Thank you very much for taking time out of your very busy schedules to attend our first quarter of FY 2026 earnings call. My name is Miyata from Corporate Communication and IR Department and I'll be serving as the moderator today.

Thank you for your kind attention. The session will be conducted via Zoom Webinar.

We will proceed according with the agenda shown on page 3 of the presentation materials. The briefing will be conducted in Japanese, but we will have simultaneous interpretation in English also available.

Please click the interpretation icon at the bottom of your screen and select either Japanese or English for your preferred language. Questions will be taken together after all the presentations have been concluded.

The Q&A session is scheduled for approximately 30 minutes. Please note that participants' microphones will remain muted during the presentations.

First, Dr. Okuda to provide an overview of the first quarter of FY 2026.

I am Okuda, President and CEO. I would like to give an overview of the first quarter of FY 2026.

Please refer to slide 5 in the material at hand. In first quarter FY 2026, both domestic and overseas product sales progressed steadily, resulting in both increase in revenue and profit.

Growth was driven mainly by Hemlibra exports to Roche, as well as increased Nemluvio exports to and higher royalty income from Galderma. As a result, compared with the same period last year, revenue increased by 11.5%, operating profit by 17.1%, and quarterly profit by 19.6%.

As such, first quarter got off to a smooth start in line with our initial expectations. Details of the revenue will be covered on the next slide, slide 6.

This shows the year-on-year changes in revenue compared with the same period last year. Revenue grew by ¥33.2 billion, up 11.5%.

I will walk through the items from left to right. Domestically, despite the negative impact of the NHI drug price revision and generics penetration, mainstay products as well as new products performed well, resulting in an increase of ¥8.4 billion.

Overseas, while export unit price declined, the increase from volume and foreign exchange effects more than offset this, resulting in an increase of ¥23.4 billion. In particular, Hemlibra exports to Roche and Nemluvio exports to Galderma increased significantly, marking solid progress.

Other revenues increased year-on-year primarily due to higher royalty income related to Nemluvio despite a decrease in one-time income. Domestic sales, overseas sales, and other revenue all increased, achieving overall revenue growth.

Please move on to the next slide. I would like to explain about the key progress made in the first quarter.

Regarding NXT007, we plan to initiate two Phase 3 trials in the second quarter, aiming for a regulatory filing in 2028. Regarding emugrobart, which is GYM329, we have discontinued the development for SMA and FSHD.

On the other hand, based on the clinical results obtained, we believe this will not impact the development for obesity, where the target myostatin is highly prevalent. Therefore, we will proceed with the Phase 2 trial.

As for Enspryng, we presented the result of the Meteoroid study in MOGAD at the American Academy of Neurology in April. Further details will be provided later in Mr.

Kusano's section. Regarding giredestrant, while numerical improvement in PFS was observed in the persevERA study for the first-line HR-positive breast cancer, the primary endpoint was not met.

Consequently, we have discontinued the development for the first-line setting. Meanwhile, based on the results of the evERA and lidERA studies, which have already achieved their primary endpoints, we aim to file for the second- to third-line and adjuvant treatment for HR-positive breast cancer within 2026.

For DONQ52, we have commenced an in-house Phase 2 study targeting celiac disease. Overall, progress remains on track toward achieving a record number of regulatory filings.

Next is page 8. I will discuss new product launches and indications.

In February, we launched ELEVIDYS, Japan's first gene therapy for DMD. In March, the combination therapy of Lunsumio and Polivy became the first in the world to receive approval in Japan for relapsed or refractory large B-cell lymphoma.

We also launched a subcutaneous formulation for Lunsumio and obtained approval for an autoinjector formulation for Enspryng. Regarding out-licensed products, orforglipron, brand name foundeor, was approved and launched in the US as a treatment for obesity.

foundeor is the only once-daily oral GLP-1 receptor agonist that can be taken at any time without any restrictions on food or water intake. Applications for approval are currently pending in over 40 countries for obesity and type 2 diabetes, and we look forward to contributing further to patients worldwide.

For Nemluvio, we anticipate further growth, especially as Galderma has raised its peak sales projection to over $4 billion. Finally, I will explain the composition of the Board of Directors.

We have launched a new management structure, having newly appointed Ms. Kinuko Mitani, a medical expert, as an independent external director and a member of the Nominating Committee.

