Chugai Pharmaceutical Co., Ltd.

Strong Q3 FY2026 performance; core profitability expanding - Core revenue (core basis): JPY 906.8bn, +JPY 112.2bn (+14.1% YoY); this is +19.0% vs prior-year (per CFO’s framing). - Core operating profit: JPY 536.1bn, up +JPY 85.6bn; operating margin improved to 50.2% (+0.8pt). - Net income: ~JPY 384.7bn (CFO noted financial income from higher interest rates outpaced operating profit growth). - Surprising/important: despite system-related disruption, underlying momentum appears strong (management said results are tracking well vs full-year forecast and expect to exceed it).

Key driver: Japan sales rebound + overseas royalties/milestones; one-off ERP disruption helped Q3 - Japan (domestic): +JPY 62.6bn YoY - Despite negative effects from drug price revisions and generic penetration, growth was driven by core/new products. - Front-loaded shipments to wholesalers as transition into next-generation infrastructure boosted net sales. - Overseas: +JPY 49.6bn YoY - Partly offset by lower export unit prices from export volume and FX, but NEMLUVIO (Galderma) and Alecensa (Roche) export growth supported the outcome. - Other revenue: +JPY 44.2bn YoY - Mainly higher Hemlibra royalties and milestone/royalty income (CFO cited royalty/milestone jump). - Negative/special item: ERP system replacement / Go-live caused a shutdown in Japan, leading to an ~JPY 30bn shipment increase moved into Q3; management confirmed it is effectively one-off and should reverse in Q4.

Full-year outlook: likely to exceed forecast; product outlook looks intact - Management (CEO/CFO) stated Q3 is tracking well and they expect full-year core results to exceed the forecast. - Actemra (overseas): expect to exceed forecast - CFO: JPY 121.7bn through Q3 vs JPY 130.8bn forecast (implying > ~JPY 10bn upside potential if Q4 aligns). - Hemlibra (overseas): expected roughly in-line - CFO: full-year expected to come in line with forecast given shipment/export planning. - Risks implied by CFO: FX and export unit price pressure are continuing variables, but volumes and product mix have been able to offset much of that.