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Trk00 43468 2

  1. 1. SUMMARY OF FINANCIAL STATEMENTS [Japan GAAP] (CONSOLIDATED)Financial Results for the First Two Quarters (April 1 to September 30, 2011) of the FiscalYear Ending March 31, 2012 November 4, 2011 Takeda Pharmaceutical Company Limited Stock exchange listings: Osaka, Tokyo, Nagoya, Fukuoka, Sapporo TSE Code: 4502 URL: http://www.takeda.co.jp Representative: Yasuchika Hasegawa, President & CEO Contact: Hiroshi Ohtsuki Telephone: +81-3-3278-2037 Corporate Officer, Senior Vice President, Corporate Communications Department Scheduled date of securities report submission: November 14, 2011 Scheduled date of dividend payment commencement: December 1, 2011 Supplementary materials for the quarterly financial statements: Yes Presentation to explain for the quarterly financial statements: Yes (Millions of yen, rounded to the nearest million)1. Consolidated Financial Results (April 1 to September 30, 2011) for the Fiscal Year Ending March 31, 2012(1) Consolidated Operating Results (aggregated) (Percentage figures represent changes from the same period of the previous year.) Net sales Operating income Ordinary income Net income change change change change (¥ million) (¥ million) (¥ million) (¥ million) (%) (%) (%) (%)First two quarters ended 702,502 (1.6) 211,046 (4.8) 209,551 (7.1) 135,660 (5.9)September 30, 2011First two quarters ended 714,025 (5.5) 221,619 (8.6) 225,473 (11.5) 144,211 (24.0)September 30, 2010(Note) Comprehensive income First two quarters ended September 30, 2011 ¥(32,202)million(-%) First two quarters ended September 30, 2010 ¥ 19,411 million(-%) Fully diluted earnings per Earnings per share(¥) share(¥)First two quarters ended 171.85 171.83September 30, 2011First two quarters ended 182.69 182.67September 30, 2010(2) Consolidated Financial Position Total assets Net assets Shareholders’ equity Shareholders’ equity per (¥ million) (¥ million) ratio(%) share(¥)As of September 30, 2011 3,499,283 2,045,052 56.8 2,517.52As of March 31, 2011 2,786,402 2,136,656 75.1 2,649.69(Reference) Shareholders’ equity As of September 30, 2011 ¥ 1,987,333 million As of March 31, 2011 ¥ 2,091,589 million2. Dividends Annual dividend per share (¥) 1st quarter end 2nd quarter end 3rd quarter end Year-end TotalFiscal 2010  90.00  90.00 180.00Fiscal 2011  90.00Fiscal 2011 (Projection)  90.00 180.00(Note) Modifications in the dividend projection from the latest announcement: None3. Forecasts for Consolidated Operating Results for Fiscal 2011 (April 1, 2011 to March 31, 2012) (Percentage figures represent changes from the previous year.) Earnings per Net sales Operating income Ordinary income Net income share change change change change (¥ million) (¥ million) (¥ million) (¥ million) (¥) (%) (%) (%) (%)Fiscal 2011 1,540,000 8.5 270,000 (26.4) 270,000 (27.3) 170,000 (31.4) 215.36(Note) Modifications in forecasts of consolidated operating results from the latest announcement: Modified
  2. 2. 4. Other Information (1) Changes in significant subsidiaries during the period : Yes (changes in specified subsidiaries resulting in the change in consolidation scope) New: 2 companies (Company names: Nycomed Danmark ApS, Nycomed GmbH) (Note) For details, refer to “2.Other Information in Summary” in Page 11. (2) Adoption of special accounting treatments for quarterly consolidated financial statements: Yes (Note) For details, refer to “2.Other Information in Summary” in Page 11. (3) Changes in accounting policies, changes in accounting estimates and restatements 1) Changes in accounting policies due to revisions of accounting standards etc : Yes 2) Changes in accounting policies other than 1) : No 3) Changes in accounting estimates : No 4) Restatements : No (Note) For details, refer to “2.Other Information in Summary” in Page 11. (4) Number of shares outstanding (common stock) 1) Number of shares outstanding (including treasury stock) at term end: September 30, 2011 789,666,095 shares March 31, 2011 789,666,095 shares 2) Number of shares of treasury stock at term end: September 30, 2011 265,826 shares March 31, 2011 295,436 shares 3) Average number of outstanding shares (during the first two quarters ended September 30): September 30, 2011 789,387,660 shares September 30, 2010 789,378,520 shares * Implementation status about the quarterly review  This summary of financial statements is exempt from quarterly review procedures required by Financial Instruments and Exchange Act. A part of quarterly review for securities report based on Financial Instruments and Exchange Act has not finished at the time of disclosure of this summary of financial statements. Securities report of the first two quarters is scheduled to disclose on November 14, 2011 after completion of the quarterly review. * Note to ensure appropriate use of forecasts, and other comments in particular  Our operations are exposed to various risks at present and in the future, such as changes in the business environment and fluctuation of foreign exchange rate. All forecasts in this presentation are based on information currently available to the management. We will disclose necessary information in a timely manner when our management believes there will be significant impacts to our consolidated results due to the changes in the business environment or other events.  Regarding “the effect of acquisition of Nycomed in the FY2011 forecast” and “the assumption of entry timing of generic versions of Actos in the U.S.”, please refer to “1. Qualitative Information for the first two quarters of the Fiscal Year 2011 (3) Outlook for Fiscal 2011 [Forward looking statements]” in page 10.  Supplementary materials for the financial statement, presentation materials for the earnings release conference which is scheduled on November 4 and video of the conference including question-and-answer session will be promptly posted on the Company’s website. (Website of the Company) http://www.takeda.com/investor-information/quarterly-results/index_869.html
