CSP2021: Evolved Strategy. Ambitious Goals. Transformative Execution. Same Deep Commitment to Our VISION.
The ongoing novel coronavirus disease (COVID-19) pandemic has made people more health-conscious and greater importance has been placed on the role of healthcare providers than ever before. We remain committed to fully utilizing our core capabilities to deliver VALUE to society.
On the Forefront of Healthcare Change to Turn Innovative Science into VALUE for Patients
Astellas' VISION is “to be at the forefront of healthcare change to turn innovative science into VALUE for patients.” With research and development at the heart of everything we do, we will constantly take on challenges to deliver innovative new drugs and medical solutions by leveraging our core capabilities.
In recent years, the external environment has changed at dizzying speeds. We need to achieve sustainable growth in step by flexibly adapting to change. We aim to generate benefits both for society and for us as a company through the formulation of strategies that contribute to the sustainability of society and make Astellas more sustainable as a result. This approach will build trust with stakeholders, and we will live up to stakeholders’ expectations through the allocation of generated funds to appropriate therapeutic areas. This is Astellas’ value creation process. By implementing this process in a continuous cycle, we will sustainably enhance our corporate value and continue to make innovative medical solutions available to patients.
Building a Foundation to Create Innovative Treatments under CSP2018
In fiscal 2020, which was the final year of Corporate Strategic Plan 2018, or CSP2018, (for fiscal years 2018 through 2020), revenue was in line with the plan if we exclude the impact of foreign exchange rates, albeit falling slightly short of the full-year forecast, and core operating profit also reached the planned level. Sales of major products that drive growth, namely XTANDI® (enzalutamide), XOSPATA® (gilteritinib) and PADCEV® (enfortumab vedotin), expanded and we continue to contribute to many patients.
Looking back on CSP2018 as a whole, we focused on three Strategic Goals and achieved outcomes as planned over the three years. During this period, I believe we succeeded in building a foundation to create innovative treatments, which will be our mainstay products from the mid-2020s onwards. In other words, our six key post-POC projects progressed steadily, and our Primary Focuses identified through our Focus Area Approach grew. Further, with Rx+®, in addition to succeeding in expanding projects, we were able to identify the areas we needed to focus on and clarify the direction for their commercialization.
Over the past three years, our portfolio has changed substantially. We have achieved steady progress on six key post-POC projects and obtained approvals for these products. We have also out-licensed many of our long-listed products, developing a framework that will allow us to focus more effectively on our core businesses. As a result, growing products such as XTANDI® and mirabegron, new products such as XOSPATA® and PADCEV®, and PROGRAF, which is still a core product, are expected to account for a combined share of 80% of revenue in fiscal 2021 compared with just under 60% in fiscal 2018. Negative financial impacts from products such as Vesicare® and Celecox® after the expiration of exclusive license agreements and from the termination of agreements for sales of in-licensing products in Japan, such as Symbicort® and Micardis®, have mostly worn off. I believe that the three-year period of CSP2018 was a period in which we overcame this period of transition in our portfolio and prepared for the achievement of sustainable growth. We will use the foundation built in CSP2018 to further enhance the execution of CSP2021, which will continue to evolve and develop each strategy.
Pursuing Ambitious Outcomes while Contributing to Social Sustainability
In May 2021, Astellas announced CSP2021.
In the face of the diverse global challenges in recent years, as members of society, pharmaceutical companies need to be strongly committed to improving social sustainability by actively meeting growing medical needs and sincerely addressing environmental challenges. We included “Deepen our engagement in sustainability” in our four strategic goals under CSP2021. We will continue to achieve ambitious targets as we pay close attention to the external environment and contribute to social sustainability.
Under CSP2021, we have set four Strategic Goals, three Organizational Health Goals as signposts for fostering a culture to reach these goals, and three Performance Goals, which we consider achievable if all the above are accomplished. The Organizational Health Goals, which clearly set out our aspirations as an organization, will further strengthen the organizational health and human resource development programs, which are Astellas’ core capabilities.
Strategic Goal 1: Enable patients to achieve better outcomes
Astellas is committed to maximize patient access to our products and to partner effectively with healthcare stakeholders to secure the realization of VALUE. To achieve this, we strive to accelerate submission of New Drug Applications (NDAs), reducing the time to achieve broad geographic coverage, implementing sophisticated launch plans and prioritizing our efforts across the portfolio towards where the VALUE opportunity is greatest. We will take a patient-oriented approach, adopting new techniques to create and use data and implement solutions that overcome obstructions to patient access or important factors that limit real-world outcomes. It is through pursuing these activities in association with this strategic goal that Astellas will maximize the value of XTANDI® and strategic products that drive medium- to long-term growth.
Strategic Goal 2: Translate innovative science into proven VALUE
Astellas will enhance its pipeline value by giving priority to the investment of management resources into its Primary Focuses. Through acceleration of the demonstration of VALUE, the growth of Primary Focuses, and the effective exploration of cutting-edge biopharmaceutical innovation, we aim to take our efforts under CSP2018 to the next level. Astellas is working on researching and developing life-changing therapies through priority investment in Primary Focuses selected based on an R&D strategy dubbed the Focus Area Approach. We have already established four Primary Focuses: Immuno-Oncology, Blindness & Regeneration, Mitochondria Biology and Genetic Regulation. I believe that therapeutic approaches building on our core technologies in Immuno-Oncology and especially Genetic Regulation could bring about a paradigm shift. They will enable us to move from symptomatic therapy to radical therapy, bringing great hope to patients desperate for new therapies that will treat previously untreatable diseases.
