Shionogi : Section 1 SHIONOGI Value Creation

Our Group Philosophy

SHIONOGI Group Heritage

SHIONOGI strives constantly

to supply the best possible medicine (healthcare solutions)

to protect the health and wellbeing of the patients we serve.

SHIONOGI Group Vision

Building Innovation Platforms to Shape the Future of Healthcare

SHIONOGI is transforming itself from a drug discovery-based pharmaceutical company to a HaaS* company in order to pursue the health that people truly desire and to deliver unprecedented new value to society.

*Healthcare as a Service: Provide a range of healthcare services in line with customer needs, rather than only providing pharmaceuticals.

The unwavering purpose of the SHIONOGI Group's corporate activities is expressed in the opening of the SHIONOGI Group Heritage as the image of what SHIONOGI should be and the Company's social existence values.

As people's lifestyles and values are changing irreversibly, their healthcare needs are becoming increasingly sophisticated and diverse. Unprecedented opportunities are emerging before us to deal with various needs that could not be solved in the past.

SHIONOGI will continue to transform itself into a company that goes beyond the boundaries of a pharmaceutical company to provide the best healthcare solutions by being closely attuned to desires of people everywhere with regards to health.

We are committed to making people's dreams for the future of healthcare into reality.

*SHIONOGI is an abbreviation for the SHIONOGI Group

SHIONOGI is uniting globally to take a new step forward in transforming itself into a HaaS company

Capability and Vision, unified.

"Capability" that	"Vision" for
has been built up	evolution

Our Philosophy

The Company Policy of Shionogi

Shionogi's Purpose

Shionogi strives constantly to supply the best possible medicine to protect the health and wellbeing of the patients we serve.

For this purpose, Shionogi will need to

Pursue the search for even better medicines. Produce even better medicines.

Promote awareness of these better medicines to more people so that more people will be able to use these medicines.

Research, produce, and promote in an even more economical manner.

For this purpose, Shionogi will need to

Strive ceaselessly day after day to improve their skills.

Strive ceaselessly day after day to improve as human beings.

As a result, Shionogi people will

Find even greater satisfaction in their daily work and in their daily lives. Find even greater improvement in the quality of their lives.

Find even greater prosperity in their lives.

Established in 1957

	SHIONOGI
	Group
	Heritage
	The foundation that
	supports SHIONOGI
Building Innovation Platforms
to Shape the Future of	SHIONOGI Group
Healthcare	Vision
What we want to achieve by 2030
• Be trustworthy
• Be bold	SHIONOGI Group Values
• Be dauntless in spirit
• Build greatness out of diversity	Our psyche that is indispensable for
• Contribute to society	achieving vision

Reliable Weight	Dynamic One Ring	Group Brand Logotype
"Trust" and "Accuracy"	Dynamic expansion and unity	Design that gives a sense of security
		and trust

Our minds on the new group brand

The "FUNDOH" weight mark which stands "accuracy", "honesty", and "trust" has been a longtime Group Brand Symbol of Shionogi & Co., Ltd and its group companies.

Reflecting SHIONOGI's intention to transform to a global HaaS company, we have refined the Group Brand Symbol and logotype design and evolved it into an identity that embodies the new SHIONOGI.

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Contents

• 1 Our Group Philosophy

Section 1

SHIONOGI Value Creation

Approaches to Achieve the Goals

4	Special	COVID-19 Initiative Results and
	Feature	Learning

1. Message from the CEO

1. Our History

1. Value Creation Process

1. Value Creation Story

1. Risks and Opportunities

1. SHIONOGI's Material Issues

1. Market and Performance

1. Financial Highlights / Non-Financial Highlights

1. At a Glance

Section 3

SHIONOGI Innovation and Evolution

• 54 Protect People Worldwide from the Threat of Infectious Diseases
• 58 Improve Social Productivity and Extend Healthy Lifespans
• 60 Contribute to Sustainable Social Security
• 62 Improve Access to Healthcare
• 66 Supply Socially Responsible Products and Services
• 68 Reinforce Supply Chain Management
• 69 Respect Human Rights
• 70 Protect the Environment