  3. 3. Takeda Pharmaceutical Company Limited (4502) SUMMARY OF FINANCIAL STATEMENTS (CONSOLIDATED) Financial Results for the First Two Quarters, 2011Index of the attachment1. Qualitative Information for the first two quarters of the Fiscal Year 2011 ..................................................2 (1) Analysis of Operation results ...........................................................................................................................2 (2) Analysis of Financial Position..........................................................................................................................9 (3) Outlook for Fiscal 2011 .................................................................................................................................10 (4) Litigation ........................................................................................................................................................112. Other Information in Summary ......................................................................................................................11 (1) Changes in significant subsidiaries during the period ....................................................................................11 (2) Adoption of special accounting treatments for quarterly consolidated financial statements .........................11 (3) Changes in accounting policies, changes in accounting estimates and restatements .....................................113. Consolidated Financial Statements for the First Two Quarters (April 1 to September 30, 2011) ............12 (1) Consolidated Balance Sheets .........................................................................................................................12 (2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income ....................14 Consolidated Statements of Income ...............................................................................................................14 Consolidated Statements of Comprehensive Income .....................................................................................15 (3) Consolidated Statements of Cash Flows ........................................................................................................16 (4) Note regarding assumption of a going concern ..............................................................................................17 (5) Segment Information ......................................................................................................................................17 (6) Sales Results (Sales to outside customers) .....................................................................................................18 (7) Note regarding significant changes in the amount of shareholders’ equity ...................................................18 -1-
  4. 4. Takeda Pharmaceutical Company Limited (4502) SUMMARY OF FINANCIAL STATEMENTS (CONSOLIDATED) Financial Results for the First Two Quarters, 20111.Qualitative Information for the first two quarters of the Fiscal Year 2011 (1) Analysis of Operation results i) Introduction In developed countries, the growth of the ethical pharmaceutical market has slowed down due to governmental policies that reduce medical costs, and the rise of generic drugs. In contrast, the market in emerging countries has been expanding rapidly due to improvement in medical technologies and the establishment of medical insurance plans, and its presence has increased in the worldwide market. At the end of September 2011, we completed the acquisition of Nycomed A/S (“Nycomed”), headquartered in Zurich, Switzerland, for 9.6 billion Euro and made Nycomed a wholly owned subsidiary of Takeda effective immediately. By adding Nycomed’s business infrastructure including its extensive sales channels in Europe and rapidly growing emerging countries to Takeda’s strong presence in Japan and the U.S. markets, we have significantly expanded our sales network from 28 countries to approximately 70 countries. Nycomed has developed “DAXAS”, a first-in-class drug for Chronic Obstructive Pulmonary Disease, and in addition to global expansion of sales channels we can leverage Nycomed’s R&D capabilities and drug development expertise in Europe and emerging countries to improve the potential of our existing product and R&D pipelines. Furthermore, the integration of the diverse global talent working in Nycomed will help promote our transformation to a dynamic corporate culture. In our “2011 - 2013 Mid-Range Plan”, the Vision is for Takeda to achieve Growth through Innovation and Culture, and we remain dedicated to achieving the goals to transform into a New Takeda. Specifically, we will invest strongly in R&D focused on core therapeutic areas, while effectively deploying both internal and external resources to create innovative drugs and transform treatment paradigms (for further details, refer to section v), [Activities and Results of “Research & Development”] on page 8). We will also shift from a product portfolio centered on mature high selling products to a more diverse portfolio focused on new products (for further details, refer to [Major new products launched in Japan, the U.S. and Europe during and after 2009] on page 4). From the first quarter of the current fiscal year, we have undertaken various activities which implement these strategies. Firstly, in the U.S. we launched “EDARBI” (a drug for treatment of hypertension) in April 2011. Our clinical tests verified that “EDARBI” lowers blood pressure more effectively than other angiotensin II receptor blockers currently on the market. In September, the Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency (EMA) issued a positive opinion for “EDARBI”, and we will strive for prompt approval for the European market. Secondly, in July 2011, earlier than originally scheduled, we were able to resubmit two New Drug Applications (NDA) to the U.S. Food and Drug Administration (FDA) for alogliptin and the fixed-dose combination tablet of alogliptin/pioglitazone (“ACTOS”) for treatment of type 2 diabetes. The FDA will review the NDA resubmissions within the next six months, and we believe that Takeda’s presence in the U.S. diabetes treatment market can be maintained by achieving wide market penetration of alogliptin before the introduction of Actos generics. In Japan we -2-
