Steady Results as Projected for the First Year of Strategic Plan 2018
Aiming to Overcome the Patent Cliff* and Achieve Sustainable Growth
“On the forefront of healthcare change, to turn innovative science into VALUE for patients” – by following the path to achieving this VISION, Astellas can realize its corporate philosophy and achieve continuous improvement in corporate value.
In the fiscal year ending March 2020, Astellas' financial performance is to be negatively impacted by the end of exclusivity for several of our main products. Though it is difficult for innovative drug businesses to avoid this, our goals are to overcome such temporary declines in performance and achieve medium-to long-term profit growth by creating and continuing to deliver VALUE to patients. During the fiscal year ended March 2019, we were able to execute against the strategies for growth outlined in the Strategic Plan 2018 , our roadmap to achieving these goals.
Strategic Plan 2018 and Progress
In the fiscal year ended March 2019, Astellas achieved an increase both in revenue and profit on a consolidated basis. Core operating profit and core profit both reached all-time highs. The three strategic objectives outlined in the Strategic Plan 2018 also progressed as planned.
Strategic Plan 2018: Strategic Goal 1
Maximizing Product VALUE and Operational Excellence
Sales of XTANDI, a main growth driver, increased steadily due to increased use among patients with earlier stages of prostate cancer. Mirabegron expanded its market share and showed double-digit year-on-year growth in sales , partly due to an increase in prescriptions as the first choice treatment for overactive bladder. In December 2018, we launched XOSPATA®, in Japan and the U.S. With this launch, a FLT3 inhibitor for the treatment of acute myeloid leukemia (AML), in Japan and the U.S. With these launches, we were able to provide a new treatment option for patients with relapsed or refractory AML with FLT3 activating mutations for whom no effective treatment had been established. In only a short period since coming to the market, the launches have been successful and the response from physicians using XOSPATA has been positive.
Development of key post-POC pipeline projects is advancing as planned and we have achieved a number of milestones, including progression through various stages of development and the submission of several new drug applications. Enzalutamide (XTANDI) was approved for the additional indication of non-metastatic castration-resistant prostate cancer in the U.S. and Europe. Additionally, Phase 3 results were also obtained for the indication of metastatic hormone sensitive prostate cancer (Regulatory applications for this indication were submitted in the U.S. in June 2019 and in Japan and Europe in July 2019). For Roxadustat, an application was made in Japan for the treatment of anemia associated with chronic kidney disease (CKD) on dialysis, and the results for all the Phase III studies conducted in Europe were obtained.
For enfortumab vedotin, we obtained positive data from a phase II study in patients with locally advanced or metastatic urothelial cancer, and a Biologics License Application was submitted in the U.S. in July 2019.
We are also further pursuing Operational Excellence by reviewing operating models in accordance with changes in business environments and product portfolios, as well as optimizing the allocation of management resources.
Strategic Plan 2018: Strategic Goal 2
Evolving How We Create VALUE
– With Focus Area Approach –
Aiming to upgrade and expand our development pipeline, we have identified areas where we prioritize management resources from the very earliest development stages, and have begun clinical trials in multiple projects. We have also obtained promising assets through the acquisition of Quethera Limited, which focuses on developing novel gene therapies in the ophthalmic area, and Potenza Therapeutics, Inc., which has discovered multiple development candidates in the immuno-oncology field through earlier collaborative research with us. Beyond these, through partnerships with multiple external organizations, we are pursuing ongoing VALUE creation aligned with the Focus Area approach.
Notably, Astellas is intensively investing in cell therapy, a highly anticipated field of next-generation medicine, and we have begun clinical trials of ASP7317, our first candidate for cell therapy in dry age-related macular degeneration. Further, through the acquisition of Universal Cells, Inc., we have established a foundation to expand our pipelines for cell therapy in non-ophthalmology areas. Additionally, we are working to solve the unique commercialization challenges of cell therapy including addressing the manufacturing capabilities required in accordance with regulations of each region.
Strategic Plan 2018: Strategic Goal 3
Developing Rx+™ Programs
In Rx+™, we have worked to establish a foundation for programs to create new businesses beyond the scope of prescription drugs (Rx). In addition to establishing a U.S. base to develop our network, we are exploring opportunities for collaboration with startups and academia through the establishment of a venture capital fund specializing in digital health and participation in a venture capital fund specializing in optical technology and medical devices. We made significant progress in several specific programs, including entering into agreements with partners and initiating clinical trials.
Improving Access to Health
In order to realize our business philosophy, it will be crucial for Astellas to be chosen by all stakeholders and earn their trust. Astellas is helping to improve the sustainability of society by fulfilling its social responsibility as a pharmaceutical company through its business activities, beginning with satisfying unmet medical needs. Through these efforts, we will earn the trust of society in Astellas and its products. We believe that this trust will enhance our own sustainability as a company.
We also believe that Astellas has a responsibility to work to address the Access to Health issue, an area where Astellas can leverage its strengths and technologies as a pharmaceutical company. In the year ended March 2019, Astellas implemented a range of initiatives to improve Access to Health, including contributions through the Access Accelerated global partnership, launching new programs to fight neglected tropical diseases (NTDs) and driving the advancement of current programs. 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.”
Strengthening Human Resource Development and Organizational Capabilities
I believe that measures to address human resources development and compliance as well as achievement of the strategic plan, are important. Like the front and rear wheels of a car, both elements are essential for us to move forward. Even if we dedicate to create and deliver value through innovative approaches, our efforts will not be meaningful unless our processes and output are scientifically and socially trustworthy. That is also why I believe it is crucial for every employee working at Astellas to take ownership of their duties based on an understanding of the Astellas’ sense of values (Astellas Way) as well as Astellas’ approach to human resources and organization management (HR Vision).
Moreover, Astellas is a consistent supporter of the United Nations Global Compact. As such, Astellas conducts our 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
In the fiscal year ending March 2020, we expect decreases both in revenue and profit due to the end of exclusivity for our main products. However, this is a very important year to minimize the impact and ensure a return to growth trajectory in the future. We will continue to generate VALUE as we evolve toward achieving our strategic plan.