolbetuximab
Clinical trial
Trial overview
Progress
Phase 3
Phase 3
Phase 2
vs placebo
Combination with mFOLFOX6
vs placebo
Combination with CAPOX
Monotherapy,
Combination with mFOLFOX6
Started in Jun. 2018
Under preparation
Started in Jun. 2018
41
Business ReviewAstellas Pharma Inc. ANNUAL REPORT 2018
Roxadustat
Roxadustat is hypoxia-inducible factor (HIF) prolyl
hydroxylase (PH) inhibitor with oral administration.
Roxadustat is thought to increase HIF involving in the
production of red blood cells by inhibiting HIF-PH, thereby
enhancing the production of red blood cells and
improving anemia. Astellas is currently developing
roxadustat for anemia associated with chronic kidney
disease (CKD) in patients on dialysis and non-dialysis.
Anemia is one of the common complications of CKD.
It is said that the progression of anemia in CKD leads to
end-stage renal disease and increases the mortality rate.
Therefore, managing the hemoglobin levels in patients
with anemia in CKD is a crucial issue in the treatment of
renal dysfunction.
Roxadustat has a different mechanism of action than
the conventional treatments and can be administered
orally. It is thus expected to become a new treatment
option which could provide both effectiveness and
convenience for patients.
For filing and reimbursement in Europe, a total of six
Phase 3 trials are being conducted. In addition, six Phase 3
trials are being conducted in Japan. Four Japanese trials in
patient with anemia in CKD on dialysis have all achieved
their primary objectives. Astellas is planning to submit a
Development Progress of Roxadustat
Global
Treatment
phase
Trial overview
Status
HIMALAYAS: Incident dialysis, vs epoetin
alfa
Dialysis
SIERRAS: Stable dialysis, vs epoetin alfa
PYRENEES: Stable dialysis, vs epoetin alfa
or darbepoetin
DOLOMITES: vs darbepoetin
Non-
dialysis
ALPS: vs placebo
ANDES: vs placebo
Enrollment
completed
Enrollment
completed
Enrollment
completed
Enrollment
completed
Study completed
Enrollment
completed
Japan
Treatment
phase
Dialysis
Non-
dialysis
Trial overview
Status
Hemodialysis: Conversion, vs darbepoetin
Study completed
Hemodialysis: Conversion, long-term
Study completed
Hemodialysis: Correction (ESA*-naïve)
Study completed
Peritoneal dialysis
Study completed
Conversion, vs darbepoetin
Correction (ESA*-naïve)
Recruiting
Enrollment
completed
* ESA: Erythropoiesis-stimulating agents
NDA in Japan for anemia associated with CKD in patients
on dialysis in 2018.
Fezolinetant
Fezolinetant is an antagonist of the G protein-coupled
receptor (GPCR) known as NK3 receptor. Fezolinetant is
expected to act on specific neurons that control body
temperature in menopausal women, and is being
developed for menopause-related vasomotor symptoms
(MR-VMS: hot flashes and night sweats). It is reported that
MR-VMS is recognized in nearly 80%*1 of menopausal
women. Given that existing hormone replacement
treatments present safety concerns*2, a safe and effective
non-hormone therapy is awaited as a new treatment option.
In Phase 2a (POC) trial, fezolinetant showed positive
results in terms of the improvement in the frequency and
severity of hot flashes. Based on these results, Astellas
expects fezolinetant to become a safe, first-in-class, non-
hormonal treatment for MR-VMS. Phase 2b trial is currently
ongoing in the U.S. with an expected data readout in 2018.
*1 UpToDate – Clinical manifestations and diagnosis of menopause (Literature
review current through: June 2017)
*2 JAMA 2013 Oct 2; 310(13): 1353-1368
U.S. Annual Branded TRx*1 Trends for MR-VMS*2
80,000
60,000
40,000
20,000
0
N
u
m
b
e
r
o
f
T
R
x
,
(
1
0
0
0
s
)
Data released
by WHI*3 in 2001
Unmet medical needs
2016 market
Approx. US$1 billion
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
*1 TRx: Total prescriptions
*2 IQVIA NPA (2000-2016)/IQVIA NSP (2000-2016) (3HTs and SSRI), NAMS 2015
Position Statement
*3 WHI: Women’s Health Initiative
42
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018
Research and Development
R&D Topics during the Year
Progress in Development (Approval and Filing)
Japan
Europe
United States
2017
APR
OCT
MAY
sitagliptin (DPP-4 inhibitor)/
ipragliflozin (SGLT2 inhibitor）
Filed for the fixed-dose combination
Gonax for prostate cancer
NOV
Filed for an additional formulation of a 12-week
extended-release formulation
JUN
mirabegron (beta-3 adrenergic receptor agonist)/
solifenacin (muscarine M3 receptor antagonist)
Filed for combination usage of mirabegron
with solifenacin
DEC
fidaxomicin (macrocyclic antibiotic)
Filed for infectious enteritis (susceptible strains:
fidaxomicin susceptible Clostridium difficile)
Bipresso extended-release tablets for depressive
symptoms associated with bipolar disorder
JUL
Approved for improvement of depressive symptoms
associated with bipolar disorder
tacrolimus (immunosuppressant)
Filed for a granule formulation for pediatric patients
AUG
Repatha subcutaneous injection
for hypercholesterolemia
Approved for an additional formulation of
automated mini-doser
Suglat for diabetes mellitus
Filed for an additional indication of type 1
diabetes mellitus
2018
JAN
blinatumomab (Anti-CD19 BiTE antibody)
Filed for acute lymphoblastic leukemia
XTANDI for prostate cancer
Filed for an additional indication of non-metastatic
castration-resistant prostate cancer
XTANDI for prostate cancer
Approved for an additional formulation of tablets
FEB
Vesicare for overactive bladder
Approved for an additional indication of neurogenic
detrusor overactivity in pediatric patients
LINZESS for irritable bowel syndrome
with constipation
SEP
Filed for an additional indication of chronic constipation
MAR
XTANDI for prostate cancer
Approved for an additional formulation of tablets
gilteritinib (FLT3/AXL inhibitor)
Filed for relapsed or refractory FLT3-mutation
positive acute myeloid leukemia
Sujanu fixed-dose combination tablets
for diabetes mellitus
Approved for the combination tablet of ipragliflozin
and sitagliptin
43
Business ReviewAstellas Pharma Inc. ANNUAL REPORT 2018 Capturing New Opportunities
Other
Modality/Technology
Universal Donor Cell technology
In February 2018, Astellas acquired Universal Cells, Inc.,
which had proprietary Universal Donor Cell technology for
producing pluripotent stem cells with the potential to
reduce the risk of immunological rejection in cell therapy.
This acquisition enables Astellas to strengthen and expand
its research and development of cell therapy by combining
this technology and the platform technologies of the
Astellas Institute for Regenerative Medicine.
Reference
Focus Area Approach
P15
Biology
Acquisition of Mitobridge, Inc.
In November 2017, Astellas exercised its exclusive option
rights to acquire Mitobridge, Inc. into a wholly owned
subsidiary and completed acquisition in January 2018.
Mitobridge, Inc. was previously a R&D collaborator
discovering and developing novel drugs that targets
mitochondria function.
Reference
Focus Area Approach
P16
Immunostimulatory gene-loading oncolytic virus
In February 2018, Astellas entered into an exclusive global
licensing agreement with Tottori University on the
development and commercialization of immunostimulatory
gene-loading oncolytic virus. We expect to offer new
opportunities in cancer immunotherapy with this virus via
the induction of antitumor immunity in tumors not
responding to currently available cancer immunotherapies.
* Some rights relating to the fundamental technology are non-exclusive.
Alliance Station established
In April 2017, Astellas and Kyoto University established the
Alliance Station as a new open innovation scheme with
aim of delivering advanced medical treatments. In addition,
the Alliance Laboratory for Advanced Medical Research in
the Graduate School of Medicine Kyoto University was
established as a framework for such activities.
Acquisition of Ogeda SA
In May 2017, Astellas completed its acquisition of Ogeda
SA, making it a wholly owned Astellas subsidiary with the
aim of expanding the pipeline in clinical development.
Besides fezolinetant, NK3 receptor antagonist developing
for menopause-related vasomotor symptoms, Astellas
acquired multiple small molecule compounds in the
preclinical stage for inflammatory and autoimmune diseases.
Reference
Research and Development
P42
Rice-based oral vaccine MucoRice
In May 2017, Astellas and the Institute of Medical Science,
the University of Tokyo (IMSUT) agreed to expand the
scope of the collaborative research program for the rice-
based oral vaccine MucoRice to include vaccines against
cholera, enterotoxigenic E. coli, and viral gastroenteritis
diarrhea. In February 2017, a new collaborative research
agreement was signed with IMSUT, Chiba University and
ASAHI KOGYOSHA CO., LTD. aiming for practical
applications of MucoRice-CTB.
Reference
Access to Health
P63
New collaborative drug-discovery program
In October 2017, Astellas signed an agreement with
Mitsubishi Tanabe Pharma Corporation and Daiichi Sankyo
Co., Ltd. to conduct a joint program JOINUS to discover
new therapeutic drugs using the drug-repositioning
compound libraries.
44
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Research and Development
Status of R&D Pipeline (as of July 2018)
Biology
Modality/Technology
Classification
Target Disease
Phase/Area
Dosage
Form
Licensor*1
FA approach*2
Code No.
Generic Name
(Brand Name)
Oncology
MDV3100
enzalutamide
(XTANDI)
ASP3550
degarelix
(GONAX)
GnRH antagonist
AMG 103
blinatumomab
Anti-CD19 BiTE
antibody
ASP2215
gilteritinib
FLT3/AXL inhibitor
Androgen receptor
inhibitor
Non-metastatic castration-
resistant prostate cancer
Non-metastatic hormone-
sensitive prostate cancer
Metastatic hormone-sensitive
prostate cancer
Prostate cancer
(3-month formulation)
Oral
Pfizer
Approved (Jul. 2018)/US
Filed (Jan. 2018)/Europe
P-III/US, Europe, Asia
P-III/US, Europe, Japan ,Asia
Filed (Nov. 2017)/Japan
Injection
Ferring
Acute lymphoblastic leukemia
Filed (Jan. 2018)/Japan
Injection Amgen
(co-development with
Amgen Astellas)
Oral
In-house
Relapsed or refractory
acute myeloid leukemia
Post-chemo maintenance
acute myeloid leukemia
Post-HSCT maintenance
acute myeloid leukemia
Newly diagnosed acute myeloid
leukemia with low intensity
induction of chemotherapy
Newly diagnosed acute myeloid
leukemia with high intensity
induction of chemotherapy
Filed (Mar. 2018)/US, Japan
P-III/Europe, Asia
P-III/US, Europe, Japan, Asia
P-III/US, Europe, Japan, Asia
P-II/III/
US, Europe, Japan, Asia
P-I/US, Japan
IMAB362
zolbetuximab
ASG-22ME
enfortumab
vedotin
AGS-16C3F
Anti-Claudin 18.2
monoclonal antibody
Gastric and gastroesophageal
junction adenocarcinoma
P-III/US, Europe, Japan, Asia Injection
ADC targeting Nectin-4 Urothelial cancer
P-III/US, Europe, Japan, Asia Injection
ADC targeting ENPP3
Renal cell carcinoma
P-II/US, Europe
Injection
In-house
(Ganymed)
In-house
(co-development with
Seattle Genetics)
In-house
(ADC technology
in-licensed from Seattle
Genetics)
In-house
(ADC technology
in-licensed from Seattle
Genetics)
In-house
(ADC technology,
EuCODE license from
Ambrx)
Injection
Injection
Injection Option agreement with
Potenza Therapeutics
Injection Option agreement with
Potenza Therapeutics
Cancer
immunology
Cancer
immunology
AGS67E
Lymphoid malignancies
AGS62P1
Acute myeloid leukemia
ASP8374/PTZ-201
ASP1948/PTZ-329
Cancer
Cancer
P-I
P-I
P-I
P-I
Immunology, Muscle disease and Ophthalmology
FK506
tacrolimus
ASP015K
peficitinib
ASKP1240
bleselumab
Immunosuppressant
Prevention of rejection after organ
transplantation (Granule
formulation in pediatric use)
Approved (May 2018)/US
Oral
In-house
JAK inhibitor
Rheumatoid arthritis
Filed (May 2018)/Japan
Oral
In-house
Anti-CD40 monoclonal
antibody
Recurrence of focal segmental
glomerulosclerosis
in de novo kidney transplant
recipients
P-II/US
Injection
Kyowa Hakko Kirin
ASP4070/
JRC2-LAMP-vax
DNA vaccine for
Japanese red cedar
Pollinosis caused by Japanese red
cedar
P-II/Japan
Injection
Immunomic
Therapeutics
LAMP-vax
technology
ASP5094
Anti-alpha-9 integrin
monoclonal antibody
Rheumatoid arthritis
P-II/Japan
Injection
In-house
45
Business ReviewAstellas Pharma Inc. ANNUAL REPORT 2018 Code No.
Generic Name
(Brand Name)
Classification
Target Disease
Phase/Area
Dosage
Form
Licensor*1
FA approach*2
Biology
Modality/Technology
CK-2127107
reldesemtiv
Fast skeletal troponin
activator
Cell therapy
(Retinal pigment
epithelium cell)
ASP7317
MA-0211
ASP0892
Spinal muscular atrophy
Chronic obstructive pulmonary
disease
Amyotrophic lateral sclerosis
Dry age-related macular
degeneration,
Stargardt’s macular degeneration
Duchenne muscular dystrophy
Peanut allergy
P-II/US
P-II/US
P-II/US
P-II/US
P-I
P-I
Oral
Cytokinetics
Injection
In-house
(Astellas Institute for
Regenerative Medicine)
Oral
Injection
In-house
(Mitobridge)
Immunomic
Therapeutics
Molecular
motor
Cell therapy
Mitochondria
LAMP-vax
technology
Urology and Nephrology
EB178
solifenacin/
mirabegron
Combination therapy
of solifenacin and
mirabegron
Overactive bladder with
symptoms of urge urinary
incontinence, urgency, and
urinary frequency
Approved (Apr. 2018)/US
Oral
In-house
YM905
solifenacin
Muscarine M3 receptor
antagonist
Neurogenic detrusor overactivity
in pediatric patients
Filed (Feb. 2017)/US
ASP1517/FG-4592
roxadustat
HIF stabilizer
Anemia associated with chronic
kidney disease in patients not on
dialysis and on dialysis
P-III/Europe
P-III/Japan
YM178
mirabegron
Beta-3 receptor agonist Neurogenic detrusor overactivity
P-III/Europe
in pediatric patients
YM311/FG-2216
HIF stabilizer
Renal anemia
Nerve Growth Factor
(NGF) neutralization
antibody
Bladder pain syndrome /
Interstitial cystitis
P-II/Europe
P-I/Japan
P-II/Europe
Oral
Oral
Oral
Oral
In-house
FibroGen
In-house
FibroGen
Injection
In-house
Muscarine M3 receptor
positive allosteric
modulator
Underactive bladder
P-II/Europe, Japan
Oral
In-house
Underactive bladder
Acute kidney injury
P-I
P-I
Oral
In-house
Injection
In-house
(Mitobridge)
Mitochondria
fidaxomicin
Macrocyclic antibiotic
Infectious enteritis (bacterial
target: Clostridium difficile)
Clostridium difficile infection in
pediatric patients
Approved (Jul. 2018)/Japan Oral
Merck
P-III/Europe
AMG 785
romosozumab
Anti-sclerostin
monoclonal antibody
Osteoporosis for those at high risk
of fracture
Filed (Dec. 2016)/Japan
Injection Amgen
SGLT2 inhibitor
Type 1 diabetes
Filed (Jan. 2018)/Japan
Oral
(co-development with
Amgen Astellas)
In-house
(co-development with
Kotobuki)
Guanylate cyclase-C
receptor agonist
Chronic constipation
Filed (Sep. 2017)/Japan
Oral
Ironwood
NK3 receptor
antagonist
Menopause-related vasomotor
symptoms
P-II/US
P-I/Japan
P-II/US
Fibromyalgia
Calcium2+-activated
K+ channel opener
Dopamine D1 receptor
positive allosteric
modulator
Cognitive impairment associated
with schizophrenia
P-II/US
Neuropathic pain
Cognitive impairment associated
with schizophrenia
Prophylaxis of diarrhea caused by
Vibrio cholerae
P-I
P-I
P-I
*1 Compounds with “In-house” in this column include ones discovered by collaborative research.
*2 Focus Area approach
Oral
Oral
Oral
Oral
Oral
Oral
In-house
(Ogeda)
In-house
In-house
Chromocell
In-house
The Institute of Medical
Science, the University
of Tokyo
46
ASP6294
ASP8302
ASP7713
MA-0217
Others
ASP1941
ipragliflozin
(Suglat)
ASP0456
linaclotide
(LINZESS)
ESN364
fezolinetant
ASP0819
ASP4345
ASP1807/CC8464
ASP6981
MucoRice-CTB
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Research and Development
CSR Activities in Research and Development
Research
Ethical Considerations in Research on Human
Subjects and Specimens Derived from Humans
Astellas conducts research on human subjects, and obtains
and conducts research on specimens derived from humans,
after appropriately obtaining the consent of the subjects
in accordance with the Declaration of Helsinki* as well as
the laws, regulations and guidelines of relevant countries.
In Japan, Astellas provides training for researchers in
areas such as bioethics, genomic research and related clinical
research based on a strong commitment to respecting the
human rights of research subjects and protecting the
privacy and confidentiality of their personal information.
The Astellas Research Ethics Committee has been
established with outside members participating in the
committee to determine the ethical acceptability and
scientific propriety of research plans in a fair and impartial
manner.
*1 Laboratory Biosafety Manual 3rd Edition
*2 Biosafety in Microbiological and Biomedical Laboratories 5th Edition
*3 NIH Guidelines for Research Involving Recombinant or Synthetic Nucleic Acid
Molecules
Use of Genetic Resources
Astellas has published its Position on Genetic Resources,
and is committed to full compliance with the relevant laws
and regulations of countries supplying genetic resources,
and to the fair distribution of profits derived from the use
of such resources according to the conditions mutually
agreed upon with each country. This commitment is based
on the concept of genetic resource utilization and the
associated distribution of profits set out in the Nagoya
Protocol*1 adopted by the Conference of the Parties to the
Convention on Biological Diversity*2. The impacts of the
use of new genetic modification technologies on the
environment, biodiversity, and human health are not fully
known. Therefore, Astellas will proceed cautiously when
using these technologies while remaining mindful of the
need to preserve biodiversity and consider ethical issues.
* Declaration of Helsinki: A statement of ethical principles for medical research
*1 Nagoya Protocol: Protocol on access to genetic resources and the fair and
involving human subjects, addressed to physicians and others who are involved
in medical research on human subjects.
equitable sharing of benefits arising from their utilization
*2 The Convention on Biological Diversity: International convention on the
sustainable use and conservation of biological diversity
Ethical Considerations in Animal Testing
Treatment of Intellectual Property
Appropriate protection of intellectual property is critical to
addressing unmet medical needs and maintaining a
competitive advantage. With this in mind, Astellas has
established a Policy on Intellectual Property. In view of the
importance of improving people’s access to health,
Astellas participates in the Patent Information Initiative for
Medicines (Pat-INFORMED) implemented by the World
International Patent Organization (WIPO) to ensure easy
access to Astellas’ patent information on medicines by
health agencies tasked with the procurement of medicines
in various countries.
Moreover, we are committed to not filing or enforcing
patents in countries facing significant economic
challenges. These select countries are decided by referring
to those designated as Least Developed Countries (LDCs)
defined by the United Nations or Low Income Countries
(LICs) defined by the World Bank.
Astellas conducts animal testing based on its Policy on
Animal Care and Use. We have established the Corporate
Institutional Animal Care and Use Committee with outside
members participating in the committee, to determine
whether to conduct animal testing based on the 4R
Principles*1. All of Astellas’ animal testing facilities have
acquired accreditation from AAALAC international*2.
*1 4R Principles: Developing non-animal testing alternatives and replacing animals
of phylogenetically lower species (Replacement); reducing the number of
animals involved to the minimum necessary to achieve the scientific purpose
(Reduction); avoiding the infliction of distress on animals wherever possible
(Refinement); and scientifically and ethically justifying animal use in light of
their significance, necessity, predictability and other criteria (Responsibility).
*2 AAALAC International: The Association for Assessment and Accreditation of
Laboratory Animal Care International. An international organization that
promotes the humane treatment of animals through voluntary accreditation
and assessment programs. Studies are undertaken from both scientific and
ethical standpoints to verify the quality of animal control and use programs.
Biotechnology and Biohazard Control
Astellas handles genetically modified organisms and
performs experiments using materials containing
pathogens in compliance with the World Health
Organization Laboratory Biosafety Manual*1, the U.S.
Centers for Disease Control (CDC) Biosafety Manual*2 and
the U.S. National Institutes of Health Guidelines*3, as well
as the laws of individual countries.
47
Business ReviewAstellas Pharma Inc. ANNUAL REPORT 2018 Clinical Development
Respect for Human Rights, Protection of the
Privacy and Confidentiality of the Personal
Information of Clinical Trial Subjects, and
Assurance of Reliability in Clinical Trials
Astellas conducts clinical trials to assess the efficacy and
safety of new drug candidates in patients under the
Declaration of Helsinki, Good Clinical Practice (GCP) and all
relevant laws and regulations with full consideration to
protecting human rights and the privacy and
confidentiality of clinical trial subjects’ personal information.
Clinical study protocols developed by Astellas are evaluated
and approved for ethical acceptability and scientific
validity by internal and external evaluation committees.
In conducting clinical trials, Astellas confirms that
clinical trial subjects have provided informed consent,
having received a full explanation of the purpose and
methods of the trial, its expected benefits and disadvantages,
matters related to compensation for health impairment
and other details. Moreover, we implement education and
training for any employees or staff members involved in
clinical trials, and monitor medical institutions that
perform clinical trials to ensure full GCP compliance.
In addition, we manage trial data appropriately to
protect the privacy and confidentiality of the personal
information of clinical trial subjects. Periodic assessments
are also made to check that any outsourced clinical trials
are conducted in accordance with the same standards.
Disclosure of Information on Clinical Trials and
Trial Results
Astellas is committed to increasing transparency and
providing disclosure of clinical trial data. Maximizing the
value of clinical trial data, and putting it to good use in
driving scientific advancement and increasing innovation,
requires that the clinical trial data be appropriately
accessible to the research community and others who
might utilize it. The Policy on Disclosure of Clinical Trial
Data has been published on the Company website to
present Astellas’ position on this matter.
Specifically, Astellas provides patient-level data that
have been anonymized in accordance with applicable laws
and regulations through an external website*1 to those
scientists and healthcare professionals requesting it.
Doctors and the public can confirm summaries of clinical
trial findings via the website for clinical trial data disclosure.
This website also gives patients access to plain language
summaries of study results prepared for non-experts*2.
*1 Patient-level data are provided through the following website:
http://www.clinicalstudydatarequest.com
*2 Results of the clinical trials are provided through the following website:
https://www.astellasclinicalstudyresults.com/Welcome.aspx
Patient Centricity in Clinical Drug Development
Real-world considerations in clinical trials are increasingly
important in ensuring that our studies address current
medical practices and patient needs.
Patient centricity is now a focus for regulatory
authorities and the pharmaceutical industry. The patient-
centric approach is being discussed at all points in the
drug development value chain, from discovery through to
commercialization.
We are pursuing patient centricity in clinical development.
To do so, we are trying to incorporate insights from real-
world data into the planning of clinical trials by
understanding how healthcare is provided to patients.
Efforts are being made to include patient input in how to
optimally design clinical trials, recruit participants, and
identify relevant endpoints that patients care most about.
For example, we use patient-reported outcomes
(PROs) such as questionnaires and patient diaries to
monitor and assess patients’ health conditions. In addition,
we use real-world data for estimation of target populations
based on the morbidity rate and ineligible cases in
screening, and feasibility of studies in clinical trial facilities.
As a pilot project, we established a patient-friendly website
for an investigational drug to support patient/caregiver-
focused recruitment and health literacy recommendations.
Especially in the muscle disease field, we are working with
patient organizations. Working closely with those
organizations, we are striving to reflect valuable insights
from patients and caregivers in clinical trial designs.
Through these activities, we try to make it easier for
patients to participate in clinical trials, as we work to
obtain trial results with greater clinical significance.
Please refer to the URL below for information about the following CSR
activities in research and development.
• Ethical Considerations in Stem Cell Research and Development
• Expanded Access to Investigational Medicines
Web https://www.astellas.com/en/sustainability/
business-activities/
Please refer to the following URL for information about our policies and
position statements.
Web https://www.astellas.com/en/about/
policies-and-position-statements/
48
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018
Manufacturing to Sales and Procurement
Manufacturing to Sales and Procurement
clinical experience to further increase penetration of this
drug among urologists.
In the U.S., Astellas and the Pfizer Group co-promote
XTANDI and share profits equally. In all countries excluding
the U.S., Astellas commercializes XTANDI, while paying the
Pfizer Group royalties based on sales.
* In Japan, XTANDI has been approved for the treatment of castration-resistant
prostate cancer.
Fiscal 2017 Performance and Outlook
Sales of XTANDI were ¥294.3 billion, an increase of 16.8%
year on year.
Looking at regional sales of XTANDI, sales in Japan
increased 11.4% to ¥26.1 billion. Sales in the Americas rose
9.2% to US$1,404 million. In this region, U.S. sales increased
7.2% to US$1,303 million. In EMEA, sales rose by 14.6% to
€823 million. In Asia & Oceania, sales increased 47.3% to
¥5.8 billion, marking overall growth. Sales increased across
all regions as XTANDI steadily gained traction among
chemotherapy-naïve patients.
Sales of XTANDI by Region
Americas
Japan
EMEA
Asia & Oceania
(¥ billion)
400.0
300.0
200.0
100.0
0
+16.8%
252.1
85.3
4.0
139.4
+5.5%
294.3
5.8
310.3
7.7
106.7
155.6
119.7
154.7
23.4
2017.3
26.1
2018.3
28.2
2019.3
(Forecast)
Overview of Main Products
Astellas is focused on maximizing the value of the main
products that will drive growth in each region, such as
XTANDI and Betanis/Myrbetriq/BETMIGA.
Prostate Cancer Treatments
XTANDI
Business Environment and Basic Strategy
According to the American Cancer Society, more than
164,000 men are expected to be diagnosed with prostate
cancer in the U.S. in 2018. In Europe, it is estimated that
approximately 365,000 people were diagnosed with
prostate cancer in 2015.
XTANDI is a once-daily oral androgen receptor
inhibitor. It was launched in the U.S. in 2012 to treat
patients with metastatic castration-resistant prostate
cancer who had previously received chemotherapy
through docetaxel. In 2014, XTANDI obtained an additional
indication for the treatment of patients with
chemotherapy-naïve metastatic castration-resistant
prostate cancer. As of March 2018, XTANDI is sold in more
than 70 countries and regions around the world, including
Japan, the Americas, EMEA and Asia & Oceania. It has so far
been used in the treatment of more than 310,000 patients.
XTANDI stands out as a significant growth driver for
Astellas. We aim to establish the position of XTANDI as the
first choice of therapy for metastatic castration-resistant
prostate cancer*, for which it is currently indicated. To
reach this goal, we will leverage our solid presence in the
urology field and our abundant data based on extensive
49
Business ReviewAstellas Pharma Inc. ANNUAL REPORT 2018 Overactive Bladder (OAB) Treatments
Betanis/Myrbetriq/BETMIGA and Vesicare
Business Environment and Basic Strategy
OAB can trigger urinary urgency issues (involving cases
where urge urinary incontinence is present and others
where it is not), and it is often associated with urinary
frequency and nocturia. By 2018, approximately 546
million people worldwide are expected to contract OAB*.
Astellas sells Vesicare and Betanis/Myrbetriq/BETMIGA
as treatments that help to relieve symptoms associated
with OAB such as urgency, urinary frequency, and urge
urinary incontinence. Vesicare has earned a position as the
first choice among anticholinergic drugs—the standard
therapy for OAB. As of March 2018, Vesicare is sold in over
80 countries and regions worldwide.
Betanis/Myrbetriq/BETMIGA is a beta-3 adrenergic
receptor agonist that helps to relieve symptoms associated
with OAB through a different mechanism of action from
Vesicare. As of March 2018, it is sold in around 50 countries
and regions worldwide under the brand name of Betanis
in Japan, Myrbetriq in the Americas, and BETMIGA in EMEA
and Asia & Oceania.
Patent protection for Vesicare will expire in various
regions from 2019 onward. In this environment, we will
allocate resources to Betanis/Myrbetriq/BETMIGA as we
focus on achieving further market penetration, in order to
maximize the value of the OAB franchise as a whole.
* Irwin DE, Kopp ZS, Agatep B, Milsom I, Abrams P. Worldwide prevalence estimates
of lower urinary tract symptoms, overactive bladder, urinary incontinence and
bladder outlet obstruction. BJU Int. 2011, vol.108, no.7, p.1132-1138.
As part of efforts to maximize the product value of
XTANDI, Astellas drove development forward with a focus
on expanding indications. In January 2018, Astellas
submitted applications in Europe and the U.S. for approval
of an additional indication of XTANDI for non-metastatic
castration-resistant prostate cancer based on data from
the PROSPER trial. In July 2018, Astellas obtained approval
for this additional indication in the U.S. In Japan, Astellas
obtained approval for XTANDI tablets as additional dosage
forms. Sales of XTANDI tablets were launched in June 2018.
Moreover, Astellas is pushing ahead with additional
clinical studies such as the EMBARK trial for patients with
non-metastatic hormone-sensitive prostate cancer and the
ARCHES trial for patients with metastatic hormone-
sensitive prostate cancer, with the aim of expanding the
indications of XTANDI to patients with prostate cancer in
earlier stages.
XTANDI
In the area of prostate cancer, Astellas also sells Eligard
and Gonax, both of which are treatments for prostate
cancer, in addition to XTANDI. Eligard, a luteinizing
hormone-releasing hormone (LHRH) agonist, is sold in
EMEA and Asia & Oceania, while Gonax, a gonadotrophin-
releasing hormone (GnRH) antagonist with a
subcutaneously injectable formulation, is sold in Japan.
50
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Manufacturing to Sales and Procurement
Fiscal 2017 Performance and Outlook
In fiscal 2017, aggregate sales of our OAB franchise,
including Vesicare and Betanis/Myrbetriq/BETMIGA,
increased by 6.1% to ¥228.1 billion.
Astellas focused on increasing the market penetration
of Betanis/Myrbetriq/BETMIGA by promoting it as an OAB
treatment with well-balanced effectiveness and tolerability
based on a new mechanism of action. As a result, in fiscal
2017, aggregate sales increased in every region, with sales
growing by 27.2% to ¥125.7 billion. In Japan, sales of
Betanis increased by 13.7% to ¥29.5 billion. Betanis’ annual
share of the OAB treatment market was approximately
37% (on a value basis). In the Americas, Myrbetriq sales
rose 28.7% to US$657 million. In this region, Myrbetriq’s
annual share of the U.S. OAB treatment market reached
approximately 41% (on a value basis). In EMEA, sales of
BETMIGA increased by 18.5% to €141 million. In EMEA,
BETMIGA’s annual share of the OAB treatment market
reached approximately 16% (on a value basis). In Asia &
Oceania, BETMIGA sales increased sharply by 47.7% to
¥5.2 billion.
Meanwhile, in fiscal 2017, sales of Vesicare decreased
by 11.9% to ¥102.3 billion. Looking at regional sales of
Vesicare, sales in Japan decreased 6.8% to ¥23.9 billion,
sales in the Americas declined 24.0% to US$372 million,
sales in EMEA decreased 9.5% to €244 million, and sales in
Asia & Oceania rose 0.4% to ¥5.0 billion.
Total Sales of the OAB Franchise (By Product)
Betanis/Myrbetriq/BETMIGA
Vesicare
(¥ billion)
300.0
200.0
100.0
0
214.9
98.8
116.1
+6.1%
+6.6%
243.1
146.2
228.1
125.7
102.3
96.9
2017.3
2018.3
2019.3
(Forecast)
As a result of the foregoing, sales of Betanis/
Myrbetriq/BETMIGA in fiscal 2017 surpassed sales of
Vesicare for the first time. Additionally, Betanis/Myrbetriq/
BETMIGA’s share of the total sales of the OAB franchise
reached approximately 55%, compared with approximately
46% in fiscal 2016, on a yen basis.
Concomitant use of Betanis/Myrbetriq/BETMIGA and
Vesicare, which was approved in the U.S. in May 2018, is
expected to contribute positively to sales. Moreover, Astellas
will make effective use of additional data that will be obtained
from post-marketing clinical trials, with the aim of driving
further growth in sales of Betanis/Myrbetriq/BETMIGA.
Betanis/Myrbetriq/BETMIGA
Other Main Products and New Products
Overview of Main Products (Global Products)
Prograf and Advagraf/Graceptor/ASTAGRAF Prograf
and Advagraf/Graceptor/ASTAGRAF are a vital earnings
base for Astellas.
This drug is an immunosuppressant used to suppress
organ transplant rejection. Although the patent for this
drug has already expired in major countries, it is sold in
approximately 100 countries and regions and has made a
significant global contribution to the field of
transplantation. Sales of Prograf increased 6.6% to ¥198.5
billion in fiscal 2017. Looking at regional sales, sales in
Japan decreased 1.1% to ¥48.3 billion, and sales in the
Americas declined 8.0% to US$232 million. However, sales
in EMEA via in-house distribution channels rose 2.8% to
51
Business ReviewAstellas Pharma Inc. ANNUAL REPORT 2018 Linzess Linzess was launched in March 2017 as Japan’s
first drug indicated for the treatment of irritable bowel
syndrome with constipation (IBS-C). In fiscal 2017, sales of
Linzess were ¥1.4 billion. We will continue working to
increase market penetration of this drug, which provides a
new option for treating IBS-C. In August 2018, Astellas
obtained approval in Japan for the additional indication of
chronic constipation (other than constipation associated
with organic disorders).