To ensure prompt and decisive management decision-making, the board maintains an appropriate balance of diversity, including expertise and gender, as well as an optimal scale. We will continue to strive for further enhancement of our corporate governance.

That's all. Thank you.

Next, from Kusano, we will ask him to provide FY 2026 Q1 overview of development pipeline.

Thank you very much. I am Head of Project Lifecycle Management Unit.

Please refer to slide 11 in the materials. These are the topics for Q1.

I will go through them from the top. There's one launch: ELEVIDYS, a microdystrophin gene therapy, has been launched as the first regenerative medicine product in Japan for DMD.

Five approvals: Enspryng has received approval for a new dosage form, an autoinjector, which we expect to improve convenience for the patients. foundeor, once-daily oral GLP-1 receptor agonist that can be taken without restrictions on food or fluid intake, is our in-house innovation.

Our licensee, Eli Lilly, has received approval in the United States for obesity and has begun commercialization. Lunsumio and the Polivy combination therapy has also received approval as indication extension for relapsed or refractory large B-cell lymphoma.

There's one filing: we have submitted a regulatory application for the ocular implant for ranibizumab. A filing for ranibizumab formulation dedicated to ocular implant delivery is also planned within the year.

Four studies have started: inavolisib has initiated Phase 3 studies for two types of PIK3CA mutation breast cancer respectively. CT-388 is a long-acting GLP-1/GIP receptor agonist, and Phase 3 study was initiated for obesity without type 2 diabetes.

Our in-house DONQ52 started Phase 2 study for celiac disease. There are four pipeline removals: Enspryng has been removed from the pipeline following Roche's decision to discontinue Phase 2 clinical trial for DDM, for strategic reasons.

GYM329, in light of the results of the MANATEE study, development for spinal muscular atrophy has been discontinued, and based on the result of MANOEUVRE study, development of FSHD has been discontinued. Tecentriq, based on the results of IMbrave251 study, development for hepatocellular carcinoma second-line has been discontinued.

giredestrant, based on the result of the persevERA study, development for first-line hormone receptor-positive breast cancer has been discontinued. Moving on to the second page of the topics.

First, readouts: foundeor's ACHIEVE-4 study is a trial evaluating the risk of cardiovascular events in patients with type 2 diabetes at high cardiovascular risk. The results demonstrated non-inferiority versus insulin glargine, meeting the primary endpoint.

Our licensee Eli Lilly plans to submit filing for foundeor for type 2 diabetes by the end of the second quarter under Commissioner's National Priority Voucher, or CNPV. Regarding congress publications, I will provide further details on NXT007 and Enspryng later in this presentation.

For Nemluvio, results from a Phase 2 study in children aged 2 to 11 with atopic dermatitis were presented at the American Academy of Dermatology. Favorable skin clearance and itch control similar to adults and adolescents were confirmed in the pediatric population as well.

Regarding orphan drug designation, glofitamab has received the designation for large B-cell lymphoma. We exercised an option right under joint research agreement concluded in 2025 and obtained a license for Araris Biotech's proprietary ADC linker-payload technology, or AraLink.

We aim to combine this with our antibody engineering capabilities to create innovative ADC. I now turn to key milestones for 2026.

The underlined and in bold fonts reflect changes since the previous earnings announcement, and I have described them already so far. Preparation for Phase 3 studies for NXT007 are well underway.

Next, I will present the results from Part C of the Phase 1/2 next-age study for NXT007, which were announced at the European Hematology Association Congress in February. This is the first set of data for patients with hemophilia A, both with and without inhibitors, who switched from emicizumab to NXT007 with a loading dose and no washout period.

Consistent with Part B, which targeted emicizumab-naive patients, the results demonstrated favorable tolerability when switching from emicizumab to NXT007 without a washout period. In the high-dose cohort, blood concentrations reached levels expected to provide coagulation factor VIII activity equivalent to normal levels, and no bleeds requiring treatment were observed.

The fact that favorable tolerability was demonstrated when switching from emicizumab to NXT007 without a washout period is a significant finding for advancing safety assessments during the switching process. We are developing NXT007 with the ambitious goal of achieving coagulation potential equivalent to that of people without hemophilia.

Working closely with Roche, we are steadily preparing for the three Phase 3 clinical trials scheduled to begin this year, and we remain committed to delivering this treatment to patients as soon as possible. Next slide, please.