  5. 5. Takeda Pharmaceutical Company Limited (4502) SUMMARY OF FINANCIAL STATEMENTS (CONSOLIDATED) Financial Results for the First Two Quarters, 2011launched “LIOVEL”, a fixed-dose combination tablet of “NESINA” (alogliptin brand name in Japan) and “ACTOS”,for treatment of type 2 diabetes in September 2011.Our business environment has remained severe, including the historic appreciation of the yen. However, in additionto our strategies in Japan and the U.S. where we have already established robust business foundations, we will secureour continuing growth by maximizing the synergies of the steady integration of Takeda and Nycomed, such as thesales expansion of Takeda’s product pipeline utilizing Nycomed’s strong sales channels in Europe and emergingcountries.In April 2011, we established a new sales and marketing company, Takeda Pharmaceutical (China) Limited, as awholly owned subsidiary of Takeda (China) Holdings Co., Ltd., and it began full-scale operation in August. We willwork to expand our product lineup in China, including new as well as existing Takeda products, and will develop asales organization aimed at establishing a significant presence in this fast-growing market.In July 2011, Laboratories Takeda (Takeda’s wholly owned subsidiary in France) withdrew pioglitazone-containingproducts for the treatment of type 2 diabetes in France, based on a decision by the French authorities. The decision tosuspend the products was made on the basis of a small increased risk of bladder cancer in patients treated withpioglitazone observed in a French epidemiological study. Meanwhile, in July the European Medicines Agency(EMA) recommended changes to the label of pioglitazone-containing products regarding a risk of bladder cancer,and it is expected to be adopted by the European Commission (EC) hereafter. In the United States and Japan, thedescription related to bladder cancer in the product label for pioglitazone-containing products was revised throughconsultations with each authority.We remain confident in the therapeutic benefits of pioglitazone as an important treatment for type 2 diabetes, andremain committed to pioglitazone and pioglitazone-containing medications, and to the millions of people living withtype 2 diabetes. Patient safety is always the first priority for Takeda. Thus, we continuously monitor the safety andtolerability of all of our products and will continue to work with the EMA and other regulatory bodies to share andreview all available data, and to determine the appropriate next steps.In June 2011, Takeda marked the 230th anniversary of its founding. Over this long history, Takeda has developed acorporate philosophy of “Takeda-ism = Integrity, meaning fairness, honesty and perseverance.” Based on thisphilosophy, we continue to take good care of the earth’s environment and to ensure and observe compliance as aresponsibility of a global company. In addition, learning from the Great East Japan Earthquake, we will furtherstrengthen our risk management system to ensure stable drug supplies. We will work to realize Takeda’smanagement mission: “We strive towards better health for patients worldwide through leading innovation inmedicine.” -3-
  6. 6. Takeda Pharmaceutical Company Limited (4502) SUMMARY OF FINANCIAL STATEMENTS (CONSOLIDATED) Financial Results for the First Two Quarters, 2011<Reference> Major new products launched in Japan, the U.S. and Europe during and after 2009[Japan] <Launched in March 2009> “Ecard” (a drug for treatment of hypertension: a fixed dose combination of “Blopress” and diuretic (hydrochlorothiazide)) <Launched in June 2010> “Nesina” (a drug for type 2 diabetes, generic name: alogliptin benzoate) “Unisia” (a drug for treatment of hypertension: a fixed dose combination of “Blopress” and calcium channel blocker (amlodipine besilate)) “Vectibix” (a cancer drug, generic name: panitumumab)<Launched in July 2010> “Rozerem” (an insomnia drug, generic name: ramelteon) “Metact” (a drug for type 2 diabetes: a fixed dose combination of “Actos” and biguanide (metformin hydrochloride)) “Actos OD (orally-disintegrating tablets)” (a drug for type 2 diabetes)<Launched in November 2010> “Lampion pack” (a drug for secondary eradication of Helicobacter Pylori: a single pack containing “Takepron”, amoxicillin hydrate and metronidazole)<Launched in March 2011> “Reminyl” (a drug for Alzheimers dementia, generic name: galantamine hydrobromide, licensed from Janssen and jointly marketed with the licensor)<Launched in June 2011> “Sonias” (a drug for type 2 diabetes: a fixed dose combination tablet of “Actos” and sulfonylurea (glimepiride))<Launched in September 2011> “Liovel” (a drug for type 2 diabetes: a fixed dose combination tablet of “Actos” and “Nesina”)[Americas]<Launched in February 2009> “Dexilant” (a drug for gastroesophageal reflux disease, generic name: dexlansoprazole)<Launched in March 2009> “Uloric” (a drug for hyperuricemia for patients with chronic gout, generic name febuxostat)<Launched in June 2010> “Actoplus met XR” (a drug for type 2 diabetes: a fixed dose combination of “Actos” and biguanide (metformin timed- release drug))<Launched in April 2011> “Edarbi” (a drug for treatment of hypertension, generic name: azilsartan medoxomil)[Europe]<Launched in February 2010> “Mepact” (a drug for non-metastatic osteosarcoma, generic name: mifamurtide) -4-