Linzess
€607 million, mainly supported by an increase of 8.0% in
sales of Advagraf. Sales in Asia & Oceania rose 14.0% to
¥42.5 billion, with sales growing primarily in China.
Overview of New Products (Japan)
Suglat/Sujanu Suglat, a type 2 diabetes treatment, is
Japan’s first selective sodium-glucose co-transporter 2
(SGLT2) inhibitor. In Japan, Astellas is co-promoting Suglat
with Kotobuki Pharmaceutical Co., Ltd. Sales of Suglat
grew 22.5% to ¥11.6 billion in fiscal 2017. Suglat’s share of
the market for selective SGLT2 inhibitors in Japan was
around 22% (on a value basis).
In May 2018, Astellas launched sales in Japan of
Sujanu Combination Tablets, a combination drug of Suglat
and the DPP-4 inhibitor sitagliptin phosphate hydrate, with
the indication of type 2 diabetes. Sujanu is co-promoted
with Kotobuki Pharmaceutical Co., Ltd. and MSD K.K.
In addition, in January 2018, Astellas filed an
application in Japan for approval of an additional
indication of Suglat for type 1 diabetes.
In April 2016, Astellas launched Repatha, the
Repatha
first proprotein convertase subtilisin/kexin type 9 (PCSK9)
inhibitor in Japan, indicated for the treatment of familial
hypercholesterolemia or hypercholesterolemia*. It is being
co-promoted by Astellas and Amgen Astellas BioPharma
K.K. in an effort to steadily increase market penetration. In
May 2017, limits on the prescription period were removed
and the self-injectable formulation of Repatha became
eligible for National Health Insurance coverage. In fiscal
2017, sales of Repatha were ¥1.6 billion. In January 2018,
Astellas launched sales of Repatha SC Injection 420 mg Auto
Mini-Doser, an additional dosage formulation of Repatha.
* The approved indication is as follows: “Familial hypercholesterolemia,
Hypercholesterolemia, only when patients who have high risk of cardiovascular
events and do not adequately respond to HMG-CoA reductase inhibitors.
* Official guidance on points to consider regarding the use of Repatha under
National Health Insurance coverage was issued by the Medical Affairs Division of
the Ministry of Health, Labour and Welfare (Medical Affairs Division 1215 No.12;
December 15, 2017).
52
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Manufacturing to Sales and Procurement
CSR Activities from Manufacturing to Sales
Quality and Reliability Assurance
Anti-Counterfeiting Activities
The distribution of counterfeit medicines in legitimate
supply chains not only leads to the loss of opportunities
for patients to receive medical treatment but could also
have adverse health consequences. This has become a
serious problem worldwide.
Astellas operates the Anti-Counterfeit Committee, led
by the supply chain management and quality assurance
divisions, and has a product security division. These parts
of Astellas conduct monitoring and surveys, and
implement countermeasures targeting not only
counterfeit medicines, but also diversion, smuggling, theft
and related activities. When selling products, Astellas
systematically introduces effective anti-counterfeit
technologies, including product serialization of secondary
product packaging as stipulated by regulations, based on
pharmaceutical laws and regulations and risks in each
market where products are sold, as well as product
characteristics. In addition, Astellas carries out educational
activities to prevent the spread of counterfeit medicines in
collaboration with members of the pharmaceutical
industry and organizations such as the World Health
Organization (WHO), the PSI* and the Transported Asset
Protection Association. We also proactively endeavor to
support and cooperate with national governments and
judicial authorities to crack down on counterfeit medicines.
Astellas publishes its Position on Counterfeit
Medicines on its website.
* PSI: The Pharmaceutical Security Institute (PSI) is a not-for-profit organization
established to strengthen global anti-counterfeiting efforts. A total of 33
pharmaceutical manufacturers are currently members of the PSI.
Product Recalls
Astellas has a recall system in place that is activated when
the safety, efficacy or quality of a product is brought into
question. The system ensures relevant information is
promptly passed on to medical institutions and other
affected parties, and that a recall of the product in
question is instigated. Astellas voluntarily initiated three
product recalls in fiscal 2017. As of March 2018, no reports
of any related health impairments had been received.
Improving the Pharmacovigilance (PV) System
Astellas is continuously improving its PV system by
strengthening collaboration between the internal PV
function and other relevant departments, affiliates and
licensing partners. This is to support the provision of
53
trustworthy product information and proper product use,
along with regulatory compliance.
Astellas regularly provides product safety awareness
training not only to staff closely involved with the PV
function but also to all employees and contractors
including affiliate staff, to maintain and strengthen swift
and appropriate collection of product safety information. For
external service providers outsourced by departments other
than the PV division, Astellas updates their contracts to add
requirements for safety management information collection
as necessary. Through these measures, Astellas is building
a system for collecting information over a wide scope.
In addition, Astellas is exploring utilizing real-world
data such as large healthcare databases for safety signal
detection of Astellas products to help minimize risk by
enhancing collaboration between PV and other functions.
Furthermore, Astellas PV has started exploring and
assessing automation technologies and artificial
intelligence technologies that can be used for safety data
monitoring, processing and reporting, and earlier
identification and analysis of safety signals. We plan to use
these technologies to strengthen our safety data
management systems.
Technology Development & Manufacturing
Stable Supply and Quality Control
Astellas places highest priority on ensuring stable
manufacture and supply of safe and effective
pharmaceuticals to patients. To ensure this, we have
established our own Good Manufacturing Practice (GMP)-
compliant quality standards as the basis for consistently
achieving high levels of quality control. We apply these
standards to manufacturing facilities and equipment, and
to all stages from raw material procurement and storage to
production and shipment.
Relationship with Local Communities
To promote sustainable pharmaceutical manufacturing,
Astellas arranges opportunities for dialogue with local
residents and communities near its manufacturing sites. By
proactively disclosing its initiatives, Astellas is working to
build good relationships with them.
At the Kerry Plant in Ireland, Astellas is launching
annual events with the local community to protect the
environment, ensure health and safety, and save energy.
Each year, the event themes revolve around environmental
protection, health and safety, and energy conservation,
Business ReviewAstellas Pharma Inc. ANNUAL REPORT 2018 and local children draw pictures with the themes. These
are made into a calendar which is sold locally, with all
proceeds donated to the Irish Kidney Association. Every
year, over 1,000 entries are received from 12 schools, and
the event is now being developed into a regular
community event. In 2017, we received the SEAI* Award as
one of Ireland’s leading companies.
* SEAI: Sustainable Energy Authority of Ireland is an Irish government-affiliated
organization supporting the reduction of CO2 emissions.
Provision of Product Information
Ensuring Proper Use
Astellas’ Medical Representatives (MRs) provide information
on appropriate usage based on on-label information to
healthcare professionals to ensure that Astellas
pharmaceutical products are used safely and effectively. In
promotion of Astellas products, MRs observe high ethical
standards and strictly observe the Astellas Group Code of
Conduct, local codes of conduct, and the relevant laws
and regulations in each country.
Medical Science Liaisons (MSLs) engage with
healthcare professionals to exchange scientifically based
information to advance their understanding and the safe
and effective use of our products in patient care. MSLs
observe high ethical standards and provide reliable, clear,
fair, balanced and unbiased medical and scientific
information. MSLs refrain from promotion of products, and
observe high ethical standards, making compliance their
top priority.
Responding to Inquiries
Astellas has a responsibility to provide truthful, balanced
and unbiased medical information in response to inquiries
regarding our products. By fulfilling this responsibility,
Astellas supports the safe and effective use of our products.
In countries throughout the globe, we have Medical
Information Call Centers that respond to a variety of
inquiries. In our larger call centers, we have systems that
allow for 24-hour responses to urgent inquiries, even on
business holidays. In fiscal 2017, we responded to
approximately 160,000 inquiries.
Astellas makes continuous efforts to improve its
medical information services, with the aim of providing
accurate, appropriate and consistent information. As part
of these efforts, a global medical information system is
used where medical responses from Group companies
around the world are documented. This enables the
responses to be communicated to our customers in a
simple, swift and accurate manner. At the same time, we
can analyze feedback from patients and medical professionals
and inform the life cycle management of our products.
Procurement
Promoting CSR Procurement
Astellas considers it important to fulfill its social
responsibilities across the entire supply chain, including
suppliers. To achieve this goal, Astellas has formulated the
Astellas Business Partner Code of Conduct, which requires
business partners to do their business in accordance with
CSR measures. We also conduct global questionnaire-
based surveys based on the code, along with requesting
our business partners to sign the Acknowledgement of
Astellas Business Partner Code of Conduct. As of March 31,
2018, we had obtained survey responses from
approximately 900 companies, covering suppliers of direct
materials, as well as major suppliers of indirect materials
and major facility and equipment suppliers. In fiscal 2017,
we widened the scope of the survey to include
pharmaceutical wholesalers, licensees, distributors and
banks. Furthermore, we conduct on-site audits of suppliers
in countries that pose a high CSR procurement risk.
Please refer to the following URL for information about related CSR
activities from manufacturing to sales.
• Anti-Doping Measures
• Strengthening of Quality Assurance Systems at Affiliates
• Quality Assurance Policies
• Measures to Prevent Medical Malpractice and Improve the
Distinguishability of Pharmaceuticals
• Introduction of Universal Design into Product Packaging
Web https://www.astellas.com/en/sustainability/
business-activities
Please refer to the following URL for information about our policies and
position statements.
Web https://www.astellas.com/index.php/en/about/
policies-and-position-statements
54
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Improvement in the Quality and Efficiency of Operations
Improvement in the Quality and
Efficiency of Operations
Recent Initiatives
Astellas will pursue further improvements in both the
quality and efficiency of operations, as well as
reallocating management resources in fields that
promise growth and a superior position competitively,
further strengthening its operational foundation.
With regard to the organizational structure, Astellas is
working to strengthen its global management functions.
In April 2017, we integrated legal and intellectual property
functions in each region by newly establishing Legal and
Intellectual Property functions on a global level.
Furthermore, in April 2018, we established the new global
functions Finance, Human Resources, and Internal
Auditing to integrate the finance, human resources, and
internal auditing functions in each region.
We are also promoting optimization of management
resource allocation. Our agreement to transfer assets to LTL
Pharma Co., Ltd. regarding marketing authorization for 16
long-listed products in Japan, bulk supply business of
active pharmaceutical ingredients to third parties in and
outside of Japan, and the royalty business took effect in
April 2017. Accordingly, in the fiscal year ended March 31,
2018, manufacturing and marketing authorization for
several products was also succeeded to LTL Pharma Co.,
Ltd., and we transferred the distribution rights of the
products in Japan. Furthermore, in October 2017, we
succeeded the manufacturing and marketing approvals in
Japan for Protopic, a treatment for atopic dermatitis, to
Maruho Co., Ltd.
In addition, Astellas implemented the following
initiatives.
Outsourcing of Operational and Management
Support
As part of an initiative to promote efficiency by
outsourcing operational and management support duties,
in December 2017, Astellas dissolved Astellas Business
Services Co., Ltd., which undertook operational and
management support duties for Astellas Pharma Inc. and
its subsidiaries in Japan, completing the liquidation in
March 2018.
55
Termination of Research Activities at Agensys, Inc.
Astellas terminated its research activities at U.S.
consolidated subsidiary Agensys, Inc. in March 2018 and
transferred the research facilities and related assets to Kite,
a Gilead Company in the United States, in April 2018.
Astellas will advance its strategy in the oncology field
by reducing its investments in Antibody-Drug Conjugate
(ADC) research and expanding its investments in new
technologies and modalities that will give us an even
stronger competitive advantage.
Optimization of Organizational Structure in Europe
Astellas is taking steps to optimize our organizational
structure in Europe, aiming to evolve our operating model
with changes in the operating environment. As part of this,
we decided to consolidate our Netherlands R&D functions
in Japan and the U.S.
Moreover, in EMEA, we are working to further improve
the efficiency of our finance function through outsourcing,
and to enhance the quality and efficiency of our sales and
marketing activities by optimizing the sales and marketing
organization and structure.
Restructuring of Operations in Japan and
Introduction of Early Retirement Incentive Program
As part of optimization of organizational capabilities under
Strategic Plan 2018, Astellas decided to reorganize itself
and its Group companies within Japan, focusing not only
on back-office divisions, but also frontline divisions such as
R&D and Sales & Marketing.
In conjunction with the restructuring of operations in
Japan, an early retirement incentive program is planned to
be introduced for Astellas Pharma Inc., Astellas Marketing
and Sales Support Co., Ltd., Astellas Research Technologies
Co., Ltd., and Astellas Learning Institute Co., Ltd. in the
fiscal year ending March 31, 2019.
We will strive to strengthen the operational
foundation even further by streamlining our organizational
structure and secure the necessary resources for growth
investment by pursuing Operational Excellence while
utilizing advanced technologies.
Business ReviewAstellas Pharma Inc. ANNUAL REPORT 2018 Our People, Our Organization
Astellas recognizes employees as important
stakeholders. Astellas employees play the most valuable
role in transforming the Company and in achieving
enhanced levels of enterprise value. We are working to
train employees and strengthen their competitiveness.
Astellas is fostering a corporate culture that aims to
align the aspirations of its diverse employees in one
direction to realize its business philosophy.
languages, conducting training and meetings for managers,
and even reflecting the vision in personnel measures.
Astellas will increase the competitiveness of its human
resources and organization by spreading and implementing
the HR Vision and the Astellas Way. Moreover, Astellas will
bring together individuals from diverse backgrounds
within the Company to surmount national, regional and
organizational barriers, foster mutual respect, and unite
our people to continuously achieve innovation.
HR Vision
The Astellas Way
—Five Messages for One Astellas—
Astellas has formulated a Human Resources (HR) Vision,
which represents its approach to “Our People, Our
Organization,” and this vision is shared globally to define its
aspirations for its human resources and its organization.
Making Astellas’ VISION a reality requires individual
employees to understand the HR Vision and to act based
on the Astellas Way.
As part of its activities to achieve these goals, Astellas is
focusing on activities to disseminate the HR Vision.
Specifically, this involved translating the HR Vision into various
Overview of the HR Vision
Towards Realizing the Corporate VISION
Patient Focus:
Ask yourself if your decisions and actions contribute
to improving patient health.
Ownership:
Embrace change and always challenge
by taking ownership.
Results:
Commit to results each time you face a challenge, and
consider fresh approaches to achieving them.
Openness:
Maximize your creativity through diversity
and open communication.
Integrity:
Act with integrity by always considering the implications of
your actions, and then take responsibility for the outcomes.
One Astellas with the Astellas Way
Our People
Our Organization
Embrace Change and Challenge
Value Diversity and Inclusion
Serve Others
Act with Integrity
Resilient
Inspired
Aligned
Ethical
HR MANAGEMENT
DEVELOP
EMPLOYER
OF
CHOICE
ATTRACT
RETAIN
Providing Opportunities for Employees to
Succeed Globally
Astellas provides employees with opportunities to succeed
globally in a variety of ways. In Japan, we have established
an internal recruitment system to revitalize our
organization and support employees in developing their
own abilities and growing, while encouraging our people
to succeed in roles at various overseas bases by proactively
appointing employees from each division to be assigned
abroad. In addition, we accept long-term and short-term
assignees from Group companies outside Japan. In these
and other ways, we are working to promote global
interaction among our people at the divisional level.
56
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Improvement in the Quality and Efficiency of Operations
Diversity Management
Astellas is working to promote diversity so that diverse
people can play a role in our Company, irrespective of race,
nationality, gender, or age. Respecting the diverse values
of our employees and reflecting their various perspectives
in our business activities not only heightens creativity in
our organization but also helps to attract talented people
as employees and enhances our competitiveness.
Based on this recognition, Astellas implements
measures to promote diversity in line with the current
situation in the region. For Astellas, promoting the career
advancement of women in Japan is a high priority,
particularly because the country has a low ratio of women
in management positions compared to other regions. In
2007, therefore, Astellas launched the Diversity Promotion
Project. By 2020, the Company aims to develop a work
environment in which life events do not hinder career
advancement, and it has established a target to raise its
ratio of female managers in Japan to 10% or higher (at
Astellas Pharma Inc.) on a non-consolidated basis.
In fiscal 2017, Astellas disseminated information twice
a year by e-learning to encourage employees to
understand other matters in addition to promoting
women’s activities in the workplace, and publicized the
themes of male participation in childcare and caregiving
and of LGBTQ.
In addition, Astellas is promoting nationality diversity
to further advance the globalization of its business, and in
Japan, the Company has been hiring non-Japanese
graduates since 2014.
Astellas is implementing initiatives for upgrading the
work environment it provides for people with disabilities. It
has established the Green Supply Support Office*1 and
been a participating member of Japan’s Accessibility
Consortium for Enterprises (ACE)*2. Astellas is supporting
hearing-impaired employees to overcome their disabilities
by utilizing an app that instantaneously converts voice
data into written words.
*1 Green Supply Support Office: An organization established within a Group
company in 2011 that is mainly comprised of employees with intellectual
disabilities. It engages in activities such as enhancing greenery by cultivating
flowers, resource recycling, and carrying out various cleaning activities.
*2 Accessibility Consortium of Enterprises (ACE): A general incorporated
association that was formed to conduct activities such as the establishment of
a new employment model for people with disabilities who contribute to the
growth of companies.
57
Male/Female Employee Ratio per Region and Ratio of Female
Managers (Fiscal 2017)
Japan
Americas
EMEA
Asia &
Oceania
Average
70.8%
45.4%
41.7%
46.8%
55.0%
29.2%
54.6%
58.3%
53.2%
45.0%
8.5%
49.3%
51.5%
48.8%
33.2%
Male
Female
Ratio of female
managers
Promoting Health Management
If each employee realizes a high level of productivity and
creativity and practices a workstyle that enables self-
fulfillment, this will revitalize the organization and lead to
its growth as One Astellas. The underlying condition for
realizing these ways of working is the good health of the
employees. Based on this thinking, in Japan, Astellas is
promoting a health management that encourages
employees to take control of looking after their health.
Specifically, in cooperation with the health insurance
association (“collaboration health”), the Company is
promoting improving employee health and disease
prevention, and developing measures that include
supporting mental health, preventing overwork, and
countering second-hand smoking.
Occupational Health & Safety
We have the Astellas Environment, Health & Safety Policy
in place to prevent work-related accidents and minimize
those caused by workplace mishaps and hazards. Under
this policy, each facility is independently building
Environment, Health & Safety management systems and
promoting associated initiatives. We are also working to
ensure occupational safety from many different
perspectives based on the information we share on
accidents and near misses that have occurred at our
workplaces around the world.
From 2017, Astellas expanded its scope of
management and began global consolidation*1.
Between January and December 2017, there were 0
fatalities and 11 work-related injuries requiring time off
work. Of these 11 injuries, the longest leave of absence
was 61 days due to a traffic accident.
Frequency rate of work-related injuries*2 was 0.33 and
severity rate of work-related injuries*3 was 0.007 on a
global basis. We will strive to reduce our occupational
Business ReviewAstellas Pharma Inc. ANNUAL REPORT 2018 safety risks with the goal of holding our severity rate of
work-related injuries under 0.005 on a global basis.
*1 In addition to the previous scope, Astellas began aggregating data for overseas
offices and research bases. The totals by region for global and outside Japan
have been disclosed since 2017.
*2 Frequency rate of work-related injuries: This rate shows the number of
employee deaths or injuries resulting from work-related accidents causing
leaves of absence per million hours of work. The larger the number, the more
frequently work-related injuries occur.
*3 Severity rate of work-related injuries: This rate shows the number of days absent
from work due to work-related injuries per thousand hours of work. The larger
the number, the more serious the injury.
Respect for Human Rights
The Astellas Charter of Corporate Conduct clearly states
that members of the Astellas Group shall respect human
rights and the personality and individuality of all its
employees, observe all applicable international rules and
local regulations, and embrace all cultures and customs.
The recognition of the importance of respecting human
rights is shared by Group companies worldwide.
Astellas disclosed its Position on Human Rights in
April 2017. Wherever we operate, Astellas is committed to
complying with internationally recognized basic human
rights and labor standards as well as applicable local labor
and employment laws, and to implementing and
upholding the UN Guiding Principles on Business and
Human Rights. Also, Astellas conducted a human rights
impact assessment and has identified four human rights
issues to which we pay particular attention as human
rights in clinical trials and other research and development
activities, product safety and counterfeit drugs, Access to
Health and human rights in the workplace. Under the U.K.
Modern Slavery Act 2015, we publish a Slavery and Human
Trafficking Statement for each fiscal year, describing what
steps we have taken to address this risk in our own
operations or our supply chains.
We have established a system for swiftly responding to
human rights issues that includes the setting up of external
and internal helplines, as well as conducting training sessions
for employees. Moreover, we have been globally confirming
the awareness of human rights issues in the workplace and
the status of human rights activities at our Group
companies by conducting written surveys. In fiscal 2017,
there were no critical human rights issues or other issues of
common, worldwide concern reported in the survey.
For details on our people, our organization, please visit the
following website:
Web https://www.astellas.com/en/sustainability/employees/
For details on the incidence of work-related injuries, please visit the
following website:
Web https://www.astellas.com/index.php/en/responsibility/
Occupational-Health-And-Safety
TOPIC Improving Employee Satisfaction
Engagement Survey
Astellas is continuously pursuing initiatives to
improve employee satisfaction. As part of these, in
January 2018, the Company conducted an
engagement survey in Japan, the Americas, EMEA
and Asia & Oceania. This was the first survey to be
conducted that targeted the approximate 16,000
employees of the Astellas Group and was based on
common questions that were asked on a global basis.
The response rate was about 90%, which is very high
compared to the average response rate of global
pharmaceutical companies.
Of the 13 categories, 11 categories received
favorable answers from over 70% of answers. Of
these, the five categories entitled Customer Focus,
Ethics and Compliance, Goals and Targets, Immediate
Superior, and Sustainable Engagement received more
than 80% favorable answers. From these results, the
Company determined that Astellas’ strengths include
its support of employees’ vision for Astellas, their
significant pride and recognition in the vision’s
implementation, and their high evaluation of the
trustworthy work environment.
Regarding the opinions about needed
improvements that Astellas has gained from employees
through this survey, the Company will reflect them in
the course of carrying out the new Corporate
Strategic Plan and will implement appropriate actions
to make the needed improvements.
58
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Improvement in the Quality and Efficiency of Operations
Ethics and Compliance
Astellas believes that acting in accordance with the
highest ethical standards, which includes obeying the
letter and spirit of the law, is the cornerstone of all its
activities. Based on this belief, the Astellas Charter of
Corporate Conduct, which is shared globally, expresses
the Company’s ethical business philosophy in terms of
corporate behavior. In addition, the Astellas Group Code
of Conduct is a global code for all agents, directors,
officers and employees around the world, establishing
that they are expected to perform their duties ethically
and in compliance with laws and regulations.
Astellas promotes compliance and maintains the
highest ethical standards through the development,
implementation and continuous enhancement of its
policies, processes, and global compliance structures
and thereby maintains the trust of patients and other
stakeholders and enhances enterprise value.
Structured to Promote Ethics and Compliance
Astellas has been continuously enhancing the global
organizational structure for the Ethics & Compliance
function at the global, regional and local levels. In fiscal
2017, Astellas increased the number of Ethics &
Compliance personnel to enhance support in high-risk
markets and activities. Ethics & Compliance professionals
partner with the business to continue to reinforce the
importance of integrating ethics, integrity and compliance
into business processes as doing so is critical to the
sustainable success of Astellas.
The Group Operations team in the Ethics &
Compliance function continues to coordinate compliance-
related activities such as training, communications, risk
assessment, monitoring, investigations, and policy
management, thereby driving consistency on a global basis.
Global Ethics & Compliance Structure (as of April 2018)
Chief Ethics & Compliance Officer (CECO)
Head of Ethics & Compliance
Global Compliance Committee
Anti-Bribery/Anti-Corruption
Privacy
Japan & Asia Oceania
Americas
EMEA
Regional Ethics & Compliance Lead
Regional Ethics & Compliance Lead
Regional Ethics & Compliance Lead
Regional Compliance Committee
Regional Compliance Committee
Regional Compliance Committee
Ethics & Compliance Group Operations
59
Business ReviewAstellas Pharma Inc. ANNUAL REPORT 2018 Compliance Risk Assessments
The ability to effectively assess compliance risk at local,
regional and global levels is a foundational element of
Astellas’ compliance program. These assessments enable
Astellas to more quickly identify and better respond to
existing and emerging compliance risks.
In fiscal 2017, Astellas conducted compliance risk
assessments (CRAs), based on a globally consistent
process, in a number of countries around the globe. The
CRAs involved both the assessment of external
environmental risk in each of the countries as well as
assessment of internal risks within the affiliate.
The internal activities assessed included transfers of
value in any form to healthcare professionals, market
access activities, interactions between the Company and
government officials or healthcare professionals, and
meals, gifts or hospitality. The findings of the CRAs helped
Astellas to enhance compliance programs in each country
and monitor trends in risks at the regional and global
levels. The Ethics & Compliance function works closely
with the business throughout the assessment process and
helps develop and support any risk mitigation plans
developed to address the identified risks.
Initiatives to Promote Compliance
Compliance Training and Communications
Compliance training and communications targeted at the
business are important to conducting business activities
grounded on high ethical standards and integrity. Astellas
regularly educates employees on both existing and
emerging compliance risks as well as policies and
processes that help manage those risks. These educational
activities help to foster compliance awareness and
understanding among employees. Training and
communication materials share Astellas Way values and a
patient-focused mindset, so employees can see how
policies and procedures help them live the Astellas mission.
In fiscal 2017, the Ethics & Compliance function began
deploying online training through a single global system,
enhancing the ability to provide access to important
training initiatives to all employees globally. Global online
training allows for enhanced tracking and monitoring of
timely completion of training requirements and has
resulted in improvements in completion rates across a
wide range of training topics. All employees, including
new employees, are required to complete compliance
training on topics such as the Astellas Group Code of
Conduct, data privacy, anti-bribery and anti-corruption
compliance, and conflicts of interest.
Integrity in Action Program
As one of the pillars of the Astellas Way, the Integrity in
Action program is designed to reinforce for all employees
the importance of taking responsibility and being
accountable for their actions, acting ethically and with
integrity, and leading by example.
As of the end of fiscal 2017, the Integrity in Action
program was adopted by almost all affiliates and
functions globally.
During Integrity in Action events, both business and
Ethics & Compliance leaders at the local, regional, and
global levels delivered messages to employees that
reinforced how critical it is to incorporate Integrity in
Action in all their business activities. The events also raised
awareness about the importance of speaking up about
potential compliance issues and how acting ethically and
with a high sense of integrity can create a competitive
advantage for Astellas.
60
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Improvement in the Quality and Efficiency of Operations
Compliance Monitoring
Compliance monitoring is a foundational component of
any compliance program. Astellas monitors existing and
emerging compliance risks and trends across a variety of
activities. Doing so allows us to better anticipate potential
issues before they become actual problems for the
Company. In fiscal 2017, Astellas continued to enhance its
monitoring program and activities in each region. The
compliance monitoring yielded results that not only
enhanced the compliance program, but also provided
management with insights to inform their decision-
making on various process improvements. One of the
many positive outcomes of the monitoring program this
year was that monitoring helped identify areas where
Astellas could optimize systems functionality to provide
both compliance and business utility.
Increasing Understanding of the Global Conflict of
Interest Policy
Another core element of an effective ethics and compliance
program is how a company approaches its own conflicts
of interest, because the foundation of an effective and
robust ethics and compliance program is based on how a
company manages its own internal behavior.
Conflicts of interest refer to situations where outside
activities or other personal interests impair an employee’s
objectivity or judgment when performing their duties.
Conflicts of interest also encompass situations where there
is a potential conflict between the interests of an
employee and Astellas. The Astellas Global Conflict of
Interest Policy and accompanying training reinforces for
employees that they are expected to conduct their
business activities with ethics and integrity even when no
one is observing or there are no potential legal violations.
Astellas believes that establishing this baseline expectation
regarding internal conflicts of interest contributes to
employees conducting their business with ethics and
integrity when engaging with stakeholders outside the
Company and where legal risks are involved.
Transparency
More and more countries and government organizations
are requiring transparency with respect to pharmaceutical
company relationships with healthcare professionals and
organizations. Astellas is committed to engaging in
appropriate relationships with healthcare professionals
and organizations throughout the world. The disclosure of
relevant financial relationships with healthcare
professionals and organizations reflects the commitment
61
to corporate accountability to both internal and external
stakeholders. Astellas is committed to fulfilling its
transparency requirements through the work of its global
transparency team in coordination and collaboration with
multiple business functions across the organization.
In Japan, Astellas has continued to make public
financial relationships with healthcare professionals and
organizations and patient organizations in accordance
with the Transparency Guideline published by the Japan
Pharmaceutical Manufacturers Association. In the U.S.,
Astellas adheres to reporting requirements set forth by the
federal Sunshine Act and state laws. Across Europe, we
disclose transfers of value to healthcare professionals and
organizations based on the disclosure requirements
established by the European Federation of Pharmaceutical
Industries and Associations.
Helpline for Employees and Encouraging a
Speak-Up Culture
In fiscal 2017, Astellas upgraded its existing regional external
compliance reporting helplines by deploying a global version
of its external helpline that is available in local languages.
Employees can use the helpline to report and receive advice
on how to react in the event they discover actual or
suspected misconduct. Reports may be made by employees
or third parties and may be made anonymously where
permitted by local law. In Japan, Astellas has established
internal helplines in addition to the global external
helpline, including one dedicated to sexual harassment.
Astellas continues to foster an environment that
encourages employees to use the helplines and speak up
to report potential or actual violations of the Astellas Group
Code of Conduct, as well as any other illegal or unethical
behavior or business practices. In addition, Astellas strictly
prohibits any retaliation against those who raise a concern
or report a suspected compliance violation in good faith,
even if the concern or report is not substantiated.
Having the ability to centrally manage the reports of
suspected non-compliance and the corresponding
investigations also enhances Astellas’ ability to analyze
compliance trends both regionally and globally. In fiscal 2017,
Astellas’ helplines received reports in each region. Matters
raised included potential harassment and promotional
code violations. In response, thorough investigations were
conducted and appropriate action was taken.
Business ReviewAstellas Pharma Inc. ANNUAL REPORT 2018 Anti-Bribery and Anti-Corruption Compliance
Ensuring Fair Competition
Astellas strictly prohibits bribery and corruption in any
aspect of its business. One critically important compliance
priority is to identify those activities that have high bribery
and corruption risks for the Company and establish the
processes needed to appropriately manage those risks.
Examples of activities identified as high risk for which we
have developed processes include support for healthcare
professional education and the engagement of healthcare
professionals to provide necessary services on behalf of
the Company. The development and implementation of
policies and procedures targeted at these kinds of high-
risk activities as well as the regular training of employees
and business partners on how to comply with these
policies and procedures helps Astellas mitigate the risks
associated with these activities.
Astellas monitors the bribery and corruption risk
environment at the global, regional and local levels and
enhances its compliance governance activities to
appropriately manage these risks, including the use of
effective and impactful training and communication activities.
Astellas is committed to conducting its business in a fair
and competitive environment and does not reach any
agreements with its competitors regarding sales
conditions, such as prices, sales plans and strategies, and
market and customer shares. Astellas limits engagement
with competitors and avoids any conversation concerning
these topics when engagement is necessary, so that such
interactions are not construed to reflect the existence of
such an agreement.
In fiscal 2017, there were no incidences of
government authorities taking legal action against Astellas
for anti-competitive, anti-trust, or monopolistic practices,
or of authorities levying significant fines or other sanctions
due to non-compliance with laws and regulations.
For further information on Astellas’ ethics and compliance activities,
please visit the following website:
Web https://www.astellas.com/en/about/
compliance-initiatives/
Message from the Privacy Lead
Enhancing Our Data Privacy Program
Protecting the personal information of patients,
healthcare professionals, suppliers, employees and other
stakeholders has been and continues to be an extremely
important priority for Astellas.
Astellas has established a global team made up of
experts from the Ethics & Compliance, Information
Systems, and Legal functions in order to address the
European Union’s new General Data Protection
Regulation (GDPR). Astellas has introduced crucial
program elements to comply with GDPR requirements.
In addition, Astellas has implemented the
Information Security Enhancement Program led by the
Information Systems function. This program has
strengthened our security controls around data privacy
and cybersecurity.
In Japan, Astellas has revised the local privacy
policy and supporting internal guidelines in response to
the amended Act on the Protection of Personal
Information, which came into force in May 2017.
Astellas is committed to complying with GDPR and
data privacy laws around the world in order to maintain
the trust of stakeholders. Astellas will continue to
enhance transparency and fulfill our obligation of
corporate accountability with respect to the personal
information entrusted to us.
Karen Lowney
Executive Director, Privacy Lead,
Ethics & Compliance
Astellas US LLC
62
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Access to Health
Astellas is committed to solving Access to Health issues.
We believe that the relationships of trust developed
with governments and local partners through these
initiatives will generate synergies with business
activities over the long term.
Collaborative Research on New Drugs for the
Treatment of Tuberculosis and Malaria
Astellas is pursuing collaborative research to discover new
drugs for the treatment of tuberculosis and malaria, which
are infectious diseases that cause tremendous suffering
among people in developing countries
In 2016, 10.4 million people fell ill with tuberculosis,
while more than 200 million people contracted malaria. 1.7
million people* died of tuberculosis while 445,000 people
died of malaria. Both tuberculosis and malaria have led to
serious social problems, underscoring the urgent need for
innovative drugs to treat these diseases.