I will present the study results for Enspryng, which targeted adult and adolescent patients with relapsing MOGAD. In the global Phase 3 clinical trial for MOGAD, satralizumab significantly reduced the risk of new MOGAD relapse, achieving the primary endpoint.

It demonstrated that it reduced the risk of relapse by 68% compared to placebo in the time to first relapse. Regarding safety, consistent with the data already established in the approved NMOSD indication, no new safety concerns were identified and favorable tolerability was confirmed.

Currently, there are no existing therapies approved for MOGAD. With no established standard of care, there are high expectations for this study as it is the first to verify efficacy in a prospective randomized controlled trial.

Furthermore, for this indication, we have obtained orphan drug and Sakigake designations in Japan, and we plan to file for approval within this year. We look forward to delivering this new treatment options to patients as soon as possible.

These data were presented at the American Academy of Neurology Annual Meeting held last week. In recognition of this significance and high impact, it was selected as a presentation topic for the pre-AAN press conference.

Next slide, please. I will discuss our upcoming filing schedule.

Projects marked with a light blue star are newly added, while those with a green star indicate a change in the scheduled filing year. In this update, we have also subdivided projects previously disclosed as 2028 and beyond into 2028 and '29 and beyond.

For NXT007, we plan to file for hemophilia A in 2028. Regarding inavolisib, for which new two Phase 3 trials have been initiated, we also plan to file in 2028 for each.

Additionally, for enoticumab, we expect to file in 2029 or later. The subsequent slides are attached as reference.

Please refer to them as necessary. This concludes my presentation.

Next, FY 2026 Q1 consolidated financial review provided by CFO Taniguchi.

Hello. I will discuss the financial results for the first quarter of FY 2026.

I'm Taniguchi, CFO. Let me start by sharing the P&L.

The first quarter revenue came to ¥321.7 billion, up ¥33.2 billion, or 11.5% year-on-year. Core operating profit also increased by ¥23.8 billion, or plus 17.1%, to ¥163.3 billion.

I will now walk you through the details in sequence, starting with product sales. Product sales was ¥291.6 billion, up ¥31.9 billion, or 12.3% year-on-year.

Looking at by region, domestic sales came to ¥111.4 billion, up ¥8.4 billion, or 8.2% year-on-year. New products and mainstay products performed well, fully absorbing the impacts of the NHI drug price revision and generic drug penetration.

Overseas, exports of mainstay products to Roche continued to perform strongly, reaching ¥180.1 billion, up ¥23.4 billion, or 14.9% year-on-year. Hemlibra and Nemluvio have increased.

Also, royalty, this part increased quite a bit. One-time slightly calmed down, but the royalty income from Galderma related to Nemluvio increased and, on the whole, was positive.

Moving on to cost items, cost of sales was ¥92.3 billion, an increase of ¥4.8 billion, or 5.5% increase year-on-year. Now, this increase in absolute terms reflects the growth in product sales themselves.

The cost of sales ratio declined by 2.0 percentage points year-on-year to 31.7%, which reflects the increase in Hemlibra with slightly low cost of sales. That in the background has had some effect.

R&D expenses increased by ¥1.2 billion year-on-year to ¥41.9 billion, driven by investments in drug discovery and early-stage development and advancements of development projects. SG&A expenses, there was significant increase in new product-related promotional expenses in first quarter for Lunsumio, ELEVIDYS, and others.

In addition, enterprise taxes and accruals for bonuses linked to profit levels also increased. The enterprise taxes is local tax, resulting in a year-on-year increase of ¥3.9 billion to ¥24.9 billion.

From the second quarter onwards, however, SG&A is expected to trend lower year-on-year and at the year-end is projected to be around ¥1.2 billion below prior year, in line with our published forecast. As a result, operating profit increased by ¥23.8 billion year-on-year to ¥163.3 billion, and the operating margin rose by 2.4 percentage points year-on-year to 52.8%.

Net income after tax was ¥118.6 billion, an increase of ¥19.4 billion, or 19.6% increase. This is the breakdown of changes in product sales.

Domestic oncology sales was ¥55.7 billion, up ¥2.6 billion, or 4.9% year-on-year. Key factors: increase of Polivy following approval of the combination therapy with Lunsumio in March, steady growth of mainstay product Phesgo, which more than offset the decline in Perjeta, and strong launch of new product Lunsumio.

Those were the positive drivers. On the other hand, Avastin continued to decline due to NHI drug price revision and generics.