  7. 7. Takeda Pharmaceutical Company Limited (4502) SUMMARY OF FINANCIAL STATEMENTS (CONSOLIDATED) Financial Results for the First Two Quarters, 2011ii) Overview of Operating ResultsConsolidated results (April 1 to September 30, 2011) were as follows: Billions of yen Year-on-year change Net Sales ¥702.5 Decrease ¥11.5 ( 1.6%) Operating Income ¥211.0 Decrease ¥10.6 ( 4.8%) Ordinary Income ¥209.6 Decrease ¥15.9 ( 7.1%) Net Income ¥135.7 Decrease ¥ 8.6 ( 5.9%)[Net Sales]Consolidated net sales decreased by ¥11.5 billion (1.6%) to ¥702.5 billion over the same period of the previous year.- Despite of overseas sales growth of VELCADE (a drug for multiple myeloma treatment) by Millennium Pharmaceuticals Inc. (Takeda’s wholly owned subsidiary in the U.S.), DEXILANT (a drug for gastroesophageal reflux disease) and ULORIC (a drug for hyperuricemia for patients with chronic gout) by Takeda Pharmaceuticals North America, Inc. in addition to domestic sales contributions from new drugs launched in 2010, including Vectibix (a drug for cancer treatment) and Nesina (a drug for type 2 diabetes treatment), the sales increase couldn’t absorb the Yen’s appreciation against the U.S. dollar and Euro (negative effects: ¥28.7 billion) and the decrease in sales of Prevacid (a drug for peptic ulcer treatment) in the U.S. As a result, consolidated net sales decreased.- The table below shows consolidated sales of Takeda’s major ethical drugs: Billions of yen Drug for type 2 diabetes treatment Decrease ¥24.6 billion (12.6%) over ¥171.0 Pioglitazone (Japanese product name: Actos) the same period of the previous year Drug for hypertension treatment Increase ¥3.4 billion (3.1%) over ¥112.3 Candesartan (Japanese product name: Blopress) the same period of the previous year Drug for peptic ulcer treatment Decrease ¥12.9 billion (17.1%) over Lansoprazole (Japanese product name: ¥62.3 the same period of the previous year Takepron) Drug for treatment of prostate cancer, Increase ¥4.9 billion (8.7%) over breast cancer and endometriosis ¥60.9 the same period of the previous year Leuprorelin (Japanese product name: Leuplin) Drug for multiple myeloma treatment Increase ¥2.6 billion (10.0%) over ¥28.1 VELCADE (Sales in the U.S.) the same period of the previous year[Operating Income]Consolidated operating income decreased by ¥10.6 billion (4.8%) to ¥211.0 billion over the same period of theprevious year.- Although selling and general administrative expenses decreased by ¥9.9 billion (2.9%) over the same period of the previous year, operating income decreased because gross profit fell by ¥20.5 billion (3.6%) due to the decline in net sales.- R&D expenses decreased by ¥5.2 billion (4.2%) over the same period of the previous year. -5-
  8. 8. Takeda Pharmaceutical Company Limited (4502) SUMMARY OF FINANCIAL STATEMENTS (CONSOLIDATED) Financial Results for the First Two Quarters, 2011- Selling and general administrative expenses, excluding R&D expenses, fell by ¥4.7 billion (2.2%) over the same period of the previous year, mainly due to the Yens appreciation.[Ordinary Income]Consolidated ordinary income decreased by ¥15.9 billion (7.1%) to ¥209.6 billion over the same period of theprevious year.- In addition to the decrease in operating income, non-operating income and loss resulted unfavorably by 5.3 billion over the same period of the previous year due to the increase of valuation losses on assets and liabilities denominated in foreign currency. As a result, ordinary income decreased.[Net Income]Consolidated net income decreased by ¥8.6 billion (5.9%) to ¥135.7 billion over the same period of the previousyear.- Earnings per share ("EPS") decreased by ¥10.84 (5.9%) to ¥171.85 over the same period of the previous year.- EPS excluding extraordinary income (loss) and other special factors arising from business acquisitions and similar events (see Note below), decreased by ¥13.82 (6.5%) to ¥199.68 over the same period of the previous year.(Note) EPS excluding extraordinary income (loss) and special factors is calculated by deducting any extraordinary income (loss) and special factors, such as amortization of goodwill, depreciation of intangible assets, and the like due to business acquisition, from net income.iii) Results by Segment (April 1 to September 30, 2011)The following table shows sales and operating income of each business segment for the first two quarters (April 1 toSeptember 30, 2011). Billions of yen Net sales Operating income Type of Business Change over the Change over the Amount same period of the Amount same period of the previous year previous year Ethical Drug ¥ 627.0 Decrease ¥ 11.1 ¥ 198.4 Decrease ¥11.2 (Japan) <¥ 296.0> < Increase ¥12.4> (Overseas) <¥ 331.0> <Decrease ¥23.5> Consumer Healthcare ¥ 31.8 Increase ¥ 0.6 ¥ 7.5 Decrease ¥ 0.4 Other ¥ 46.0 Decrease ¥ 1.0 ¥ 6.3 Increase ¥ 1.1 Total ¥ 702.5 Decrease ¥ 11.5 ¥ 211.0 Decrease ¥10.6 (Note) Net sales for each segment refer to sales to outside customers.[Ethical Drug Segment]Net sales in the Ethical Drug Segment decreased by ¥11.1 billion (1.7%) to ¥627.0 billion over the same period ofthe previous year, and operating income also decreased by ¥11.2 billion (5.3%) to ¥198.4 billion.- Net sales in Japan increased by ¥12.4 billion (4.4%) to ¥296.0 billion, due to a rise in sales of new products launched in 2010, including Vectibix and Nesina. -6-
  9. 9. Takeda Pharmaceutical Company Limited (4502) SUMMARY OF FINANCIAL STATEMENTS (CONSOLIDATED) Financial Results for the First Two Quarters, 2011The following table shows sales results of major products in Japan. Billions of yen Increase of ¥3.2 billion (4.8%) Blopress (Drug for hypertension treatment) ¥70.9 over the same period of the previous year Increase of ¥3.5 billion (10.3%) Takepron (Drug for peptic ulcer treatment) ¥37.6 over the same period of the previous year Leuplin (Drug for treatment of prostate cancer, Increase of ¥1.1 billion (3.5%) ¥33.8 breast cancer and endometriosis) over the same period of the previous year Decrease of ¥5.4 billion (22.3%) Actos (Drug for type 2 diabetes treatment) ¥18.9 over the same period of the previous year Increase of ¥2.4 billion (13.3%) Enbrel (Drug for rheumatoid arthritis treatment) ¥20.8 over the same period of the previous year- Sales in the overseas markets decreased by ¥23.5 billion (6.6%) to ¥331.0 billion over the same period of the previous year, mainly due to the decrease in sales of Prevacid in the U.S. and negative effects of the Yen’s appreciation. In the U.S., the decrease in sales of Prevacid was absorbed by sales growth of VELCADE, DEXILANT and ULORIC. As a result, sales in the U.S. increased on the local currency basis. In Europe, sales decreased mainly due to the decrease in sales of Actos.