Considering these backgrounds, in October 2017,
Astellas entered into a new collaborative research
agreement with TB Alliance for the exploration of new
drugs for the treatment of tuberculosis and a screening
collaboration agreement with Medicines for Malaria
Venture (MMV) to discover new drugs for malaria. Under
these agreements, Astellas will provide its original library
of compounds, while TB Alliance and MMV will conduct
screenings of the library to discover hit compounds to be
used in the research and development of new tuberculosis
and malaria drugs, respectively.
These research programs are funded by the Global
Health Innovative Technology Fund (“GHIT Fund”).
* Figure includes 0.4 million people infected with HIV.
63
Collaborative Research to Identify Lead
Compounds for New Antiparasitic Drugs
In March 2018, Astellas participated in the Neglected
Tropical Diseases Drug Discovery Booster*1, a consortium
whose purpose is to identify lead compounds*2 for
leishmaniasis and Chagas disease, both of which are
neglected tropical diseases (NTDs). The consortium is
supported by funding from the GHIT Fund.
NTDs are mainly parasitic, bacterial, viral or fungal
infections prevalent among people living in poverty in
developing nations in tropical and subtropical regions. At
least 1 billion people worldwide are reported to be infected
with the 20 NTDs listed by the World Health Organization
(WHO), many of which cause serious social difficulties.
Through the consortium, Astellas will contribute to
the discovery of new drugs for patients suffering from
leishmaniasis and Chagas disease.
The collaborative research concerning Chagas disease
undertaken by Astellas with the National Institute of
Advanced Industrial Science and Technology has been
concluded following the expiry of the term of the
collaborative research agreement. As a part of this project,
basic technology for the discovery of molecules essential
for the protozoan parasite survival were developed using
genome editing technology, thereby making it possible to
select highly suitable target molecules for drug discovery.
*1 Neglected Tropical Diseases Drug Discovery Booster: A consortium launched by
the Drugs for Neglected Diseases initiative (DNDi), a not-for-profit organization
engaged in the development of new treatments for neglected diseases. In
addition to Astellas, seven pharmaceutical companies, specifically Eisai Co., Ltd.,
Shionogi & Co., Ltd., Takeda Pharmaceutical Company Limited, AstraZeneca plc.,
Celgene Corporation, Merck KGaA, and AbbVie, also participate in the
consortium as partners.
*2 Lead compound: A compound with confirmed pharmacological activity
against a target disease. Optimization research (for improvement of activity,
physical properties, pharmacokinetics, toxicity, etc.) is conducted based on lead
compounds.
Collaborative Research on a Rice-Based
Oral Vaccine
Astellas has been conducting collaborative research with
the Institute of Medical Science, the University of Tokyo
(IMSUT) on the rice-based oral vaccine MucoRice against
diarrheal diseases caused by cholera, enterotoxigenic
Escherichia coli (E. coli), norovirus, etc. In developing
countries, diarrhea caused by pathogenic bacteria, such as
Vibrio cholera and enterotoxigenic E. coli, is a major cause
Business ReviewAstellas Pharma Inc. ANNUAL REPORT 2018 of death among infants and young children. However,
vaccines present several issues, such as the need to store
and transport existing cholera vaccines at a constant low
temperature, and the fact that vaccines against
enterotoxigenic E. coli have not been approved in
developing countries.
There are high hopes that MucoRice could be stored
at room temperature. Therefore, if the challenges are
overcome, it will not require the strict temperature
management that is usual for the storage of
biopharmaceuticals. The establishment of cultivation
techniques that enable efficient production should help
reduce medical expenditures for the vaccine.
In December 2017, Astellas, IMSUT, Chiba University
and ASAHI KOGYOSHA CO., LTD. signed a collaborative
research agreement aimed at the practical application of
MucoRice-CTB, a rice-based oral vaccine that expresses
the Cholera Toxin B subunit (CTB) in the rice storage
protein. Under the agreement, Astellas will examine the
conditions for production and formulation of MucoRice-
CTB. Meanwhile, IMSUT, Chiba University, and ASAHI
KOGYOSHA will develop the production system for the
vaccine. This research program has been designated as a
project under Cyclic Innovation for Clinical Empowerment
and will be supported by the Japan Agency for Medical
Research and Development.
Through these collaborative research projects, Astellas
will attempt to develop new platform technology to create
innovative new drugs to address unmet medical needs.
Development of Pediatric Formulation
for Schistosomiasis
Schistosomiasis is one of the most prevalent parasitic
diseases in developing countries centered on Africa and
South America. The disease has a particularly high
incidence rate among children. The existing “gold standard”
treatment for schistosomiasis is praziquantel. However,
one challenge is that praziquantel tablets are difficult to
administer to preschool-age children, including infants
and toddlers, mainly due to the risk of choking stemming
from the tablets’ large size and the drug’s bitter taste.
Having set up a consortium with other
pharmaceutical companies, research institutions and
international non-profit organizations, Astellas is
developing a pediatric formulation of praziquantel.
The pediatric formulation newly developed by Astellas
uses its own drug formulation technology. The pediatric
formulation was designed to be smaller than the existing
tablet and orally dispersible so that it can be taken even
without water, due to a reduction of bitterness. In addition,
the pediatric formulation can be manufactured using
simple production technology, while holding down
production costs, and the tablets are stable even in the hot
and humid environment of tropical areas. Astellas has
transferred the technology and expertise needed to
develop the pediatric formulations to consortium partners
in Brazil and Germany, thereby helping to produce drug
products used for clinical trials and to build local
pharmaceutical manufacturing capabilities.
The consortium is conducting a Phase 2 clinical trial
and preparing to start Phase 3 clinical trials including the
receipt of funding from the GHIT Fund and the European &
Developing Countries Clinical Trials Partnership. Astellas
continues to provide its expertise and technology to
the consortium.
Newly developed pediatric formulation (top) and existing formulation (bottom)
Members of the consortium developing the pediatric formulation of praziquantel
©Lygature 2016
64
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 management of this event. Participants included members
of pharmaceutical companies, academia, United Nations
organizations, non-governmental organizations, and
government institutions. Through keynote addresses and
panel discussions by experts, the event confirmed the
importance of collaboration between the private and
public sectors and facilitated discussion on activities,
issues and prospects for driving widespread adoption of
universal health coverage and achieving the United
Nations’ Sustainable Development Goals.
*1 For details about Access Accelerated, please visit the following website:
http://www.accessaccelerated.org/
*2 As of March 2018
ACTION ON FISTULATM
ACTION ON FISTULATM*1 was conceived, built and is run by
the Fistula Foundation. It was started in 2014 by a grant
given to the Fistula Foundation from an affiliate of Astellas,
Astellas Pharma Europe Ltd. Since 2014, the program has
transformed the lives of 3,417*2 women in Kenya who are
suffering with obstetric fistula*3. By 2020, ACTION ON
FISTULATM aims to help more than 4,500 patients in total
to access fistula treatment.
The Fistula Foundation and Astellas jointly funded the
first phase of the program, which ran from 2014 to 2017.
Astellas provided funding of €1.5 million (approximately
50% of the total) and the remaining was provided by the
Fistula Foundation. In this phase, the program improved
the lives of patients with obstetric fistula while
simultaneously training doctors who will be able to
provide surgical treatment in Kenya. The program also set
up the Fistula Treatment Network to extend access to
services, with six hospitals enrolled and providing fistula
surgeries on a routine basis.
Contribution to Access Accelerated and Related
Progress
Astellas has participated in Access Accelerated*1 since its
launch in January 2017. Access Accelerated is a global
initiative aimed at improving access to non-communicable
disease prevention, diagnosis and treatment in low and
middle income countries. More than 20 international
pharmaceutical companies are partners in the program,
working alongside organizations such as the World Bank
and the Union for International Cancer Control.
Non-communicable diseases (NCDs) are any diseases
not caused by human-to-human transmission of an
infectious agent. Leading NCDs include cancer,
cardiovascular disease, chronic respiratory disease and
diabetes. Many NCDs are caused by unhealthy eating, lack
of exercise, smoking or excessive drinking, and could be
prevented by lifestyle improvement. NCDs are not just on
the increase in developed countries, but the number of
patients suffering from NCDs is also increasing in
developing countries. The rising incidence of NCDs not
only puts pressure on the healthcare budgets of
developing countries, but also leads to economic losses
when patients cannot work due to illness.
Under Access Accelerated, Astellas supports ACTION
ON FISTULATM, a pioneering program which has
transformed the lives of over 3,400*2 women in Kenya who
are suffering with obstetric fistula. As part of this program,
Astellas worked to present its activities and raise public
awareness of obstetric fistula by opening a booth at a
special side event at the United Nations General Assembly
held in September 2017 and at a stakeholder collaboration
event held in Kenya in March 2018.
Moreover, in 2017, Astellas launched a new initiative
in India structured according to patients’ income levels,
with the aim of improving their access to its anticancer
products. Astellas will continue to push ahead with
activities that improve patients’ access to the prevention,
diagnostics, and treatment of NCDs in low and middle
income countries.
Furthermore, in December 2017, the Japan
Pharmaceutical Manufacturers Association and Access
Accelerated hosted a side event titled “Accelerating
Sustainable Universal Health Coverage by Improving
Access to NCD Care” at the 2017 Universal Health Coverage
Forum. Astellas was involved in the planning and
65
Business ReviewAstellas Pharma Inc. ANNUAL REPORT 2018
The second phase of ACTION ON FISTULATM is
scheduled to run from 2017 to 2020. Astellas has
committed to supporting the Fistula Foundation for this
phase. Astellas is funding €0.75 million (approximately 25%
of the total) and the remaining was funded by the Fistula
Foundation. In the second phase of the program, ACTION
ON FISTULATM aims to build capacity to deliver ongoing
treatment and provide surgeries to even more patients
with obstetric fistula. Specifically, the program aims to
increase the number of hospitals enrolled in the Fistula
Treatment Network to 8 hospitals, train an additional 6
surgeons specializing in fistula, and train an additional 10
fistula nurses. In addition, ACTION ON FISTULATM wants to
help fistula patients who have undergone treatment with
emotional assistance, economic empowerment and
employment support so that they can return to their
communities. To this end, the program plans to establish
20 support groups that will be enrolled in the Fistula
Treatment Network.
On WHO’s Universal Health Coverage Day in
December 2017, Astellas hosted a meeting titled "Act for
UHC, ACTION ON FISTULA - Transforming the Lives of
Women in Kenya.” Members of the Fistula Foundation and
the United Nations Population Fund (UNPFA) were invited
to speak at the event, in an effort to raise awareness of
obstetric fistula in Japan.
*1 For more information about the program visit the following website:
https://www.astellas.com/index.php/en/sustainability/action-on-fistula
*2 As of March 2018
*3 An obstetric fistula is a hole between the vagina and rectum or bladder that is
caused by prolonged obstructed labor when emergency care is unavailable,
causing fecal and/or urinary incontinence. Although it has been virtually
eradicated in developed countries, the UNFPA estimates 3,000 new cases of
obstetric fistula occur annually in Kenya. Women with obstetric fistula are often
subject to severe social stigma due to odor, which is constant and humiliating,
often driving the patients’ family, friends and neighbors away. Stigmatized,
these women are also often denied access to education and employment and
live in isolation and poverty.
Astellas employees visit the home of an obstetric fistula patient who has
received treatment
©Georgina Goodwin 2017
Progress in ACTION ON FISTULATM
(May 2014-March 2018)
Patients successfully treated with
reconstructive surgery
3,417 patients
Trained and certified doctors to
the standard level of competency
6 Kenyan doctors
Centers in the Fistula
Treatment Network
6 centers
FIGO-accredited fistula
training center
Established Gynocare Women’s and
Fistula Hospital in Eldoret, Kenya
Kenyan counties* reached
45 counties
Trained community
outreach workers
295 outreach workers
Conducted outreach activities
10,093 activities
Community members reached
with fistula messages
845,578 community members
* Kenya is divided into 47 counties. There are several units of governance below
the county level. These units include subcounties, wards, and villages.
Astellas employees visit the Gynocare Women’s and Fistula Hospital
©Georgina Goodwin 2017
66
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018
Social Contribution
Astellas is cooperating with a range of stakeholders in
an effort to address social issues that affect people
throughout the world.
AECEP Overseas Volunteer Program
In fiscal 2016, Astellas launched a new social contribution
program called the Astellas Emerging Countries
Empowerment Program (AECEP).
AECEP is a program for addressing social issues in
emerging countries in partnership with enterprises and
non-governmental organizations (NGO) in which Astellas
employees utilize their respective expertise, skills and
experience. Volunteer employees participating in the
program (“participants”) travel to an emerging country
after a preparation period of one and half months. They
then carry out initiatives in the country for a limited time
of three and a half months at an assigned partner
enterprise or NGO that works toward solutions that should
meet the expectations of society.
Partners are selected from among enterprises and
NGOs involved in addressing medical, health and safety
issues or environmental problems. Participants get directly
involved in local social issues and learn many things
through collaborating with leaders and community
members who are strongly committed to solving the
issues. Participants maximize their use of the experience
and abilities they have cultivated through work at Astellas
to help make the partner activities more effective, and to
build or improve their systems. Engaging in social
contributions in this kind of equal, interactive relationship
is the major characteristic of AECEP.
In fiscal 2017, the second year of the program, two
employees were selected as participants. One participant
was assigned to an organization in Cambodia, where they
contributed to efforts to promote better health for the
needy and children through the manufacture and sale of
highly nutritious food and beverage products. The other
participant was assigned to an organization in Vietnam
where they managed an art classroom, selling
miscellaneous goods printed with the children’s
illustrations primarily to support children with disabilities.
The participants cooperated with the local organizations
while overcoming various difficulties, and managed to
successfully generate results in improving the nutritional
value of numerous products, developing new products,
67
expanding sales channels, and improving the level of
customer service. They received warm words of gratitude
from members of their assigned organizations.
The invaluable experiences that can be obtained
through AECEP—getting away from daily work and
pursuing one’s own potential in an emerging country
while newly creating value for society—also have major
significance for Astellas from the standpoint of human
resource development.
“Embrace Change and Challenge” is included in the
“Our People” section of our HR Vision, and Astellas will also
continue promoting AECEP for this reason: to help develop
human resources with a long-term, strategic thinking
ability who are truly capable of taking on challenges with a
sense of ownership.
An Astellas employee (right) meets with a member of an organization in
Cambodia to discuss making products with high nutritional value
An Astellas employee (second from the left) selling miscellaneous goods
crafted from artwork created by children in Vietnam
Business ReviewAstellas Pharma Inc. ANNUAL REPORT 2018 Support for Patients
Mentor Volunteers in the Science WoRx® Program
Astellas conducts a variety of activities to provide
assistance to patients fighting illnesses, and to their family
members, on a global basis. Astellas promotes Peer
Support Training Sessions in Japan as part of efforts to
support the self-reliance and development of patient
associations. Peer Support Training Sessions are held for a
wide range of participants, including patients and their
families, along with those who have recently formed
patient associations. In these training sessions, activities
include programs for participants to learn attentive
listening skills, which enable colleagues who have faced
the same issues or have experienced the same problems
to serve as consulting partners to one another. In fiscal
2017, Peer Support Training Sessions were held in 3
locations across Japan, and were attended by 19
organizations and 31 people.
Astellas also supports local Ronald McDonald House
Charities (RMHC) Chapters in the United States, helping
the global organization provide comfort and care to
millions of families with sick children who have to travel far
from home for the care they need. Last year alone, RMHC
helped families save almost US$900 million in out-of-pocket
lodging and meal expenses, due in large part to more than
508,000 volunteers who provide services like meal
preparation at Ronald McDonald Houses around the world.
Astellas employees in the U.S. have supported this
organization for three years in a row, volunteering to cook
for patients’ families staying at local Ronald McDonald
Houses. These activities offer Astellas employees in the U.S.
the opportunity to lead local volunteer programs.
Employees are responsible for scheduling events,
recruiting team members to participate, purchasing
supplies and leading teams in preparing and serving
meals. The events have served as an engaging team-
building experience that contributes to the organization’s
activities to support patients and their families. In fiscal
2017, 379 Astellas US employees prepared and served
2,623 meals to patients’ families at 62 Ronald McDonald
House events across the U.S. to comfort families caring for
a sick child.
Astellas employees in the U.S. are dedicated to mentoring
students as part of the Science WoRx® mentor program to
promote science education. In 2017, Science WoRx®
mentors shared their experiences in science, technology,
engineering, and math (STEM) fields and encouraged more
than 200 young women to take an interest in science-
related careers at iBIO Institute’s STEMGirls camp, a week-
long STEM summer camp for girls.
Employees who volunteer as mentors through
Science WoRx® also serve as judges and presenters at
science fairs, sharing their love of science with students to
inspire the next generation of innovators.
Group-Wide Volunteer Activities for Changing
Tomorrow Day
Astellas Group employees around the world are
encouraging a diverse range of volunteer activities as part
of Changing Tomorrow Day based on the themes of
promoting healthcare and maintaining the environment,
thereby contributing to their local communities. In fiscal
2017, more than 6,400 employees participated.
Changing Tomorrow Day Held in Fiscal 2017
Region
Participants
Volunteering
hours
Number of
locations
Number of
countries
Japan
Americas
EMEA
Asia & Oceania
Total
3,445
2,060
325
641
6,471
4,542
7,178
2,449
2,173
16,342
117
81
20
11
229
1
4
13
6
24
68
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Environmental Preservation
Astellas believes that maintaining a healthy global
environment is an essential theme for maintaining sound
business activities and building a sustainable society.
Going forward, Astellas will strive to realize its
VISION for being a responsible corporation based on a
long-term timeframe that keeps future generations in
mind and a global perspective. At the same time, we will
continue efforts to address regional social issues and
pursue corporate activities in harmony with the global
environment.
Environmental Action Plan
Having determined the Astellas Environment, Health &
Safety Policy, Astellas identified its aspirations in the
Astellas Environment, Health & Safety Guidelines. As
appropriate, we review the Environmental Action Plan,
which outlines short- to medium-term activity targets
based on various factors, including progress status and
social circumstances, and add new initiatives and/or set
more challenging targets.
Fiscal 2017 results are as shown in the table below.
The Environmental Action Plan involving Climate-Related
Measures was formulated using fiscal 2005 as the base
year, but we have revised the plan to take into account the
significant changes that have occurred to the
environments within and outside of the Company since
the time the plan was formed. The main background to
the changes and the new plan are below.
Main Background to Changes in the Climate-
Related Action Plan
• Increase of overseas offices
• In Japan’s electricity usage, there is a divergence between
the volume of GHG emissions based on the Environmental
Action Plan and the volume of actual emissions
• Transfer of the Fuji Plant, Norman Plant, etc., to other
companies, etc.
New Environmental Action Plan
Reduce greenhouse gas (GHG) emissions (scope 1+2*)
by 30% by fiscal 2030
(Base year: Fiscal 2015)
* Scope 1 Direct emissions
* Scope 2 Indirect emissions
Initiatives for Realizing a Low-Carbon Society
Promotion Framework and Initiatives for Climate-
Related Measures
- Setting Science Based Targets (SBT)
Astellas endeavors to reduce the GHG emissions
accompanying its activities to help realize a low-carbon
society. The Global EHS Sub-Committee comprised of
members from each regional base has been organized to
develop ways to conserve energy and reduce GHG
emissions for the entire Group and analyze the risks and
opportunities that climate change presents to the
business. The sub-committee reports to top management
Environmental Action Plan Performance in Fiscal 2017 (Summary)
Environmental Action Plan
Fiscal 2017 (Summary)
1. Measures to Address Climate Change
(Base year: Fiscal 2005)
Reduce GHG emissions by 35% or more by the end of fiscal 2020
Japan: Reduce GHG emissions by 30% or more
Overseas plants: Reduce GHG emissions by 45% or more
Global: Reduced 30%
Japan: Reduced 29%
Overseas plants: Reduced 37%
2. Measures for the Conservation of
Natural Resources (Research and
production sites)
(Base year: Fiscal 2005)
3. Biodiversity
(Base year: Fiscal 2005)
1) Enhance water resource productivity by around 2.5 times the
fiscal 2005 result by the end of fiscal 2020
Indicator: Sales (¥ billion)/Water resources withdrawn (1,000 m3)
2) Improve waste generated per unit of sales to around 20% of the
fiscal 2005 result by the end of fiscal 2020
Indicator: Volume of waste generated (tons)/Sales (¥ billion)
1) Achieved; 2.9 times the
fiscal 2005 result
2) Almost achieved; 21% the
fiscal 2005 result
Triple the biodiversity index by fiscal 2020
Improved to 2.6 times
Note: GHG emissions generated through electricity usage are calculated using the following coefficients:
(1) A coefficient of 0.330 kg-CO2/kWh is used to calculate results needed to evaluate progress against the Environmental Action Plan and make investment decisions and
implement countermeasures to bridge the gap between results and targets. The figures shown in the table above represent the results calculated using this coefficient.
(2) GHG emissions (actual emissions) for electricity use are calculated using the CO2 emission coefficient of electric power suppliers. In Japan, the latest adjusted emission
coefficient for each power supplier announced by the Ministry of the Environment and METI is applied. If the coefficient of the electric power supplier is not available
in other regions, the country-specific emission coefficient provided by the International Energy Agency (IEA) is applied.
69
Business ReviewAstellas Pharma Inc. ANNUAL REPORT 2018
on their discussions and decisions at the CSR Committee.
In the new Environmental Action Plan from fiscal
2018, Astellas has newly set our targets that are consistent
with the Science Based Targets (SBT), which recommended
that private companies set reduction targets aligned with
the Paris Agreement, which entered into force in 2016,
with all business activities being evaluated. In February
2018, we submitted a commitment letter to the SBT
Initiative. We expect that our fiscal 2030 targets (base year:
fiscal 2015) will be verified and approved by the SBT
Initiative by the end of fiscal 2018.
Reducing GHG Emissions
The GHG emissions volume for fiscal 2017, based on the
new action plan, was 207 kilotons (Scope 1: 87 kilotons;
Scope 2: 119 kilotons).
For reductions under Scope 2, which accompany
energy supply from external sources such as electricity,
Astellas employs a market-based method calculated using
an emission coefficient for each power company that
supplies us. Emissions in regions where it is difficult to use
the emission coefficients for each electric power company
are calculated with country-specific emission coefficients
provided in the CO2 EMISSIONS FROM FUEL COMBUSTION
2017 EDITION published by the International Energy
Agency. Furthermore, we also purchase electricity
obtained from renewable energy sources for plants in the
European region and other areas.
GHG Emissions (Actual Emissions)
Scope 1
Base emissions for the new Environmental Action Plan
Scope 2
(kilotons)
250
200
150
100
50
0
223
124
99
2015
213
217
123
207
119
Monitoring GHG Emissions in the Value Chain
The Environmental Action Plan applies to emissions in its
business activities related to climate change (Scope 1, 2),
but Astellas also strives to monitor emissions across the
entire value chain (Scope 3).
We have also set SBT for GHG emissions from
important emissions sources in Scope 3 and are working
to reduce these.
GHG Emissions
Scope 3
283 kilotons
Emissions from value chain
58%
Total
490 kilotons
(Fiscal 2017)
Scope 1
87 kilotons
Direct emissions
18%
Scope 2
(purchased electricity
and heat)
119 kilotons
Indirect emissions
24%
Status of GHG Emissions (Fiscal 2017)
(tons)
Scope 1 Direct emissions
Scope 2 Indirect emissions
87,429
(Sales fleets 24,203)
119,499
Scope 3 Other indirect emissions
Upstream activities
Downstream activities
1. Purchased goods and
services
9. Transportation and
144,418
distribution
(downstream)*
2. Capital goods
68,203
10. Processing of sold
products
3. Fuel- and energy-related
activities (not included in
Scope 1 or 2)
26,002 11. Use of sold products
Not
relevant
Not
relevant
No
emissions
results
12. End-of-life treatment of
sold products
668
4. Transportation and
distribution (upstream)*
3,781
Raw materials transported
by tanker trucks
(244)
13. Leased assets
(downstream)
95
87
Plant
Warehouse
(286)
14. Franchises
2016
2017
(FY)
Distribution warehouse
(853)
Distribution warehouse
Wholesaler
(2,398)
15. Investments
5. Waste generated in
operations
4,753
6. Business travel (aircraft use)
32,572
7. Employee commuting
2,542
8. Leased assets (upstream)
Not
relevant
* Product shipments are handled by outside contractors.
Not
relevant
Not
relevant
Not
relevant
70
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Using Renewable Energy
Environmental Action Plan (Resource Recycling)
Using renewable energy is one of the most effective
climate-related measures. Astellas actively installs
equipment for photovoltaic panels, wind turbine
generators, and biomass boilers, and consumes the energy
produced at its business sites.
Additionally, by purchasing renewable-sourced
electricity and carbon-neutral city gas, we also indirectly
suppress GHG emissions.
Status of Renewable Energy Use (Fiscal 2017)
Water resource productivity (For research and production sites)
Indicator
Sales (¥ billion)/Water resources withdrawn (1,000 m3)
Numerical
targets
Enhance water resource productivity by around 2.5
times the fiscal 2005 result by the end of fiscal 2020
Waste generated per unit of sales (For research and production sites)
Indicator
Volume of waste generated (tons)/Sales (¥ billion)
Numerical
targets
Improve waste generated per unit of sales to around
20% of the fiscal 2005 result by the end of fiscal 2020
Business site
Types of renewable energy
Energy volume
Water Resource Productivity*
Kerry Plant
• Wind power generation (Power
capacity: 800 kW)
• Woodchip biomass boiler (Power
capacity: 1.8 MW)
1,692
37,211
MWh
GJ
• Purchases renewable-sourced
6,650
MWh
electricity
Global
Dublin Plant
• Purchases renewable-sourced
electricity
Meppel Plant
• Purchases renewable-sourced
electricity
5,855 MWh
12,896 MWh
WRP 0.13
(2.5)
or over
Target
2020
WRP 0.05
(1)
Base
2005
Achieved
WRP 0.15
(2.9)
Result
2017
(FY)
Leiden
(Netherlands)
U.S. regional
headquarters
Tsukuba
Research
Center
Yaizu
Technology
Center
• Purchases renewable-sourced
electricity
• Purchases carbon-neutral city gas
• Geothermal heat
• Geothermal heat
2,305
MWh
* Water Resource Productivity (WRP) =
Sales (¥ billion)
Water resources withdrawn (1,000 m3)
146
1,491
3
GJ
GJ
GJ
Waste Generated per Unit of Sales*
WGS 51
• Photovoltaic generation
49 MWh
• Geothermal heat (immeasurable)
—
Global
(100%)
Almost
achieved
WGS 10
20% or
below
Target
2020
WGS 11
21%
Result
2017
(FY)
Base
2005
Initiatives for Resource Recycling
* Waste Generated per unit of Sales (WGS) =
Volume of waste generated (tons)
Sales (¥ billion)
Astellas seeks to contribute solutions to the social issues
involved in establishing a recycling-oriented society. We
have therefore been striving to reduce water withdrawal
and landfill waste. We established a management indicator
called water resource productivity and have been working
to improve on this front.
We are also moving ahead on reducing landfill waste
to as close to zero as possible by actively recycling and
reusing, and have set improvement targets for waste
generated per unit of sales.
Ongoing Water Risk Evaluation
Astellas uses the Global Water Tool™ provided by the World
Business Council for Sustainable Development to analyze
water risks specific to the operating regions where its
plants and other facilities are located.
The Astellas Group on a global basis does not
currently withdraw water from water bodies in areas
concerned with water resource depletion. As water risks
may emerge in the future as a result of climate change, we
are taking steps to minimize our dependence on such
resources, and also regard this as an effective means of
ensuring business continuity.
71
Business ReviewAstellas Pharma Inc. ANNUAL REPORT 2018 Initiatives for Biodiversity
Astellas understands its business activities in all fields have
an impact on ecosystems. We will make a positive
contribution to the preservation of biodiversity by working
to lessen that impact. Furthermore, we will actively
contribute to the creation of a society that coexists with the
natural world, enabling the preservation of biodiversity and
the sustainable use of the benefits of healthy ecosystems.
Astellas has created a Biodiversity Index* by assessing
the three main factors responsible for the deterioration of
biodiversity, categorized as environmental pollution,
resource consumption and climate change. Going forward,
we will continue improving in each category while
working toward achieving the target for fiscal 2020, which
is a ratio three times the fiscal 2005 level.
The Biodiversity Index for fiscal 2017 came in at 2.6
times the fiscal 2005 level. As the scope of the
Environmental Action Plan has expanded regarding
climate change, so has the scope of each index used to
calculate the Biodiversity Index. The following graph has
been recalculated from past indices. Beyond the region,
Astellas believes that by minimizing the impact of its
business activities on the environment, the Company will
help suppress the deterioration of biodiversity and realize
an environment in which sustainable business activities
may be continued.
* For details on the calculation method, please visit the following website:
https://www.astellas.com/responsibility/preserving-biodiversity
3.0
Target
2.6
2.5
2.3
Biodiversity Index
Ratio to fiscal 2005 level
3.0
2.0
1.0
1.0
2.0
1.7
0
2005
2013
2014
2015
2016
2017
2020
(FY)
For details on environmental preservation, please visit the following
website:
Web https://www.astellas.com/en/responsibility/environment
Message from the Kerry Plant Vice President & General Manager
Protecting the Natural Ecosystem Inside the Plant
Kerry Plant manufactures a range of products including
the immunosuppressant Prograf, which are supplied
globally. A significant portion of the plant is located in a
designated nature reserve, and the plant has a nature
reserve plan to protect and enhance ecological value
and biodiversity. The plan aims to conserve and enhance
the ecological environment of all plant and animal
habitats, protect notable plant and animal species,
encourage sustainable recreational and educational use
and improve public awareness.
We take part in various Killorglin Tidy Towns
sustainability initiatives, providing a leisure walkway
through the nature reserve, erecting information boards
on the local flora and fauna, and educating local
students on environmental awareness.
Astellas will continue to contribute to the creation
of a community with a strong environmental conscience
and a clear commitment to a sustainable relationship
with our environment that will
lead to the preservation of
biodiversity and protection of
our ecosystem.
Patricia Quane
Vice President & General Manager,
Kerry Plant
Astellas Ireland Co., Limited
72
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Stakeholder Engagement
Astellas conducts business activities within a diverse
network of relationships, including with patients and
many others, and our activities are supported by
these relationships. We regard stakeholders such as
patients and healthcare professionals, employees, and
shareholders and investors as particularly important
stakeholders because they are significantly impacted
by our business activities.
Interacting with these stakeholders who support
the business activities of Astellas in good faith, and
understanding their expectations and needs, is
essential to acquiring their trust and sustainably
increasing our enterprise value.
We therefore use various opportunities to
communicate with stakeholders. In addition, to
promote constructive dialogue with our stakeholders,
we appropriately disclose information to all groups in
a way that is both timely and impartial.
By continuing to conduct communication
through disclosure and engagement, we will further
raise our transparency as a company and strive to
sustainably increase the enterprise value of Astellas
while simultaneously raising the overall sustainability
of society.
For details, please visit the following website:
Web
https://www.astellas.com/en/sustainability/stakeholder-communications
Patient Engagement
Achieving “Even Better” Communication with Patients
Astellas defines Patient Focus as one of our five
messages of the Astellas Way. To improve our
implementation of patient focus, Astellas assesses its
day-to-day efforts continuously and improves how it
interacts with patients.
Astellas made changes in the U.S. such as
establishing a system to give a quicker response to
inquiries about its clinical trials to patients, and
implementing a patient support survey to assess the
responses of Astellas to patients, and to better
understand patients’ perceptions about our
customer services.
Furthermore, taking into consideration the levels
of patients’ knowledge and understanding about
health, Astellas revises the descriptions of important
safety information together with the informed
consent form. Moreover, Astellas strives to have
better communications with patients by providing
training to all staff who have the chance of coming
into contact with patients, on themes such as the
knowledge and understanding of health, the
consideration of patients, and interpersonal skills.
These improvements that started in the U.S. will
be adapted for other regions, helping to fulfill our
VISION of turning innovative science into value
for patients.
73
Business ReviewAstellas Pharma Inc. ANNUAL REPORT 2018 Financial Information and Data
Financial Summary
Financial Review
Consolidated Financial Statements
Consolidated Statement of Income
Consolidated Statement of Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to Consolidated Financial Statements
Independent Auditor’s Report
Investor Information
Corporate Data/
Principal Subsidiaries and Affiliates
75
77
86
91
152
153
154
Definition of Financial Results on a Core Basis
We disclose our financial results under IFRS on a core basis to help provide an
accurate indication of the Group’s recurring profitability. Certain items reported in
financial results under IFRS on a full basis that are deemed to be non-recurring
items by the Company are excluded as non-core items on a core basis.
Consolidated Financial Results
(Full Basis)
Consolidated Financial Results
(Core Basis)
Sales
Cost of sales
Gross profit
Selling, general and
administrative expenses
R&D expenses
Amortisation of
intangible assets
Share of profits of associates
and joint ventures
Other income
Other expense
Operating profit
Finance income
Finance expense
Profit before tax
Income tax expense
Profit for the year
Non-recurring other income and other expense
within IFRS-based operating profit are excluded
(for example, items such as impairment losses
or restructuring expenses)
Core operating profit
Adjustments for finance income and
finance expense (for example, gain (loss)
on sale of available-for-sale (AFS) financial
assets and impairment losses on AFS
financial assets are excluded)
Core profit for the year
74
Astellas Pharma Inc. ANNUAL REPORT 2018 Financial Summary
Astellas has adopted the International Financial Reporting Standards (IFRS), effective from
fiscal 2013 (March 2014). Results for each category and earnings per share are presented
on a core basis for the fiscal years since March 2014.