Section 4

Governance to Create Value and Implement Strategy

• 72 SpecialFeature Outside Directors Roundtable
• 75 Corporate Governance
• 85 Engagement with Stakeholders
• 86 Ensure Compliance
• 87 Risk Management

• External evaluation

ESG index		External recognition related to IR and sustainability

Other

Selected by domestic equity managers at the Government Pension Investment Fund as having an "Excellent Integrated Report" (second consecutive year)

Section 2		Data Section
	SHIONOGI Strategy
	90 11-Year Financial Summary
34	Medium-Term Business Plan
92 Consolidated Financial Statements
36	Management Strategy/Financial Strategy
97 Non-Financial Data
40	R&D Strategy
98	Environmental Data
44	Top-Line Strategy
99 Third-Party Assurance of Environmental Data
48	Management Foundation Strategy
100	Glossary
50	Secure Human Resources to Support Growth
101	Attestation of Validity
			102	Corporate Information/Stock Information

Forward-looking statements

This report contains forward-looking statements. These statements are based on expectations in light of the information currently available, assumptions that are subject to risks, and uncertainties which could cause actual results to differ materially from these statements. Risks and uncertainties include general domestic and international economic conditions, such as general industry and market conditions, and changes of interest rates and currency exchange rates. These risks and uncertainties particularly apply to forward-looking statements concerning existing products and those under development. Product risks and uncertainties include, but are not limited to: completion and discontinuation of clinical trials; obtaining regulatory approvals; claims and concerns about product safety and efficacy; technological advances; adverse outcome of important litigation; domestic and foreign healthcare reforms; and changes of laws and regulations.

• For existing products, there are also manufacturing and marketing risks, which include, but are not limited to, inability to build manufacturing capacity to meet demand, unavailability of raw materials, and competition with other companies' products. The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events, or otherwise. This report contains information on pharmaceuticals (including com- pounds under development), but this information is not intended to make any representations or advertisements regarding the efficacy of these pharmaceuticals nor provide medical advice of any kind.

• Commitment to society

SHIONOGI has endorsed and supported the United Nations Global Compact. See our website for more information. https://www.shionogi.com/global/en/sustainability/ungc.html

• Editorial Policy

In order for stakeholders*1 better understand SHIONOGI's corporate value, we conduct integrated reporting based on integrated thinking.

• Period covered

Results for fiscal 2021 (April 1, 2021 to March 31, 2022). Some of the activities after the same period are included.

• Target organizations

This report covers 53 Group companies (the Company, 48 consolidated subsidiar- ies, 3 affiliated companies, and 1 jointly controlled entity). The scope of our environmental activities covers all of Shionogi & Co., Ltd business sites and major domestic group companies. For some indicators, major overseas group companies are also included in the scope of coverage.

• Reference Guidelines

IIRC*2 "International Integrated Reporting Framework," "GRI (Global Reporting Initiative) Sustainability Reporting Standards," "ISO 26000," Ministry of the Environment "Environmental Reporting Guidelines 2018," and Ministry of Economy, Trade and Industry "Guidance for Collaborative Value Creation"

*2 IIRC was reorganized as the Value Reporting Foundation (VRF) in June 2021. VRF was integrated into the ISSB of the IFRS Foundation in August 2022.

• Disclosure and engagement
  Financial information

IR Library https://www.shionogi.com/global/en/investors/ir-library.html

Securities report (JP) https://www.shionogi.com/jp/ja/investors/ir-library/securities-report.html

Non-financial information

Sustainability https://www.shionogi.com/global/en/sustainability.html

Policies https://www.shionogi.com/global/en/company/policies.html

Basic Views and Guidelines on Corporate Governance https://www.shionogi.com/global/en/company/cg/basic.html

Environmental Initiatives https://www.shionogi.com/global/en/sustainability/environment. html

*1
Shareholders and investors	Employees

	SHIONOGI's stakeholders
Customers	Society

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Section 1 SHIONOGI Value Creation Approaches to Achieve the Goals

Special

Feature

COVID-19 Initiative Results and

Learning

Results

Commitment to fighting COVID-19

Pre-symptomatic		Prophylactic
phase/detection		vaccines
• Provide wastewater epidemiological surveillance service by	• Research and development of a recombinant protein vaccine
establishing AdvanSentinel Inc.