Strategic Goal 3: Advance the Rx+® business
We changed the goal of “Developing Rx+® programs” under CSP2018 to “Advance the Rx+® Business” under CSP2021. The Rx+® business will enter the stage where efforts for business creation will bear fruit in CSP2021. In the period between fiscal 2021 and fiscal 2025, we expect to commercialize at least five projects. By putting even greater effort into the commercialization of Rx+® programs, we will move closer to achieving our vision of realizing “a world where people can live mentally and physically healthy lives and be true to themselves through healthcare solutions based on scientific evidence.”
Strategic Goal 4: Deepen our engagement in sustainability
This is the strategic goal that we have newly added in CSP2021. We conducted a range of activities that have contributed to society under CSR management. In fiscal 2020, we reviewed our activities to date and plan to shift away from CSR-Based Management towards group-wide initiatives based on Astellas’ Sustainability, which will contribute to the sustainability of both society and Astellas, while taking ESG into consideration. In our sustainability initiatives, we are prioritizing and focusing on Access to Health (ATH), which leverages Astellas’ core capabilities, technologies, and expertise, and Environment, in particular Climate Change.
Organizational Health Goals
We established Organizational Health Goals (OHGs) to implement CSP2021 more effectively. I believe that fostering a corporate culture enabling the creation of greater innovation to reach more ambitious goals is important for the reliable execution of CSP2021, and above all, for the personal growth of individual employees.
I hope that a culture which encourages employees to take appropriate risks without fear of failure and to steadily learn from this to create innovation for the future will lead to growth of “Our People, Our Organization” and help us to achieve our goals under CSP2021. We will achieve this whilst at the same time never compromising on patient safety or product integrity or compliance with regulations.”
The level of performance we consider achievable through the pursuit of our aspirations and steady implementation of our four strategies is expressed as numerical targets in these performance goals.
1. Sales Revenue of XTANDI® and Strategic Products: ≥ ¥1.2 trillion in FY2025
2. Pipeline Value: Focus Area projects expected sales ≥ ¥0.5T in FY2030
3. Core Operating Profit Margin: ≥ 30% in FY2025
By achieving these three Performance Goals, we aim to become a company with a market capitalization valued at more than 7 trillion yen in fiscal 2025.
For Growth with Society
Astellas recognizes that its contribution to social sustainability is essential for the company’s business continuity. As a research and development-orientated company, we recognize we have a responsibility to increase social sustainability and are committed to developing the organization and external cooperation framework needed for this and to working as One Astellas to solve sustainability issues. At the same time, widespread recognition for our initiatives will build trust in society and will also make Astellas more sustainable.
Astellas’ Materiality Matrix, which specifies the priority for our initiatives, identifies 31 material issues besides “Access to Health” and “climate change”, including “proper use of products”, “diversity & inclusion”, and “health, safety & welfare of employees”. We are tracking various material issues in accordance with our priority.
In addition, Astellas is a signatory to the UN Global Compact in 2011. By incorporating the Ten Principles in the four areas of human rights, labour, environment, and anti-corruption into our daily business activities, we conduct globally responsible business activities for the enhancement of sustainability as a consistent supporter of the UN Global Compact.
An effective governance framework is another of Astellas’ strengths. To maintain governance on a global level, we respect our Charter of Corporate Conduct and the Astellas Group Code of Conduct as a set of core ethics and compliance standards for all our activities throughout the world. Acting in accordance with “high ethical standards” is the core of our value here at Astellas.
I hope that this report will provide a better understanding of the full extent of our policies and initiatives for contributing to a more sustainable society.
Build the Foundations of Human Resource and Organizational Management Necessary for a Global Organization with Astellas’ Unique Approach
At Astellas, diverse people bring their ideas together as “One Astellas” to transform the company, and we are striving to foster an organizational culture which enables sustainable enhancement of enterprise value and realization of our VISION. Astellas has established the “HR Vision,” which represents its approach to “Our People, Our Organization,” and the “Astellas Way,” which defines a shared set of values underlying this vision, and we are working as a Group on various activities based on a shared global worldview. Through the global standardization of a grade system and compensation philosophy based on the HR Vision, we are building an HR Management system that allows us to fairly and impartially hire the best talent from human resource markets around the world. In 2020, we actively revised multiple HR Management systems that were unique to Japan in the interests of global standardization. Then, in 2021, the contents and training record of employee training were integrated into a global common system.
Astellas’ approach for personnel assignments and career development is to assign the right person in the right position and talent development. Since 2020, we introduced a new global common job posting system, and appoint talent who are considered to be the most qualified for the position, regardless of nationality, gender, or age. All employees who meet the requirements can apply for positions if they are interested in them, providing employees with all kinds of career opportunities around the world.
We will continue striving for work styles that enable each employee to demonstrate high productivity and creativity and achieve self-realization. The Organizational Health Goals we set in CSP2021 will further accelerate these initiatives.
Continuing to Advance Strongly Towards the Realization of Our VISION
Through CSP2018, we succeeded in building a foundation to create the life-changing therapies which will be our mainstay products from the mid-2020s. We are confident that this strategy was correct and believe we are even closer to realizing our VISION. CSP2021 will build on this foundation and the steady translation of strategies into results is considered its biggest challenge. As such, the keyword in CSP2021 is “Execution.”
We will harness transformative execution to reach the ambitious targets of CSP2021 and advance strongly towards the realization of our VISION “to be on the forefront of healthcare change to turn innovative science into VALUE for patients.”