For the year
Sales
Cost of sales
SG&A expenses*2
R&D expenses*2
R&D ratio (%)
Operating income/profit
Operating margin (%)
Net income/Profit for the year
At year-end
Total assets
Total net assets/Total equity
Per share data*3
Net income/Profit for the year
Total net assets/Total equity
Dividends
Major indicators
ROE (%)
DOE (%)
Equity ratio (%)
Free cash flow
(¥ billion, US$ million)
Average exchange rate (US$/¥)
(€/¥)
2008.3
J-GAAP
2009.3
J-GAAP
2010.3
J-GAAP
2011.3
J-GAAP
(¥ billion)
2012.3
J-GAAP
2013.3
J-GAAP
2014.3
IFRS
2015.3
IFRS
2016.3
IFRS
2017.3
IFRS
2018.3
IFRS
2018.3
IFRS
(¥ billion)
(US$ million)*1
¥972.6
¥965.7
¥974.9
¥953.9
¥969.4
¥1,005.6
¥1,139.9
¥1,247.3
¥1,372.7
¥1,311.7
¥1,300.3
$12,267
279.3
417.3
134.5
13.8
275.9
28.4
177.4
264.4
450.9
159.1
16.5
250.4
25.9
171.0
289.2
499.2
195.6
20.1
186.4
19.1
122.3
296.0
538.8
217.3
22.8
119.2
12.5
67.7
318.6
519.2
189.8
19.6
131.5
13.6
78.2
1,439.2
1,110.9
1,348.4
1,030.2
1,364.2
1,053.9
1,335.1
1,021.1
1,400.6
1,018.1
1,445.6
1,062.0
1,653.1
1,268.5
1,793.6
1,317.9
1,799.3
1,259.2
1,814.1
1,271.8
1,858.2
1,268.3
¥349.89
2,228.34
110.00
16.1
5.0
77.1
178.5
114
162
¥356.11
2,189.26
120.00
16.0
5.4
76.3
168.8
101
143
¥261.84
2,278.77
125.00
11.7
5.6
77.1
118.6
93
131
¥146.49
2,207.70
125.00
6.5
5.6
76.4
(142.0)
86
113
(¥)
¥169.38
2,200.64
125.00
7.7
5.7
72.6
146.7
79
109
324.1
527.6
182.0
18.1
153.9
15.3
82.9
¥36.08
469.92
130.00
8.0
5.7
73.3
95.5
83
107
330.6
397.0
191.5
16.8
186.3
16.3
132.8
¥59.11
568.53
135.00
7.4
5.0
76.7
187.4
100
134
333.2
452.5
206.6
16.6
216.5
17.4
153.2
¥69.37
600.93
30.00
10.5
5.1
73.5
116.2
110
139
335.6
500.4
225.7
16.4
267.5
19.5
198.8
¥92.12
592.58
32.00
15.0
5.4
70.0
166.7
120
133
320.5
470.8
208.1
15.9
274.6
20.9
213.3
¥101.15
615.89
34.00
17.3
5.6
70.1
162.2
108
119
294.2
478.3
220.8
17.0
268.7
20.7
204.3
¥100.64
641.80
36.00
13.0
5.7
68.3
190.8
111
130
2,776
4,513
2,083
2,535
—
—
1,928
17,530
11,965
$0.95
6.05
0.34
—
—
—
—
—
1,800
(¥)
(US$)
*1 U.S. dollars have been converted at the rate of ¥106 to US$1, the approximate exchange rate on March 31, 2018.
*2 SG&A expenses under J-GAAP (from fiscal 2007 to fiscal 2012) include R&D expenses.
*3 Astellas conducted a stock split of common stock at a ratio of 5 for 1 with an effective date of April 1, 2014. Net income/profit for the year per share and total net assets/total
equity per share are calculated based on the number of shares issued after the stock split (excluding treasury shares) on the assumption that the stock split was conducted at
the beginning of fiscal 2012. Moreover, the number of shares outstanding has also been calculated on the assumption that the stock split was conducted at the beginning of
fiscal 2012.
75
Financial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 For the year
Sales
Cost of sales
SG&A expenses*2
R&D expenses*2
R&D ratio (%)
Operating income/profit
Operating margin (%)
Net income/Profit for the year
At year-end
Total assets
Total net assets/Total equity
Per share data*3
Net income/Profit for the year
Total net assets/Total equity
Dividends
Major indicators
ROE (%)
DOE (%)
Equity ratio (%)
Free cash flow
(¥ billion, US$ million)
Average exchange rate (US$/¥)
(€/¥)
279.3
417.3
134.5
13.8
275.9
28.4
177.4
¥349.89
2,228.34
110.00
16.1
5.0
77.1
178.5
114
162
264.4
450.9
159.1
16.5
250.4
25.9
171.0
¥356.11
2,189.26
120.00
16.0
5.4
76.3
168.8
101
143
289.2
499.2
195.6
20.1
186.4
19.1
122.3
¥261.84
2,278.77
125.00
11.7
5.6
77.1
118.6
93
131
296.0
538.8
217.3
22.8
119.2
12.5
67.7
¥146.49
2,207.70
125.00
6.5
5.6
76.4
(142.0)
86
113
318.6
519.2
189.8
19.6
131.5
13.6
78.2
(¥)
¥169.38
2,200.64
125.00
7.7
5.7
72.6
146.7
79
109
2008.3
J-GAAP
2009.3
J-GAAP
2010.3
J-GAAP
2011.3
J-GAAP
(¥ billion)
2012.3
J-GAAP
2013.3
J-GAAP
2014.3
IFRS
2015.3
IFRS
2016.3
IFRS
2017.3
IFRS
2018.3
IFRS
2018.3
IFRS
(¥ billion)
(US$ million)*1
¥972.6
¥965.7
¥974.9
¥953.9
¥969.4
¥1,005.6
¥1,139.9
¥1,247.3
¥1,372.7
¥1,311.7
¥1,300.3
$12,267
324.1
527.6
182.0
18.1
153.9
15.3
82.9
330.6
397.0
191.5
16.8
186.3
16.3
132.8
333.2
452.5
206.6
16.6
216.5
17.4
153.2
335.6
500.4
225.7
16.4
267.5
19.5
198.8
320.5
470.8
208.1
15.9
274.6
20.9
213.3
294.2
478.3
220.8
17.0
268.7
20.7
204.3
1,439.2
1,110.9
1,348.4
1,030.2
1,364.2
1,053.9
1,335.1
1,021.1
1,400.6
1,018.1
1,445.6
1,062.0
1,653.1
1,268.5
1,793.6
1,317.9
1,799.3
1,259.2
1,814.1
1,271.8
1,858.2
1,268.3
2,776
4,513
2,083
—
2,535
—
1,928
17,530
11,965
(¥)
(US$)
¥36.08
469.92
130.00
8.0
5.7
73.3
95.5
83
107
¥59.11
568.53
135.00
7.4
5.0
76.7
187.4
100
134
¥69.37
600.93
30.00
10.5
5.1
73.5
116.2
110
139
¥92.12
592.58
32.00
15.0
5.4
70.0
166.7
120
133
¥101.15
615.89
34.00
17.3
5.6
70.1
162.2
108
119
¥100.64
641.80
36.00
13.0
5.7
68.3
190.8
111
130
$0.95
6.05
0.34
—
—
—
1,800
—
—
76
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Financial Review
Overview of the Year Ended March 31, 2018
(Fiscal 2017)
In its consolidated operating results (core basis) for fiscal
2017, Astellas posted decreases in the three items of sales,
core operating profit and core profit for the year.
Consolidated Financial Results (Core Basis)
Sales
Operating profit
Profit for the year
(¥ billion)
2017.3
2018.3
1,311.7
274.6
213.3
1,300.3
268.7
204.3
Astellas discloses financial results on a core basis as an
indicator of its recurring profitability. Certain items
reported in financial results on a full basis that are deemed
to be non-recurring items by Astellas are excluded as
non-core items from these financial results on a core basis.
These adjusted items include impairment losses, gain
(loss) on sales of property, plant and equipment,
restructuring costs, loss on disaster, a large amount of losses
on compensation or settlement of litigation and other legal
disputes, and other items that we judge should be excluded.
Foreign Exchange Impact for Fiscal 2017
The exchange rates for yen in fiscal 2017 are shown in the
table below. Movements in the rates led to a ¥43.3 billion
increase in the value of sales and a ¥13.1 billion increase in
core operating profit.
Sales
In fiscal 2017, consolidated sales declined 0.9% year on
year to ¥1,300.3 billion. Despite strong sales of core
products, sales decreased mainly due to the impact of
generics in Japan, the transfer of the global dermatology
business in 2016, and the transfer of long-listed products
in Japan in 2017.
In global products, sales of XTANDI for the treatment
of prostate cancer increased in all regions—Japan, the
Americas, EMEA, and Asia & Oceania. In addition,
combined sales of overactive bladder (OAB) treatments
Vesicare and Betanis/Myrbetriq/BETMIGA grew, and sales
of the immunosuppressant Prograf increased.
Turning to products in Japan, sales continued to grow
for the anti-inflammatory analgesic Celecox, the adult
bronchial asthma treatment Symbicort, the type 2 diabetes
treatment Suglat, and the adult rheumatoid arthritis
treatment Cimzia. Further, sales rose in the Americas for
the azole antifungal CRESEMBA and the pharmacologic
stress agent Lexiscan.
Sales by Region
Consolidated
Japan
Americas
EMEA
Asia & Oceania
(¥ billion)
2017.3
2018.3
1,311.7
1,300.3
480.8
412.4
330.8
87.7
421.2
433.3
343.8
102.0
Note: Sales by geographical area are calculated according to the location of sellers.
Americas/EMEA (Foreign Currency)
Foreign Exchange Rates (Average)
Americas (US$ million)
(¥)
EMEA (€ million)
2017.3
2018.3
3,805
2,785
3,909
2,651
US$1
€1
2017.3
2018.3
108
119
111
130
Fluctuation in Foreign Exchange Rates from April to March
2017.3
2018.3
¥0
(Strengthening of yen)
¥6
(Strengthening of yen)
¥8
(Strengthening of yen)
¥11
(Weakening of yen)
US$1
€1
77
Financial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Sales of Main Products
XTANDI
OAB products in Urology
Vesicare
Betanis/Myrbetriq/BETMIGA
Prograf
2017.3
2018.3
Change
(¥ billion)
252.1
214.9
116.1
98.8
186.2
294.3
228.1
102.3
125.7
198.5
16.8%
6.1%
-11.9%
27.2%
6.6%
Cost of Sales and Gross Profit
Cost of sales decreased 8.2% to ¥294.2 billion. The cost of
sales ratio stood at 22.6%, 1.8 percentage points lower
from the previous fiscal year, mainly due to changes in the
product mix.
Gross profit increased by 1.5% to ¥1,006.1 billion in
line with the decrease in the cost of sales.
Cost of Sales and Gross Profit
SG&A Expenses, R&D Expenses and Amortisation of
Intangible Assets
SG&A expenses
SG&A ratio (%)
Advertising and sales
promotional expenses
Personnel expenses
Other
R&D expenses
R&D ratio (%)
Amortisation of intangible assets
(¥ billion)
2017.3
2018.3
470.8
35.9
144.1
177.0
149.7
208.1
15.9
35.8
478.3
36.8
152.1
178.5
147.7
220.8
17.0
35.8
Operating Profit (Core Basis)
As a result of the above mentioned factors, core operating
profit decreased 2.1% to ¥268.7 billion. The operating
margin decreased 0.2 of a percentage point to 20.7%.
Sales
Cost of sales
Cost of sales ratio (%)
Gross profit
Gross profit ratio (%)
(¥ billion)
2017.3
2018.3
Operating Profit (Core Basis)
1,311.7
320.5
24.4
991.2
75.6
1,300.3
294.2
22.6
1,006.1
77.4
Sales
Operating profit
Operating margin (%)
(¥ billion)
2017.3
2018.3
1,311.7
274.6
20.9
1,300.3
268.7
20.7
Selling, General and Administrative (SG&A)
Expenses, Research and Development (R&D)
Expenses and Amortization of Intangible Assets
Profit for the Year (Core Basis)
Core profit for the year decreased by 4.2% to ¥204.3 billion.
Basic core earnings per share decreased by 0.5% year
SG&A expenses increased 1.6% year on year to ¥478.3
billion. Despite effective use of expenses and optimization
of resource allocation, there was an increase due largely to
impact from foreign exchange rates.
R&D expenses rose 6.1% year on year to ¥220.8 billion,
owing primarily to a rise in costs associated with expanded
investment in new fields and technologies, and progress
on late-stage development projects. The ratio of R&D
expenses to sales increased 1.1 percentage points year on
year to 17.0%.
Amortization of intangible assets was ¥35.8 billion,
unchanged year on year.
on year to ¥100.64.
Profit for the Year (Core Basis)
Profit before tax
Income tax expense
Profit for the year
Ratio of profit for the year to sales (%)
(¥ billion)
2017.3
2018.3
274.9
61.6
213.3
16.3
269.4
65.1
204.3
15.7
78
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Consolidated Financial Results (Full Basis)
Consolidated Financial Results (Full Basis)
Sales
Operating profit
Profit before tax
Profit for the year
(¥ billion)
2017.3
2018.3
1,311.7
1,300.3
260.8
281.8
218.7
213.3
218.1
164.7
In its consolidated operating results on a full basis for fiscal
2017, Astellas posted decreases in the four items of sales,
operating profit, profit before tax, and profit for the year.
The full basis financial results include “other income,” “other
expense” (including impairment losses, net foreign
exchange losses, etc.), and gain on sales of available-for-
sale financial assets (included in “finance income”) which
are excluded from the core basis financial results.
Under “other income,” Astellas posted a gain from
remeasurement relating to business combinations
associated with the acquisition of Mitobridge, Inc. Items
posted under “other expense” included impairment losses
in connection with the termination of research operations
of Agensys, Inc. and revision of plans for the development
project involving Ganymed Pharmaceuticals AG, in
addition to net foreign exchange losses. As a result, “other
income” for FY2017 was ¥11.9 billion (¥9.6 billion in the
previous fiscal year). “Other expense” for FY2017 was ¥67.3
billion (¥23.3 billion in the previous fiscal year). Gain on
sales of available-for-sale financial assets for FY2017 was
¥4.7 billion (¥21.3 billion in the previous fiscal year).
Reconciliation of Full Basis to Core Basis
Account item
Sales
Cost of sales
Gross profit
SG&A expenses
R&D expenses
Amortisation of intangible assets
Share of losses of associates and joint ventures
Other income*1
Other expense*1
Operating profit
Finance income*2
Finance expense*2
Profit before tax
Income tax expense
Profit for the year
2017.3
2018.3
Full basis
Adjustment
Core basis
Full basis
Adjustment
Core basis
(¥ billion)
1,311.7
320.5
991.2
470.8
208.1
35.8
(1.9)
9.6
23.3
260.8
22.9
2.0
281.8
63.1
218.7
—
—
—
—
—
—
—
(9.6)
(23.3)
13.7
(21.3)
(0.7)
(6.9)
(1.5)
(5.4)
1,311.7
320.5
991.2
470.8
208.1
35.8
(1.9)
—
—
274.6
1.7
1.3
274.9
61.6
213.3
1,300.3
294.2
1,006.1
478.3
220.8
35.8
(2.4)
11.9
67.3
213.3
6.6
1.8
218.1
53.4
164.7
—
—
—
—
—
—
—
(11.9)
(67.3)
55.4
(4.7)
(0.6)
51.3
11.6
39.6
1,300.3
294.2
1,006.1
478.3
220.8
35.8
(2.4)
—
—
268.7
1.9
1.2
269.4
65.1
204.3
*1 “Other income” and “other expense” are excluded from core basis results. “Other income” and “other expense” include gain (loss) on sale and disposal of property, plant and
equipment, impairment losses for other intangible assets, loss on restructuring and foreign exchange gains (losses), etc.
*2 Gain (loss) on sale of available-for-sale (AFS) financial assets and impairment losses on AFS financial assets included in “finance income” and “finance expense” are excluded
from core basis results as non-core items.
79
Financial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Consolidated Forecasts for the Year Ending
March 31, 2019 (Fiscal 2018) (Announced in
April 2018)
Consolidated business forecasts for fiscal 2018 are
presented on a core basis in the table below.
Fiscal 2018 Forecasts (Core Basis)
Sales
Operating profit
Profit for the year
Average exchange rate (US$)
(€)
2018.3
1,300.3
268.7
204.3
(¥ billion)
2019.3
(Forecast)
1,278.0
262.0
210.0
(¥)
2018.3
2019.3
(Forecast)
111
130
105
130
We project decreases in sales and core operating profit but
an increase in core profit for the year, compared with fiscal
2017. We expect negative impacts on sales and profits
from foreign exchange rates and a decline in the amount
of deferred income recognized in connection with the
transfer of long-listed products and the global
dermatology business. Excluding the impact from business
transfers and foreign exchange rates, we project sales and
core operating profit on par with fiscal 2017, despite
negative impact from NHI drug price revisions in Japan.
We assume the yen will strengthen against the U.S.
dollar and stay at the same level against the euro
compared with fiscal 2017. Accordingly, we expect foreign
exchange factors to have a ¥23.9 billion negative impact
on sales and a ¥1.9 billion negative impact on core
operating profit.
Sales
In fiscal 2018, we forecast a 1.7% year-on-year decrease in
sales to ¥1,278.0 billion. Despite anticipating ongoing
growth for the mainstay global products XTANDI and
Betanis/Myrbetriq/BETMIGA, we expect lower sales due
mainly to impact from NHI drug price revisions taking
effect in April 2018 in Japan and generic versions of long-
listed products such as the hypertension treatment Micardis.
Reference Overview of Main Products
P49
Forecast by Region
Consolidated
Japan
Americas
EMEA
Asia & Oceania
2018.3
(¥ billion)
2019.3
(Forecast)
1,300.3
1,278.0
421.2
433.3
343.8
102.0
396.8
424.4
343.9
112.9
Note: Sales by geographical area are calculated according to the location of sellers.
Americas/EMEA (Foreign Currency)
Americas (US$ million)
EMEA (€ million)
Sales of Main Products
2018.3
2019.3
(Forecast)
3,909
2,651
4,042
2,645
2018.3
2019.3
(Forecast)
XTANDI
OAB products in Urology
Vesicare
Betanis/Myrbetriq/BETMIGA
Prograf
294.3
228.1
102.3
125.7
198.5
(¥ billion)
Change
5.5%
6.6%
-5.2%
310.3
243.1
96.9
146.2
16.3%
190.7
-3.9%
80
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018
Sales of Main Products by Region
Japan
EMEA
2017.3
2018.3
(¥ billion)
2019.3
(Forecast)
2017.3
2018.3
(€ million)
2019.3
(Forecast)
Sales in the Japanese
market*
452.7
383.4
365.3
XTANDI
Vesicare
Betanis
Harnal
Prograf
Funguard
Micardis
Micombi
Micamlo
Celecox
Symbicort
Bonoteo
Geninax
Vaccines
ARGAMATE
Gonax
Cimzia
Suglat
Repatha
LINZESS
Lipitor
Myslee
Seroquel
Americas
23.4
25.6
25.9
9.2
48.8
11.2
93.2
9.4
26.2
47.6
39.3
13.8
10.1
34.5
5.8
4.5
7.7
9.5
23.2
14.7
7.5
26.1
23.9
29.5
7.4
48.3
10.6
46.3
4.9
13.8
48.3
39.5
13.3
9.2
29.4
5.8
4.7
9.0
11.6
1.6
1.4
19.6
13.3
6.2
28.2
22.7
32.0
5.1
46.3
7.8
17.7
49.4
10.4
8.7
36.8
5.3
5.1
9.8
13.3
9.2
15.3
10.9
4.5
Sales in EMEA
2,785
2,651
2,645
XTANDI
Eligard
Vesicare
BETMIGA
Omnic
Sales by Astellas
Bulk and royalties
Prograf and Advagraf
Sales by Astellas
Advagraf
Exports to third parties
MYCAMINE
Asia & Oceania
Sales in Asia & Oceania
Prograf
Harnal
Vesicare
BETMIGA
MYCAMINE
XTANDI
Eligard
718
132
270
119
138
118
19
612
590
252
22
91
823
125
244
141
138
121
17
632
607
272
25
90
921
126
229
169
130
121
9
598
584
14
70
2017.3
2018.3
(¥ billion)
2019.3
(Forecast)
87.7
37.3
21.1
5.0
3.5
6.0
4.0
0.2
102.0
42.5
23.2
5.0
5.2
6.4
5.8
0.4
112.9
46.5
23.8
4.5
7.5
7.9
7.7
0.6
(US$ million)
* Sales of products in Japan are shown on a gross sales basis.
2017.3
2018.3
2019.3
(Forecast)
Sales in the Americas
XTANDI
US
Outside of the US
Tarceva
US
Outside of the US
VESIcare
Myrbetriq
Prograf
Scan
MYCAMINE
AmBisome
CRESEMBA
81
3,805
1,286
1,215
3,909
1,404
1,303
71
325
238
87
490
510
252
660
113
97
53
102
268
194
74
372
657
232
664
111
102
87
4,042
1,474
1,355
119
377
806
191
661
94
109
100
Financial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Assets, Liabilities and Equity
An overview of the consolidated statement of financial
position as of March 31, 2018 and the main changes from
the end of the previous fiscal year are shown below.
Assets
Total assets as of March 31, 2018 amounted to ¥1,858.2
billion, up ¥44.1 billion from a year earlier.
Non-current assets increased ¥75.2 billion to ¥1,012.6
billion at the fiscal year-end. Goodwill and other intangible
assets increased, owing mainly to the acquisitions of
Ogeda SA and Mitobridge, Inc. As a result, goodwill was
¥213.0 billion, up ¥44.5 billion from the previous fiscal
year-end, and other intangible assets were ¥416.9 billion,
up ¥29.5 billion from the previous fiscal year-end.
Current assets decreased ¥31.0 billion to ¥845.6
billion. Cash and cash equivalents were ¥331.7 billion,
down ¥9.2 billion from the previous fiscal year-end.
Equity
Total equity as of March 31, 2018 was ¥1,268.3 billion, a
decrease of ¥3.5 billion from a year earlier. While profit for
the year stood at ¥164.7 billion, Astellas paid ¥71.6 billion
in dividends of surplus and acquired ¥130.7 billion in
treasury shares.
We cancelled treasury shares worth ¥132.2 billion (85
million shares) in May 2017.
Liabilities
Total liabilities as of March 31, 2018 amounted to ¥589.9
billion, up ¥47.7 billion from a year earlier.
Total non-current liabilities rose ¥25.9 billion to
¥168.3 billion. Current liabilities increased ¥21.8 billion to
¥421.6 billion.
Operating Profit and Profit for the Year (Core Basis)
We project a decline in gross profit due to a decrease in sales.
We expect SG&A expenses to remain mostly
unchanged from fiscal 2017 as a result of ongoing efforts
to streamline expenses and a reduction in negative impact
from foreign exchange rates, although the ratio of SG&A
expenses to sales is expected to rise due mainly to a
decline in sales.
We forecast a 3.1% year-on-year decline in R&D
expenses to ¥214.0 billion, chiefly reflecting the
concentration of resources including investments in key
post-POC pipeline projects and new technology such as
cell therapy. The ratio of R&D expenses to sales is projected
at 16.7% (compared with 17.0% in fiscal 2017).
As a result, we forecast a 2.5% year-on-year decrease
in core operating profit to ¥262.0 billion.
Core profit for the year is expected to increase 2.8%
year on year to ¥210.0 billion. Basic core earnings per share
is projected to increase 5.6% year on year to ¥106.27.
Number of Employees
As of March 31, 2018, Astellas employed 16,617 people
worldwide, a year-on-year decrease of 585.
Looking at each region, in Japan, the number of
employees was 6,825, down 204 from the previous fiscal
year-end. In the Americas, the regional head count was
2,840 employees, down 176 from the previous fiscal year-
end. In EMEA, we had 4,490 employees, down 182 year on
year. In Asia & Oceania, we had 2,462 employees, down 23
from the previous fiscal year-end.
Number of Employees by Region
Total
Japan
Americas
EMEA
Asia & Oceania
Number of MRs
Total (Global)
(persons)
2017.3
2018.3
17,202
16,617
7,029
3,016
4,672
2,485
6,825
2,840
4,490
2,462
(persons)
2017.3
2018.3
5,750
5,330
82
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Liquidity and Financing
Astellas is making strategic business investments to
enhance innovation and add greater breadth to its
product and development pipelines, targeting sustainable
enhancement of enterprise value.
Cash Flows from Financing Activities
Net cash flows used in financing activities totaled ¥203.4
billion, up ¥37.3 billion from the previous fiscal year.
Dividends paid to owners of the parent totaled ¥71.6
billion, an increase in outflow of ¥1.5 billion year on year.
Other outflows included ¥130.7 billion used for the
acquisition of Astellas’ own shares.
Regarding the liquidity of funds, liquidity is
As a result of the above, the balance of cash and cash
maintained to enable Astellas to target a certain amount
of strategic investment opportunities, while also supplying
working capital. As outlined in the section on business
risks (P85), Astellas’ operations face various risks unique to
the ethical pharmaceutical business. The Group’s financial
policy is to maintain a healthy balance sheet at all times so
that it can finance smoothly at low costs, especially in the
event that funding requirements exceed Astellas’ internal
funding capacity in the course of developing business.
Cash Flows
Cash flows from Operating Activities
Net cash flows from operating activities amounted to
¥312.6 billion, an increase of ¥77.0 billion in year-on-year
terms. The main components included income tax paid of
¥65.0 billion.
Cash Flows from Investing Activities
Net cash flows used in investing activities totaled ¥121.8
billion, up ¥48.4 billion from the previous fiscal year.
Looking at the main outflows, acquisition of
subsidiaries used cash of ¥83.7 billion mainly due to the
acquisition of Ogeda SA, purchases of property, plant and
equipment used cash of ¥25.1 billion, and purchases of
intangible assets used cash of ¥15.2 billion. On the other
hand, proceeds from sales of available-for-sale financial
assets provided cash of ¥7.0 billion.
equivalents as of March 31, 2018 amounted to ¥331.7
billion, a decrease of ¥9.2 billion compared with the
previous fiscal year-end.
Business Acquisitions
Astellas is investing to capture new business opportunities
and working to create innovation, as we are enhancing our
capabilities to deliver innovative medicines.
As part of these initiatives, Astellas acquired Ogeda
SA, a drug discovery company in Belgium, for €0.5 billion
and made it a wholly owned subsidiary in May 2017 to
further expand its pipeline. Ogeda shareholders will be
eligible to receive up to €0.3 billion in further contingent
payments based on progress in the development of
fezolinetant, Ogeda’s clinical program.
Additionally, in January 2018, Astellas paid $225
million*1 to acquire 100% of the equity in Mitobridge, Inc.,
previously a U.S. equity-method company, and made it a
wholly owned subsidiary. Mitobridge shareholders will be
eligible to receive up to $225 million*2 in further
contingent payments based on progress of various
programs in clinical development. The purpose of the
acquisition is to strengthen Astellas’ networks and
knowledge related to mitochondrial drug development,
along with acquiring several programs involving patients
with mitochondrial dysfunctions.
Moreover, in February 2018, Astellas acquired
Universal Cells, Inc., a bioventure company in the U.S., for
up to $102.5 million of upfront and milestones depending
on achievement of clinical milestones. Through the
acquisition, Astellas gained technology to produce
pluripotent stem cells with the potential to lower
immunological rejection, an issue in cell therapy.
*1 The actual payment excluding the amount equivalent to Astellas’ equity is
$161.7 million.
*2 The actual payment excluding the amount equivalent to Astellas’ equity is
$165.5 million.
Reference
R&D Topics during the Year
P43
83
Financial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Capital Expenditures
Astellas made capital expenditures with the aim of
augmenting and renewing its research facilities and
equipment as well as production facilities and equipment.
Capital expenditures in fiscal 2017 totaled ¥24.1 billion, up
0.9% year on year (accrual basis).
In fiscal 2018, capital expenditures are forecast to
increase 12.0% to ¥27.0 billion.
Earnings per Share, Dividends and Equity
Attributable to Owners of the Parent
Policy on Shareholder Returns
Astellas is working to achieve sustained enhancement in
enterprise value, and actively pursuing shareholder returns.
While prioritizing the reinvestment of funds in the
business to foster growth, Astellas strives to achieve stable and
sustained growth in dividends, based on medium- to long-
term consolidated earnings growth. Furthermore, Astellas
will flexibly purchase treasury stock as necessary to improve
capital efficiency and the level of returns to shareholders.
Common Stock
Common Stock
(thousands of shares)
2017.3
2018.3
Total number of issued shares*
2,153,823
2,068,823
Treasury shares*
88,817
92,670
Per Share Data
Earnings per share
Basic
Diluted
Basic (core basis)
Dividends
Equity per share attributable to
owners of the parent
(¥)
Treasury Shares
2017.3
2018.3
103.69
103.55
101.15
34.00
615.89
81.11
81.02
100.64
36.00
641.80
Number of shares bought back*
2017.3
2018.3
60,000
thousand
88,870
thousand
Acquisition cost
¥91.4 billion
¥129.9 billion
Cancellation of treasury shares*
68,000
thousand
85,000
thousand
* Excludes purchases of shares constituting less than a trading unit
As a part of profit distribution to its shareholders and as
measures of its capital policy, Astellas implemented
acquisition of its own shares from the stock market,
purchasing 88.87 million shares, worth ¥129.9 billion,
during the fiscal year ended March 31, 2018.
Furthermore, we cancelled 89 million shares of
treasury stock in May 2018.
ROE
Return on equity (ROE) was 13.0%, down 4.3 percentage
points from fiscal 2017.
84
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 While the Astellas Group strives to ensure that its
actions do not infringe the IP rights of other parties, there
is a risk of litigation in the event of any inadvertent
violations. Such litigation could also impact the Astellas
Group’s business results significantly.
Risks Relating to Product Side Effects and Safety
Any problems arising due to serious side effects or other
safety issues that are caused by the Astellas Group’s
products could impact the Astellas Group’s business results
significantly.
Environment, Health and Safety-Related Risks
The Astellas Group is careful to observe laws and
regulations relating to environmental or health and safety
issues and has instituted internal standards that aim to
exceed most statutory requirements. Despite such
precautions, the costs involved in the unlikely event of a
business-related incident causing a serious breach of
compliance in this area could impact the Astellas Group’s
business results significantly.
Foreign Exchange Rate Fluctuations
The Astellas Group’s business results and financial position
are subject to the impact of exchange rate fluctuations due
to the Astellas Group’s extensive international operations.
In addition to the risks outlined above, the Astellas
Group is exposed to a wide range of business-related risks,
including but not limited to (1) general commercial
litigation, (2) delays or suspension of manufacturing
activities due to natural disasters or other factors, and (3)
partial dependence on licensing or sales agreements
relating to pharmaceuticals developed by other companies.
Business Risks
The main risks that could significantly impact the business
results and financial position of the Astellas Group are
outlined below.
Inherent Uncertainties in Pharmaceutical R&D
In general, the probability of discovering a promising
compound through drug discovery research is not high.
Further, it takes a large amount of investments and a great
deal of time to successfully launch a new product after
discovery of a new compound. However, it may be
necessary to discontinue clinical development if the
effectiveness of a drug is not proven as initially expected,
or if safety issues arise. In addition, pharmaceuticals are
subject to legal restrictions in each country, so that
authorization from local regulatory authorities is a
prerequisite for a product launch in each country. It is
difficult to accurately foresee if and when approvals for
new products can be obtained.
The Astellas Group’s R&D activities are subject to these
inherent risks.
Sales-Related Risk
The pharmaceutical industry operates in a highly
competitive environment characterized by rapid
technological innovation. The Astellas Group faces fierce
competition from drug makers and generics
manufacturers based in Japan or overseas. The launch of
competitive products by rivals could impact the Astellas
Group’s business results significantly.
Intellectual Property (IP) Risk
The Astellas Group’s ethical pharmaceuticals business
benefits from the protection of many patents. Although
the Astellas Group manages IP rights properly and is
vigilant against third-party violation of such rights, the
adverse impact on the Astellas Group’s business results of
actual IP violations may still be substantial. The Astellas
Group’s business results are also subject to the outcome of
litigation undertaken by the Astellas Group to protect
patents where infringement has occurred.