Specialty area: ¥55.7 billion, up ¥5.8 billion, or 11.8% year-on-year. In addition to mainstay products Hemlibra and Vabysmo, a new product PiaSky also recorded steady sales growth.

Overseas product sales were ¥180.1 billion, up ¥23.4 billion, or 14.9% year-on-year, significant increase by Hemlibra. This is the quarterly trends in P&L items due to revenue recognition timing differences arising from export timing.

There trends to some quarter-to-quarter ups and downs. Overseas sales as well, volume growth significantly exceeded the decline in export unit prices, and this was further supplemented by a positive foreign exchange impact, contributing to the increase.

That led to the total amount of increase, ¥23.8 billion breakdown. I would like to be very brief.

This is the quarter-based change in profits. There are ups and downs, but compared to first quarter last year, we have positive operating profit, and you can see the background why this is the case.

This is about the revenue quarterly trends. Again, export not necessarily gives us the same amount each month.

That leads to some variability. If you compare first quarter with first quarter, this is what we have: overseas, domestic, we are seeing well-balanced increase in all of the segments.

As of the first quarter, what has been the progress so far against the initial plan? Both revenue, profit compared to last year, the progress rate are relatively higher.

Normally, the progress tends to be low in the first quarter. However, it's trending above last year's level.

Next page talks about per segment, per product progress. We are showing you the progress as of last first quarter.

Across different products, the progress have been trending above last year's level. Next shows the impact of FX.

Last year's exchange rate and this year's exchange rate shows ¥10 difference, and because of this ¥10 weaker yen, we had impact of ¥11.6 billion in terms of revenue and ¥9.8 billion in terms of OP, both positive. Next, moving on to the balance sheet.

Total assets, since the end of last December, it went up by ¥203 billion and achieved ¥2.2651 trillion. We had the payment of tax and a payment of the fiscal dividend.

In terms of the working capital, we've had the collection of the AR in the first quarter. As a result, total asset reduced.

However, in terms of the net asset, as it's said here, it decreased by ¥118 billion to ¥1.907 trillion. The rate of decrease in net asset was smaller compared to that of total asset, and equity ratio attributable to owners of the parent rose to 84.2%.

In terms of operating cash flow, it was ¥203.3 billion. However, we had a payment of the corporate tax and a payment of the special dividend, and it was actually negative.

Next is the adjustment of core and non-core. Adjustment items would include the recognition of intangible asset in accordance with the licensing-in.

Also, we have some depreciation cost and business restructuring cost would include the replacement of ERP, SAP. Upgrading the operational platform requires ¥4 billion.

Next page lists up the CapEx that are already approved internally, and it shows plans going forward. With this, I would like to conclude my part.

Thank you very much.

We will now move on to the Q&A session. For Q&A, Takano, who is the Head of Sales Division, will also join.

In order to accommodate as many questioners as possible, we kindly ask that each person limit their questions to two. Please note that the audio of your questions, together with the presentations, may be published on our website at a later date.

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We will now begin taking questions. Please click the electronic hand button at the bottom of the Zoom Webinar screen.

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Please unmute your microphone, state your company name and your name, and then ask your question. If you wish to withdraw your question, please click the lower hand button.

From Citi Group, Yamaguchi-san, your first, please.

Can you hear me?

Yes, we can.

Hello. I am Yamaguchi with Citi Group.

The first question is to Taniguchi-san. You have talked about the overall progress of the entire Q1.

In comparison to your forecast, the impression is that the news were all good. Am I right to understand that the current situation is better than you had expected or is right on track?

Yes. Short response: we were right on track, and we had expected this.

Of course, there are fluctuations. Hemlibra, for example, did considerably well overseas.

From that point of view, there are good news. Overall, however, in the position of making any changes to published forecast.

Thank you very much. Second question has to do with Nemluvio.

Export volume as well as royalty payment, both doing well. You're not giving specific numbers, we will have to just guess.

Galderma also is above a consensus. Locally speaking, for Q1, this was better than what you had expected or was it what you had expected?

We'd say this is what we had expected because we always plan conservatively from a rational point of view. Looking at Q1 track records, it's within the range that we had expected.

If you were conservative, this seems more.

We cannot really say anything definitive unless we see the situation beyond the second quarter, but

it wasn't bad. It wasn't bad for the first quarter.

Thank you very much.

Next, from JPMorgan Securities, Mr. Wakao, please.

Yes, I am Wakao speaking from JPMorgan. Regarding the export sales, I have a question.