[Consumer Healthcare Segment]Net sales in the Consumer Healthcare Segment increased by ¥0.6 billion (1.8%) to ¥31.8 billion over the sameperiod of the previous year, mainly due to an increase in sales of Alinamin tablets and Benza. On the other hand,operating income decreased by ¥0.4 billion (5.0%) to ¥7.5 billion due to the increase in sales promotion expenses.[Other Segment]Sales in the Other Segment decreased by ¥1.0 billion (2.2%) to ¥46.0 billion over the same period of the previousyear, but operating income grew by ¥1.1 billion (20.4%) to ¥6.3 billion mainly due to an improvement in sales costratio.iv) Basic Policy for Profit Distribution and Dividends for Fiscal 20111) Basic Policy for Profit Distribution We will make strategic investments which are necessary for future growth in order to achieve sustainable growth and maximizing enterprise value of our group. With regard to profit distribution under “2011-2013 Mid-Range Plan”, it is our basic policy that dividend per share for Fiscal Years 2011, 2012 and 2013 be maintained at the same level as annual dividend of ¥180 per share to realize stable profit distributions.2) Dividends for Fiscal 2011 For the first two quarters ended September 30, 2011, we will pay an interim dividend of ¥90 per share. We plan to pay a year-end dividend of ¥90 per share. Accordingly, the annual dividends paid to shareholders will be ¥180 per share, which is the same amount as the previous fiscal year. -7-
  10. 10. Takeda Pharmaceutical Company Limited (4502) SUMMARY OF FINANCIAL STATEMENTS (CONSOLIDATED) Financial Results for the First Two Quarters, 2011v) Activities and Results of “Research & Development”Takeda always decides its R&D strategy in accordance with the latest medical needs. By concentrating investment ofits management resources into its existing core therapeutics area of Metabolic (diabetes and obesity), Oncology andCentral Nervous System diseases as well as the new core therapeutics area of Immunology/Inflammatory, Takedawill challenge innovation in medicine and a shift in therapy paradigms.Major activities and result of R&D thus far during the reporting period are:[In-house R&D activities]-In June 2011, Takeda presented the results from two ongoing Phase I studies with investigational therapy MLN4924in metastatic melanoma and other advanced solid tumors at the annual meeting of the American Society of ClinicalOncology. Takeda also presented the results from Phase I study in patients with acute myeloid leukemia (AML) orhigh-grade myelodysplastic syndromes (MDS) at the 16th Congress of the European Hematology Association.-In June 2011, Takeda presented the results from two ongoing Phase I studies with MLN9708, the first oralproteasome inhibitor being studied in patients with relapsed and/or refractory multiple myeloma (MM) at the 16thCongress of the European Hematology Association.-In June 2011, Takeda presented the results of the safety, tolerability and hemoglobin A1c (HbA1c) lowering actionof TAK-875 for the treatment of type 2 diabetes at the American Diabetes Association (ADA) 71st Annual ScientificSessions. Takeda started Phase III clinical trials of TAK-875 in Japan in September 2011 and US/EU in October2011.-In July 2011, Takeda submitted a supplemental New Drug Application (sNDA) to the U.S. Food and DrugAdministration (FDA) for VELCADE (bortezomib) for injection to add overall survival (OS) data after a five-yearfollow up to the product label. In October, Takeda withdrew the supplemental new drug application (sNDA) for theuse of VELCADE for Injection in combination with rituximab in patients with relapsed follicular lymphoma. InNovember, Takeda received an approval from FDA for a supplemental new drug application (sNDA) for VELCADEfor Injection, which updates the label to include additional long-term (median follow-up 60.1 months) overallsurvival (OS) data from the VISTA* trial.*VISTA: VELCADE as Initial Standard Therapy in multiple myeloma: Assessment with melphalan and prednisone-In July 2011, Takeda resubmitted two New Drug Applications (NDA) to the FDA for alogliptin and the fixed-dosecombination therapy alogliptin/pioglitazone.-In August 2011, Takeda started Phase II clinical trials of TAK-385 in Japan for treatment of endometriosis anduterine fibroids.-In September 2011, Takeda started Phase III clinical trials of SYR-472 in Japan for treatment of type 2 diabetes.-In September 2011, Takeda started Phase III clinical trials of TAK-438 in Japan for treatment of patients with acid-related diseases such as reflux esophagitis.-In September 2011, Takeda received a positive opinion for Edarbi (azilsartan medoxomil, development code: TAK-491), a new once-daily angiotensin II receptor antagonist, for the treatment of essential hypertension (high bloodpressure) from the Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency(EMA). -8-
  11. 11. Takeda Pharmaceutical Company Limited (4502) SUMMARY OF FINANCIAL STATEMENTS (CONSOLIDATED) Financial Results for the First Two Quarters, 2011-In October 2011, Takeda decided to discontinue the development of ramelteon in Europe for the treatment ofinsomnia in order to best optimize Takeda’s resources for its research and development activities.[Fixed Dose Combination activities]-In July 2011, Takeda received an approval from the Japanese Ministry of Health, Labour and Welfare for theproduction and marketing of LIOVEL, a fixed-dose combination tablet of Nesina and Actos for treatment of type 2diabetes. In September, Takeda launched LIOVEL in Japan.[Alliance activities]-In April 2011, Takeda reached a decision to participate in the Phase III clinical trial of anti-cancer agent AMG479 inJapan, which Takeda in-licensed from Amgen, Inc. (U.S.) for patients with metastatic pancreas cancer.-In May 2011, Takeda started a Phase III clinical trial in Japan for Lu AA21004, which Takeda in-licensed fromLundbeck in Denmark, in patients with major depressive disorder (MDD).-In May 2011, Takeda submitted an NDA to the FDA for peginesatide (formerly known as Hematide™) for thetreatment of anemia associated with Chronic Renal Failure CRF in adult patients on dialysis.