85
Financial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Consolidated Financial Statements
Consolidated Statement of Income
Astellas Pharma Inc. and Subsidiaries
For the year ended 31 March 2018
Sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Research and development expenses
Amortisation of intangible assets
Share of losses of associates and joint ventures
Other income
Other expense
Operating profit
Finance income
Finance expense
Profit before tax
Income tax expense
Profit for the year
Profit attributable to:
Owners of the parent
Earnings per share
Basic
Diluted
(Millions of yen)
(Millions of U.S. dollars)
Note
6
2017
2018
2018
¥1,311,665
¥1,300,316
$12,267
(320,503)
991,162
(470,777)
(208,129)
(35,837)
(1,864)
9,594
(23,318)
260,830
22,916
(1,976)
281,769
(63,069)
(294,250)
1,006,066
(478,330)
(220,781)
(35,838)
(2,419)
11,872
(67,311)
213,258
6,637
(1,782)
218,113
(53,434)
(2,776)
9,491
(4,513)
(2,083)
(338)
(23)
112
(635)
2,012
63
(17)
2,058
(504)
¥ 218,701
¥ 164,679
$ 1,554
¥ 218,701
¥ 164,679
$ 1,554
(Yen)
(U.S. dollars)
¥ 103.69
¥ 81.11
103.55
81.02
$ 0.77
0.76
17
7
8
10
11
12
13
13
Consolidated Statement of Comprehensive Income
Astellas Pharma Inc. and Subsidiaries
For the year ended 31 March 2018
(Millions of yen)
(Millions of U.S. dollars)
Note
2017
2018
2018
¥218,701
¥164,679
$1,554
Profit for the year
Other comprehensive income
Items that will not be reclassified subsequently to profit or loss
Remeasurements of defined benefit plans
Subtotal
Items that may be reclassified subsequently to profit or loss
Foreign currency translation adjustments
Fair value movements on available-for-sale financial assets
14
14
Subtotal
Other comprehensive income, net of tax
Total comprehensive income
Total comprehensive income attributable to:
Owners of the parent
2,962
2,962
1,611
1,611
(32,544)
(14,474)
(47,018)
(44,056)
¥174,644
28,590
3,660
32,250
33,860
¥198,539
15
15
270
35
304
319
$1,873
¥174,644
¥198,539
$1,873
86
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Consolidated Statement of Financial Position
Astellas Pharma Inc. and Subsidiaries
As of 31 March 2018
(Millions of yen)
(Millions of U.S. dollars)
Note
2017
2018
2018
Assets
Non-current assets
Property, plant and equipment
Goodwill
Other intangible assets
Trade and other receivables
Investments in associates and joint ventures
Deferred tax assets
Other financial assets
Other non-current assets
Total non-current assets
Current assets
Inventories
Trade and other receivables
Income tax receivable
Other financial assets
Other current assets
Cash and cash equivalents
Subtotal
Assets held for sale
Total current assets
Total assets
15
16
17
22
18
19
20
21
22
19
20
23
24
¥ 191,115
¥ 181,295
168,521
387,419
22,263
2,988
90,349
61,597
13,154
212,976
416,912
25,282
3,138
97,237
67,375
8,372
$ 1,710
2,009
3,933
239
30
917
636
79
937,407
1,012,587
9,553
182,537
309,817
10,986
13,554
18,849
340,923
876,665
—
876,665
147,626
319,512
8,412
13,517
14,448
331,731
835,245
10,374
845,619
1,393
3,014
79
128
136
3,130
7,880
98
7,978
¥1,814,072
¥1,858,205
$17,530
87
Financial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Equity and liabilities
Equity
Share capital
Capital surplus
Treasury shares
Retained earnings
Other components of equity
Total equity attributable to owners of the parent
Total equity
Liabilities
Non-current liabilities
Trade and other payables
Deferred tax liabilities
Retirement benefit liabilities
Provisions
Other financial liabilities
Other non-current liabilities
Total non-current liabilities
Current liabilities
Trade and other payables
Income tax payable
Provisions
Other financial liabilities
Other current liabilities
Total current liabilities
Total liabilities
(Millions of yen)
(Millions of U.S. dollars)
Note
2017
2018
2018
25
25
25
25
32
18
28
29
30
31
32
29
30
31
¥ 103,001
¥ 103,001
$ 972
177,091
(138,207)
1,013,923
116,002
1,271,810
1,271,810
177,219
(135,951)
976,076
147,945
1,268,289
1,268,289
440
18,514
36,614
4,921
28,389
53,528
3,515
26,426
36,673
4,891
49,422
47,370
1,672
(1,283)
9,208
1,396
11,965
11,965
33
249
346
46
466
447
142,406
168,296
1,588
182,826
10,900
96,589
2,992
106,548
399,856
542,262
140,909
25,184
126,231
7,559
121,737
421,620
589,916
1,329
238
1,191
71
1,148
3,978
5,565
Total equity and liabilities
¥1,814,072
¥1,858,205
$17,530
88
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Consolidated Statement of Changes in Equity
Astellas Pharma Inc. and Subsidiaries
For the year ended 31 March 2018
(Millions of yen)
Equity attributable to owners of the parent
Note
Share capital
Capital surplus
Treasury shares
Retained
earnings
Subscription
rights to shares
Other components of equity
Foreign currency
translation
adjustments
Fair value
movements on
available-for-sale
financial assets
Remeasurements
of defined
benefit plans
Total
Total
Total equity
¥103,001
¥176,903
¥ (157,111)
¥ 973,054
¥2,126
¥132,134
¥29,103
¥ —
¥163,363 ¥1,259,209
¥1,259,209
—
(32,544)
(32,544)
—
(14,474)
(14,474)
—
2,962
2,962
—
218,701
218,701
(44,056)
(44,056)
(44,056)
(44,056)
174,644
174,644
As of 1 April 2016
Comprehensive income
Profit for the year
Other comprehensive income
Total comprehensive income
Transactions with owners of the parent
Acquisition of treasury shares
Disposals of treasury shares
Cancellation of treasury shares
Dividends
Share-based payments
Transfers
Total transactions with owners
of the parent
As of 31 March 2017
Comprehensive income
Profit for the year
Other comprehensive income
Total comprehensive income
Transactions with owners of the parent
Acquisition of treasury shares
Disposals of treasury shares
Cancellation of treasury shares
Dividends
Share-based payments
Transfers
Total transactions with owners
of the parent
25
25
25
26
27
25
25
25
26
27
—
—
—
—
—
—
—
—
—
—
—
—
—
—
(78)
—
—
266
—
188
—
—
—
218,701
—
218,701
(92,193)
877
—
(456)
110,219
(110,219)
—
—
—
(70,119)
—
2,962
—
—
—
—
(342)
—
—
—
—
18,903
(177,831)
(342)
—
—
—
—
—
—
—
—
—
—
—
—
—
—
103,001
177,091
(138,207)
1,013,923
1,784
99,590
14,629
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
164,679
—
164,679
—
(130,712)
(159)
819
—
(353)
132,150
(132,150)
—
—
—
(71,634)
—
1,611
—
—
286
—
127
—
—
—
—
(307)
—
—
—
—
—
28,590
28,590
—
3,660
3,660
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
(342)
—
—
—
(2,962)
(2,962)
(92,193)
(92,193)
1
—
1
—
(70,119)
(70,119)
266
—
266
—
(2,962)
(3,304)
(162,044)
(162,044)
—
—
116,002
1,271,810
1,271,810
—
164,679
164,679
1,611
1,611
33,860
33,860
33,860
33,860
198,539
198,539
—
—
—
—
—
—
(130,712)
(130,712)
(307)
—
—
—
1
—
1
—
(71,634)
(71,634)
286
—
286
—
(1,611)
(1,611)
2,257
(202,526)
(307)
(1,611)
(1,918)
(202,060)
(202,060)
As of 31 March 2018
¥103,001
¥177,219
¥(135,951)
¥ 976,076
¥1,477
¥128,179
¥18,289
¥ — ¥147,945 ¥1,268,289 ¥1,268,289
(Millions of U.S. dollars)
Equity attributable to owners of the parent
Note
Share capital
Capital surplus
Treasury shares
Retained
earnings
Subscription
rights to shares
Other components of equity
Foreign currency
translation
adjustments
Fair value
movements on
available-for-sale
financial assets
Remeasurements
of defined
benefit plans
Total
Total
Total equity
As of 31 March 2017
Comprehensive income
Profit for the year
Other comprehensive income
Total comprehensive income
Transactions with owners of the parent
Acquisition of treasury shares
Disposals of treasury shares
Cancellation of treasury shares
Dividends
Share-based payments
Transfers
Total transactions with owners
of the parent
25
25
25
26
27
$972
$1,671
$(1,304)
$9,565
$17
$ 940
$138
$ —
$1,094
$11,998
$11,998
—
—
—
—
—
—
—
—
—
—
—
—
—
—
(2)
—
—
3
—
1
—
—
—
(1,233)
8
1,247
—
—
—
21
1,554
—
1,554
—
(3)
(1,247)
(676)
—
15
(1,911)
—
—
—
—
(3)
—
—
—
—
(3)
—
270
270
—
—
—
—
—
—
—
—
35
35
—
—
—
—
—
—
—
—
15
15
—
—
—
—
—
(15)
(15)
—
319
319
—
(3)
—
—
—
(15)
(18)
1,554
319
1,873
1,554
319
1,873
(1,233)
(1,233)
0
—
0
—
(676)
(676)
3
—
3
—
(1,906)
(1,906)
As of 31 March 2018
$972
$1,672
$(1,283)
$9,208
$14
$1,209
$173
$ —
$1,396
$11,965
$11,965
89
Financial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Consolidated Statement of Cash Flows
Astellas Pharma Inc. and Subsidiaries
For the year ended 31 March 2018
Cash flows from operating activities
Profit before tax
Depreciation and amortisation
Impairment losses and reversal of impairment losses
Finance income and expense
(Increase) decrease in inventories
(Increase) decrease in trade and other receivables
Increase (decrease) in trade and other payables
Other
Cash generated from operations
Income tax paid
Net cash flows from operating activities
Cash flows from investing activities
Purchases of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchases of intangible assets
Purchases of available-for-sale financial assets
Proceeds from sales of available-for-sale financial assets
Acquisition of subsidiaries, net of cash acquired
Interest and dividends received
Other
Net cash flows used in investing activities
Cash flows from financing activities
Acquisition of treasury shares
Dividends paid to owners of the parent
Other
Net cash flows used in financing activities
Effect of exchange rate changes on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
(Millions of yen)
(Millions of U.S. dollars)
Note
2017
2018
2018
¥281,769
¥218,113
$2,058
63,791
16,340
(20,940)
(26,644)
5,057
15,651
(27,409)
307,616
(72,004)
235,612
(29,010)
1,262
(19,638)
(484)
28,642
(50,915)
1,618
(4,858)
(73,383)
(92,193)
(70,119)
(3,841)
(166,153)
(15,183)
(19,107)
360,030
¥340,923
64,863
42,398
(4,854)
37,830
(6,634)
(43,804)
69,723
377,635
(65,021)
312,614
(25,077)
1,209
(15,208)
(693)
6,970
(83,723)
1,849
(7,125)
612
400
(46)
357
(63)
(413)
658
3,563
(613)
2,949
(237)
11
(143)
(7)
66
(790)
17
(67)
(121,799)
(1,149)
(130,712)
(71,634)
(1,083)
(203,429)
3,421
(9,192)
340,923
¥331,731
(1,233)
(676)
(10)
(1,919)
32
(87)
3,216
$3,130
37
25
26
23
23
90
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Notes to Consolidated Financial Statements
Astellas Pharma Inc. and Subsidiaries
For the year ended 31 March 2018
1. Reporting Entity
Astellas Pharma Inc. and its subsidiaries (collectively,
Company are publicly traded on the Tokyo Stock
the “Group”) are engaged in the manufacture and sales
Exchange (First Section).
of pharmaceutical products. The parent company of the
The Group’s consolidated financial statements for
Group, Astellas Pharma Inc. (the “Company”), is
the year ended 31 March 2018 were authorised for
incorporated in Japan, and the registered address of
issue on 15 June 2018 by Kenji Yasukawa,
headquarters and principal business offices are
Representative Director, President and Chief Executive
available on the Company’s website
Officer, and Chikashi Takeda, Senior Corporate
(https://www.astellas.com/en/). Also, shares of the
Executive and Chief Financial Officer.
2. Basis of Preparation
(1) Compliance with IFRS
as representations that the Japanese yen amounts
The consolidated financial statements of the Group have
could be converted into U.S. dollars at the above or any
been prepared in accordance with International
other rate.
Financial Reporting Standards (“IFRS”) issued by the
International Accounting Standards Board.
(4) New or amended IFRS standards and
interpretations not yet adopted
(2) Basis of measurement
The following is a list of the major new or amended
The Group’s consolidated financial statements have
IFRS standards and interpretations that the Group has
been prepared on a historical cost basis, except for
not adopted among those issued by the date of the
financial instruments measured at fair value.
approval of the Group’s consolidated financial
(3) Presentation currency
statements. The effects on the Group’s consolidated
financial statements for the year ending 31 March 2019
The Group’s consolidated financial statements are
due to the application of IFRS 9 Financial Instruments
presented in Japanese yen, which is also the
and IFRS 15 Revenue from Contracts with Customers
Company’s functional currency, and figures are rounded
are immaterial. Financial assets classified as available-
to the nearest million yen, except as otherwise
for-sale financial assets under IAS 39 will be classified
indicated.
as financial assets measured at fair value through other
For the convenience of readers outside Japan, the
comprehensive income under IFRS 9.
accompanying consolidated financial statements are
The effects on the Group’s consolidated financial
also presented in U.S. dollars by translating Japanese
statements due to the application of IFRS 16 Leases are
yen amounts at the exchange rate of ¥106 to U.S. $1,
still under consideration and cannot be estimated at this
the approximate rate of exchange at the end of 31
time.
March 2018. Such translations should not be construed
91
Effective date
(fiscal years
The Group’s
application date
Summaries of new or amended IFRS
IFRSs
beginning on or after)
(fiscal year ending)
standards and interpretations
1 January 2018
31 March 2019
measurement of financial assets and financial
Amendments related to classification and
IFRS 9
Financial
Instruments
Revenue from
IFRS 15
Contracts with
1 January 2018
31 March 2019
Customers
IFRS 16
Leases
1 January 2019
31 March 2020
liabilities, impairment, and hedge accounting
Comprehensive framework for revenue
recognition
Amendments related to accounting treatment
for leases
3. Significant Accounting Policies
The significant accounting policies of the Group set forth
agreed sharing of control of an arrangement, which
below are applied continuously to all periods indicated in
exists only when decisions about the activities that
the consolidated financial statements.
significantly affect the returns of the arrangement
(1) Basis of consolidation
(i) Subsidiaries
Subsidiaries are entities controlled by the Group. The
require the unanimous consent of the parties sharing
control. Joint arrangements in which the Group has an
interest are classified and accounted for as follows:
Joint operation—when the Group has rights to the
Group controls an entity when the Group has power
assets and obligations for the liabilities relating to an
over the entity, is exposed to, or has rights, to variable
arrangement, it accounts for each of its assets,
returns from its involvement with the entity, and has the
liabilities, revenue and expenses, in relation to its
ability to affect those returns through its power over the
interest in the joint operation.
entity. Subsidiaries are fully consolidated from the date
Joint venture—when the Group has rights only to the
on which control is transferred to the Group, and they
net assets of the arrangement, it accounts for its
are deconsolidated from the date on which the Group
interest in the joint venture using the equity method
loses control.
in the same way as associates.
All intragroup assets and liabilities, transactions and
unrealised gains or losses arising from intragroup
(2) Business combinations
transactions are eliminated on consolidation.
(ii) Associates
Business combinations are accounted for using the
acquisition method.
Associates are entities over which the Group has
significant influence on their financial and operating
The consideration transferred is measured at fair
value and calculated as the aggregate of the fair values
policies but does not have control or joint control. If the
of the assets transferred, liabilities assumed, and the
Group owns between 20% and 50% of the voting power
equity interests issued by the Group. The consideration
of an entity, it is presumed that the Group has significant
transferred also includes any assets or liabilities
influence over the entity. The Group accounts for
investments in associates using the equity method.
(iii) Joint arrangements
resulting from a contingent consideration arrangement.
The identifiable assets acquired, the liabilities and
contingent liabilities assumed that meet the recognition
A joint arrangement is an arrangement in which the
principles of IFRS 3 “Business Combinations” are
Group has joint control. Joint control is the contractually
measured at their acquisition-date fair values, except:
92
Deferred tax assets or liabilities, liabilities (or assets,
Exchange differences arising on translating the
if any) related to employee benefits, and liabilities
financial statements of foreign operations are
related to share-based payment transactions are
recognised in other comprehensive income. On the
recognised and measured in accordance with IAS 12
disposal of the interest in a foreign operation, the
“Income Taxes”, IAS 19 “Employee Benefits”, and
cumulative amount of the exchange differences is
IFRS 2 “Share-based Payment”, respectively; and
reclassified to profit or loss.
Non-current assets and disposal groups classified as
held for sale are measured in accordance with IFRS
5 “Non-current Assets Held for Sale and
Discontinued Operations”.
The excess of the aggregate of the consideration
transferred and the amount recognised for non-
(4) Sales
(i) Sale of goods
Sales are measured at the fair value of the
consideration received or receivable, less discounts,
charge-backs and other rebates, excluding sales taxes
controlling interest in the acquiree over the acquisition-
and value added taxes. Also, the Group recognises the
date fair value of the identifiable net assets acquired is
sales amount of transactions in which the Group is
recorded as goodwill. If the excess is negative, then a
acting as an agent on a net basis.
gain is immediately recognised in profit or loss.
Revenue from the sale of goods is recognised when
Acquisition-related costs incurred in connection with
all of the following conditions have been satisfied,
business combinations, such as finder’s fees and
advisory fees, are expensed when incurred.
(3) Foreign currency translation
(i) Functional and presentation currency
namely, the significant risks and rewards of ownership
of the goods have been transferred to the buyers, the
Group retains neither continuing managerial
involvement which normally can be associated with
ownership nor effective control over the goods sold, it is
The financial statements of an entity of the Group are
probable that the economic benefits will flow to the
prepared using the functional currency of the entity. The
Group, and the amount of revenue and costs associated
consolidated financial statements of the Group are
presented in Japanese yen, which is the functional
currency of the Company.
(ii) Transactions in foreign currencies
with the transaction can be reliably measured.
Therefore, revenue is usually recognised at the time of
delivery of goods to customers.
Sales discounts, charge-backs and other rebates are
Foreign currency transactions are translated into the
recognised upon the recognition of underlying revenue
functional currency using the exchange rates prevailing
as accounts payable, provisions or as deductions from
at the dates of the transactions or an approximation of
accounts receivable.
the rate.
At the end of each reporting period, monetary assets
(ii) Royalty income
and liabilities denominated in foreign currencies are
Some of the Group’s revenues are generated from the
translated into the functional currency using the
exchange rates at the closing date and exchange
differences arising from translation are recognised in
profit or loss.
(iii) Foreign operations
agreements under which third parties have been
granted rights to produce or market products or rights to
use technologies. Royalty income is recognised on an
accrual basis in accordance with the substance of the
relevant agreement. Revenue associated with milestone
Assets and liabilities of foreign operations are translated
agreements is recognised upon achievement of the
into Japanese yen using the exchange rate at the end of
milestones defined in the respective agreements.
fiscal year. Income and expenses are translated into
Upfront payments and licence fees received for
Japanese yen using the average exchange rate for the
agreements where the rights or obligations still exist are
period.
93
initially recognised as deferred income and then
recognised in income as earned over the period of the
that are recognised in other comprehensive income or
development collaboration or the manufacturing
directly in equity.
obligation.
Current taxes are calculated at the amount expected
to be paid to or recovered from the taxation authority by
(5) Research and development expenses
applying the statutory tax rate and tax laws enacted or
Expenditure on research and development of an internal
substantially enacted at the end of the fiscal year.
project is fully expensed as “Research and development
Deferred tax assets and deferred tax liabilities are
expenses” in the consolidated statement of income
recognised for temporary differences between the
when incurred.
carrying amounts of certain assets or liabilities in the
Internally generated development expenses are
consolidated statement of financial position and their tax
recognised as an intangible asset only if the
base. However, deferred tax assets and liabilities are
capitalisation criteria under IAS 38 are satisfied.
Therefore, internal expenditure incurred for ongoing
not recognised for:
taxable temporary differences arising from the initial
internal development projects is not capitalised until
recognition of goodwill.
marketing approval is obtained from the regulatory
taxable or deductible temporary differences arising
authorities in a major market, which is considered the
from the initial recognition of assets and liabilities in
time at which the criteria of capitalisation under IAS 38
a transaction other than a business combination that
are met.
affects neither accounting profit nor taxable profit
In addition to the Group’s internal research and
(tax loss).
development activities, the Group has entered into
deductible temporary differences associated with
research and development collaboration agreements
investments in subsidiaries, associates and interests
with some alliance partners. The expenses and income
in joint arrangements when it is not probable that the
associated with the settlement of the expenditure
temporary difference will reverse in the foreseeable
incurred for the research and development collaboration
future or there will not be sufficient taxable profits
activities are accounted for as research and
against which the deductible temporary differences
development expenses on an accrual basis in the same
can be utilised.
way as research and development expenses incurred
taxable temporary differences associated with
within the Group.
(6) Finance income and finance expense
Finance income mainly comprises interest income,
dividend income, and gain on sales of financial
instruments. Interest income is recognised using the
effective interest method. Dividend income is recognised
when the right to receive payment is established.
Financial expenses mainly comprise interest
expense, fees, loss on sales of financial instruments,
and impairment losses for financial assets.
(7) Income tax
Income tax expense is comprised of current and
investments in subsidiaries, associates, and interests
in joint arrangements when the Group is able to
control the timing of the reversal of the temporary
difference and it is probable that the temporary
difference will not reverse in the foreseeable future.
Deferred tax assets are recognised to the extent that
it is probable that taxable profits will be available against
which deductible temporary differences, unused tax
losses, and unused tax credits can be utilised.
Deferred tax assets and deferred tax liabilities are
measured at the tax rates that are expected to apply to
the period when the asset is realised or the liability is
settled, based on tax rates and tax laws that have been
enacted or substantively enacted by the end of the fiscal
deferred taxes, and recognised in profit or loss, except
for taxes related to business combinations and to items
year.
94
Deferred tax assets and deferred tax liabilities are
depreciable amount of an asset is determined by
offset if the Group has a legally enforceable right to
deducting its residual value from its cost.
offset current tax assets against current tax liabilities,
The estimated useful lives of major classes of property,
and they are related to income taxes levied by the same
plant and equipment are as follows:
taxation authority on either the same taxable entity or
different taxable entities which intend to settle current
tax assets and current tax liabilities on a net basis.
(8) Earnings per share
Basic earnings per share are calculated by dividing
profit for the year attributable to owners of the parent by
the weighted-average number of ordinary shares
outstanding during the year, adjusting treasury shares.
For the purpose of calculating diluted earnings per
share, profit for the year attributable to owners of the
parent and the weighted average number of shares
outstanding, adjusting treasury shares, is calculated for
the effects of all dilutive potential ordinary shares.
(9) Property, plant and equipment
Property, plant, and equipment is measured by using
the cost model and is stated at cost less accumulated
depreciation and accumulated impairment losses.
The cost of items of property, plant and equipment
includes costs directly attributable to the acquisition and
the initial estimate of costs of dismantling and removing
the items and restoring the site on which they are
located.
Buildings and structures
Machinery and vehicles
Tools, furniture and fixtures
2 to 60 years
2 to 20 years
2 to 20 years
The useful lives, residual values, and depreciation
methods of property, plant and equipment are reviewed
at the end of fiscal year, and changed, if any.
(10) Leases
Leases are classified as finance leases whenever
substantially all the risks and rewards incidental to
ownership of an asset are transferred to the Group. All
other leases are classified as operating leases.
Under finance lease transactions, leased assets and
lease obligations are initially recognised at the lower of
the fair value of the leased property or the present value
of the minimum lease payments, each determined at the
inception of the lease. Leased assets are depreciated
on a straight-line basis over the shorter of their
estimated useful lives or lease terms. Minimum lease
payments made under finance leases are allocated to
finance expense and the repayment amount of the lease
obligations. The finance expense is allocated to each
period during the lease term so as to produce a constant
periodic rate of interest on the remaining balance of
Costs incurred after initial recognition are recognised
liabilities.
as an asset, as appropriate, only when it is probable that
future economic benefits associated with the asset will
flow to the Group and its cost can be reliably measured.
Costs of day-to-day servicing for items of property, plant
and equipment, such as repairs and maintenance, are
expensed when incurred.
When an item of property, plant and equipment has
a significant component, such component is accounted
for as a separate item of property, plant and equipment.
Depreciation of an asset begins when it is available for
use. The depreciable amount of items of property, plant
and equipment is depreciated on a straight-line basis
over the estimated useful lives of each component. The
Under operating lease transactions, lease payments
are recognised as an expense on a straight-line basis
over the lease term.
The Group determines whether an arrangement is,
or contains a lease, based on the substance of the
arrangement at the date of commencement of the lease.
The substance of the arrangement is determined based
on the following factors:
(a) whether the fulfillment of the arrangement is
dependent on the use of a specific asset or assets
and,
(b) whether the arrangement conveys a right to use the
asset.
95
(11) Goodwill
expected future economic benefits that are attributable
Measurement of goodwill on initial recognition is
to the asset will flow to the Group and the asset is
described in “(2) Business combinations”. After initial
identifiable.
recognition, goodwill is carried at cost less any
An intangible asset recognised as IPR&D is not
accumulated impairment losses.
amortised because it is not yet available for use, but
Impairment of goodwill is described in “(13)
instead, it is tested for impairment whenever there is an
Impairment of property, plant and equipment, goodwill,
indication of impairment or at least on an annual basis
and other intangible assets”.
irrespective of whether there is any indication.
Once marketing approval from the regulatory
(12) Other intangible assets
authorities is obtained and the asset is available for use,
Other intangible assets are identifiable non-monetary
IPR&D is transferred to “Patents and technologies” or
assets without physical substance, other than goodwill,
“Marketing rights” and amortisation begins from that
including patents and technologies, marketing rights,
time on a straight-line basis over its useful life.
and in-process research and development (IPR&D)
acquired in a business combination or acquired
(13) Impairment of property, plant and
separately.
Other intangible assets acquired separately are
measured at cost upon initial recognition, and those
equipment, goodwill, and other intangible
assets
(i) Impairment of property, plant and equipment and
acquired in a business combination are measured at fair
other intangible assets
value at the acquisition date. After initial recognition, the
At the end of each quarter, the Group assesses whether
Group applies the cost model and other intangible
there is any indication that its property, plant and
assets are carried at cost less any accumulated
equipment and other intangible assets may be impaired.
amortisation and accumulated impairment losses.
If there is an indication of impairment, the
Other intangible assets are amortised over their
recoverable amount of the asset is estimated. Other
estimated useful lives (2-25 years) on a straight-line
intangible assets not yet available for use or with
basis beginning at the time when they are available for
indefinite useful lives are tested for impairment annually
use. Amortisation of other intangible assets acquired
irrespective of whether there is any indication of
through business combinations or through the in-
impairment.
licensing of products or technologies is presented in the
When it is not possible to estimate the recoverable
consolidated statement of income under “Amortisation of
amount of an individual asset, the Group estimates the
intangible assets”. The estimated useful life of other
recoverable amount of the cash-generating unit to which
intangible assets is the shorter of the period of legal
the asset belongs. A cash-generating unit is the smallest
protection or its economic life, and it is also regularly
identifiable group of assets that generates cash inflows
reviewed.
that are largely independent of the cash inflows from
Among rights related to products or research and
other assets or groups of assets.
development through the in-licensing of products or
The recoverable amount is the higher of fair value
technologies or acquired through business
less costs of disposal and value in use. In measuring the
combinations, those that are still in the research and
value in use, the estimated future cash flows are
development stage or have not yet obtained marketing
discounted to the present value using a discount rate
approval from the regulatory authorities are recognised
that reflects the time value of money and the risks
under “Other intangible assets” as IPR&D.
specific to the asset. The discount rate used for
Subsequent expenditure, including initial upfront and
calculating the recoverable amount is set at a rate
milestone payments to the third parties, on an acquired
appropriate to each geographical area of operations.
IPR&D is capitalised if, and only if, it is probable that the
96
If the recoverable amount of an asset or a cash-
generating unit is less than its carrying amount, the
(14) Financial instruments
(i) Initial recognition
carrying amount of the asset or the cash-generating unit
Financial assets and financial liabilities are recognised
is reduced to its recoverable amount, and the reduction
on the trade date when the Group becomes a party to
is recognised in profit or loss as an impairment loss.
(ii) Impairment of goodwill
the contractual provisions of the instrument.
Financial assets and financial liabilities are
Goodwill is allocated to each of the cash-generating
measured at fair value at initial recognition. Transaction
units, or groups of cash-generating units, that is
costs directly attributable to the acquisition of financial
expected to benefit from the synergies of the business
assets or issuance of financial liabilities, other than
combination, and it is tested for impairment annually and
financial assets measured at fair value through profit or
whenever there is an indication that the cash-generating
loss (“financial assets at FVTPL”) and financial liabilities
unit may be impaired. If, at the time of the impairment
measured at fair value through profit or loss (“financial
test, the recoverable amount of a cash-generating unit is
liabilities at FVTPL”), are added to the fair value of the
less than its carrying amount, the carrying amount of the
financial assets or deducted from the fair value of
cash-generating unit is reduced to its recoverable
financial liabilities on initial recognition. Transaction
amount, and the reduction is recognised in profit or loss
costs directly attributable to the acquisition of financial
as an impairment loss.
assets at FVTPL and financial liabilities at FVTPL are
Impairment loss is allocated to reduce the carrying
amount of any goodwill allocated to the cash-generating
recognised in profit or loss.
(ii) Non-derivative financial assets
unit or group of cash-generating units and then to the
Non-derivative financial assets are classified into
other assets on a pro rata basis of the carrying amount
“financial assets at FVTPL”, “held-to-maturity
of each asset in the cash-generating unit or group of
investments”, “loans and receivables” and “available-for-
cash-generating units.
(iii) Reversal of impairment loss
sale financial assets”. The classification is determined
based on the nature and purpose of the financial assets
At the end of each quarter, the Group assesses whether
at the time of initial recognition.
there is any indication that an impairment loss
(a) Financial assets at FVTPL
recognised in prior years for other intangible assets may
The Group classifies financial assets as FVTPL when
no longer exist or may have decreased. If such
the financial assets are either held for trading or
indication exists, the recoverable amount of the asset or
designated as FVTPL at initial recognition.
the cash-generating unit is estimated. If the recoverable
Financial assets at FVTPL are measured at fair value,
amount of the asset or the cash-generating unit is
and any gain or loss resulting from changes in fair value,
greater than its carrying amount, a reversal of an
dividends, and interest income are recognised in profit
impairment loss is recognised, to the extent the
or loss.
increased carrying amount does not exceed the lower of
(b) Held-to-maturity investments
the recoverable amount or the carrying amount (net of
Non-derivative financial assets with fixed or
depreciation or amortisation) that would have been
determinable payments and fixed maturity dates that the
determined had no impairment loss been recognised in
Group has the positive intent and ability to hold to
prior years.
maturity are classified as held-to maturity investments.
Any impairment loss recognised for goodwill is not
Subsequent to initial recognition, held-to-maturity
reversed in a subsequent period.
investments are measured at amortised cost using the
effective interest method, less any impairment loss.
Interest income using the effective interest method is
recognised in profit or loss.
97
(c) Loans and receivables
In the case of equity instruments classified as
Non-derivative financial assets with fixed or
available-for-sale, a significant or prolonged decline in
determinable payments not quoted in an active market
the fair value of the equity instrument below its cost
are classified as loans and receivables.
would be considered as objective evidence of
Subsequent to initial recognition, loans and
impairment.
receivables are measured at amortised cost using the
The Group assesses the existence of objective
effective interest method, less any impairment loss.
evidence of impairment for loans and receivables and
Amortisation incurred under the effective interest
held-to-maturity financial assets, individually for
method is recognised in profit or loss.
(d) Available-for-sale financial assets
separately significant assets or collectively for assets
with no individual significance. When there is objective
Non-derivative financial assets designated as available-
evidence of impairment on those financial assets, the
for-sale financial assets or not classified as FVTPL,
difference between the asset’s carrying amount and the
held-to-maturity investments or loans and receivables
present value of estimated future cash flows discounted
are classified as available-for-sale financial assets.
at the financial asset’s original effective interest rate is
Subsequent to initial recognition, available-for-sale
recognised in profit or loss as an impairment loss.
financial assets are measured at fair value, and any gain
The impairment loss for loans and receivables are
or loss resulting from changes in fair value is recognised
recognised through the allowance for doubtful accounts,
in other comprehensive income. Dividends on available-
and the carrying amount of a loan and receivable is
for-sale financial assets are recognised in profit or loss.
written off against the allowance account when it is
When available-for-sale financial assets are
subsequently considered uncollectible. When an event
derecognised or determined to be impaired, the
occurring after the impairment was recognised causes
cumulative gain or loss that had been recognised in
the amount of the impairment loss to decrease, a
other comprehensive income is reclassified to profit or
reversal of the impairment loss is recognised in profit or
loss.
(iii) Impairment of financial assets other than FVTPL
loss.
When there is objective evidence that an available-
Financial assets, other than those at FVTPL, are
for-sale financial asset is impaired, the cumulative loss
assessed for any objective evidence of impairment at
that had been recognised in other comprehensive
the end of each quarter. Financial assets are impaired
income is transferred to profit or loss. Any subsequent
when there is objective evidence of impairment as a
recovery in the fair value of impaired equity instruments
result of one or more events that occurred after the
classified as available-for-sale financial assets is
initial recognition of the financial assets and these
events have adversely affected the estimated future
recognised in other comprehensive income.
(iv) Derecognition of financial assets
cash flows of the financial assets that can be reliably
When the contractual rights with respect to the cash
estimated.
flows from a financial asset expire or the contractual
Objective evidence of impairment of financial assets
rights to receive the cash flows from a financial asset
includes:
significant financial difficulty of the issuer or obligor;
breach of contract, such as a default or delinquency
in interest or principal payments;
have been transferred and substantially all the risks and
rewards of ownership of the financial asset are
transferred, the Group derecognises the financial asset.
(v) Non-derivative financial liabilities
probability that the borrower will enter bankruptcy or
Non-derivative financial liabilities are classified into
other financial reorganisation; or
“Financial liabilities at FVTPL” and “Financial liabilities
disappearance of an active market for the financial
measured at amortised cost”. The classification is
assets.
determined based on the nature and purpose of the
financial liabilities at the time of initial recognition.
98
(a) Financial liabilities at FVTPL
profit or loss and on the disposal or partial disposal of
The Group classifies financial liabilities as FVTPL when
the foreign operation, respectively.
the financial liabilities are designated as FVTPL at initial
Financial assets and financial liabilities arising from
recognition.
derivatives are classified as either financial assets at
Financial liabilities at FVTPL are measured at fair
FVTPL or financial liabilities at FVTPL.
value, and any gain or loss resulting from changes in fair
value and interest expense are recognised in profit or
(15) Cash and cash equivalents
loss.
Cash and cash equivalents comprise cash on hand,
(b) Financial liabilities measured at amortised cost
demand deposits, and highly liquid short-term
Non-derivative financial liabilities not classified as
investments with maturities of three months or less from
FVTPL are classified as financial liabilities measured at
the date of acquisition which are subject to an
amortised cost.
insignificant risk of changes in value.
Subsequent to initial recognition, financial liabilities
measured at amortised cost are measured at amortised
(16) Inventories
cost using the effective interest method.