Hemlibra, Nemluvio, for those two products, the reason why these two are doing better than your expectation, is it because the sales is trending well in the market, especially for Hemlibra, you are expecting single-digit growth? If the actual sales is strong, I think your plan is going to be overshot.

How should I look at it?

Thank you very much for your question. The first quarter every year shows some purchasing pattern, but this purchasing pattern is quite confusing every year in the first quarter.

Is this outperforming trend going to continue for the rest of the year? If I tell you so, I may sound too optimistic.

We say low single digit as our expectation, and this remains unchanged. In that case, from second quarter onward, we may see some ups and downs.

If a single-digit growth expectation is not becoming the reality, and we expect outperformance, I think we need to look at this thing from Roche perspective and Chugai's perspective. I can't talk about Roche number in my own position, but Chugai's export business-wise, export can vary, but we do have visibility in two coming six months.

Based on such, the actual result from second quarter onward will be somewhat quite similar to our current forecast.

Thank you. My second question is regarding GYM329.

In your presentation, you said SMA, FSHD development didn't work out, but for obesity, you said that there will be no impact. Can you give us more colors on that?

Scholar Rock's apitegromab, their trial is going well for obesity indication. What is the difference, your compound against Scholar Rock's apitegromab?

Is it coming from the difference in inhibition activity?

Thank you very much for your question. Kusano would like to respond to your question.

Now, development on obesity, is it going to be okay? SMA, FSHD, two trials in a Phase 2, when we look at their results, reduction of myostatin has already been confirmed and the increase of muscular mass and improvement of motor function, we couldn't show consistent result and we were not sure about the efficacy.

Now, for FSHD and SMA, those neuromuscular disease, when it comes to that, increase in muscle mass, does not directly link to the improvement of the motor function. That's a difficult point.

Myostatin volume itself tends to be lower in the patient compared to the healthy people. That's why it's said to be very difficult to prove the efficacy of the drug in such target audience.

Now when it comes to obesity, it's a chronic metabolic disease. The damage on nerve and damage on muscle, we don't believe that will lead to these disease.

Incretin, which is a combination drug, will induce the reduction in energy consumption. In GYM329, maintenance of muscle or increase of muscle would lead to the increase of the energy consumption.

We are not looking into the improvement of motor function of muscle, we believe this obesity trial has probability of success. Regarding Scholar Rock's compound, increase in muscle volume and improvement of motor function are not really linked directly in this type of disease.

GYM329 in Phase 3 trial, this is Phase 3, Phase 2 trial, different from Scholar Rock, and patient background is also different. We can't make head-to-head comparison, and primary endpoint and assessment for the motor function is different between us and theirs.

Thank you very much. That's all.

Thank you. From UBS Securities, Seki-san, please.

This is Seki, UBS. Thank you very much for that information.

My first question has to do with what Taniguchi-san said. This is Galderma royalty.

This seems to have had a major impact. When are you going to announce this as a separate line item?

Of course, we'll be following different criteria. Also, there are criteria led by auditors, and we will follow their timing.

I'm not going to give you details. I believe that, however, this year is not the best timing.

Your materiality standard is 5% or 10%?

No, we're not disclosing that.

The second question is to Dr. Okuda.

This has to do with how you intend to use cash, especially late-phase pipeline, your own discovered products from the outside appears to be somewhere in a transition, which means that other companies do try to introduce licensed products to fill the gap. I do understand that you are very actively pursuing this, but maybe should announce this more.

Seki-san, this is Okuda speaking. Thank you for your question.

How we intend to use the cash at hand, within Chugai Pharmaceutical company, we position this as a very important strategic decision. Innovative pharmaceutical development capability, we would like to very actively invest in acquiring that kind of capacity.

That's one. In addition to developing innovative drugs, we want to also invest in delivery of that.

For example, what you have just mentioned, late-phase development products or those close to launch, product candidate introduction close to market is something that we're thinking about. Now, in addition to R&D investment, there could be other CapEx for enhancing our production, and there could be investments in order to maintain ecological aspects, and also return to shareholders.

Those three, we want to make sure are in balance as we make the most proper decisions. Opportunistic decisions mean, I believe, thinking about every possible avenue from a strategic point of view.

Thank you.

Next is from Morgan Stanley MUFG Securities, Mr. Muraoka, please.

Hello. I am Muraoka from Morgan Stanley MUFG.

