A Global Value Chain Spanning Japan, the United States and Asia

「Orders in the preclinical business for the fiscal year ending March 2026 reached a record ¥35,728 million, up ¥3,620 million, or 11.3%, from the previous fiscal year. The main driver was increased orders from European and U.S. customers, where we have strategically strengthened our efforts. Orders from these customers rose 35.2% to ¥13,225 million. Overseas orders increased 25.7% to ¥15,505 million, and the overseas order ratio rose to 43.4% from 38.4%.」

「Overseas orders in the first half increased 16.3% year on year to ¥6,459 million, and the overseas order ratio rose to 40.9% from 36.3% in the previous first half.」

「Orders in the preclinical business for the six months ended September 30, 2024 were ¥15,311 million, up ¥2,695 million, or 21.4%, from the previous first half and a record high for a first half. Orders in the second quarter, July to September, were ¥8,140 million, compared with ¥4,217 million in the previous second quarter, also a record high for a second quarter. Domestic orders increased by ¥76 million, or 0.8%, to ¥9,756 million, while overseas orders increased by ¥2,619 million, or 89.2%, to ¥5,555 million. Overseas orders accounted for 36.3% of total orders, compared with 23.2% in the previous first half.」

「Overseas orders declined by ¥1,529 million, or 17.8%, year on year to ¥7,052 million, and the overseas order ratio fell to 25.7% from 34.4%. However, recent inquiries, a leading indicator of orders, have improved, and inquiries and visits from overseas customers have increased.」

「Several major overseas pharmaceutical companies had been conducting due diligence toward new agreements since the start of the fiscal year ending March 2024, and in the third quarter we secured pilot orders from several companies.」

「Since the beginning of the current fiscal year, several major overseas pharmaceutical companies have stepped up due diligence toward new agreements, and we have begun accepting specific pilot studies.」

「In the fiscal year ending March 2023, we signed a new preferred agreement with a domestic pharmaceutical company in recognition of these initiatives, which has led to higher orders. Due diligence toward preferred agreements with several major overseas pharmaceutical companies is also now in full swing.」

「Overseas orders increased by ¥2,730 million, or 52.7%, from the nine months ended December 31 of the previous fiscal year to ¥7,910 million. Overseas orders accounted for 41.0% of total orders, compared with 29.0% in the corresponding period of the previous fiscal year.」

「The acquisition was carried out to expand revenue by capturing economies of scale following Inary Research becoming a wholly owned subsidiary, and to deepen the global value chain by sharing expertise in contract-testing menus, development strategies, experimental technologies and evaluation methods for commissioned work involving novel drug-discovery modalities.」

「Overseas orders increased by ¥1,074 million, or 66.6%, from the first quarter of the previous fiscal year to ¥2,686 million. The increase was driven mainly by higher orders from European and U.S. customers, and overseas orders accounted for 40.9% of total orders, compared with 26.3% in the first quarter of the previous fiscal year.」

「For the fiscal year ended March 2022, the five-year compound annual growth rate of orders was 18.2%, and orders outstanding at fiscal year-end both reached record highs. Orders from domestic pharmaceutical companies also grew steadily, but the notable feature of the fiscal year ended March 2022 was the sharp increase in orders from overseas customers. Orders from overseas pharmaceutical companies accounted for 27.4% of total orders, with a five-year compound annual growth rate exceeding 52.2%.」

「Overseas orders during the nine months ended December 31 were ¥4,958 million, a substantial 2.2-fold increase year on year, driven by orders from Europe and the United States. The overseas order ratio rose to 28.2% from 19.0%.」

「The special gain resulted from the transfer of an equity interest in SNBL CHINA, which conducts experimental-animal breeding, rearing and quarantine operations in China, to Pharmaron Group, a Chinese listed company that operates a global pharmaceutical R&D services business, together with a third-party allotment in May 2021. Pharmaron Group came to hold a 50.01% interest in SNBL CHINA.」

「As part of this effort, we expanded SNBL CHINA, an experimental-animal breeding and supply facility in China, by making it a joint venture with Pharmaron Group, a Chinese listed company, and plan to further increase breeding and supply capacity while strengthening the breeding infrastructure at our Group facilities in Cambodia.」

「As a Group, we are further strengthening our global business expansion and working to broaden our customer base while making effective use of the experience and networks we have built in overseas markets.」

「Centered on our subsidiary CLINICAL STUDY SUPPORT (CSS), we are promoting a clinical research business that broadly supports clinical research, including global expansion under a partnership agreement with Evidera, a group company of Pharmaceutical Product Development LLC, a U.S. clinical CRO, and are strengthening this business by using real-world data.」

「Centered on our subsidiary CLINICAL STUDY SUPPORT (CSS), we are promoting a clinical research business that broadly supports clinical research, including global expansion under a partnership agreement with Evidera, a PPD Group company, and are strengthening this business by using real-world data.」

「Through SNBL PPD, a joint venture with Pharmaceutical Product Development LLC, a world-leading clinical CRO based in North Carolina, we are building a robust organizational structure to respond quickly to the rapidly expanding global clinical-trial market.」

「Based on these results, we determined that partnering with an overseas CRO capable of generating synergies would be more effective for accelerating the growth of our U.S. business from a medium- to long-term perspective. We therefore transferred our U.S. preclinical business to Altasciences, a North America-based clinical CRO group headquartered in Quebec, Canada, after spinning it off as a separate company in September of the previous year.」

「In the United States, we converted SNBL Clinical Pharmacology Center, Inc., located in Baltimore, Maryland, into a joint venture with Pharmaron, which has many global pharmaceutical customers in drug-discovery chemical synthesis, renamed it Pharmaron CPC, and are expanding the business by combining our existing operations with Pharmaron's sales network and proprietary technologies.」

「In the United States, we converted SNBL Clinical Pharmacology Center, Inc., located in Baltimore, Maryland, into a joint venture with Pharmaron, which has many global pharmaceutical customers in drug-discovery chemical synthesis, renamed it Pharmaron CPC, and are expanding the business by combining our existing operations with Pharmaron's sales network and proprietary technologies.」

「In the United States, through Pharmaron CPC, our joint venture with Pharmaron, which serves global pharmaceutical companies in the chemical synthesis field of drug discovery, we are combining Pharmaron's sales network and proprietary technologies with our existing business to expand operations.」

「Going forward, our challenge is to build alliances with other companies at each location, strengthen the global value chain and operate efficiently.」

「To meet these needs and build a global drug discovery support platform, our group is strengthening its U.S. and Asian businesses in addition to expanding its domestic operations, with the aim of establishing a global value chain.」