(vi) Derecognition of financial liabilities
Inventories are measured at the lower of cost and net
realisable value. The cost of inventories includes costs
The Group derecognises financial liabilities when the
of purchase, costs of conversion and all other costs
obligations of the financial liabilities are fulfilled or when
incurred in bringing the inventories to their present
the obligations are discharged, cancelled, or expired.
(vii) Derivatives
location and condition. Net realisable value is calculated
as the estimated selling price in the ordinary course of
The Group is engaged in derivative transactions and
business less the estimated costs of completion and
mainly uses forward foreign exchange contracts to
estimated costs necessary to sell. Cost of inventories is
manage its exposure to risks from changes in foreign
calculated mainly using the first-in, first-out (FIFO)
exchange rates.
method.
Derivatives are initially recognised at fair value of the
date when the derivative contracts are entered into and
(17) Assets held for sale
are subsequently measured at their fair values at the
Non-current assets or disposal groups are classified as
end of each quarter.
“Assets held for sale” if their carrying amounts will be
Changes in the fair value of derivatives are
recovered principally through a sale transaction rather
recognised in profit or loss, except for the following. If
than through continuing use. To be classified as assets
the hedging relationship qualifies for hedge accounting,
held for sale, the asset must be available for immediate
the gain or loss on the hedging instrument of cash flow
sale in its present condition, and the sale must be highly
hedges or hedges of a net investment in a foreign
probable. Specifically, management of the Group must
operation that are determined to be effective hedges are
have a firm commitment to execute the plan to sell the
recognised in other comprehensive income. The
asset and the sale is expected to be completed within
amounts that had been recognised in other
one year from the date of classification, as a general
comprehensive income for cash flow hedges and
rule. Assets held for sale are measured at the lower of
hedges of a net investment in a foreign operation shall
their carrying amounts and fair values less costs to sell,
be reclassified from equity to profit or loss in the same
and they are not depreciated or amortised while they are
period or periods during which the hedged items affect
classified as held for sale.
99
(18) Equity
(i) Ordinary shares
the consolidated statement of financial position as
assets or liabilities. The defined benefit obligation is
Proceeds from the issuance of ordinary shares by the
calculated by using the projected unit credit method.
Company are included in share capital and capital
The present value of the defined benefit obligation is
surplus. Transaction costs of issuing ordinary shares
calculated by the expected future payments using
(net of tax) are deducted from capital surplus.
(ii) Treasury shares
discount rate. The discount rate is determined by
reference to market yield on high-quality corporate
When the Company reacquires its own ordinary shares,
bonds having maturity terms consistent with the
the amount of the consideration paid including
estimated term of the related pension obligations.
transaction costs is deducted from equity. When the
Service cost and net interest expense (income) on
Company sells treasury shares, the difference between
the net defined benefit liabilities (assets) are recognised
the carrying amount and the consideration received from
in profit or loss.
the sale is recognised in equity.
Actuarial gains and losses, the return on plan
(19) Share-based payment
assets, excluding amounts included in net interest, and
any change in the effect of the asset ceiling are
The Group operates an equity-settled share-based
recognised immediately in other comprehensive income
payment plan and a cash-settled share-based payment
under “Remeasurements of defined benefit plans”, and
plan as share-based payment plans.
(i) Equity-settled share-based payment plan
transferred from other components of equity to retained
earnings immediately.
Under the equity-settled share-based payment plan,
(b) Defined contribution plans
services received are measured at the fair value of the
Contributions paid for defined contribution plans are
equity instruments at the grant date, and are recognised
expensed in the period in which the employees provide
as expenses from the grant date over the vesting period,
with a corresponding increase in equity.
(ii) Cash-settled share-based payment plan
the related service.
(ii) Short-term employee benefits
Short-term employee benefits are expensed when the
Under the cash-settled share-based payment plan,
related service is provided. Bonus accrual is recognised
services received are measured at the fair value of the
as a liability when the Group has present legal or
liabilities incurred and recognised as expenses over the
constructive obligations resulting from past service
vesting period, with a corresponding increase in
rendered by the employees and reliable estimates of the
liabilities. Until the liabilities are settled, the fair value of
obligations can be made.
liabilities are remeasured at the end of each quarter and
at the settlement date, with changes in fair value
(21) Provisions
recognised in profit or loss.
Provisions are recognised when the Group has present
(20) Employee benefits
(i) Retirement benefits
legal or constructive obligations as a result of past
events, it is probable that outflows of resources
embodying economic benefits will be required to settle
The Group operates defined benefit and defined
the obligations, and reliable estimates of the obligations
contribution retirement plans for its employees.
can be made.
(a) Defined benefit plans
When the effect of the time value of money is
Net defined benefit assets or liabilities are calculated as
material, provisions are measured at the present value
the present value of the defined benefit obligation less
of the expenditures expected to be required to settle the
the fair value of plan assets and they are recognised in
obligations.
100
(22) Government grants
recognised as income in the period in which the Group
Government grants are recognised and measured at
recognises the corresponding expenses. Government
fair value, if there is reasonable assurance that the
grants related to assets are recognised as deferred
Group will comply with the conditions attached to them
income and then recognised in profit over the expected
and that the grants will be received. Government grants
useful life of the relevant asset on a regular basis.
that are intended to compensate for specific costs are
4. Significant Accounting Estimates, Judgments and Assumptions
The preparation of the consolidated financial statements
a significant risk of causing a material adjustment to the
requires management of the Group to make estimates,
carrying amounts of assets and liabilities in the next
judgments and assumptions that affect the application of
accounting policies and the reported amounts of assets,
fiscal year are as follows:
Impairment of property, plant and equipment,
liabilities, income, and expenses.
goodwill and other intangible assets (Notes 15, 16
Given their nature, actual results may differ from
and 17)
those estimates.
Provisions (Note 29)
The estimates and underlying assumptions are
Retirement benefits (Note 28)
reviewed on an ongoing basis, and the effects resulting
Recoverability of deferred tax assets (Note 18)
from revisions of accounting estimates are recognised in
Income tax expense (Note 12)
the period in which the estimates are revised and in
Financial instruments measured at fair value which
future periods affected by the revision.
have no market price in active markets (Notes 33
Estimates and underlying assumptions representing
and 37)
101
5. Segment Information
The main activities of the Group are the manufacture and sale of pharmaceutical products, and there are no separate
operating segments. Therefore, the Group has a single reporting segment, “Pharmaceutical”.
Information about products and services
Sales by type of product and service are as follows:
XTANDI
Prograf
Betanis/Myrbetriq/BETMIGA
Vesicare
Other
Total
(Millions of yen)
2017
2018
¥ 252,078
¥ 294,302
186,156
98,844
116,075
658,512
198,471
125,745
102,306
579,492
¥1,311,665
¥1,300,316
(Note) Sales of “Betanis/Myrbetriq/BETMIGA” previously included in “Other” are presented separately from the fiscal year ended 31 March 2018 since those
have become material. In accordance with this change, sales of “Betanis/Myrbetriq/BETMIGA” for the fiscal year ended 31 March 2017 of ¥98,844
million, which had been included in “Other,” have been reclassified to conform to the current period presentation.
Information about geographical areas
Sales and non-current assets by geographical areas are as follows:
Sales by geographical areas
Japan
Americas
U.S.A. (included in Americas)
EMEA
Asia and Oceania
Total
(Millions of yen)
2017
2018
¥ 464,082
¥ 406,414
412,625
388,539
343,401
91,558
435,108
404,409
351,280
107,513
¥1,311,665
¥1,300,316
(Note) Sales by geographical areas are categorised by country or areas based on the geographical location of customers.
Non-current assets by geographical areas (Property, plant and equipment, goodwill and other intangible assets)
Japan
Americas
U.S.A. (included in Americas)
EMEA
Asia and Oceania
Total
(Millions of yen)
2017
2018
¥356,907
¥424,603
253,277
252,943
132,715
4,155
240,566
240,313
141,952
4,061
¥747,055
¥811,183
102
(Note) Due to the completion of the purchase price allocation for the acquisition of Ganymed Pharmaceuticals AG, the Group retrospectively revised the
corresponding balances in the above non-current assets by geographical areas table as of 31 March 2017. For details, please refer to Note “37.
Business Combinations”.
Information about major customers
External customer that accounts for 10% or more of consolidated sales of the Group is as follows:
McKesson Corporation
6. Sales
The breakdown of sales is as follows:
Sales of pharmaceutical products
Royalty income
Other
Total sales
7. Other Income
The breakdown of other income is as follows:
Gain from remeasurement relating to business combinations
Net foreign exchange gains
Other
Total other income
Segment
2017
2018
Pharmaceutical
¥150,184
¥148,962
(Millions of yen)
(Millions of yen)
2017
2018
¥1,225,070
¥1,231,839
57,433
29,162
43,254
25,223
¥1,311,665
¥1,300,316
(Millions of yen)
2017
2018
¥ －
6,946
2,649
¥9,594
¥ 5,877
－
5,995
¥11,872
(Notes) 1. The amount of “Net foreign exchange gains” for the year ended 31 March 2017 includes foreign exchange losses resulting from forward foreign
exchange contracts (¥10,285 million).
2. “Gain from remeasurement relating to business combinations” for the year ended 31 March 2018 was due to Mitobridge, Inc. becoming a wholly
owned subsidiary of the Company.
103
8. Other Expense
The breakdown of other expense is as follows:
Impairment losses for property, plant and equipment
Impairment losses for goodwill
Impairment losses for other intangible assets
Restructuring costs
Net foreign exchange losses
Other
Total other expense
2017
¥ 7,877
－
10,188
3,117
－
2,136
(Millions of yen)
2018
¥ 2,533
7,200
32,665
9,151
10,468
5,294
¥23,318
¥67,311
(Notes) 1. “Impairment losses for property, plant and equipment” for the year ended 31 March 2017 mainly resulted from the recognition of impairment losses
for buildings and certain other assets held by a U.S. subsidiary in connection with the sale of shares of this subsidiary to another company.
2. “Impairment losses for other intangible assets” for the year ended 31 March 2017 were principally due to an impairment loss on patents due to
lower-than-expected profitability and to the discontinuation of development activities for projects.
3. “Impairment losses for goodwill” for the year ended 31 March 2018 were due to impairment of the goodwill resulting from the acquisition of U.S.
subsidiary Agensys, Inc., in connection with the termination of research operation of Agensys.
4. “Impairment losses for other intangible assets” for the year ended 31 March 2018 were principally due to reviewing development project plans for
IMAB362.
5. “Restructuring costs” for the year ended 31 March 2018 were principally due to the consolidation of the R&D activities in EMEA into Japan and the
U.S.
6. The amount of “Net foreign exchange losses” for the year ended 31 March 2018 includes foreign exchange gains resulting from forward foreign
exchange contracts (¥2,147 million).
9. Employee Benefit Expenses
The breakdown of employee benefit expenses is as follows:
Rewards and salaries
Bonuses
Social security and welfare expenses
Retirement benefit expenses—Defined contribution plan
Retirement benefit expenses—Defined benefit plan
Restructuring and termination benefits
Other employee benefit expenses
Total employee benefit expenses
(Millions of yen)
2017
2018
¥143,538
¥152,523
56,341
30,600
14,243
6,804
8,064
2,821
55,654
31,117
14,411
6,302
6,230
2,664
¥262,411
¥268,902
(Note) Employee benefit expenses are included in “Cost of sales”, “Selling, general and administrative expenses”, “Research and development expenses”
and “Other expense” in the consolidated statement of income.
104
10. Finance Income
The breakdown of finance income is as follows:
Interest income
Cash and cash equivalents
Other
Dividend income
Available-for-sale financial assets
Gain on sales
Available-for-sale financial assets
Other
Other
Total finance income
11. Finance Expense
The breakdown of finance expense is as follows:
Impairment losses
Available-for-sale financial assets
Other
Total finance expense
12. Income Tax Expense
The breakdown of income tax expense recognised in profit or loss is as follows:
Current income tax expense
Deferred income tax expense
Income tax expense reported in the consolidated statement of income
(Millions of yen)
2017
2018
¥ 906
72
618
21,265
13
41
¥1,575
73
227
4,744
2
14
¥22,916
¥6,637
(Millions of yen)
2017
2018
¥ 642
1,334
¥1,976
¥ 474
1,309
¥1,782
(Millions of yen)
2017
2018
¥ 68,322
(5,253)
¥ 63,069
¥ 81,409
(27,975)
¥ 53,434
(Note) Deferred income tax expense increased by ¥9,800 million for the year ended 31 March 2018, due to the effect of the U.S. Tax Cuts and Jobs Act,
which came into force in December 2017.
105
Income tax recognised in other comprehensive income is as follows:
2017
Tax benefit
(expense)
Before tax
Net of tax
Before tax
Remeasurements of defined
benefit plans
¥ 4,211
¥(1,249)
¥ 2,962
¥ 2,271
(Millions of yen)
2018
Tax benefit
(expense) Net of tax
¥ (661)
¥ 1,611
Foreign currency translation
adjustments
Fair value movements on
(32,544)
－
(32,544)
28,590
－
28,590
available-for-sale financial assets
(20,931)
6,457
(14,474)
5,168
(1,508)
3,660
Total other comprehensive
income
¥(49,264)
¥ 5,208
¥(44,056)
¥36,029
¥(2,169)
¥33,860
Reconciliation of effective tax rate
The Company is subject mainly to corporate tax,
were 30.7% in both years. Foreign subsidiaries are
inhabitant tax, and enterprise tax on its income and the
subject to income taxes on their income in their
effective statutory tax rates calculated based on those
respective countries of domicile.
taxes for the years ended 31 March 2017 and 2018
Effective statutory tax rate
Tax credit for research and development expenses
Non-deductible expenses
Difference in tax rates applied to foreign subsidiaries
Undistributed earnings of foreign subsidiaries
Effect of U.S. tax reforms
Other
Actual tax rate
2017
2018
30.7%
(1.7)
2.6
(7.8)
0.3
－
(1.8)
30.7%
(3.9)
4.3
(12.6)
(0.3)
3.9
2.4
22.4%
24.5%
106
13. Earnings per Share
The basis of calculation of basic earnings per share and diluted earnings per share is as follows:
Basis of calculating basic earnings per share
Profit attributable to owners of the parent
Profit not attributable to ordinary shareholders of the parent
Profit used to calculate basic earnings per share
(Millions of yen, except as otherwise indicated)
2017
2018
¥ 218,701
－
¥ 164,679
－
218,701
164,679
Weighted average number of shares during the year (Thousands of shares)
2,109,149
2,030,203
Basis of calculating diluted earnings per share
Profit used to calculate basic earnings per share
Adjustment
Profit used to calculate diluted earnings per share
¥ 218,701
－
¥ 164,679
－
218,701
164,679
Weighted average number of shares during the year (Thousands of shares)
2,109,149
2,030,203
Subscription rights to shares (Thousands of shares)
2,830
2,268
Weighted average number of diluted ordinary shares during the year
(Thousands of shares)
2,111,979
2,032,472
Earnings per share (attributable to owners of the parent):
Basic (Yen)
Diluted (Yen)
¥ 103.69
¥ 81.11
103.55
81.02
14. Other Comprehensive Income
Reclassification adjustments of other comprehensive income are as follows:
Other comprehensive income that may be reclassified subsequently to profit or loss
Foreign currency translation adjustments
Amount arising during the year
Reclassification adjustment
Subtotal
Fair value movements on available-for-sale financial assets
Amount arising during the year
Reclassification adjustment
Subtotal
Other comprehensive income that may be reclassified subsequently to
profit or loss before tax effect
Tax effect
(Millions of yen)
2017
2018
¥(32,615)
¥28,563
71
27
(32,544)
28,590
(94)
(20,836)
(20,931)
(53,475)
6,457
9,860
(4,692)
5,168
33,758
(1,508)
Other comprehensive income that may be reclassified subsequently to profit or loss, net of tax
¥(47,018)
¥32,250
107
15. Property, Plant and Equipment
Movement of cost, accumulated depreciation and impairment losses for property, plant and equipment
The movement of property, plant and equipment for the year ended 31 March 2017 is as follows:
Buildings
and
structures
Machinery
and
vehicles
Tools,
furniture
and fixtures
Land
Construction
in progress
Total
(Millions of yen)
Cost
Balance at 1 April 2016
¥211,164
¥ 154,051
¥ 79,235
¥18,023
¥ 18,124
¥ 480,597
Acquisitions
Business combinations
Disposals
Loss of control of subsidiaries
Reclassification from
construction in progress
Other
2,599
－
(1,302)
(8,775)
3,228
(2,193)
2,712
258
(3,658)
(8,696)
12,481
(2,456)
4,591
14
(5,383)
(289)
1,083
(565)
－
－
(0)
(144)
－
(116)
14,001
－
(65)
(1,457)
23,903
272
(10,408)
(19,360)
(16,792)
－
(485)
(5,816)
Balance at 31 March 2017
204,722
154,692
78,687
17,762
13,325
469,188
Accumulated depreciation and
accumulated impairment losses
Balance at 1 April 2016
(92,416)
(123,360)
Depreciation
Impairment losses
(7,520)
(8,753)
(or reversal of impairment losses)
(4,375)
(2,030)
Disposals
Loss of control of subsidiaries
Other
1,228
8,249
927
3,062
8,448
1,894
(63,811)
(5,598)
(46)
5,297
283
449
Balance at 31 March 2017
(93,907)
(120,739)
(63,427)
Carrying amounts
－
－
(128)
－
128
－
－
(54)
－
(279,642)
(21,872)
(1,298)
(7,877)
52
1,298
2
－
9,639
18,407
3,272
(278,073)
Balance at 1 April 2016
118,748
30,691
15,423
18,023
18,069
200,955
Balance at 31 March 2017
¥110,815
¥ 33,953
¥ 15,260
¥17,762
¥ 13,325
¥ 191,115
(Notes) 1. The increase due to business combinations reflected the acquisition of Ganymed Pharmaceuticals AG. For details on this business combination,
please refer to Note “37. Business Combinations”.
2. “Other” mainly includes exchange differences.
108
The movement of property, plant and equipment for the year ended 31 March 2018 is as follows:
Buildings
and
structures
Machinery
and
vehicles
Tools,
furniture
and fixtures
Land
Construction
in progress
Total
(Millions of yen)
Cost
Balance at 1 April 2017
¥ 204,722
¥ 154,692
¥ 78,687
¥17,762
¥13,325
¥ 469,188
Acquisitions
Business combinations
Disposals
Reclassification from
3,765
488
4,646
155
3,624
21
(8,473)
(5,939)
(4,159)
construction in progress
5,979
3,301
432
Reclassification to assets
held for sale
Other
(10,149)
687
(4,102)
3,502
(127)
470
－
36
－
－
－
24
12,071
－
24,107
700
(7)
(18,577)
(9,712)
－
(95)
(920)
(14,473)
3,764
Balance at 31 March 2018
197,020
156,254
78,949
17,822
14,664
464,709
Accumulated depreciation and
accumulated impairment losses
Balance at 1 April 2017
(93,907)
(120,739)
Depreciation
Impairment losses
(or reversal of impairment losses)
Disposals
Reclassification to assets
held for sale
Other
(7,468)
(8,780)
(1,837)
8,277
1,933
(628)
(319)
5,407
3,056
(2,856)
(63,427)
(5,792)
(21)
4,086
87
(488)
Balance at 31 March 2018
(93,629)
(124,231)
(65,554)
Carrying amounts
－
－
－
－
－
－
－
－
－
－
－
－
－
－
(278,073)
(22,039)
(2,177)
17,771
5,076
(3,972)
(283,414)
Balance at 1 April 2017
110,815
33,953
15,260
Balance at 31 March 2018
¥ 103,390
¥ 32,023
¥ 13,395
17,762
¥17,822
13,325
191,115
¥14,664
¥ 181,295
(Notes) 1. The increase due to business combinations reflected the acquisitions of Ogeda SA, Mitobridge, Inc., and Universal Cells, Inc. For details on these
business combinations, please refer to Note “37. Business Combinations”.
2. “Other” mainly includes exchange differences.
The Group recognised impairment losses (or reversal of
mainly resulted from the transfer of a U.S. subsidiary to
impairment losses) of ¥7,877 million for the year ended
another company. The recoverable amount of the
31 March 2017 and ¥2,177 million for the year ended 31
assets, including buildings, of ¥944 million is calculated
March 2018, and they are included in “Other expense” in
with reference to fair value based on the price agreed
the consolidated statement of income.
upon for the transfer.
Impairment losses (or reversal of impairment losses)
of ¥7,877 million for the year ended 31 March 2017
109
The carrying amounts of the assets held under finance leases included in “Property, plant and equipment” are as follows:
Buildings and
Machinery and
Tools, furniture and
structures
vehicles
fixtures
Total
(Millions of yen)
Balance at 1 April 2016
Balance at 31 March 2017
Balance at 31 March 2018
¥ －
¥37
¥41
¥95
¥ 6
¥ 1
¥1,133
¥1,630
¥1,344
¥1,228
¥1,672
¥1,386
16. Goodwill
The movement of cost and accumulated impairment losses for goodwill is as follows:
Balance at 1 April 2016
Business combinations
Exchange differences
Balance at 31 March 2017
Business combinations
Impairment losses
Disposals
Exchange differences
Balance at 31 March 2018
(Millions of yen)
Accumulated
Cost
impairment losses Carrying amount
¥153,121
¥ －
¥153,121
16,360
(960)
168,521
58,288
－
(7,200)
(6,632)
－
－
－
－
(7,200)
7,200
－
16,360
(960)
168,521
58,288
(7,200)
－
(6,632)
¥212,976
¥ －
¥212,976
(Notes) 1. The increase due to business combinations in the year ended 31 March 2017 reflected the acquisition of Ganymed Pharmaceuticals AG. The
movement in the year ended 31 March 2017 was retrospectively revised due to the completion of the purchase price allocation in the year ended
31 March 2018. For details on this business combination, please refer to Note “37. Business Combinations”.
2. The increase due to business combinations in the year ended 31 March 2018 reflected the acquisitions of Ogeda SA, Mitobridge, Inc., and
Universal Cells, Inc. For details on these business combinations, please refer to Note “37. Business Combinations”.
110
Goodwill recognised in the consolidated statement of
pharmaceutical business are 8.0% and 6.0%,
financial position mainly resulted from the acquisition of
respectively. The pre-tax discount rates used for the
OSI Pharmaceuticals, Inc. in 2010.
impairment test of the Americas cash-generating unit
The Group, in principle, regards the geographical
and the whole pharmaceutical business are 10.4% and
business units, which are managed for internal reporting
7.7%, respectively.
purposes, as cash-generating units.
Also, a growth rate of 2.0% for the Americas cash-
For the year ended 31 March 2017, the majority of
generating unit and 1.0% for the whole pharmaceutical
goodwill is mainly allocated to the Americas cash-
business is reflected in calculating the terminal value
generating unit, and the carrying amount of goodwill was
after the three-year business plan. The growth rate
¥152,455 million.
reflects the status of the country and the industry to
For the year ended 31 March 2018, goodwill is
which the cash-generating unit belongs.
allocated to the Americas cash-generating unit and the
The value in use sufficiently exceeds the carrying
whole pharmaceutical business, and the carrying
amount of the cash-generating unit. Therefore, even if
amounts of goodwill allocated were ¥113,632 million
the key assumptions used in the calculation of the value
and ¥68,571 million, respectively. In addition, the Group
in use fluctuate within a reasonable range, the Group
has not yet completed the allocation to cash-generating
assumes that the possibility that the value in use will be
units of goodwill amounting to ¥30,773 million acquired
lower than the carrying amount is remote.
through business combinations in the year ended 31
The Group recognised impairment losses of ¥7,200
March 2018.
million for the year ended 31 March 2018 and they are
For the impairment test, the value in use, which is
included in “Other expense” in the consolidated
calculated based on the three-year business plan
statement of income. The impairment losses for the year
approved at the board of directors meeting, is used as
ended 31 March 2018 were recognised on the goodwill
the recoverable amount. The Group uses a discount
resulting from the acquisition of U.S. subsidiary
rate calculated based on a weighted average cost of
Agensys, Inc., in connection with the termination of
capital (WACC) determined for each geographical area.
research operation of Agensys, deeming the
The after-tax discount rates used for the impairment test
recoverable amount to be zero.
of the Americas cash-generating unit and the whole
111
17. Other Intangible Assets
Movement of cost, accumulated amortisation and impairment losses for other intangible assets
The movement of other intangible assets for the year ended 31 March 2017 is as follows:
Patents and
Marketing
technologies
rights
IPR&D
Software
Other
Total
(Millions of yen)
Cost
Balance at 1 April 2016
¥ 341,371
¥ 57,081
¥145,876
¥ 43,697
¥ 319
¥ 588,344
Acquisitions
Business combinations
Disposals
Reclassification
Other
163
1
－
7,728
(770)
Balance at 31 March 2017
348,492
Accumulated amortisation and
accumulated impairment losses
99
－
(5,127)
－
(1,599)
50,454
10,416
86,020
－
(7,728)
(1,636)
7,400
11
(2,184)
－
(404)
1,550
－
(3)
－
(23)
19,628
86,033
(7,314)
－
(4,433)
232,949
48,520
1,843
682,258
Balance at 1 April 2016
(166,192)
(42,493)
(16,258)
(32,304)
(3,533)
－
(26,931)
(6,073)
(208)
(252,083)
(9)
(41,919)
Amortisation
Impairment losses
(or reversal of impairment losses)
Disposals
Other
(6,054)
－
(224)
1,725
3,402
1,459
(4,064)
－
8
(70)
2,140
829
－
3
10
(8,463)
5,545
2,082
Balance at 31 March 2017
(204,775)
(39,441)
(20,315)
(30,104)
(204)
(294,839)
Carrying amounts
Balance at 1 April 2016
175,179
14,588
129,617
16,766
111
336,261
Balance at 31 March 2017
¥ 143,717
¥ 11,013
¥212,634
¥ 18,416
¥1,639
¥ 387,419
(Notes) 1. The increase due to business combinations reflected the acquisition of Ganymed Pharmaceuticals AG. For details on this business combination,
please refer to Note “37. Business Combinations”.
2. “Other” mainly includes exchange differences.
112
The movement of other intangible assets for the year ended 31 March 2018 is as follows:
Patents and
Marketing
technologies
rights
IPR&D
Software
Other
Total
(Millions of yen)
Cost
Balance at 1 April 2017
¥ 348,492
¥ 50,454
¥232,949
¥ 48,520
¥ 1,843
¥ 682,258
Acquisitions
Business combinations
Disposals
Reclassification to assets
held for sale
Other
Balance at 31 March 2018
Accumulated amortisation and
accumulated impairment losses
569
1,052
(1,360)
－
(9,343)
339,410
602
－
－
－
3,365
79,846
－
－
1,469
52,525
9,509
325,669
10,641
－
(1,344)
(93)
1,315
59,039
21
2
－
－
6
15,198
80,899
(2,704)
(93)
2,956
1,871
778,514
Balance at 1 April 2017
(204,775)
(39,441)
(20,315)
(32,802)
(3,037)
－
(30,104)
(6,975)
(204)
(294,839)
(11)
(42,824)
Amortisation
Impairment losses
(or reversal of impairment losses)
Disposals
Reclassification to assets
held for sale
Other
(529)
1,359
－
7,626
－
－
－
(1,371)
(30,592)
－
－
(56)
(0)
1,319
70
(237)
(1,520)
－
(32,642)
2,678
－
(6)
70
5,955
Balance at 31 March 2018
(229,121)
(43,849)
(50,964)
(35,927)
(1,742)
(361,602)
Carrying amounts
Balance at 1 April 2017
143,717
11,013
212,634
18,416
1,639
387,419
Balance at 31 March 2018
¥ 110,289
¥ 8,676
¥274,705
¥ 23,112
¥ 130
¥ 416,912
(Notes) 1. The increase due to business combinations reflected the acquisitions of Ogeda SA and Universal Cells, Inc. For details on these business
combinations, please refer to Note “37. Business Combinations”.
2. “Other” mainly includes exchange differences.
Amortisation of other intangible assets related to the
Impairment losses (or reversal of impairment losses)
rights of product or research and development arising
for other intangible assets are recognised in the
from in-licensing agreements is recognised in the
consolidated statement of income under “Other
consolidated statement of income under “Amortisation of
expense” and “Other income.”
intangible assets”.
Impairment test and impairment losses for other intangible assets
For the intangible assets other than goodwill, the Group
impairment test, the value in use is mainly used as the
assesses the necessity of impairment mainly by
recoverable amount. The discount rate is calculated
individual asset. Also, intangible assets not yet being
based on the WACC, and the range of post-tax discount
amortised are tested for impairment annually whether or
rate used for the calculation of the value in use is 6.0%
not there is any indication of impairment. For the
113
to 10.0%, and that of the pre-tax discount rate is 7.7% to
agreement with UMN Pharma Inc. and the
14.3%.
discontinuation of development activities with respect
As a result of the impairment test, the Group
to IPR&Ds for ASP7374 and ASP7373, cell culture
recognised the following impairment losses for the years
based influenza vaccine programs that had been
ended 31 March 2017 and 2018.
licensed from UMN Pharma Inc.
For the year ended 31 March 2017, impairment
For the year ended 31 March 2018, impairment
losses (or reversal of impairment losses) recognised for
losses (or reversal of impairment losses) recognised for
other intangible assets were ¥8,463 million, and details
other intangible assets were ¥32,642 million, and details
of the main items are as follows:
on the main item are as follows:
(1) The Company recognised an impairment loss of
The Company recognised an impairment loss of
¥6,054 million, deeming the recoverable amount as
¥27,548 million on IPR&D pertaining to IMAB362,
zero, due to lower-than-expected profitability of
resulting from the acquisition of Ganymed
patents for products sold in Japan. The recoverable
Pharmaceuticals AG, due to reviewing development
amount represented the value in use, calculated
project plans. The recoverable amount represented the
based on discounted future cash flows.
value in use, calculated based on discounted future
(2) The Company recognised an impairment loss of
cash flows. The post-tax and pre-tax discount rates
¥4,000 million, deeming the recoverable amount as
used for the calculation of the value in use are 10.0%
zero, due to the exercise of its right to terminate its
and 14.3%, respectively.
Significant intangible assets
Significant intangible assets recognised in the
acquisition of Ganymed Pharmaceuticals AG in 2016,
consolidated statement of financial position as of 31
the rights related to the research and development of
March 2017 are mainly composed of the rights related to
enzalutamide (XTANDI) acquired through the licence
IMAB362 resulting from the acquisition of Ganymed
agreement with Medivation, Inc., and the rights related
Pharmaceuticals AG in 2016, the rights related to the
to the research and development of YM311/roxadustat
research and development of enzalutamide (XTANDI)
acquired through the licence agreement with FibroGen,
acquired through the licence agreement with
Inc. The carrying amounts of those intangible assets
Medivation, Inc., the rights related to the research and
were ¥77,609 million, ¥64,017 million, ¥60,930 million
development of YM311/roxadustat acquired through the
and ¥51,656 million, respectively. The carrying amount
licence agreement with FibroGen, Inc., and the rights
of the rights related to fezolinetant resulting from the
related to “Tarceva” resulting from the acquisition of OSI
acquisition of Ogeda SA represents provisional fair
Pharmaceuticals, Inc. in 2010. The carrying amounts of
value, as the allocation of the fair value of purchase
those intangible assets were ¥84,476 million, ¥67,231
consideration transferred had not been completed. For
million, ¥51,656 million, and ¥44,698 million,
details, please refer to Note “37. Business
respectively.
Combinations”.
Significant intangible assets recognised in the
For intangible assets already starting amortisation,
consolidated statement of financial position as of 31
the remaining amortisation period was 2 to 12 years in
March 2018 are mainly composed of the rights related to
the year ended 31 March 2017 and 1 to 11 years in the
fezolinetant resulting from the acquisition of Ogeda SA
year ended 31 March 2018. The intangible assets not
in 2017, the rights related to IMAB362 resulting from the
yet being amortised are tested for impairment annually.
114
18. Deferred Taxes
The breakdown and movement of deferred tax assets and deferred tax liabilities are as follows:
For the year ended 31 March 2017
Recognised in
As of
Recognised
other
1 April
in profit or
comprehensive
Business
(Millions of yen)
As of
31 March
2016
loss
income
combinations
Other
2017
Available-for-sale financial assets
¥(11,067)
¥ (263)
¥ 6,457
Retirement benefit assets and liabilities
Property, plant and equipment
Intangible assets
Accrued expenses
Inventories
Tax loss carry-forwards
Other
Total
10,448
2,506
(47,540)
25,792
52,116
8,637
39,841
315
(1,249)
(1,469)
2,881
(1,572)
3,843
(270)
1,788
－
－
－
－
－
－
¥ －
－
－
(25,806)
－
－
6,954
－
¥ 66
¥ (4,807)
(172)
(40)
9,343
996
1,199
(69,266)
(214)
(736)
(920)
310
24,007
55,223
14,401
41,939
¥ 80,733
¥ 5,253
¥ 5,208
¥(18,852)
¥ (506)
¥ 71,836
(Note) The increase in deferred tax assets and deferred tax liabilities due to business combinations reflected the acquisition of Ganymed Pharmaceuticals
AG. The movement in the year ended 31 March 2017 was retrospectively revised due to the completion of the purchase price allocation in the year
ended 31 March 2018. For details on this business combination, please refer to Note “37. Business Combinations”.
