Steady Results also for the Second Year of the Corporate Strategic Plan 2018
Working to Achieve the Corporate Strategic Plan 2018’s Objectives Upon Making Active Investments for Medium- to Long-Term Growth
We give our deepest sympathies to those who have passed away as a result of the Coronavirus Disease (COVID-19) and pray, from the bottom of our hearts, for the recovery of those who have been infected. As part of our mission as a pharmaceutical company, Astellas will contribute to overcoming this pandemic through various actions and measures.
Corporate Strategic Plan 2018 and Progress
For Astellas, the three years of the Corporate Strategic Plan 2018, which started in April 2018, are the years in which our product portfolio significantly changed due to the end of market exclusivity for several of our main products. As an important strategic goal of the Corporate Strategic Plan, in order to survive this transitional period and attain sustainable growth, we are launching new products as planned and maximizing their values. In implementing this strategy, we have been able to surpass expectations by concentrating management resources in expanding the sales of core products and to develop post-POC pipeline projects. In spite of the forecast which originally estimated a decrease of revenue and core operating profit for the fiscal year ended March 2020, we were able to offset the negative impact from the end of market exclusivity for our main products by increasing the market penetration of XTANDI through the expanding of its indication for earlier stages of prostate cancer and the stronger than expected initial sales of our new product EVENITY. As a result, revenue and profit for the fiscal year ended March 2020 were in the same range as those for the fiscal year ended March 2019, and an increase was seen in both when the foreign exchange rate impact was excluded from the calculation. In addition to this, we were able to invest in new technology in preparation for the future.
The three strategic goals outlined in the Corporate Strategic Plan are steadily progressing, and we are demonstrably advancing towards realizing our VISION of “on the forefront of healthcare change to turn innovative science into VALUE for patients.”
Corporate Strategic Plan 2018: Strategic Goal 1
Maximizing Product VALUE and Operational Excellence
Our key products XTANDI and mirabegron grew faster than expected in the fiscal year ended March 2020, which was one of the factors our revenue and core operating profit exceed the forecasts. Sales of XTANDI grew not only in the United States, Europe and Japan, but also in Russia, Brazil, etc. due to the expansion of its indications across the world. Sales of mirabegron continued to grow in each region due to market expansion through disease awareness activities and further penetration of product features in healthcare professionals. Many milestones have also been achieved in the development of key post-POC pipeline projects, such as the obtaining of study results, regulatory submissions and approvals, and in these two years we were able to launch the three global products, XOSPATA, PADCEV and Evrenzo. In some cases, we were able to achieve ahead-of-schedule launches by utilizing the accelerated approval pathways that regulatory authorities have begun to introduce.
In order to maximize the VALUE of products and key post-POC pipeline projects, it is also important to realize an organizational structure that matches our product portfolios and external environment. In April 2019, we established a new sales and marketing structure and enhanced strategic planning and execution capabilities for key products by product, region and country. In China, where the market is expected to further expand going forward, we have strategically positioned the market as one of the top-tier markets like Japan, US and Europe, and accordingly started to strengthen not only the sales structure, but also the development and regulatory functions.
In terms of the allocation of management resources, we are sufficiently investing in new products and growing products based on clear prioritization. On the other hand, we are continuing to pursue Operational Excellence by reviewing selling expenses, transferring the rights to sell products to third parties, etc.
Corporate Strategic Plan 2018: Strategic Goal 2
Evolving How We Create VALUE
– With Focus Area Approach –
Astellas is taking an approach called “Focus Area Approach” as its research and development strategy, and the Primary Focus that was selected based on this strategy is what we focus our management resources to develop innovative healthcare solutions.
In January 2020, Astellas acquired Audentes Therapeutics, Inc, and gained capabilities for gene therapy, including technology platforms, manufacturing capabilities, and the achievement and experience to develop new drug candidates into the clinical stage. By obtaining these assets, Astellas has made a significant first step toward becoming a top runner in this area. As a result of this, as an addition to the other four areas of, “Antigen-specific Immune Modulation (ASIM),” “immuno-oncology targeting lymphocytes with low permeability,” “regeneration and blindness” and “mitochondria biology,” “genetic regulation” became the 5th Primary Focus.