Can you hear me okay?

Yes,

thank you. I have a question regarding Nemluvio.

Three months ago, I was looking at the initial guidance number three months ago, and I have a question to Mr. Taniguchi.

The increase in export and royalty income coming from non-Roche partners and Galderma YoY, ¥20 billion revenue increase, if I take all those numbers and do this math, royalty rate 11% to 12% and supply of product 30% to 35%, it seems like the condition of this business is almost comparable to the business with Roche and sounds really nice. Am I missing out something or am I correct?

Thank you very much, Mr. Muraoka, for your question.

Now, we cannot disclose details. However, with the arms-length principle in the license agreement with Roche and contract with Galderma and the others, basically our contracts are based on arms-length principle in a very fair manner.

License transaction has been almost standardized in this pharmaceutical industry, and we've licensed this out in late stage. In terms of the rate, it's a tiered structure.

Toward the end of the year, normally revenue tends to go up and license income also tends to go up, and that's all I can tell you.

In terms of the product supply, when I do my math, I get 30% to 35% as a number. It has just been launched, the inventory in Galderma was not proactively piled up.

Am I correct to understand that export has been progressing a little excessively?

It depends on Galderma's policy. We have commitment period specified in the contract.

We call it firm order. We basically follow this firm order, I can't comment on the inventory in a policy.

Thank you very much. Now I have a question on orforglipron.

I don't think you can answer, but 1,200 prescriptions in week one compared to this fiscal year's plan, how do you think of this? I know this is too early question to ask, but how do you interpret this number?

I think this is a good result, but I would like to understand how you see the result or progress so far.

Thank you.

Of course, we do have internal budget. We have assumption as well.

It's just been launched, I don't think it is appropriate to mention any interpretation of ours. When things go on and progress, we may be able to make some comment, but so far, the available data or numbers are quite limited.

So.

Understood. Thank you.

Thank you. From Macquarie Capital, Tony Ren-san, please.

Oh, can you hear me?

Yes, we can.

Okay. Thank you for taking my question.

Now, congratulations. Very strong first quarter.

My first question is for Kusano-san. Congrats that you are starting the DONQ52 trial, Phase 2 trial in celiac disease.

Is this Phase 2 trial registrational? Can it be used for regulatory approval?

Assuming it is not, can you explain to us your current thinking of the Phase 3 programs for regulatory approval? How many trials are you thinking?

How large are these trials? What are the endpoints you have in mind for this disease where we don't have current approved drugs?

Thank you. Tony Ren,

thank you very much for your question related to DONQ52. Yes, we have started our Phase 2 study.

This is for active celiac disease, randomized, double-blind, placebo-controlled study. Yes, we believe that for filing, this is looking at the GI tract improvement and also celiac disease.

This is looking at the reduction in symptoms. We are thinking about enrolling 90-plus patients, and we hope to make sure that we get good data.

For studies beyond that, we will have to wait until the outcome of the Phase 2 to think about what we want to do for the subsequent program, I would keep from talking about that right now. Thank you.

Okay. Thank you.

The Phase 2 trial is registrational?

This of course is Phase 2, it's not that this is going to be come part of the dossier. What we're saying is we would like to look at the outcome of the Phase 2 to think about the program going forward.

Okay. Understood.

Thank you very much. The next question is for Taniguchi-san.

This is about Eli Lilly the royalty associated with Eli Lilly's foundeor. This launch, everyone is paying a lot of attention to.

Could you just remind us has Eli Lilly indicated to you when they will pay you the foundeor royalty? Would that be on a quarterly basis?

Would there be a one-quarter lag? In other words, they will pay you the first quarter royalty in the second quarter.

Thank you.

Thank you very much for the question. Details of the contract I cannot disclose, but of course, we understand that the approval came on the 6th of April, for the first quarter, of course, it's not posted.

Now, we, of course, calculate based on our own estimate, and so when they start receiving payments, that is going to be reflected in our books, too.

Okay. Very good.

Thank you very much.

Next is from Daiwa Securities, Mr. Hashiguchi, please.

Hello, this is Hashiguchi. My first question is related to ELEVIDYS.

On 20th of February is the launch date, and your full-year guidance is targeting at ¥12 billion. How do you see the progress so far?

Initially, you had taken safety measures. There were many things that you need to do before the actual launch, but what is the feedback from the Healthcare Institute and the patient so far?

