EISAI UNSPONSORED ADR

Q3 FY2025 headline performance (strong organic growth; profits lower YoY due to lack of one-offs) - Revenue: JPY 619.9bn (+3.1% YoY), described as a record-high third-quarter and driven “almost entirely” by organic business (i.e., not by partnership/out-licensing one-time items). - Operating profit (OP): JPY 54.5bn but down YoY because this year lost temporary/one-off profit from product out-licensing; management emphasized organic OP contribution has significantly expanded. - Full-year guidance unchanged: Revenue JPY 790bn and OP JPY 54.5bn.

“3Ls” business momentum: growth offsetting declines (positive underlying trend) - The quarter’s Pharmaceutical growth was mainly from the “3Ls”: - Lenvima: JPY 258.1bn (+4% YoY); growth across regions, with U.S. IRA price impact offset by strong demand. - DAYVIGO (insomnia): JPY 47.7bn (+18% YoY); Japan absorbing a 14% drug price reduction yet still +4% YoY; global confidence to reach full-year forecast JPY 58bn. - LEQEMBI (early Alzheimer’s): Q1–Q3 revenue JPY 61.8bn, +109% YoY; “more than doubling,” with steady expansion across Americas, Japan, China, and EMEA. - Offset included: HALAVEN sales decline (reaching LOE; lower cost ratio), and absence of prior-year one-time items in other businesses.

Cost/reinvestment profile: R&D down, SG&A up (and “structural reform” coming in Q4) - COGS: JPY 139.2bn, gross margin broadly stable; higher ratio mainly from Japanese price revisions and mix shift (decline in HALAVEN). - R&D: JPY 114.4bn (-8.5% YoY); R&D-to-revenue 18.5% (improved). - SG&A: JPY 315.7bn (+4.7% YoY) reflecting proactive investment for LEQEMBI (shift of spend from R&D to SG&A largely for LEQEMBI). - Q4 outlook includes planned structural reform costs in EMEA + additional R&D spending allocated to next-generation key pipeline programs; management says these costs are contained within the current OP guidance.