Moreover, links are now beginning to form between the Primary Focus areas that were originally independent of one another. For example, universal donor cell technology, which advances “regeneration and blindness,” is utilized also in “immuno-oncology.” By integrating technologies in the different fields, our initiatives will be strengthened and expanded, and will grow into a unique Primary Focus. It is expected to become the key to the future growth of Astellas, and a source of competitive advantage that is second to none.
Corporate Strategic Plan 2018: Strategic Goal 3
Developing Rx+ Programs
Astellas set, as its third strategic goal, “to develop new products and services (Rx+ business) which is out of Astellas’ core prescription pharmaceutical products (Rx) by combining Astellas’ expertise and experience in medical drugs with technology and knowledge from different fields,” and has been seeking new business opportunities. Consequently, many projects have been developed thus far, and we have mapped out “Rx+ Story™” as a strategic direction in order to evolve the Rx+ business. We expect that connecting and creating synergy effects among business ideas which tend to be established based on single opportunity and be sporadic, are enhanced and the development of the Rx+ business accelerated by this strategic direction.
Each program aiming to create the Rx+ business is progressing steadily toward commercialization. Going forward, we plan to realize “a world where people can live mentally and physically healthy lives and be true to themselves through healthcare solutions based on scientific evidence.“
Improving the Sustainability of Society and Astellas
Astellas contributes to the improvement of a sustainable society by fulfilling its social responsibility as a pharmaceutical company through its business activities, such as providing pharmaceutical products that satisfy unmet medical needs. We earn the trust of society toward our products through such efforts, and we believe that this trust will enhance our own sustainability as a company.
In line with this belief, with the continuing spread of COVID-19, we are, as a part of our mission as a pharmaceutical company, taking various actions and measures to contribute to securing the safety of patients and alleviating strain on healthcare resources. We have, thus far, conducted initiatives in areas that include the stable supply of products, contribution to the R&D of drugs, and assistance to regions where infection is spreading.
Through improving Access to Health, Astellas will contribute to the attainment of the Sustainable Development Goals (SDGs) adopted by the United Nations, focusing primarily on “Goal 3: Good Health and Well-Being.” In addition to this, Astellas is working to achieve other goals related to the environment, society, etc. through various business activities, with the aim of developing a sustainable society.
Strengthening Human Resource Development and Organizational Capabilities
In order to realize the Corporate Strategic Plan, the “people” and the “organization” that support it are indispensable, and it is crucial that every employee working at Astellas takes ownership of their duties based on the understanding of the Astellas’ sense of values, the “Astellas Way,” as well as the Astellas’ approach to human resources and organization, the “HR Vision.” Astellas’ human resources and organization management has been structured in such a way as to focus on the three areas of attracting, developing, and retaining talent, so that it can maximize the performance of the “people” and the “organization”. In the fiscal year ended March 2020, we introduced a new global system that standardizes all the employees’ data and integrates the performance evaluation system. This allows us to assign the right person in the right position at the right time with a fair evaluation. Going forward, we will carry out new initiatives in due course and create a working environment where every employee is motivated to work.
As a consistent supporter of the United Nations Global Compact, Astellas conducts its daily business activities based on the 10 principles advocated by the United Nations, covering the four fields of human rights, labor, the environment, and anti-corruption.
To Our Stakeholders
Two years have passed since the implementation of the Corporate Strategic Plan 2018, and the fiscal year ending March 2021 will be its final year. The initiatives for each strategic goal are steadily making headway, and some are even performing better than expected. We were also able to make new investments for sustainable growth.
Though revenue and core operating profit for the fiscal year ending March 2021 is projected to decrease compared to those for the fiscal year ending March 2020, mainly because of the spread of COVID–19, sales of XTANDI and PADCEV, which are our core products driving our growth, are expected to solidly grow. We are confident that we are advancing significantly towards our VISION in terms of more than what we see in the just financial figures, considering the fact that we have been able to begin further strengthening our business foundation and make active future investments by acquiring Audentes Therapeutics, Inc and Xyphos Biosciences, Inc.
We will proceed with our plan to achieve results for each strategic goal as soon as possible and continue to advance into the future.