-In May 2011, Takeda submitted a Marketing Authorization Application (MAA) to the EMA for SGN-35 (genericname: brentuximab vedotin, EU product name: ADCETRIS™), which Takeda in-licensed from Seattle Genetics inthe U.S., for the treatment of relapsed or refractory Hodgkin lymphoma (HL) and relapsed or refractory systemicanaplastic large cell lymphoma (sALCL). In October 2011, Takeda started Phase I/II clinical trials of SGN-35 inJapan for treatment of relapsed or refractory HL and relapsed or refractory sALCL.-In August 2011, Takeda and Amylin Pharmaceuticals, Inc. decided the discontinuation of development ofpramlintide / metreleptin, an investigational combination therapy for the treatment of obesity based on thecommercial assessment taking into account a revised development plan as well as evolving dynamics within theobesity therapeutic area.-In September 2011, Takeda submitted a New Drug Application (NDA) to the Ministry of Health, Labour andWelfare in Japan for TAK-085 (generic name: omega-3-acid ethyl esters 90) for the treatment of hyperlipidemia,which Takeda in-licensed from Pronova in Norway.[Improvement and Reinforcement of R&D organization]-In August 2011, Takeda was selected as a recipient of an approximately 23.9 billion yen government subsidy forwhich it had applied in March of this year. The Japanese government is offering this subsidy publicly under itssecondary project for advanced commercial production facility in order to support the investment associated with thedevelopment and production of new influenza vaccines.(2) Analysis of Financial Position[Assets]The amount of total assets as of September 30, 2011 is ¥3,499.3 billion, an increase of ¥712.9 billion compared to theprevious fiscal year end. Noncurrent assets increased by ¥1,024.6 billion mainly due to an increase in intangibleassets including goodwill accompanied with acquisition of Nycomed. On the other hand, current assets decreased by¥311.8 billion mainly due to a decrease in marketable securities also accompanied with Nycomed acquisition. -9-
  12. 12. Takeda Pharmaceutical Company Limited (4502) SUMMARY OF FINANCIAL STATEMENTS (CONSOLIDATED) Financial Results for the First Two Quarters, 2011[Liabilities]The amount of total liabilities as of September 30, 2011 is ¥1,454.2 billion, an increase of ¥804.5 billion compared tothe previous fiscal year end mainly due to an increase of debt loan accompanied with Nycomed acquisition.[Net Assets]The amount of total net asset as of September 30, 2011 is ¥2,045.1 billion, a decrease of ¥91.6 billion compared tothe previous fiscal year end, mainly due to decrease in foreign currency translation adjustment caused by the Yen’sappreciation. The shareholders’ equity ratio decreased by 18.3 pt to 56.8% from the previous fiscal year end.(3) Outlook for Fiscal 2011The outlook for consolidated results for the full year of fiscal 2011 has been revised from the previous forecast(announced at 1st quarter of fiscal 2011 financial results announcement on July 29, 2011) as follows, taking thecurrent results into consideration and reflecting a review of foreign exchange rates, in addition to the effect ofacquisition of Nycomed.[Full-year consolidated forecasts (April 1 to March 31, 2012)] Net Sales Operating income Ordinary income Net income Earnings per share (¥ billion) (¥ billion) (¥ billion) (¥ billion) “EPS”(¥) Previous forecast (A) ¥1,450.0 ¥390.0 ¥395.0 ¥250.0 ¥316.71 Revised forecast in ¥1,540.0 ¥270.0 ¥270.0 ¥170.0 ¥215.36 this document (B) Change (B-A) Increase ¥90.0 Decrease ¥120.0 Decrease ¥125.0 Decrease ¥80.0 Change Increase 6.2% Decrease 30.8% Decrease 31.6% Decrease 32.0%[Assumptions for the Forecast]The foreign exchange rates for the 2nd half of fiscal 2011 are assumed to be US$1 = ¥75 and Euro1 = ¥105. Theaverage of foreign exchange rates for the full year of fiscal 2011are assumed to be US$1 = ¥77 and Euro1 = ¥109.[Forward looking statements]The effect of acquisition of Nycomed in the FY2011 forecastThe revised forecast for FY2011 includes the effect of acquisition of Nycomed. However, the amount ofvaluation/allocation for Nycomed’s assets/liabilities and the accounting treatment for the amortization method and itsduration may be changed within one year from the acquisition date, according to the business combinationaccounting standards. The final amount will be settled through the audit by our independent auditor. This forecastincludes the Nycomed’s profit and loss impact for 2nd half of fiscal 2011 only, because the acquisition wascompleted at the end of September 2011.Assumption of the entry timing of generic versions of Actos in the U.S.The Company’s full-year consolidated forecasts for fiscal 2011 and 2011-2013 Mid-Range Plan beginning with fiscal2011 are based on the assumption of the entry timing of generic versions of Actos (generic name: pioglitazone) inAugust 2012, and the entry of ACTOplus met (a fixed-dose combination tablet of pioglitazone with metformin) andduetact (a fixed-dose combination tablet of pioglitazone with glimepiride) in December 2012.The Company’s stance on this assumption has not changed since the issuance of the press release “Takeda CompletesSettlements With All Defendants in U.S. Patent Litigation Involving ACTOS® (pioglitazone HCI), ACTOplus met®(pioglitazone HCl and metformin HCl) and duetact® (pioglitazone HCl and glimepiride)” dated December 22nd,2010, which can be found on the Web site at the following URL.(Website of the Company)http://www.takeda.com/press/article_39045.html(Website of the Tokyo Stock Exchange, part of listed company information)http://www.tse.or.jp/tseHpFront/HPLCDS0101E.do - 10 -
