Message from the CEO

The business environment in the pharmaceutical industry is becoming increasingly challenging each year, due to intensifying societal and policy scrutiny on healthcare costs and frequent NHI price revisions. Furthermore, drug discovery itself is becoming increasingly difficult. A variety of the therapeutic medicines for areas such as high blood pressure or diabetes that many patients need have been developed leaving only extremely challenging areas such as oncology, central nervous system disorders and rare diseases yet to be developed. Amid the headwinds of rising development costs, pharmaceutical companies face steep obstacles as they strive to deliver smiles to as many patients as possible, as quickly as possible, and are thus required to further accelerate development speed.

For our Company to achieve sustainable growth, it is essential to demonstrate our presence in overseas markets. Japan’s share of the global pharmaceutical market, once 20%, has now dropped to about 4%. Meanwhile, the U.S. holds 50% and Europe accounts for 15%. Amid such structural changes, while we remain committed to our longstanding policy of providing new drugs to patients in Japan, we are also transforming into a company that delivers value globally, advancing as a Global Specialty Pharma that continually delivers innovative medicines to patients around the world.

As a major move to accelerate globalization, we acquired Deciphera Pharmaceuticals, Inc. in FY2024. Based in the U.S., Deciphera is a biotech venture with an innovative drug discovery platform in oncology and a track record of clinical development and sales in the U.S. and Europe. We regard them as a crucial partner driving our evolution into a Global Specialty Pharma.

Deciphera’s strength lies in its proprietary drug discovery capability based on its Switch-Control Kinase Inhibitor Platform, which holds the potential to provide new treatment approaches for refractory cancers. In addition to having strong synergy with our existing oncology pipeline, we see advantages in utilizing Deciphera’s development and sales infrastructure in the U.S. and Europe as a launching pad for our own sales operations. Above all, both companies share a major commonality in putting patients first, which we believe makes this acquisition extremely effective in achieving our goal of sustainable growth.

In the Post Merger Integration (PMI) process, collaboration is progressing smoothly in both research & development functions and business operations. In July 2025, we integrated the functions of ONO PHARMA USA, INC., which had played a leading role as a development and sales base in the U.S. and as a development base in Europe and elsewhere, into Deciphera. As a result, Deciphera will seamlessly oversee development, regulatory filing and sales in the U.S. and Europe, enabling rapid and autonomous business operations.

In addition, researcher exchanges between the two companies have begun, and knowledge sharing is underway. Aiming for true organic integration beyond a simple capital relationship, we have begun steady collaboration based on a shared vision across research, development and business areas.

Going forward, we expect Deciphera to play a central role not only in the creation of new pipelines in oncology, but also in expanding our presence and business in the U.S. and European markets. Steadily, the Ono Group is making progress as a company that continues to deliver its products to as many patients as possible on the global stage.

Meanwhile, an urgent challenge for us is the imminent patent expiry of our mainstay products OPDIVO as well as FORXIGA Tablets and Glactiv Tablets in the diabetes field. Although this is an issue inherent to pharmaceutical companies, I believe these challenges serve as the foundation for a leap forward. Securing future growth drivers will be key to achieving sustainable growth.

First, in drug discovery, we will focus even more on the four priority areas of oncology, immunology, neurology and specialty, with particular emphasis on accelerating the development of our own clinical-stage pipelines. At the same time, we are also strategically promoting the acquisition of in-licensed drug candidates. Our targets range from early-stage research to projects in post-POC development stages, and through advancing open innovation cultivated over more than half a century, we will strengthen collaborations with domestic and international academia and bio-ventures.

We will further accelerate licensing activities by leveraging the network Deciphera has built in the U.S. and Europe. For example, regarding sapablursen, a candidate drug for polycythemia vera for which we announced the acquisition of global development and commercialization rights from U.S. company Ionis in March 2025, our acquisition of Deciphera—and its established development and sales infrastructure in the U.S. and Europe—was instrumental in finalizing the license agreement. This is a prime example of synergies materializing quickly post-acquisition, and we will continue to maximize the benefits of acquisitions to further contribute to patients.

In a rapidly changing environment, highly specialized human resources with a global perspective, adaptability to change, high ethical standards, and the ability to collaborate in teams are essential for our Company’s advancement. By combining internal training and external recruitment, we aim to create an environment where people with diverse backgrounds can thrive, which we believe will lead to sustainable growth as a company.

New employees are expected not only to acquire fundamental skills through training, but also to challenge themselves and achieve growth through practical experience. We believe that by accumulating diverse work experiences, learning proactively and broadening their range of tasks, employees will develop into human resources capable of meeting global changes.