For the year ended 31 March 2018
Recognised in
As of
Recognised
other
1 April
in profit or
comprehensive
Business
(Millions of yen)
As of
31 March
2017
loss
income
combinations
Other
2018
Available-for-sale financial assets
¥ (4,807)
¥ 73
¥(1,508)
Retirement benefit assets and liabilities
Property, plant and equipment
Intangible assets
Accrued expenses
Inventories
Tax loss carry-forwards
Other
Total
9,343
996
(69,266)
24,007
55,223
14,401
41,939
809
1,376
36,805
(4,452)
7,556
(11,821)
(2,371)
(661)
－
－
－
－
－
－
¥ －
－
(20)
¥ (41)
¥ (6,283)
63
132
9,553
2,484
(26,615)
(2,303)
(61,380)
1
3
1,406
209
(433)
967
386
(584)
19,123
63,749
4,372
39,193
¥ 71,836
¥ 27,975
¥(2,169)
¥(25,016)
¥(1,814)
¥ 70,812
(Note) The increases in deferred tax assets and deferred tax liabilities due to business combinations reflected the acquisitions of Ogeda SA, Mitobridge, Inc.,
and Universal Cells, Inc. For details on these business combinations, please refer to Note “37. Business Combinations”.
115
Deductible temporary differences, tax loss carry-forwards, and unused tax credits for which no deferred tax asset is
recognised are as follows:
Deductible temporary differences
Tax loss carry-forwards
Unused tax credits
Total
(Millions of yen)
2017
2018
¥31,527
3,350
2,182
¥37,059
¥33,446
13,423
2,708
¥49,577
(Note) The amounts for the year ended 31 March 2017 were retrospectively revised due to the completion of the purchase price allocation for Ganymed
Pharmaceuticals AG in the year ended 31 March 2018.
The expiration date and amount of tax loss carry-forwards for which no deferred tax asset is recognised are as follows:
Year 1
Year 2
Year 3
Year 4
Year 5 or later
Total
(Millions of yen)
2017
2018
¥ 632
¥ 72
62
378
471
1,807
¥3,350
271
356
152
12,571
¥13,423
(Note) The amounts for the year ended 31 March 2017 were retrospectively revised due to the completion of the purchase price allocation for Ganymed
Pharmaceuticals AG in the year ended 31 March 2018.
19. Other Financial Assets
The breakdown of other financial assets is as follows:
Other financial assets (non-current)
Financial assets at FVTPL
Loans and other financial assets
Allowance for doubtful accounts
Available-for-sale financial assets
Total other financial assets (non-current)
Other financial assets (current)
Loans and other financial assets
Total other financial assets (current)
Total other financial assets
(Millions of yen)
2017
2018
¥10,762
10,421
(14)
40,428
61,597
13,554
13,554
¥75,151
¥13,334
10,745
(13)
43,308
67,375
13,517
13,517
¥80,891
116
20. Other Assets
The breakdown of other assets is as follows:
Other non-current assets
Long-term prepaid expenses
Retirement benefit assets
Other
Total other non-current assets
Other current assets
Prepaid expenses
Other
(Millions of yen)
2017
2018
¥10,063
¥ 5,155
2,372
720
13,154
10,763
8,087
2,544
673
8,372
9,149
5,299
Total other current assets
¥18,849
¥14,448
21. Inventories
The breakdown of inventories is as follows:
Raw materials and supplies
Work in progress
Merchandise and finished goods
Total
(Millions of yen)
2017
2018
¥ 36,225
¥ 39,302
15,389
130,922
15,512
92,813
¥182,537
¥147,626
The carrying amounts of inventories are measured at
The write-down of inventories recognised as an
the lower of cost and net realisable value.
expense for the years ended 31 March 2017 and 2018
The cost of inventories recognised as an expense in
amounted to ¥3,414 million and ¥6,737 million,
“Cost of sales” for the years ended 31 March 2017 and
respectively.
2018 amounted to ¥274,048 million and ¥237,717
million, respectively.
22. Trade and Other Receivables
The breakdown of trade and other receivables is as follows:
Notes and accounts receivable
Other accounts receivable
Allowance for doubtful accounts
Total trade and other receivables
Non-current assets
Current assets
117
(Millions of yen)
2017
2018
¥297,094
¥305,930
44,792
(9,806)
332,080
22,263
48,711
(9,848)
344,794
25,282
¥309,817
¥319,512
23. Cash and Cash Equivalents
The breakdown of cash and cash equivalents is as follows:
Cash and deposits
Short-term investments (cash equivalents)
Cash and cash equivalents in the consolidated statement of financial position
Cash and cash equivalents in the consolidated statement of cash flows
24. Assets Held for Sale
The breakdown of assets held for sale is as follows:
Assets
Property, plant and equipment
Buildings and structures
Other tangible assets
Other
Total
(Millions of yen)
2017
2018
¥331,801
¥328,669
9,122
340,923
¥340,923
3,062
331,731
¥331,731
(Millions of yen)
2017
2018
¥－
－
－
¥－
¥ 7,789
164
2,422
¥10,374
Assets held for sale as of 31 March 2018 mainly
consolidated subsidiary. The Company completed the
represented facilities and leasehold rights connected
sale of those assets in April 2018.
with the research operations of Agensys, Inc., a U.S.
25. Equity and Other Components of Equity
(1) Share capital and capital surplus
The movement of the number of issued shares and share capital is as follows:
Number of
Number of ordinary
authorised shares
issued shares
Share capital
Capital surplus
(Thousands of shares)
(Thousands of shares)
(Millions of yen)
(Millions of yen)
As of 1 April 2016
9,000,000
Increase
Decrease
－
－
As of 31 March 2017
9,000,000
Increase
Decrease
－
－
As of 31 March 2018
9,000,000
2,221,823
－
(68,000)
2,153,823
－
(85,000)
2,068,823
¥103,001
－
－
103,001
－
－
¥103,001
¥176,903
266
(78)
177,091
286
(159)
¥177,219
(Note) Decrease in the number of ordinary issued shares during the years ended 31 March 2017 and 2018 resulted from the cancellation of treasury shares.
118
(2) Treasury shares
The movement of treasury shares is as follows:
As of 1 April 2016
Increase
Decrease
As of 31 March 2017
Increase
Decrease
As of 31 March 2018
(3) Other components of equity
Subscription rights to shares
Number of shares
Amount
(Thousands of shares)
(Millions of yen)
96,844
60,513
(68,540)
88,817
89,379
(85,526)
92,670
¥ 157,111
92,193
(111,096)
138,207
130,712
(132,969)
¥ 135,951
The Company had adopted share option plans through the year ended 31 March 2015, and has issued subscription rights
to shares under the former Commercial Code and the Companies Act of Japan. Contract conditions and amounts are
described in Note “27. Share-based Payment”.
Foreign currency translation adjustments
These amounts represent foreign currency translation differences that occurred when consolidating financial statements of
foreign subsidiaries prepared in a foreign currency.
Fair value movements on available-for-sale financial assets
These amounts represent valuation differences between the fair value and acquisition cost of available-for-sale financial
assets, which are measured at fair values.
26. Dividends
For the year ended 31 March 2017
(1) Dividends paid
Amount of
Dividends
dividends
per share
Resolution
Class of shares
(Millions of yen)
(Yen)
Record date
Effective date
Ordinary general meeting of
Ordinary
31 March
21 June
shareholders held on 20 June 2016
shares
¥34,007
¥16.00
2016
2016
Board of directors meeting
held on 28 October 2016
Ordinary
shares
36,134
17.00
2016
2016
30 September
1 December
(Notes) 1. The amount of dividends approved by resolution of the ordinary general meeting of shareholders on 20 June 2016 includes dividends of ¥7 million
corresponding to the Company’s shares held in the executive compensation BIP trust.
2. The amount of dividends approved by resolution of the board of directors meeting on 28 October 2016 includes dividends of ¥15 million
corresponding to the Company’s shares held in the executive compensation BIP trust.
119
(2) Dividends whose record date is in the fiscal year ended 31 March 2017 but whose effective date is in the following
fiscal year are as follows:
Amount of
Dividends
dividends
per share
Resolution
Class of shares
(Millions of yen)
(Yen)
Record date
Effective date
Ordinary general meeting of
Ordinary
31 March
shareholders held on 19 June 2017
shares
¥35,120
¥17.00
2017
20 June
2017
(Note) The amount of dividends above includes dividends of ¥15 million corresponding to the Company’s shares held in the executive compensation BIP
trust.
For the year ended 31 March 2018
(1) Dividends paid
Amount of
Dividends
dividends
per share
Resolution
Class of shares
(Millions of yen)
(Yen)
Record date
Effective date
Ordinary general meeting of
Ordinary
31 March
20 June
shareholders held on 19 June 2017
shares
¥35,120
¥17.00
2017
2017
Board of directors meeting
held on 31 October 2017
Ordinary
shares
36,552
18.00
2017
2017
30 September
1 December
(Notes) 1. The amount of dividends approved by resolution of the ordinary general meeting of shareholders on 19 June 2017 includes dividends of ¥15
million corresponding to the Company’s shares held in the executive compensation BIP trust.
2. The amount of dividends approved by resolution of the board of directors meeting on 31 October 2017 includes dividends of ¥23 million
corresponding to the Company’s shares held in the executive compensation BIP trust.
(2) Dividends whose record date is in the fiscal year ended 31 March 2018 but whose effective date is in the following
fiscal year are as follows:
Amount of
Dividends
dividends
per share
Resolution
Class of shares
(Millions of yen)
(Yen)
Record date
Effective date
Ordinary general meeting of
Ordinary
31 March
18 June
shareholders held on 15 June 2018
shares
¥35,594
¥18.00
2018
2018
(Note) The amount of dividends above includes dividends of ¥23 million corresponding to the Company’s shares held in the executive compensation BIP
trust.
120
27. Share-based Payment
(1) Performance-linked Stock Compensation Scheme
(i) Outline of the Performance-linked Stock Compensation Scheme
From the fiscal year ended 31 March 2016, the Group
level of attainment of the medium-term management
has introduced a Performance-linked Stock
targets. The Performance-linked Stock Compensation
Compensation Scheme for directors (excluding outside
Scheme under which the Company’s shares are
directors and directors who are Audit & Supervisory
delivered from the BIP Trust is accounted for as an
Committee members) and corporate executives for the
equity-settled share-based payment transaction.
purpose of increasing their awareness of contributing to
In addition, the Company will provide cash benefits
the sustainable growth in business results and corporate
determined based on stock price of the Company to
value.
corporate executives residing overseas based on the
The Scheme employs a framework referred to as the
level of attainment of the medium-term management
executive compensation BIP (Board Incentive Plan) trust
targets. The Performance-linked Stock Compensation
(hereinafter the “BIP Trust”) for directors and corporate
Scheme that provides cash benefits from the Company
executives other than those residing overseas. The BIP
is accounted for as a cash-settled share-based payment
Trust acquires the Company’s shares and delivers those
transaction.
shares to directors and other executives based on the
(ii) Expenses recognised in the consolidated statement of income
Total expenses recognised for the Performance-linked
Stock Compensation Scheme
(Millions of yen)
2017
2018
¥290
¥304
(iii) Measurement approach for the fair value of the Company’s shares granted during the fiscal year based on the
Performance-linked Stock Compensation Scheme
The weighted average fair value of the Company’s shares granted during the period is calculated based on the following
assumptions.
Share price at the grant date
Vesting period (Note 1)
Expected annual dividend (Note 2)
Discount rate (Note 3)
Weighted average fair value
(Notes) 1. Refers to the number of years from the grant date until the shares are expected to be delivered.
2. Calculated based on the latest dividends paid.
3. Based on the yield on Japanese government bonds corresponding to the vesting period.
2017
2018
1,603.5 yen
1,383.0 yen
3 years
3 years
34 yen/share
(0.3)％
36 yen/share
(0.1)％
1,501 yen
1,275 yen
121
(2) Share option plans
(i)Outline of share option plans
The Company had adopted share option plans through
rights to shares to individuals approved at the
the year ended 31 March 2015, and has granted share
Company’s board of directors meeting.
options to directors and corporate executives of the
Holders of subscription rights to shares can exercise
Company. The purpose of share option plans is to
their share subscription rights only from the day
improve the sensitivity to the share price and the
following the date of resignation from their position as
Group’s financial results and also increase the value of
director or corporate executive of the Company.
the Group by motivating the members to whom share
Share options not exercised during the exercise
options are granted.
period defined in the allocation contract will be forfeited.
After obtaining approval at the meeting of
The Company accounts for those share option plans
shareholders, share options are granted as subscription
as equity-settled share-based payment transactions.
(ii) Movement of the number of share options outstanding and their weighted average exercise price
Outstanding, beginning of the period
Granted
Exercised
Forfeited or expired
Outstanding, end of the period
Options exercisable, end of the period
2017
2018
Weighted average
Weighted average
exercise price
Number of
exercise price
Number of
(Yen)
¥1
－
1
－
1
¥1
shares
3,022,900
－
(491,400)
－
2,531,500
2,531,500
(Yen)
shares
2,531,500
－
(423,500)
－
2,108,000
2,108,000
¥1
－
1
－
1
¥1
(Notes) 1. The number of share options is presented as the number of underlying shares.
2. The weighted average share prices of share options at the time of exercise during the years ended 31 March 2017 and 2018 are ¥1,525 and
¥1,415, respectively.
122
(iii) Expiration dates and exercise prices of share options outstanding at the end of the period
Granted on August 2005
Granted on February 2007
Granted on August 2007
Granted on September 2008
Granted on July 2009
Granted on July 2010
Granted on July 2011
Granted on July 2012
Granted on July 2013
Granted on July 2014
Total
Exercise price
Number of shares
Expiration
per share
date
(Yen)
2017
2018
24 June 2025
27 June 2026
26 June 2027
24 June 2028
23 June 2029
23 June 2030
20 June 2031
20 June 2032
19 June 2033
18 June 2034
¥1
1
1
1
1
1
1
1
1
1
−
46,000
56,500
121,500
129,000
263,500
396,000
485,000
498,000
318,500
217,500
46,000
16,500
27,500
50,500
143,000
332,000
460,500
498,000
316,500
217,500
2,531,500
2,108,000
(Note) There are vesting conditions in which share subscription rights are vested according to the service record over approximately one year from the grant
date of the share option to the vesting date.
28. Retirement Benefits
The Group, excluding a part of foreign subsidiaries,
benefit plans offered, the defined benefit plan adopted in
offers post-employment benefits such as defined benefit
Japan is a major one, accounting for approximately 80%
plans and defined contribution plans. Among the defined
of the total defined benefit obligations.
(i) Defined benefit plan adopted in Japan as post-employment benefit
The Company and its domestic subsidiaries offer
Contributions of the employer are made monthly and
corporate pension plans and retirement lump-sum
also determined as 4.0% of standard salary, which is
payment plans as defined benefit plans.
calculated based on the estimate of the points granted
The benefits of the defined benefit plan are
during a year to each participant. When the plan assets
determined based on the base compensation calculated
are lower than the minimum funding standard at the end
by accumulated points earned by the time of retirement
of the period, the employer will make additional
and promised rate of return based on the yield of 10
contributions.
year government bonds. Also, the option of receiving
Defined benefit plans are exposed to actuarial risks.
benefits in the form of a pension is available for plan
The Astellas Corporate Pension Fund assigns staff with
participants with 15 years or more enrollments.
professional knowledge and expertise about the
Defined benefit plans are administered by the
composition of plan asset to determine the asset mix
Astellas Corporate Pension Fund. Directors of the
ratio and manages risks by monitoring on a quarterly
pension fund are jointly liable for damages to the fund
basis.
due to their neglect of duties about management of the
funds.
123
(ii) Defined benefit plans of overseas subsidiaries as post-employment benefits
Among foreign subsidiaries, ones located in the United Kingdom, Germany, Ireland, and some other countries offer
defined benefit plans as post-employment benefits.
Assets and liabilities of defined benefit plans recognised in the consolidated statement of financial position are as follows:
As of 31 March 2017
Pension and lump-sum payment
Japan
Overseas
Total
Other
(Millions of yen)
Present value of defined benefit obligations
¥ 123,118
¥ 30,816
¥ 153,934
Fair value of plan assets
(111,926)
(10,374)
(122,300)
Net defined benefit liability (asset)
11,192
20,442
31,634
¥2,608
－
2,608
Amounts in the consolidated statement of financial
position
Assets (other non-current assets)
(2,372)
－
(2,372)
－
Liabilities (retirement benefit liabilities)
¥ 13,564
¥ 20,442
¥ 34,006
¥2,608
As of 31 March 2018
Pension and lump-sum payment
Japan
Overseas
Total
Other
(Millions of yen)
Present value of defined benefit obligations
¥ 123,513
¥ 36,386
¥ 159,899
Fair value of plan assets
(114,280)
(13,278)
(127,557)
Net defined benefit liability (asset)
9,233
23,109
32,342
¥1,787
－
1,787
Amounts in the consolidated statement of financial
position
Assets (other non-current assets)
(2,544)
－
(2,544)
－
Liabilities (retirement benefit liabilities)
¥ 11,777
¥ 23,109
¥ 34,886
¥1,787
124
The movement of the present value of defined benefit obligations is as follows:
Balance at 1 April 2016
Current service cost
Interest cost
Remeasurements of defined benefit obligations
−actuarial gains arising from changes in
(Millions of yen)
Pension and lump-sum payment
Japan
Overseas
Total
Other
¥125,717
¥31,128
¥156,845
¥2,788
5,110
558
919
637
6,029
1,195
255
59
demographic assumptions
(5)
(360)
(365)
(6)
−actuarial (gains)/losses arising from changes in
financial assumptions
−other
Past service cost, and gains and losses arising from
settlements
Contributions to the plan by plan participants
Payments from the plan
Effect of changes in foreign exchange rates
Balance at 31 March 2017
Current service cost
Interest cost
Remeasurements of defined benefit obligations
−actuarial gains arising from changes in
(1,722)
(139)
－
－
(6,400)
－
123,118
4,875
1,001
850
271
(28)
72
(768)
(1,905)
30,816
1,048
677
(873)
131
(28)
72
(7,168)
(1,905)
153,934
5,923
1,677
1
(100)
－
－
(51)
(337)
2,608
218
61
demographic assumptions
(5)
(144)
(149)
(2)
−actuarial (gains)/losses arising from changes in
financial assumptions
−other
Past service cost, and gains and losses arising from
settlements
Contributions to the plan by plan participants
Payments from the plan
Effect of changes in foreign exchange rates
1,915
(720)
－
－
(6,671)
－
1,023
466
－
79
(1,082)
3,504
2,937
(254)
－
79
(7,753)
3,504
(126)
(186)
(431)
－
(43)
(310)
Balance at 31 March 2018
¥123,513
¥36,386
¥159,899
¥1,787
125
The movement of fair value of plan assets is as follows:
Balance at 1 April 2016
Interest income
Remeasurements of the fair value of the plan
assets
−return on plan assets
−actuarial gains/(losses) arising from changes
in financial assumptions
Contributions to the plan
−by employer
−by plan participants
Payments from the plan
Effect of changes in foreign exchange rates
Balance at 31 March 2017
Interest income
Remeasurements of the fair value of the plan
assets
−return on plan assets
−actuarial losses arising from changes in
financial assumptions
Contributions to the plan
−by employer
−by plan participants
Payments from the plan
Effect of changes in foreign exchange rates
(Millions of yen)
Pension and lump-sum payment
Japan
Overseas
Total
Other
¥111,799
¥ 9,820
¥121,620
494
211
706
¥－
－
2,080
525
2,605
411
(17)
394
2,756
－
(5,614)
－
111,926
905
4,637
(111)
2,746
－
(5,824)
－
648
63
(198)
(679)
10,374
241
(11)
(25)
901
70
(333)
2,060
3,404
63
(5,812)
(679)
122,300
1,146
4,626
(135)
3,647
70
(6,157)
2,060
－
－
－
－
－
－
－
－
－
－
－
－
－
－
Balance at 31 March 2018
¥114,280
¥13,278
¥127,557
¥－
The Group expects to contribute ¥3,852 million to its defined benefit plans in the fiscal year ending 31 March 2019.
126
The breakdown of the fair value of plan assets is as follows:
Japan
Equity
Bonds
Cash and other investments
Total
Overseas
Equity
Bonds
Cash and other investments
Total
Total fair value of plan assets
(i) Japanese plan assets
(Millions of yen)
2017
2018
¥ 22,724
¥ 21,498
37,396
51,806
111,926
4,337
2,420
3,617
10,374
36,292
56,489
114,280
4,267
2,936
6,075
13,278
¥122,300
¥127,557
Equity comprises mainly investment trust funds and it is
not active, and they are categorised as Level 2 within
categorised as Level 2 within the fair value hierarchy.
the fair value hierarchy. Cash and other investments
The fair values of bonds are measured using quoted
include alternative investments.
prices for identical or similar assets in markets that are
(ii) Overseas plan assets
Equity is mainly composed of investments with quoted
fair values of bonds are measured using quoted prices
prices in active markets or with measured value using
for identical or similar assets in markets that are not
quoted prices for identical or similar assets in markets
active, and they are categorised as Level 2 within the
that are not active, and they are mainly categorised as
fair value hierarchy. Cash and other investments include
Level 1 or Level 2 within the fair value hierarchy. The
alternative investments.
Significant actuarial assumptions and sensitivity analysis for each significant actuarial assumption are as follows:
Discount rate (%)
Japan
Overseas
2017
2018
0.6％-0.8％
1.8％-2.5％
0.5％-0.7％
1.7％-2.5％
The impact of a 0.5% increase or decrease in the
other assumptions are held constant. In practice,
discount rate as significant actuarial assumption used
changes in some of the assumptions may occur in a
on the defined benefit obligations as of 31 March 2018
correlated manner. When calculating the sensitivity of
would result in a ¥11,659 million decrease and ¥13,128
the defined benefit obligations, the same method has
million increase, respectively, in the defined benefit
been applied as calculating the defined benefit
obligation.
obligations recognised in the consolidated statement of
The sensitivity analysis does not consider
financial position.
correlations between assumptions, assuming that all
127
The weighted-average duration of the defined benefit obligations is as follows:
Japan
Overseas
2017
2018
13.7 years
13.6 years
18.6 years
18.4 years
29. Provisions
The movement of provisions for the year ended 31 March 2017 is as follows:
Balance at 1 April 2016
Increase during the year
Decrease due to intended use
Reversal during the year
Other
Balance at 31 March 2017
Non-current
Current
Total provisions
Trade-related
Asset retirement
provisions
obligations
Other
Total
¥ 83,531
¥1,948
¥11,462
¥ 96,941
(Millions of yen)
81,742
(71,488)
(2,429)
2,378
93,734
2,214
91,520
¥ 93,734
7
(7)
－
(11)
1,938
1,938
－
¥1,938
3,648
(9,282)
(634)
646
5,839
769
5,070
85,397
(80,777)
(3,063)
3,013
101,511
4,921
96,589
¥ 5,839
¥101,511
The movement of provisions for the year ended 31 March 2018 is as follows:
Trade-related
Asset retirement
provisions
obligations
Other
Total
(Millions of yen)
¥ 93,734
110,251
(81,511)
(947)
(3,155)
118,372
1,931
116,441
¥118,372
¥1,938
¥ 5,839
¥101,511
5
(1)
－
24
1,966
1,966
－
¥1,966
9,944
(3,261)
(1,518)
(221)
10,783
993
9,791
120,201
(84,772)
(2,465)
(3,352)
131,122
4,891
126,231
¥10,783
¥131,122
Balance at 1 April 2017
Increase during the year
Decrease due to intended use
Reversal during the year
Other
Balance at 31 March 2018
Non-current
Current
Total provisions
Details of provisions are as follows:
(i) Trade-related provisions
The Group recognises provisions for expenditures
adjustments to customers, based on the conditions of
expected to be incurred after the end of the period
contracts and past experience.
related to sales rebates, discounts, Medicare and
The outflow of economic benefits is expected within
Medicaid of the United States, and other price
one year from the end of the reporting period.
128
(ii) Asset retirement obligations
The Group recognises asset retirement obligations
The outflow of economic benefits is expected more
based on past performance in order to provide for the
than one year after the end of the reporting period.
restoration of rented offices.
30. Other Financial Liabilities
The breakdown of other financial liabilities is as follows:
Other financial liabilities (non-current)
Financial liabilities at FVTPL
Contingent consideration
Financial liabilities measured at amortised cost
Finance lease liabilities
Other
Total other financial liabilities (non-current)
Other financial liabilities (current)
Financial liabilities at FVTPL
Forward foreign exchange contracts
Contingent consideration
Financial liabilities measured at amortised cost
Finance lease liabilities
Other
Total other financial liabilities (current)
Total other financial liabilities
The maturity and the present value of finance lease liabilities are as follows:
Minimum lease payments
Not later than one year
Later than one year and not later than five years
Later than five years
Present value of finance lease liabilities
(Millions of yen)
2017
2018
¥27,253
¥48,226
1,136
－
904
293
¥28,389
¥49,422
¥ 626
1,196
499
671
¥ 2,992
¥31,381
¥ 481
5,946
444
688
¥ 7,559
¥56,981
(Millions of yen)
2017
2018
¥ 499
1,110
26
¥1,635
¥ 444
886
18
¥1,348
129
31. Other Liabilities
The breakdown of other liabilities is as follows:
Other non-current liabilities
Other long-term employee benefits
Deferred income
Other
Total other non-current liabilities
Other current liabilities
Accrued bonuses
Accrued paid absences
Other accrued expenses
Deferred income
Other
Total other current liabilities
(Millions of yen)
2017
2018
¥ 17,727
¥ 18,759
34,153
1,648
22,301
6,309
¥ 53,528
¥ 47,370
¥ 30,665
¥ 29,991
11,792
43,493
16,443
4,156
12,017
53,763
18,020
7,946
¥106,548
¥121,737
(Note) Deferred income under other non-current liabilities and deferred income under other current liabilities include deferred income of ¥30,593 million and
¥14,877 million, respectively, in the year ended 31 March 2017, and ¥19,584 million and ¥12,539 million, respectively, in the year ended 31 March
2018, in connection with the transfer of the global dermatology business to LEO Pharma A/S.
32. Trade and Other Payables
The breakdown of trade and other payables is as follows:
Accounts payable-trade
Other payables
Total trade and other payables
Non-current
Current
33. Financial Instruments
(1) Capital management
2017
¥115,188
68,078
¥183,266
¥ 440
182,826
(Millions of yen)
2018
¥ 75,683
68,741
¥144,424
¥ 3,515
140,909
The Group’s capital management principle is to maintain
The Group monitors financial indicators in order to
an optimal capital structure by improving capital
maintain an optimal capital structure. Credit ratings are
efficiency and ensuring sound and flexible financial
monitored for financial soundness and flexibility, and so
conditions in order to achieve sustained improvement in
is return on equity attributable to owners of the parent
the enterprise value, which will lead to improved return
(ROE) for capital efficiency.
to shareholders.
The Group is not subject to material capital
regulation.
130
(2) Classification of financial assets and financial liabilities
The breakdown of financial assets and financial liabilities is as follows:
Financial assets
Financial assets at FVTPL
Other
Loans and receivables
Trade and other receivables
Loans and other financial assets
Available-for-sale financial assets
Cash and cash equivalents
Total financial assets
Financial liabilities
Financial liabilities at FVTPL
Forward foreign exchange contracts
Contingent consideration
Financial liabilities measured at amortised cost
Trade and other payables
Other
Total financial liabilities
(Millions of yen)
2017
2018
¥ 10,762
¥ 13,334
332,080
23,961
40,428
340,923
748,153
¥ 626
28,450
183,266
2,306
344,794
24,249
43,308
331,731
757,416
¥ 481
54,172
144,424
2,328
¥214,647
¥201,405
(Notes) 1. Financial assets at FVTPL, loans and other financial assets, and available-for-sale financial assets are included in “Other financial assets” in the
consolidated statement of financial position.
2. Financial liabilities at FVTPL and financial liabilities at amortised cost are included in “Other financial liabilities” in the consolidated statement of
financial position.
(3) Financial risk management policy
The Group is exposed to financial risks such as credit
The Group limits the use of derivatives to
risks, liquidity risks, and foreign exchange risks in
transactions for the purpose of hedging financial risks
operating businesses, and it manages risks based on its
and does not use derivatives for speculation purposes.
policy to mitigate them.
131
(i) Credit risk
(a) Credit risk management
(c) Maximum exposure to credit risk
Receivables, such as trade receivables, resulting from
Other than guaranteed obligations, the Group’s
the business activities of the Group are exposed to the
maximum exposure to credit risks without taking into
customer’s credit risk. This risk is managed by grasping
account any collateral held or other credit
the financial condition of the customer and monitoring
enhancements is the carrying amount of financial
the trade receivables balance. Also, the Group reviews
instruments less impairment losses in the consolidated
collectability of trade receivables depending on the
statement of financial position. The Group’s maximum
credit conditions of customers and recognises an
exposure to credit risks of guaranteed obligations as of
allowance for doubtful accounts as necessary.
31 March 2017 and 2018 were ¥444 million and ¥343
Securities held by the Group are exposed to the
million, respectively.
issuer’s credit risk, and deposits are exposed to the
credit risk of banks. Also, derivative transactions that the
(d) Collateral
Group conducts in order to hedge financial risks are
The Group has securities and deposits received as
exposed to the credit risk of the financial institutions
collateral for certain trade and other receivables. The
which are counterparties of those transactions. In regard
carrying amount of securities held as collateral is ¥1,420
to securities transactions and deposit transactions in
million at 31 March 2018 (¥1,088 million at 31 March
fund management, the Group only deals with banks and
2017), and the carrying amount of deposits received is
issuers with certain credit ratings and manages
¥72 million at 31 March 2018 (¥72 million at 31 March
investments within the defined period and credit limit, in
2017).
accordance with Global Cash Investment Policy. In
addition, regarding derivative transactions, the Group
only deals with financial institutions with certain credit
ratings in accordance with Astellas Global Treasury
Policy.
(b) Concentrations of credit risk
In Japan, like other pharmaceutical companies, the
Group sells its products through a small number of
wholesalers. Sales to the four largest wholesalers
accounted for approximately 75% of the Group’s sales
in Japan, and the amount of trade receivables due from
those four wholesalers are ¥106,464 million at 31 March
2017 and ¥94,410 million at 31 March 2018.
132
The analysis of aging of financial assets that are past due but not impaired is as follows:
Past due but not impaired
Neither
past due
nor
impaired
Within
three
months
Between
three
months and
six months
Between
six months
and one
year
Allowance
for
doubtful
accounts
Over
one year
Total
(Millions of yen)
Balance at 31 March 2017
Trade and other
receivables
¥296,263
¥12,563
¥1,187
¥1,076
¥858
¥(1,250)
¥310,697
Loans and other
financial assets
Total
Balance at 31 March 2018
Trade and other
receivables
Loans and other
financial assets
Total
23,955
1
－
－
6
－
23,961
¥320,218
¥12,564
¥1,187
¥1,076
¥864
¥(1,250)
¥334,658
¥305,165
¥12,570
¥1,253
¥1,250
¥914
¥ (483)
¥320,669
24,241
1
0
－
6
－
24,249
¥329,406
¥12,571
¥1,254
¥1,250
¥920
¥ (483)
¥344,917
Financial assets that are individually determined to be impaired are as follows:
Trade and other receivables (gross)
Allowance for doubtful accounts
Trade and other receivables (net)
Loans and other financial assets (gross)
Allowance for doubtful accounts
Loans and other financial assets (net)
The movement of the allowance for doubtful accounts is as follows:
Balance at the beginning of the year
Increase during the year
Decrease due to intended use
Reversal during the year
Other
Balance at the end of the year
133
(Millions of yen)
2017
2018
¥29,939
(8,556)
¥21,383
¥ 14
(14)
¥33,489
(9,365)
¥24,125
¥ 13
(13)
¥ －
¥ －
(Millions of yen)
2017
2018
¥ 2,873
9,704
(229)
(2,351)
(176)
¥9,820
1,629
(961)
(748)
120
¥ 9,820
¥9,861
(ii) Liquidity risk
Liquidity risk management
The Group is exposed to liquidity risk that the Group
of financial obligations and respond flexibly to strategic
might have difficulty settling financial obligations.
investment opportunities. Also, the balance is reported
However, the Group is maintaining the liquidity on hand
monthly to the Chief Financial Officer (CFO).
that enables the Group to meet the assumed repayment
Financial liabilities by maturity date are as follows:
As of 31 March 2017
Between
Between
Between
(Millions of yen)
Carrying
Contractual
Within six
six months
one year and
two years
Over
amount
cash flows
months
and one year
two years
and five years
five years
Financial liabilities at FVTPL
Forward foreign exchange
contracts
Subtotal
¥ 626
¥ 626
¥ －
626
626
－
¥ 626
626
¥ －
－
¥ －
－
¥ －
－
Financial liabilities measured
at amortised cost
Trade and other payables
183,266
183,266
181,507
Other
Subtotal
Total
2,306
2,306
927
185,571
185,571
182,433
1,319
245
1,564
313
405
718
127
703
830
¥186,197
¥186,197
¥182,433
¥2,190
¥718
¥830
－
26
26
¥26
Contingent consideration
¥28,450
¥103,019
¥1,198
¥14,543
¥13,241
Maximum
Between
Carrying
payment
Within one
one year
Over
amount
amount
year
and five years
five years
134
As of 31 March 2018
Financial liabilities at FVTPL
Forward foreign exchange
Between
Between
Between
(Millions of yen)
Carrying
Contractual
Within six
six months
one year and
two years
Over
amount
cash flows
months
and one year
two years
and five years
five years
contracts
Subtotal
¥ 481
¥ 481
¥ －
481
481
－
¥481
481
¥ －
¥ －
¥ －
－
－
－
Financial liabilities measured
at amortised cost
Trade and other payables
144,424
144,424
140,677
Other
Subtotal
Total
2,328
2,328
925
146,752
146,752
141,603
232
209
441
421
384
804
1,313
511
1,824
1,780
299
2,079
¥147,232
¥147,232
¥141,603
¥922
¥804
¥1,824
¥2,079
Maximum
Between
Carrying
payment
Within one
one year
Over
amount
amount
year
and five years
five years
Contingent consideration
¥54,172
¥172,969
¥5,981
¥40,130
¥9,756
(iii) Foreign exchange risk
Foreign exchange risk management
currencies. Also, the balance of derivative transactions
The Group operates globally and the Group’s business
is reported monthly to the CFO.
results and financial position are exposed to foreign
exchange risks.