  13. 13. Takeda Pharmaceutical Company Limited (4502) SUMMARY OF FINANCIAL STATEMENTS (CONSOLIDATED) Financial Results for the First Two Quarters, 2011The operating results of the Company are subject to various risks at present and in the future, such as changes ofbusiness environment and the impact from foreign exchange rate fluctuations. When we judge our operating resultswill be significantly impacted by events, which are not incorporated in this forecast, we will announce such factspromptly.(4) LitigationThe Company, Takeda Pharmaceuticals North America, Inc., certain Company Affiliates located in the U.S. and EliLilly & Co. have been named as defendants in lawsuits pending in U.S. federal and state courts in which plaintiffsallege they have developed bladder cancer as a result of taking Pioglitazone (U.S. product name: Actos).The Company is vigorously defending the aforementioned lawsuits.2. Other Information in Summary(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in the change in consolidation scope): The two companies, Nycomed Danmark ApS and Nycomed GmbH, have newly become specified subsidiaries. Since each capital amount of these companies which are subsidiaries of Nycomed A/S exceeds 10% of that of Takeda Pharmaceutical Company Limited resulted from the Company’s acquisition of Nycomed A/S, these companies are deemed specified subsidiaries.(2) Adoption of special accounting treatments for quarterly consolidated financial statements ( i ) Calculation of the tax expenses The effective tax rate expected to be imposed on pretax net income (after tax effect accounting) applicable to the tax year in which this second quarter is included was estimated based on reasonable assumptions. Then, tax expenses for the first two quarters were calculated by multiplying the pretax net income for the quarters by the estimated effective tax rate.(3) Changes in accounting policies, changes in accounting estimates and restatements - Changes in accounting policies ( i ) Effective from the first quarter of the current fiscal year, the Company adopted new accounting standards, “Accounting Standard for Earnings Per Share” (Accounting Standards Board of Japan [ASBJ] statement No.2, published June 30, 2010) and “Guidance on Accounting Standard for Earnings Per Share” (ASBJ Guidance No.4, June 30, 2010). In accordance with the standards, the Company changed a part of the calculation method for fully-diluted earnings per share. These accounting standards apply to the previous year’s figure retrospectively, thus the figure shown on Summary information (top page) is adjusted. However this change had only minor impact to it. - 11 -
  14. 14. Takeda Pharmaceutical Company Limited (4502) SUMMARY OF FINANCIAL STATEMENTS (CONSOLIDATED) Financial Results for the First Two Quarters, 20113. Consolidated Financial Statements for the First Two Quarters (April 1 to September 30, 2011)(1) Consolidated Balance Sheets Millions of yen As of March 31, 2011 As of September 30, 2011 ASSETS Current assets Cash and deposits 217,897 248,551 Notes and accounts receivable 293,995 351,720 Marketable securities 656,321 157,393 Merchandise and products 59,668 113,014 Work in process 39,899 79,368 Raw materials and supplies 37,560 48,926 Deferred tax assets 229,909 225,330 Other current assets 51,894 53,294 Allowance for doubtful receivables (891) (3,097) Total current assets 1,586,252 1,274,499 Fixed assets Tangible fixed assets 407,480 474,492 Intangible fixed assets Goodwill 217,123 538,683 Patent rights 293,131 337,522 Sales rights ― 558,656 Other intangible fixed assets 7,173 26,629 Total intangible fixed assets 517,427 1,461,489 Investments and other assets Investment securities 165,019 162,100 Other fixed assets 110,419 126,821 Allowance for doubtful receivables (196) (118) Total investments and other assets 275,242 288,803 Total fixed assets 1,200,150 2,224,784 Total Assets 2,786,402 3,499,283 - 12 -
  15. 15. Takeda Pharmaceutical Company Limited (4502) SUMMARY OF FINANCIAL STATEMENTS (CONSOLIDATED) Financial Results for the First Two Quarters, 2011 Millions of yen As of March 31, 2011 As of September 30, 2011LIABILITIES Current liabilities Notes and accounts payable 83,065 89,886 Short-term loans 1,345 571,335 Income taxes payable 41,977 61,241 Reserve for employees’ bonuses 43,520 36,544 Other reserves 9,471 10,332 Other current liabilities 257,218 247,862 Total current liabilities 436,596 1,017,201 Non-current liabilities Deferred tax liabilities 112,295 293,264 Reserve for employees’ retirement benefits 16,805 51,501 Other reserves 6,779 10,673 Other non-current liabilities 77,271 81,590 Total non-current liabilities 213,150 437,029 Total liabilities 649,746 1,454,230NET ASSETS Shareholders’ equity Common stock 63,541 63,541 Capital surplus 49,638 49,638 Retained earnings 2,272,067 2,336,629 Treasury stock (1,014) (873) Total shareholders’ equity 2,384,232 2,448,936 Accumulated other comprehensive income Unrealized gain/loss on available-for-sales 73,944 70,304 securities Deferred hedge gain/loss 17 442 Foreign currency translation adjustment (366,604) (532,349) Total accumulated other comprehensive (292,643) (461,603) income Stock acquisition rights 334 376 Minority interests 44,732 57,343 Total net assets 2,136,656 2,045,052Total liabilities and net assets 2,786,402 3,499,283 - 13 -
  16. 16. Takeda Pharmaceutical Company Limited (4502) SUMMARY OF FINANCIAL STATEMENTS (CONSOLIDATED) Financial Results for the First Two Quarters, 2011(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income Consolidated Statements of Income Millions of yen First two quarters ended First two quarters ended September 30, 2010 September 30, 2011 (April 1 to September 30, (April 1 to September 30, 2010) 2011) Net sales 714,025 702,502 Cost of sales 150,583 159,565 Gross profit 563,442 542,937 Selling, general and administrative expenses R&D expenses 124,195 119,001 Other 217,629 212,890 Total selling, general and administrative 341,824 331,891 expenses Operating income 221,619 211,046 Non-operating income Interest income 870 954 Dividend income 2,356 2,164 Gains from foreign exchange 1,049 ― Equity in earnings of affiliates 239 84 Gain on transfer of operation 1,840 3,030 Other non-operating income 5,875 7,131 Total non-operating income 12,229 13,362 Non-operating expenses Interest expenses 666 607 Donations and contributions 1,050 2,504 Losses from foreign exchange ― 8,072 Other non-operating expenses 6,657 3,674 Total non-operating expenses 8,374 14,857 Ordinary income 225,473 209,551 Income before income taxes and minority 225,473 209,551 interests Total income taxes 79,814 72,105 Income before minority interests 145,660 137,446 Minority interests 1,448 1,786 Net income 144,211 135,660 - 14 -