For mid-career recruitment, we are hiring numerous experienced professionals who can immediately contribute, not only in research, development, CMC & Production and all areas of the supply chain, but also in support functions. The recruitment of diverse human resources, including women and those with experience in global business, is bringing a breath of fresh air to our traditional culture. Furthermore, we are proactively sending researchers and others to external organizations such as academia, with systems in place to feed that experience back into the Company.

In FY2024, we reorganized the materialities (key management issues) from 18 items down to 9. The previous list of 18 items was compiled to comprehensively cover wide-ranging perspectives such as environment, society, and economy, but we also received feedback that a more comprehensible structure was needed. Therefore, to allocate resources more strategically and accelerate decisionmaking and execution, we have integrated and reorganized these items.

In the course of the reorganization, we extracted nine themes that align with our mission and the value we provide, based on dialogue with internal and external stakeholders. The nine materialities are broadly categorized into three areas: “Growth Strategy,” “Foundation for Promoting Growth Strategy,” and “Realization of a Sustainable Society,” reflecting our Company’s current situation. Each of these nine materialities forms the foundation for our Company’s medium- to long-term growth and represents essential perspectives for earning ongoing trust from society. Going forward, starting with these materialities, we will focus our management resources and unify internal awareness to establish them as company-wide initiatives.

Starting from FY2024, our Company assigns the top executive functions to three Representative Directors (“Chairman,” “President,” and “Executive Vice President”), each taking on distinct roles and responsibilities. President Takino leverages his overseas experience to lead the planning and execution of global strategy, while Executive Vice President Tsujinaka advances human resources strategies and other initiatives, focusing mainly on domestic operations. As Chairman, I make decisions on the Company’s overall business and take on responsibility, while also dedicating efforts to activities that help solve social issues in business and industry associations.

Looking domestically, in NHI pricing policy, the lack of predictability in NHI prices has made it difficult for companies to invest in R&D and other areas, leading to concerns that innovation in drug discovery is being hindered. Furthermore, in recent years, issues such as “drug loss” and “drug lag”—where it becomes difficult for Japanese patients to access necessary new medicines—have worsened, and it is no exaggeration to say that society faces a mountain of pharmaceutical-related challenges. We will address these societal issues by working together with governments and related organizations to improve systems and strengthen outreach, thereby living up to society’s trust. All of us at the Company share this awareness, and by continuously questioning the ideal form of a company that provides medicines, we will strive to maintain sound and sincere management.

Our Company prioritizes both strategic investments for growth and stable shareholder return to achieve sustainable enhancement of corporate value. As a fundamental policy of our financial strategy, we actively allocate funds to growth investments such as R&D and pipeline expansion, while always being mindful of improving capital efficiency.

Regarding shareholder return, we have made progressive dividends our basic policy and strive to provide stable and continuous profit returns. Furthermore, our policy remains unchanged in flexibly repurchasing treasury shares as appropriate according to circumstances. The development of drugs requires extensive time and resources, necessitating that corporate value be enhanced from a medium- to long-term perspective. To ensure sustained value creation and address forward-looking challenges, we respectfully request shareholders’ ongoing understanding and support with a long-term perspective.

In FY2021, our Company established a Sustainable Management Policy. In addition to Contributing to People’s Health through our core business, we continue to take on the challenge of realizing a sustainable society under the policies of “preserving a prosperous global environment for future generations,” “realizing a society where everyone can actively participate,” and “establishing highly transparent and robust management.” We believe the foundation of our sustainability lies in continuing to return the profits Ono generates through its core business of delivering new medicines to society, so that both the Company and society can grow together. As our Company grows, we aim to continue taking on challenges so that, using the profits as a resource, we can meet social demands through new drug creation, environmental conservation and social contribution activities.

Additionally, we believe it is also our mission to deliver innovative medicines by listening to the voices of patients worldwide in areas with high unmet medical needs or where access to healthcare is an issue, which remain inadequately addressed by existing treatments.

Delivering medicines to society not only supports the health of patients but also contributes to solving societal challenges as a whole. For example, innovative medicines can help reduce social costs by enabling early recovery and shorter hospital stays, thereby addressing structural issues such as rising social security expenses. Improving people’s health can be expected to invigorate society as a whole, by easing the burden on healthcare and nursing care and raising the labor participation rate. Although we are but a small force, we hope to approach the possibilities of medicine from this broad perspective and strive to provide value of social significance.

Taking on social challenges through medicines is a challenge that Ono has embraced in the past, and will continue to embrace into the future. Now that the values sought in healthcare are changing, we will always address unresolved issues from the perspective of putting patients first. We hope you will look forward to the continued evolution of Ono.