#Japan #Tokyo #Alfresa Group #Vision2032 #TSCS

Overview of the New Mid-Term Management Plan: Vision2032 Stage2

Alfresa Group has announced the establishment of its new mid-term management plan, titled "Vision2032 Stage2", which will span from April 1, 2025, to March 31, 2028. This initiative aims to enhance the group's comprehensive capabilities to forge a better future.

The Vision2032 Stage2 plan represents the second stage of the group’s long-term strategy designated as the Medium-Long Term Vision, laid out in 2023. This long-term vision prioritizes societal value creation by extending healthy lifespans, contributing to regional healthcare, and driving healthcare innovation. The aim is to achieve these goals through the reinforcement of fundamental businesses, cultivation of growth sectors, and the development of new business ventures.

To effectively attain the long-term objectives, the 25-27 mid-term plan will focus on key investments to ensure profit expansion and the optimization of costs. The plan also marks an evolution in the group’s ongoing efforts.

Objectives of Vision2032 Stage2

1. Amplifying Group Synergy through TSCS

The group seeks to maximize its strengths by establishing a seamless Total Supply Chain Service (TSCS) model for the entire process from manufacturing to distribution. This will facilitate the acquisition of limited distribution products, the expansion of Contract Development and Manufacturing Organization (CDMO) services, and the maintenance of a stable supply chain.

2. Strategic Investment in Growth and New Businesses

To advance growth and new business segments in conjunction with TSCS, investments will be directed towards regenerative medicine, healthcare-related services, and international business operations to explore new opportunities.

3. Enhancing Competitiveness of Core Businesses

The strategy also includes efforts to boost profitability across core sectors to improve overall group value.

4. Strict Cost Control

In light of rising transportation and labor costs, as well as annual drug price revisions, stringent cost control measures will be enforced.

5. Promoting Sustainability Management

Guided by its core philosophy of creating and delivering vibrant lives for all, the group will proactively tackle social and environmental challenges within the healthcare sector. The objective is to contribute to a sustainable society and continuously enhance corporate value.

Financial Targets for 2025-2027

• - Projected Sales (2027): ¥3.33 trillion
• - Operating Profit (2027): ¥43.5 billion
• - Average ROE (3 Years): Approximately 7%
• - Investment Plan (3-year Total): ¥120 billion
• - Shareholder Returns: DOE of 2.5% or more, progressive dividends

Business Strategy Overview

1. Pharmaceutical Wholesale Business

The focus will be on maximizing marketing specialists (MS) strengths, strengthening nationwide networks, and enhancing logistics systems to expand business opportunities.

2. Self-Medication Wholesale Business

The theme of this segment is "health, connection, and happiness," aiming toward proactive strategies in response to industry reorganization while fostering new solutions.

3. Pharmaceutical Manufacturing Business

Future strategies include enhancing profit margins and efficiency, expanding contract manufacturing, and developing a robust product pipeline to establish a more stable management base.

4. Pharmacy and Related Services

There will be an emphasis on improving patient services, securing prescriptions, and enhancing community pharmacy functions while venturing into caregiving initiatives.

5. Other Business Ventures

The regenerative medicine sector focuses on the manufacturing and storage of master cells, alongside developing CMO and CDMO services with a view toward establishing a comprehensive TSCS.

Financial and Sustainability Strategies

The company’s financial approach will prioritize improving capital efficiency and financial soundness while maintaining consistent shareholder returns. The sustainability strategy focuses on addressing critical environmental and healthcare challenges through dedicated efforts in compliance, risk management, and corporate governance reforms.

In conclusion, the 25-27 mid-term management plan aims not only to achieve financial goals but also to positively impact society and the environment, reinforcing the commitment towards a sustainable future for the Alfresa Group and its stakeholders.