  17. 17. Takeda Pharmaceutical Company Limited (4502) SUMMARY OF FINANCIAL STATEMENTS (CONSOLIDATED) Financial Results for the First Two Quarters, 2011Consolidated Statements of Comprehensive Income Millions of yen First two quarters ended First two quarters ended September 30, 2010 September 30, 2011 (April 1 to September 30, (April 1 to September 30, 2010) 2011)Income before minority interests 145,660 137,446Other comprehensive income Unrealized gain/loss on available-for-sales securities (13,507) (3,660) Deferred hedge gain/loss 179 425 Foreign currency translation adjustment (114,463) (166,345) Share of other comprehensive income of associates accounted for using equity method 1,542 (68) Total other comprehensive income (126,249) (169,648)Comprehensive income 19,411 (32,202) [Comprehensive income attributable to] Comprehensive income attributable to owners of the parent 18,458 (33,289) Comprehensive income attributable to minority interests 952 1,088 - 15 -
  18. 18. Takeda Pharmaceutical Company Limited (4502) SUMMARY OF FINANCIAL STATEMENTS (CONSOLIDATED) Financial Results for the First Two Quarters, 2011(3) Consolidated Statements of Cash Flows Millions of yen First two quarters First two quarters ended September 30, ended September 30, 2010 2011Net cash provided by (used in) operating activities Net income before income taxes and minority interests 225,473 209,551 Depreciation and amortization 43,936 49,901 Amortization of goodwill 7,267 6,624 Interest and dividend income (3,225) (3,118) Interest expenses 666 607 Equity in (earnings) loss of affiliates (197) 767 Loss (gain) on sales and disposal of property, plant and 429 147 equipment Loss (gain) on sales of marketable securities  (71) Decrease (increase) in notes and accounts receivable (21,875) (3,969) Decrease (increase) in inventories 756 (1,841) Increase (decrease) in notes and accounts payable 4,264 (8,149) Other (45,319) (11,833) Sub total 212,176 238,617 Interest and dividends received 3,161 3,149 Interest paid (657) (545) Income taxes paid (65,628) (79,485) Net cash provided by (used in) operating activities 149,052 161,736Net cash provided by (used in) investing activities Proceeds from sales and redemption of marketable securities 12,621 368 Payment for deposit of funds into time deposit  (11) Proceeds from redemption of time deposit 17,000 2,207 Payment for purchases of property, plant and equipment (85,107) (25,012) Proceeds from sales of property, plant and equipment 351 144 Payment for purchases of investment securities (65) (67) Payment for acquisition of subsidiaries’ shares, resulting in  (1,029,580) consolidation scope change Proceeds from acquisition of subsidiaries’ shares, resulting in 3,411  consolidation scope change Other (10,797) (8,792) Net cash provided by (used in) investing activities (62,586) (1,060,744)Net cash provided by (used in) financing activities Net increase (decrease) in short-term loans (276) 569,840 Payment for treasury stock buyback (14) (10) Dividends paid (70,994) (71,006) Other (1,778) (1,852) Net cash provided by (used in) financing activities (73,062) 496,971Effect of exchange rate changes on cash and cash equivalents (60,312) (65,957)Net increase (decrease) in cash and cash equivalents (46,908) (467,993)Cash and cash equivalents, beginning of period 852,480 872,710Cash and cash equivalents, end of period 805,572 404,717 - 16 -
  19. 19. Takeda Pharmaceutical Company Limited (4502) SUMMARY OF FINANCIAL STATEMENTS (CONSOLIDATED) Financial Results for the First Two Quarters, 2011(4) Note regarding assumption of a going concern First two quarters ended September 30, 2011 (April 1 to September 30, 2011) No events to be noted for this purpose(5) Segment Information ( i ) Net sales and profit by business segment First two quarters ended September 30, 2010 (April 1 to September 30, 2010) Millions of yen Business Segments Amount reported Consumer Ethical Drug Healthcare Other Total Adjustments on statement of income for Q2 Net sales Sales to outside 638,106 31,250 46,990 716,346 (2,321) 714,025 customers Intersegment sales 1,652 58 3,392 5,103 (5,103) ― and transfers Total 639,758 31,308 50,383 721,449 (7,424) 714,025 Segment profit 209,528 7,845 5,271 222,645 (1,026) 221,619 First two quarters ended September 30, 2011 (April 1 to September 30, 2011) Millions of yen Business Segments Amount reported Consumer Ethical Drug Healthcare Other Total Adjustments on statement of income for Q2 Net sales Sales to outside 627,037 31,825 45,961 704,823 (2,320) 702,502 customers Intersegment sales 1,713 65 3,193 4,970 (4,970) ― and transfers Total 628,749 31,889 49,154 709,793 (7,291) 702,502 Segment profit 198,374 7,451 6,347 212,173 (1,126) 211,046(Note)Segment profit equals operating income on each segment. (ii) Information regarding regions Net sales First two quarters ended September 30, 2010 (April 1 to September 30, 2010) Millions of yen Americas Asia and other Japan Europe Total United States regions 355,084 258,523 252,271 86,543 13,875 714,025 First two quarters ended September 30, 2011(April 1 to September 30, 2011) Millions of yen Americas Asia and other Japan Europe Total United States regions 366,968 233,925 226,464 85,363 16,246 702,502 - 17 -
  20. 20. Takeda Pharmaceutical Company Limited (4502) SUMMARY OF FINANCIAL STATEMENTS (CONSOLIDATED) Financial Results for the First Two Quarters, 2011(6) Sales Results (Sales to outside customers)First two quarters ended September 30, 2010 (April 1 to September 30, 2010) Millions of yen Ethical Drug Amount reported Consumer Other Adjustments on statement of [Royalties] (Japan) (Overseas) Subtotal Healthcare income for Q2 283,635 354,471 638,106 31,250 46,990 (2,321) 714,025 [20,367]First two quarters ended September 30, 2011 (April 1 to September 30, 2011) Millions of yen Ethical Drug Amount reported Consumer Other Adjustments on statement of [Royalties] (Japan) (Overseas) Subtotal healthcare income for Q2 296,037 331,000 627,037 31,825 45,961 (2,320) 702,502 [20,760](7) Note regarding significant changes in the amount of shareholders’ equity First two quarters ended September 30, 2011(April 1 to September 30, 2011) No events to be noted for this purpose - 18 -

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