I am Takano. I'm the Head of Sales, and I would like to respond to your question.

ELEVIDYS been launched, and in the Pediatric Society of Neurology, and we have been working closely and we are always focusing on the safety. This month, we are expecting the treatment start on several cases, but we've been basically focusing on the safety measures, but we have been receiving a lot of strong inquiries so far.

We are now looking into the detailed feedback from the clinical practice, including NHI drug pricing, and we believe the sales and performance will progress smoothly.

Okay. inavolisib is the second question.

On page 16, you said that 2028, there are two indications to be submitted for approval: 121 and 132. There are two Phase 3 studies, and I think their result will be used.

Japan's Phase 1/2 study and Western INAVO120 study are going to be bridged so that naive-period resistant patient-targeted therapy may be filed earlier than planned, or do you think the fastest possible timing for launch is still 2028?

Thank you very much, Hashiguchi-san, for your question regarding inavolisib. Currently, we are conducting bridging study, and we do not disclose our plan for filing submission.

Now, endocrinology-resistant and HER2-positive Phase 3 are initiated, and that's why we are disclosing the timing for the filing this time. Although you haven't disclosed, however, you're pursuing the possibility of making a filing based on the bridging study.

Are you trying to bring forward the submission timing?

Although I cannot comment on the timing, however, our aim is to bring this medicine to the breast cancer patients as much, or as soon as possible.

Thank you very much. That's all.

Sanford Bernstein, Sogi-sama, please.

Thank you very much. My question is to Kusano-san about the GYM329, and some other person have already asked this.

Scholar Rock in SMA, Phase 3 positive. Of course, patient inclusion criteria and primary endpoints were different.

Can you give more details about why those difference or how those differences in patient inclusion and endpoints have led to differences in outcome?

Thank you very much for asking question. These are two separate, two different studies, it's difficult to compare them head-to-head.

For example, there are differences in primary endpoint, which is exercise tolerance. For example, Scholar Rock's Phase 3 looking at expanded Hammersmith enhanced functional assessment.

In our study, we're looking at MFM32 exercise function assessment. There are differences in the motion as well as sensitivity and scope of motor function, it's difficult to compare them.

In extended Hammersmith, focuses more on SMA. This is more of a large, for example, trunk mobilities like standing and walking and running, very major activities as needed for day-to-day life.

MFM32 is more dexterity using the fingers. That's important in day-to-day activities.

This is used across myoneurological conditions, it's quite difficult to compare the outcome of these two studies.

Thank you. I understand now.

What you have provided does tell us that these are very different assessment. Can you give us a background why you have chosen MFM32 as assessment scale?

Thank you for the question. Based on past data as well as our exchanges with key opinion leaders, we have, of course, assessed what is best.

I have another question about DONQ52. Now, celiac disease, I am still learning about celiac disease, but it seems that compared between mild and severe, there's considerable differences in conditions of patients.

DONQ52, what types of patient are you targeting to develop your drug?

Thank you very much for DONQ52 questions. We will be looking at the outcome of studies to decide who to target.

We will be looking at very highly active celiac disease to see improvement in gut situation.

Thank you.

We regret that time is drawing to a close, the next question will be the final. Mr.

Ueda from Goldman Sachs Securities, please.

Hello, my name is Ueda from Goldman Sachs. I have just one question in terms of the GP margin trend.

I would like to understand better. In Q1, basically cost ratio for the product is within your expectation, and for the fourth quarter or on full-year basis, it seems like this number is expected to go up.

Is that because, as of the first quarter, the progress of domestic products is slow while percentage contribution coming from export to outside Japan is high, or is there any other special factor? I feel like your export business is trending quite well within a certain range.

If trend goes on, I think your profitability will improve over time. Am I correct?

Thank you very much. This is Taniguchi speaking.

Hemlibra's weight, what is the percentage of Hemlibra going forward? That's very important.

It's more like how much decline do we see in Actemra. The export of Hemlibra is followed internally, and also we have an assumption for coming six months.

Based on the current schedule cost ratio, our target is 34.9% toward the end of the year, and probably this will be the most probable level.

Thank you very much. That's it.

This concludes the first quarter FY 2026 earnings briefing. For questions that we were unable to address due to time constraints, please contact Corporate Communication and IR Department.

The telephone number and email address are provided on the final slide of the presentation material. Thank you very much for taking time to join us today, taking time out of your very busy schedules.

Thank you.

This concludes the session.