Foreign exchange sensitivity analysis
The Group’s long-term basic policy is to mitigate the
The financial impact on profit before tax for the years
foreign exchange risks by controlling the amount of the
ended 31 March 2017 and 2018 in the case of a 10%
Group’s net assets denominated in foreign currencies to
appreciation of Japanese yen, which is the Company’s
the level corresponding to the business scale of each
functional currency, against the U.S. dollar and euro is
area. In the short term, the Group uses derivatives such
as follows.
as forward foreign exchange contracts to reduce the
Also, it is based on the assumption that currencies
impact of exchange rate fluctuations arising from import
other than the ones used for the calculation do not
and export transactions denominated in foreign
fluctuate and other change factors are held constant.
Profit before tax
U.S. dollar
Euro
(Millions of yen)
2017
2018
¥ (34)
(745)
¥(908)
329
(Note) The above negative amounts represent the negative impact on profit before tax in the event of a 10% appreciation in Japanese yen.
135
(4) Fair values of financial instruments
(i) Fair value calculation of financial instruments
Financial assets at FVTPL
Financial liabilities at FVTPL
Financial assets at FVTPL comprise mainly debt
Financial liabilities at FVTPL comprise contingent
securities and forward foreign exchange contracts. The
consideration for business combinations and forward
fair value of those financial instruments is measured
foreign exchange contracts.
based on prices provided by counterparty financial
The fair value of contingent consideration for
institutions.
business combinations is calculated based on the
estimated success probability of development activities
Loans and receivables
and the time value of money.
The carrying amount approximates fair value due to the
The fair value of forward foreign exchange contracts
short period of settlement terms.
is measured based on prices provided by counterparty
financial institutions.
Available-for-sale financial assets
The fair value of marketable securities is based on
Financial liabilities measured at amortised cost
quoted market prices at the end of the period. The fair
Financial liabilities measured at amortised cost comprise
value of unquoted equity shares is measured mainly
trade and other payables and other financial liabilities.
based on the discounted cash flows.
The carrying amount approximates fair value due to the
short period of settlement terms.
Cash and cash equivalents
The carrying amount approximates fair value due to the
short maturities of the instruments.
(ii) Financial instruments measured at fair value on a recurring basis
Fair value hierarchy
The levels of the fair value hierarchy are as follows:
−
Level 1: Fair value measured using quoted prices
−
Level 3: Fair value measured using significant
unobservable inputs for the assets or liabilities.
(unadjusted) in active markets for identical assets
or liabilities;
The level of the fair value hierarchy is determined
−
Level 2: Fair value measured using inputs other
based on the lowest level of significant input used for
than quoted prices included within Level 1 that are
the measurement of fair value.
observable for the assets or liabilities, either directly
The Group accounts for transfers between levels of
or indirectly; and
the fair value hierarchy as if they occurred at the end of
each quarter.
136
The breakdown of financial assets and liabilities measured at fair value on a recurring basis, including their levels in the
fair value hierarchy, is as follows:
As of 31 March 2017
Financial assets
Financial assets at FVTPL
Other
Subtotal
Available-for-sale financial assets
Quoted equity shares
Unquoted equity shares
Other equity securities
Subtotal
Total financial assets
Financial liabilities
Financial liabilities at FVTPL
Forward foreign exchange contracts
Contingent consideration
Subtotal
Total financial liabilities
Level 1
Level 2
Level 3
Total
(Millions of yen)
¥ －
－
¥7,864
7,864
¥ 2,897
2,897
¥10,762
10,762
26,170
－
－
26,170
26,170
－
－
－
－
－
－
－
7,864
626
－
626
－
14,258
0
14,258
17,156
－
28,450
28,450
26,170
14,258
0
40,428
51,190
626
28,450
29,076
¥ －
¥ 626
¥28,450
¥29,076
(Note) Financial assets at FVTPL and available-for-sale financial assets, and financial liabilities at FVTPL are included in “Other financial assets” and “Other
financial liabilities” in the consolidated statement of financial position, respectively.
137
As of 31 March 2018
Financial assets
Financial assets at FVTPL
Other
Subtotal
Available-for-sale financial assets
Quoted equity shares
Unquoted equity shares
Other equity securities
Subtotal
Total financial assets
Financial liabilities
Financial liabilities at FVTPL
Forward foreign exchange contracts
Contingent consideration
Subtotal
Total financial liabilities
Level 1
Level 2
Level 3
Total
(Millions of yen)
¥ －
－
28,732
－
－
28,732
28,732
－
－
－
¥9,197
9,197
¥ 4,137
4,137
¥13,334
13,334
－
－
－
－
9,197
481
－
481
－
14,576
0
14,576
18,714
－
54,172
54,172
28,732
14,576
0
43,308
56,643
481
54,172
54,653
¥ －
¥ 481
¥54,172
¥54,653
(Note) Financial assets at FVTPL and available-for-sale financial assets, and financial liabilities at FVTPL are included in “Other financial assets” and “Other
financial liabilities” in the consolidated statement of financial position, respectively.
138
The movement of fair value of financial instruments categorised within Level 3 of the fair value hierarchy is as follows:
For the year ended 31 March 2017
1. Financial assets
Balance at 1 April 2016
Realised or unrealised gains (losses)
Recognised in profit or loss (Note)
Recognised in other comprehensive income
Purchases, issues, sales, and settlements
Purchases
Sales
Other
(Millions of yen)
Financial
assets
at FVTPL
Available-for-
sale financial
assets
Total
¥2,005
¥13,861
¥15,866
(60)
－
952
－
1
(150)
280
482
(10)
(204)
(211)
280
1,434
(10)
(203)
Balance at 31 March 2017
¥2,897
¥14,258
¥17,156
Gains or losses recognised during the year in profit or loss
attributable to the change in unrealised gains or losses relating
to those assets held at the end of the period (Note)
¥ (60)
¥ (135)
¥ (196)
(Note) This is included in “Finance income” and “Finance expense” in the consolidated statement of income.
2. Financial liabilities
Balance at 1 April 2016
Realised or unrealised gains (losses)
Recognised in profit or loss (Note)
Business combinations
Balance at 31 March 2017
Gains or losses recognised during the year in profit or loss
attributable to the change in unrealised gains or losses relating
to those assets held at the end of the period (Note)
(Note) This is included in “Other income” and “Other expense” in the consolidated statement of income.
(Millions of yen)
Financial
liabilities
at FVTPL
¥ －
(484)
28,934
¥28,450
¥ (484)
139
For the year ended 31 March 2018
1. Financial assets
Balance at 1 April 2017
Realised or unrealised gains (losses)
Recognised in profit or loss (Note)
Recognised in other comprehensive income
Purchases, issues, sales, and settlements
Purchases
Sales
Other
(Millions of yen)
Financial
assets
at FVTPL
Available-for-
sale financial
assets
Total
¥2,897
¥14,258
¥17,156
(332)
－
1,577
－
(4)
(450)
345
693
(5)
(265)
(782)
345
2,269
(5)
(269)
Balance at 31 March 2018
¥4,137
¥14,576
¥18,714
Gains or losses recognised during the year in profit or loss
attributable to the change in unrealised gains or losses relating
to those assets held at the end of the period (Note)
¥ (332)
¥ (452)
¥ (784)
(Note) This is included in “Finance income” and “Finance expense” in the consolidated statement of income.
2. Financial liabilities
Balance at 1 April 2017
Realised or unrealised gains (losses)
Recognised in profit or loss (Note)
Business combinations
Other
Balance at 31 March 2018
Gains or losses recognised during the year in profit or loss
attributable to the change in unrealised gains or losses relating
to those assets held at the end of the period (Note)
(Note) This is included in “Other income” and “Other expense” in the consolidated statement of income.
(Millions of yen)
Financial
liabilities
at FVTPL
¥28,450
2,889
22,958
(125)
¥54,172
¥ 2,889
140
The financial assets categorised within Level 3 are
The financial liabilities categorised within Level 3 are
composed mainly of unquoted equity shares.
composed of contingent considerations arising from
The fair value of significant unquoted equity shares
business combinations.
is measured using discounted cash flows. The fair value
Contingent considerations represent certain
of unquoted equity shares is categorised within Level 3
milestone payments based on progress in the
because unobservable inputs such as estimates of
development of the clinical programs possessed by the
future net operating profit after tax and WACC are used
acquirees. The fair value of the contingent consideration
for the measurement. The WACC used for the
is calculated based on the estimated success probability
measurement of fair value depends on region or
of the clinical program adjusted for the time value of
industry. In the years ended 31 March 2017 and 2018,
money. The fair value of contingent considerations
the WACC used for measurement was 8.0%. Generally,
increase if the success probability of the clinical
the fair value would decrease if the WACC capital were
program, which is the significant unobservable input, is
higher.
raised.
The fair value of unquoted equity shares is
In regards to financial instruments categorised within
measured by relevant departments of the Company and
Level 3, there would be no significant change in fair
each Group company in accordance with the Group
value when one or more of the unobservable inputs is
accounting policy every quarter. The results with
changed to reflect reasonably possible alternative
evidences of changes in fair value are reported to a
assumptions.
superior and, if necessary, to the Executive Committee
as well.
141
34. Operating Leases
Future minimum lease payments under non-cancellable operating leases are as follows:
Not later than one year
Later than one year and not later than five years
Later than five years
Total
(Millions of yen)
2017
2018
¥13,237
20,776
3,167
¥37,179
¥12,636
30,385
24,255
¥67,275
Future minimum sublease payments expected to be received under non-cancellable subleases is as follows:
Future minimum sublease payments expected to be received
(Millions of yen)
2017
2018
¥1,819
¥1,486
Minimum lease payments and sublease payments received recognised as expenses are as follows:
Minimum lease payments
Sublease payments received
Total
(Millions of yen)
2017
2018
¥17,050
¥17,113
(211)
(221)
¥16,839
¥16,891
The Group leases buildings, vehicles and other assets
contingent rents payable and terms of purchase options.
under operating leases.
In addition, there are no material restrictions imposed by
The significant leasing arrangements have terms of
the lease arrangements.
renewal and escalation clauses, but there exist no
35. Commitments
The breakdown of commitments for the acquisition of property, plant and equipment and intangible assets is as follows:
Intangible assets
Research and development milestone payments
Sales milestone payments
Total
Property, plant and equipment
Commitments for the acquisition of intangible assets
(Millions of yen)
2017
2018
¥299,099
¥248,706
290,749
589,848
272,990
521,696
¥ 5,114
¥ 4,804
The Group has entered into research and development
payments upon the achievement of agreed objectives or
collaborations and in-license agreements of products and
when certain conditions are met as defined in the
technologies with a number of third parties. These
agreements.
agreements may require the Group to make milestone
142
“Research and development milestone payments”
The amounts shown in the table above represent the
represent obligations to pay the amount set out in an
maximum payments to be made when all milestones are
individual contract agreement upon achievement of a
achieved, and they are undiscounted and not risk
milestone determined according to the stage of research
adjusted. Since the achievement of the conditions for
and development.
payment is highly uncertain, it is unlikely that they will all
“Sales milestone payments” represent obligations to
fall due and the amounts of the actual payments may vary
pay the amount set out in an individual contract
considerably from those stated in the table.
agreement upon achievement of a milestone determined
according to the target of sales.
36. Related Party Transactions
(1) Major companies the Group controls
A list of major companies the Group controls is presented in “Principal Subsidiaries and Affiliates”.
(2) Compensation of key management personnel
The table below shows, by the type, the compensation of key management personnel:
Rewards and salaries
Share-based payment
Other
Total compensation
(Millions of yen)
2017
2018
¥1,353
¥1,312
164
430
206
932
¥1,947
¥2,450
Key management personnel consist of 22 people (21 during 2017) including Directors, Corporate Audit & Supervisory
Board Members and members of the Executive Committee.
37. Business Combinations
For the year ended 31 March 2017
Acquisition of Ganymed Pharmaceuticals AG
(1) Outline of business combination
(i) Name and business description of the acquiree
Name of the acquiree: Ganymed Pharmaceuticals AG (“Ganymed”)
Business description: Development of antibodies against cancer
(ii) Acquisition date
20 December 2016
(iii) Percentage of voting equity interests acquired
100%
143
(iv) Acquisition method
Acquisition of all shares of common stock in cash with contingent consideration to be paid when certain milestones are
achieved in the future.
(v) Primary reasons for the business combination
Ganymed is a formerly privately-held biopharmaceutical
Group will expand its oncology pipeline with an antibody
company founded in 2001 and focuses on the
program in the late-stage to build upon its leading
development of a new class of cancer drugs. Ganymed
oncology franchise as a platform for sustainable growth.
has several pipeline assets in pre-clinical and clinical
stages including IMAB362. Through the acquisition, the
(2) The fair values of assets acquired, liabilities assumed and purchase consideration transferred as at the
acquisition date are as follows:
Property, plant and equipment
Other intangible assets
Cash and cash equivalents
Other assets
Deferred tax liabilities
Other liabilities
Fair value of assets acquired and liabilities assumed (net)
Goodwill
Total
Cash
Contingent consideration
Total fair value of purchase consideration transferred
(Millions of yen)
¥ 272
86,033
629
1,103
(18,852)
(5,066)
64,118
16,360
80,478
51,544
28,934
¥ 80,478
Certain items had reflected provisional amounts as of 31
a result, “Goodwill” and “Deferred tax liabilities” each
March 2017, however, the Group completed the
decreased by ¥6,829 million.
purchase price allocation during the fiscal year ended 31
Goodwill mainly comprises the value of expected
March 2018. Along with this, the Group retrospectively
synergies arising from the acquisition and future
revised the corresponding balances in the consolidated
economic benefits, which is not separately recognisable.
statement of financial position as of 31 March 2017. As
(3) Contingent consideration
The contingent consideration represent certain
Maximum potential future cash outflows associated with
milestone payments based on progress in the
the contingent consideration total 860 million euros
development of IMAB362, Ganymed’s clinical program.
(¥103,019 million).
144
(4) Cash flow information
Total fair value of purchase consideration transferred
Fair value of contingent consideration included in purchase consideration transferred
Cash and cash equivalents held by the acquiree
Acquisition of subsidiaries, net of cash acquired
(Millions of yen)
¥ 80,478
(28,934)
(629)
¥ 50,915
(5) Acquisition-related costs
Acquisition-related costs: ¥101 million
Acquisition-related costs were recognised in selling, general and administrative expenses in the consolidated
statement of income.
(6) Effect on the consolidated statement of income
(i) Profit (loss) before tax of the acquiree since the acquisition date included in the consolidated statement of
income for the year ended 31 March 2017:
¥(1,151) million
(ii) Profit (loss) before tax of the combined entity for the year ended 31 March 2017 assuming the acquisition date
had been at the beginning of the fiscal year (unaudited):
¥(3,825) million
(Note) This effect is calculated based on the business results of Ganymed from 1 April 2016 to the acquisition date.
For the year ended 31 March 2018
Acquisition of Ogeda SA
(1) Outline of business combination
(i) Name and business description of the acquiree
Name of the acquiree: Ogeda SA (“Ogeda”)
Business description: Development of small molecule drugs targeting G-protein coupled receptors (GPCR)
(ii) Acquisition date
16 May 2017
(iii) Percentage of voting equity interests acquired
100%
(iv) Acquisition method
Acquisition of all shares of common stock in cash with contingent consideration to be paid when certain milestones are
achieved in the future.
(v) Primary reasons for the business combination
Ogeda is a formerly privately owned drug discovery
and development of small molecule drug candidates
company founded in 1994 and focuses on the discovery
targeting GPCRs. Ogeda has fezolinetant in the clinical
145
development stage. In addition, Ogeda has several
acquisition, the Group will expand its late stage pipeline,
small molecules targeting GPCRs in pre-clinical
thereby further solidifying its medium- to long-term
development in multiple therapeutic areas including
growth prospects.
inflammatory and autoimmune diseases. Through the
(2) The fair values of assets acquired, liabilities assumed and purchase consideration transferred as at the
acquisition date are as follows:
Property, plant and equipment
Other intangible assets
Cash and cash equivalents
Other assets
Deferred tax liabilities
Other liabilities
Fair value of assets acquired and liabilities assumed (net)
Goodwill
Total
Cash
Contingent consideration
Total fair value of purchase consideration transferred
(Millions of yen)
¥ 560
74,415
519
513
(25,256)
(1,883)
48,868
26,145
75,014
62,086
12,928
¥ 75,014
Certain items above reflect provisional fair values based
Goodwill mainly comprises the value of expected
on reasonable information obtained at 31 March 2018
synergies arising from the acquisition and future
as the purchase price allocation is incomplete.
economic benefits, which is not separately recognisable.
(3) Contingent consideration
The contingent consideration represent certain
the contingent consideration total 300 million euros
milestone payments based on progress in the
(¥39,156 million).
development of fezolinetant, Ogeda’s clinical program.
Maximum potential future cash outflows associated with
(4) Cash flow information
Total fair value of purchase consideration transferred
Fair value of contingent consideration included in purchase consideration transferred
Cash and cash equivalents held by the acquiree
Acquisition of subsidiaries, net of cash acquired
(Millions of yen)
¥ 75,014
(12,928)
(519)
¥ 61,567
146
(5) Acquisition-related costs
Acquisition-related costs: ¥60 million
Acquisition-related costs were recognised in selling, general and administrative expenses in the consolidated
statement of income.
(6) Effect on the consolidated statement of income
(i) Profit (loss) before tax of the acquiree since the acquisition date included in the consolidated statement of
income for the year ended 31 March 2018:
Dislosure is omitted due to immateriality.
(ii) Profit (loss) before tax of the combined entity for the year ended 31 March 2018 assuming the acquisition date
had been at the beginning of the fiscal year (unaudited):
Dislosure is omitted due to immateriality.
Acquisition of Mitobridge, Inc.
(1) Outline of business combination
(i) Name and business description of the acquiree
Name of the acquiree: Mitobridge, Inc. (“Mitobridge”)
Business description: Research and development in diseases associated with mitochondrial dysfunctions
(ii) Acquisition date
23 January 2018
(iii) Percentage of voting equity interests
The Company had owned 26.4% of voting equity interests before the acquisition. As a result of the acquisition, the
Company owns 100% of voting equity interests.
(iv) Acquisition method
Acquisition of all shares of common stock in cash with contingent consideration to be paid when certain milestones are
achieved in the future.
(v) Primary reasons for the business combination
Mitobridge is a biotechnology company founded in 2011
aging. The transaction accelerates the Group’s research
and is discovering and developing compounds that
and development in diseases associated with
target mitochondrial function. These drug candidates
mitochondrial dysfunctions and will enable the delivery
have the potential to treat genetic, metabolic or
of innovative new treatment options to patients.
neurodegenerative disorders as well as conditions of
147
(2) The fair values of assets acquired, liabilities assumed and purchase consideration transferred as at the
acquisition date are as follows:
Property, plant and equipment
Deferred tax assets
Cash and cash equivalents
Other assets
Other liabilities
Fair value of assets acquired and liabilities assumed (net)
Goodwill
Total
Cash
Contingent consideration
Fair value of previously held equity interests in Mitobridge
Total fair value of purchase consideration transferred
(Millions of yen)
¥ 71
1,594
27
27
(339)
1,380
29,329
30,708
17,951
7,048
5,709
¥30,708
Certain items above reflect provisional fair values based
value as of the acquisition date, the Company
on reasonable information obtained at 31 March 2018
recognised a ¥5,877 million gain on remeasurement
as the purchase price allocation is incomplete.
related to a business combination achieved in stages.
Goodwill mainly comprises the value of expected
This gain was included as a component of “Other
synergies arising from the acquisition and future
income” in the consolidated statement of income.
economic benefits, which is not separately recognisable.
As a result of the remeasurement of the Company’s
previously held equity interests in Mitobridge at fair
(3) Contingent consideration
The contingent consideration represent certain
the contingent consideration total 165 million U.S.
milestone payments depending on the progress of
dollars (¥17,582 million).
various programs in clinical development of Mitobridge.
Maximum potential future cash outflows associated with
(4) Cash flow information
Total fair value of purchase consideration transferred
Fair value of contingent consideration included in purchase consideration transferred
Fair value of previously held equity interests in Mitobridge included in purchase consideration
transferred
Cash and cash equivalents held by the acquiree
Acquisition of subsidiaries, net of cash acquired
(5) Acquisition-related costs
Dislosure is omitted due to immateriality.
(Millions of yen)
¥ 30,708
(7,048)
(5,709)
(27)
¥ 17,924
148
(6) Effect on the consolidated statement of income
(i) Profit (loss) before tax of the acquiree since the acquisition date included in the consolidated statement of
income for the year ended 31 March 2018:
Dislosure is omitted due to immateriality.
(ii) Profit (loss) before tax of the combined entity for the year ended 31 March 2018 assuming the acquisition date
had been at the beginning of the fiscal year (unaudited):
Dislosure is omitted due to immateriality.
Acquisition of Universal Cells, Inc.
(1) Outline of business combination
(i) Name and business description of the acquiree
Name of the acquiree: Universal Cells, Inc. (Universal Cells)
Business description: Research and development of stem cell therapies that overcome immune rejection
(ii) Acquisition date
9 February 2018
(iii) Percentage of voting equity interests acquired
100%
(iv) Acquisition method
Acquisition of all shares of common stock in cash with contingent consideration to be paid when certain milestones are
achieved in the future.
(v) Primary reasons for the business combination
Universal Cells is a biotechnology company founded in
functional cells from pluripotent stem cells with Universal
2013, which has a proprietary Universal Donor Cell
Cells’ ability to produce pluripotent stem cells that have
technology to create cell therapy products that do not
lower immunological rejection to further enable
require Human Leukocyte Antigen (HLA) matching,
investigation of innovative cell therapy treatments for
potentially overcoming a huge treatment challenge by
various diseases that currently have few or no treatment
reducing the risk of rejection. The acquisition combines
options.
the Group’s capability of establishing differentiated
149
(2) The fair values of assets acquired, liabilities assumed and purchase consideration transferred as at the
acquisition date are as follows:
Other intangible assets
Cash and cash equivalents
Other assets
Deferred tax liabilities
Other liabilities
Fair value of assets acquired and liabilities assumed (net)
Goodwill
Total
Cash
Contingent consideration
Total fair value of purchase consideration transferred
(Millions of yen)
¥ 6,485
915
82
(1,354)
(812)
5,315
2,814
8,130
5,148
2,982
¥ 8,130
Certain items above reflect provisional fair values based
Goodwill mainly comprises the value of expected
on reasonable information obtained at 31 March 2018
synergies arising from the acquisition and future
as the purchase price allocation is incomplete.
economic benefits, which is not separately recognisable.
(3) Contingent consideration
The contingent consideration represent certain specified
consideration total 38 million U.S. dollars (¥3,984
clinical milestone payments. Maximum potential future
million).
cash outflows associated with the contingent
(4) Cash flow information
Total fair value of purchase consideration transferred
Fair value of contingent consideration included in purchase consideration transferred
Cash and cash equivalents held by the acquiree
Acquisition of subsidiaries, net of cash acquired
(Millions of yen)
¥ 8,130
(2,982)
(915)
¥ 4,233
(5) Acquisition-related costs
Acquisition-related costs: ¥64 million
Acquisition-related costs were recognised in selling, general and administrative expenses in the consolidated
statement of income.
150
(6) Effect on the consolidated statement of income
(i) Profit (loss) before tax of the acquiree since the acquisition date included in the consolidated statement of
income for the year ended 31 March 2018:
Dislosure is omitted due to immateriality.
(ii) Profit (loss) before tax of the combined entity for the year ended 31 March 2018 assuming the acquisition date
had been at the beginning of the fiscal year (unaudited):
Dislosure is omitted due to immateriality.
38. Contingent Liabilities
Legal Proceedings
The Group is involved in various claims and legal
Patient Assistance Foundation Government
Investigation
proceedings of a nature considered common to the
In March 2016 and August 2017, Astellas Pharma
pharmaceutical industry.
US, Inc. (APUS), one of the Company’s indirect US
These proceedings are generally related to product
subsidiaries, received subpoenas from the U.S.
liability claims, competition and antitrust law, intellectual
Department of Justice, represented by the U.S.
property matters, employment claims, and government
Attorney’s Office in Boston, Massachusetts, requesting
investigations.
documents and other information concerning APUS’s
In general, since litigation and other legal
patient assistance programs including its donations to
proceedings contain many uncertainties and complex
Patient Assistance Foundations in the U.S. APUS is in
factors, it is often not possible to make reliable judgment
the process of responding to the subpoena, and APUS
regarding the possibility of losses nor to estimate
is cooperating fully with the investigation. We cannot
expected financial effect if these matters are decided in
predict or determine the timing or outcome of this
a manner that is adverse to the Group.
investigation or its impact on our financial condition or
In these cases, disclosures would be made as
results of operations at this time.
appropriate, but no provision would be made by the
Group.
39. Events after the Reporting Period
Acquisition of Own Shares
A resolution was adopted to acquire the Company’s own
(2) Outline of acquisition
shares under Article 156 which is applicable in
(i) Class of shares to be acquired
accordance with Article 165, Paragraph 3 of the
Common stock of the Company
Companies Act of Japan at the meeting of the Board of
(ii) Total number of shares to be acquired
Directors held on 31 May 2018. The particulars are as
Up to 60 million shares
follows:
(The percentage compared to the total number of
shares outstanding: 3.04 %)
(1) Reasons for the acquisition of own shares
(iii) Aggregate amount of acquisition cost
Shareholder return and improvement of capital
Up to ¥100 billion
efficiency
151
(iv) Period of acquisition
From 1 June, 2018 to 20 September, 2018
152
Investor Information
Common Stock (as of March 31, 2018)
Authorized:
Issued:
9,000,000,000
2,068,823,175
(including 91,373,232 treasury shares)
Number of shareholders: 112,028
Transfer Agent for Common Stock in Japan
Sumitomo Mitsui Trust Bank, Limited
1-4-1, Marunouchi, Chiyoda-ku, Tokyo 100-8233, Japan
Major Shareholders (as of March 31, 2018)
The Master Trust Bank of Japan, Ltd. (trust account)
Japan Trustee Services Bank, Ltd. (trust account)
Nippon Life Insurance Company
JP Morgan Chase Bank 385632
State Street Bank West Client - Treaty 505234
Japan Trustee Services Bank, Ltd. (trust account 5)
Japan Trustee Services Bank, Ltd. (trust account 7)
State Street Bank and Trust Company
JP Morgan Chase Bank 385147
Japan Trustee Services Bank, Ltd. (trust account 1)
Shares owned
(Thousand shares)
Percentage of total common shares
outstanding (excluding treasury shares)
175,020
118,200
64,486
48,939
43,534
39,273
38,925
37,620
32,201
29,175
8.85
5.97
3.26
2.47
2.20
1.98
1.96
1.90
1.62
1.47
Notes: Shares owned are rounded down to the nearest thousand shares, while the percentage of total common shares outstanding (excluding treasury shares) is rounded down
to two decimal places.
Astellas holds 91,373 thousand treasury shares, but it is not included in the above list of major shareholders.
Breakdown of Shareholders (as of March 31, 2018)
Other companies 3.2%
Securities companies 3.5%
Individuals and others 9.3%
Financial institutions
32.3%
Treasury stock 4.4%
Foreign companies and others
47.3%
153
Financial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018
Corporate Data
Company Name
Astellas Pharma Inc.
Head Office
2-5-1, Nihonbashi-Honcho, Chuo-ku,
Tokyo 103-8411, Japan
TEL: +81-3-3244-3000
https://www.astellas.com/en/
Capital (as of March 31, 2018)
¥103,001 million
Representative
Kenji Yasukawa
Representative Director, President and CEO
Founded
1923
Professional Institution Affiliation
International Federation of Pharmaceutical Manufacturers &
Associations (IFPMA), Japan Pharmaceutical Manufacturers
Association (JPMA), Pharmaceutical Research and
Manufacturers of America (PhRMA), European Federation of
Pharmaceutical Industries and Associations (EFPIA), etc.
Stock Exchange Listing
Tokyo (Securities Code: 4503)
Independent Auditors
Ernst & Young ShinNihon LLC
Principal Subsidiaries and Affiliates
(as of March 31, 2018)
Astellas is a group of companies engaged solely in the
pharmaceutical business. The Group consists of 92
companies, which include Astellas Pharma Inc., 83
consolidated subsidiaries and 8 affiliates accounted for
by the equity method. Major Group companies are listed
as follows:
Japan
Manufacturing Base
- Astellas Pharma Tech Co., Ltd.
R&D Bases
- Astellas Research Technologies Co., Ltd.*1
- Astellas Analytical Science Laboratories, Inc.*2
Other
- Astellas Learning Institute Co., Ltd.
- Astellas Marketing and Sales Support Co., Ltd.*1
- Amgen Astellas BioPharma K.K.
*1 Plan to discontinue all activities in Astellas Marketing and Sales Support Co., Ltd
and Astellas Research Technologies Co., Ltd. by the end of the fiscal year ending
March 31, 2019.
*2 Plan to divest Astellas Analytical Science Laboratories, Inc. to Eurofins Pharma
Services LUX Holding Sarl during the fiscal year ending March 31, 2019.
154
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Americas
Holding Company in North America
• Astellas US Holding, Inc.
1 Astellas Way, Northbrook, IL 60062-6111, U.S.A.
Regional Headquarters
• Astellas US LLC
1 Astellas Way, Northbrook, IL 60062-6111, U.S.A.
R&D Bases
• Astellas Pharma Global Development, Inc.
• Astellas Research Institute of America LLC
• Astellas Institute for Regenerative Medicine
Sales Bases
• Astellas Pharma US, Inc.
• Astellas Pharma Canada, Inc. (Canada)
• Astellas Farma Brasil Importação e Distribuição de
Medicamentos Ltda. (Brazil)
• Astellas Farma Colombia S.A.S (Colombia)
Other
• Astellas US Technologies, Inc.
• Astellas Venture Management LLC
• Astellas Innovation Management LLC
Note: All subsidiaries for which no country has been indicated are located in the U.S.
EMEA
Holding Company in EMEA
• Astellas B.V.
Sylviusweg 62, 2333, BE Leiden, The Netherlands
Regional Headquarters (Astellas EMEA Operations)
• Astellas Pharma Europe Ltd.
2000 Hillswood Drive, Chertsey, Surrey, KT16 0RS, U.K.
R&D and Manufacturing Bases
• Astellas Pharma Europe B.V.
(R&D and manufacturing, Netherlands)
• Astellas Ireland Co., Limited
(Development and manufacturing, Ireland)
Sales Bases
• Astellas Pharma Ges. mbH (Austria)
• Astellas Pharma B.V. (Belgium)
• Astellas Pharma s.r.o (Czech Republic)
• Astellas Pharma A/S (Denmark)
• Astellas Pharma S.A.S (France)
• Astellas Pharma GmbH (Germany)
• Astellas Pharmaceuticals AEBE (Greece)
• Astellas Pharma Kft. (Hungary)
• Astellas Pharma Co., Limited (Ireland)
• Astellas Pharma S.p.A. (Italy)
• Astellas Pharma B.V. (Netherlands)
• Astellas Pharma International B.V. (Netherlands)
• Astellas Pharma Sp.zo.o. (Poland)
• Astellas Farma Limitada (Portugal)
• JSC Astellas Pharma (Russia)
• Astellas Pharma d.o.o (Slovenia)
• Astellas Pharma (Proprietary) Ltd (South Africa)
• Astellas Pharma S.A. (Spain)
• Astellas Pharma A.G. (Switzerland)
• Astellas Pharma ilac Ticaret ve Sanayi A.S. (Turkey)
• Astellas Pharma DMCC (United Arab Emirates)
• Astellas Pharma Ltd. (United Kingdom)
Asia & Oceania
Sales and Other Bases
• Astellas Pharma China, Inc. (Sales and manufacturing, China)
• Astellas Pharma Hong Kong Co., Ltd. (Hong Kong)
• Astellas Pharma Taiwan, Inc. (Taiwan)
• Astellas Pharma Korea, Inc. (Korea)
• Astellas Pharma Philippines, Inc. (Philippines)
• Astellas Pharma (Thailand) Co., Ltd. (Thailand)
• P.T. Astellas Pharma Indonesia (Indonesia)
• Astellas Pharma India Private Limited (India)
• Astellas Pharma Australia Pty Ltd. (Australia)
• Astellas Pharma Singapore Pte. Ltd. (Singapore)
• Astellas Pharma Malaysia Sdn.Bhd. (Malaysia)
155
Financial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Inclusion in SRI Indexes
Astellas is a member of the FTSE4Good Index, an equity index series that is
designed to facilitate investment in companies that meet globally recognized
corporate responsibility standards.
Astellas is a member of the FTSE Blossom Japan Index. Created by the global
index provider FTSE Russell, the FTSE Blossom Japan Index is designed to
measure the performance of Japanese companies demonstrating strong
Environmental, Social and Governance (ESG) practices.
Astellas is a member of the MSCI Japan ESG Select Leaders Index, an equity
index developed by MSCI Inc. that provides exposure to Japanese companies
with high Environmental, Social and Governance (ESG) performance relative to
their sector peers.
Astellas is a member of the MSCI Japan Empowering Women Index (WIN), an
equity index developed by MSCI Inc. that comprises leading Japanese
companies that promote gender diversity.
156
Corporate Strategy and Corporate GovernanceBusiness ReviewFinancial Information and DataAstellas Pharma Inc. ANNUAL REPORT 2018 Astellas Pharma Inc.
2-5-1, Nihonbashi-Honcho,
Chuo-ku, Tokyo 103-8411, Japan
https://www.astellas.com/en/
Please direct inquiries concerning Annual Report 2018 to:
Astellas Pharma Inc. Corporate Communications
TEL: +81-3-3244-3202
FAX: +81-3-5201-7473
Issued in September 2018
For the Year Ended March 31, 2018
ANNUAL REPORT 2018
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