Initiatives for total care

As a leading company in infectious diseases, it is SHIONOGI's mission to combat the threat of COVID-19, which is having a significant impact on the lives, livelihoods, and economies of people worldwide. SHIONOGI has been working with public institutions, academia, and our partner companies to help bring COVID-19 to an early end through research, develop- ment, and provision of a wide range of medical solutions from a total care perspective, including detection (epidemic fore- casting), prevention, diagnosis, treatment, and exacerbation suppression. In particular, the development of oral therapeutics that are effective, safe, and convenient is highly anticipated worldwide as we learn to live with COVID-19. Based on the results of the Phase 3 clinical trial of S-217622 (ensitrelvir), we will accelerate our efforts to commercialize the drug in

SHIONOGICreation Value1 Section

Japan and globally. In addition, we have made progress in several late-stage clinical trials for prophylactic vaccines, including comparative studies with existing vaccines, aiming for both initial immunity and booster immunity. We plan to file for approval as soon as the necessary data and production framework are prepared. Furthermore, in efforts related to epidemic forecasting, we have taken a major step toward social implementation of wastewater monitoring by establishing Advan- Sentinel Inc. with Shimadzu Corporation. In addition to this, we were able to start providing diagnostic drugs and kits that predict not only the presence of infection, but also individuals at risk of severe exacerbation. A Phase 2 clinical trial is in progress at our partner company for the development of a drug candidate for exacerbation suppression.

	• Research and development of a nasal vaccine
• Launch of mutational analysis service	• Research and development of a universal antigen vaccine

Things we were able to do because we are SHIONOGI

Diagnostic drugs		Therapeutic agents
• Sales of antigen test kit products	• Research and development of antiviral drugs

• Sales of SARS-CoV-2 antigen test kit products for assisting in predicting exacerbation
• Sales of Th2 chemokine TARC kit for assisting in predicting exacerbation
• Online sales of PCR testing services for COVID-19(SARS-CoV-2)

Exacerbation		Support to local
suppression		governments
• Research and development of pharmaceuticals to prevent	• Support to health centers in Tokyo and Osaka prefectures
severe disease

As a drug discovery-based pharmaceutical company boasting an internally-discovered pipeline ratio of 73% (as of March 2022), SHIONOGI places the highest priority on solving the problems of patients and society in its daily drug discovery activities. Small-molecule drug discovery in particular is one of our long-cultivated strengths. For example, information on the anti-HIV drug Tivicay was utilized in the chemical structure conversion of the influenza antiviral drug Xofluza, and great use was made of the knowledge gained from the discovery of Xofluza in the new COVID-19 therapeutic drug S-217622. Furthermore, the basic skeleton of S-217622 also utilizes the structure of S-600918, which is being developed for the treatment of chronic cough. SHIONOGI's accumulated experience

in antiviral research and small-molecule drug discovery has made it possible to create promising compounds with such amazing speed. In the evaluation of the drug efficacy of com- pounds, we have a library of bacteria and viruses that we have accumulated over the years, and we have a system in place that allows us to efficiently utilize this library in combination with our library of compounds. In addition, SHIONOGI's strength lies in its broad base of researchers who handle viruses in our Biosafety Level 3 (BSL-3, a Japanese standard) laboratories which only trained personnel are allowed to work with. We believe that these are the factors that enabled us to push through the challenge of COVID-19 with such promptitude.

Helping to restore the safety and well-being of society

Ensuring a stable

supply of

pharmaceuticals

• Inventory management in cooperation with raw material suppliers and procurement contractors
• Thorough-goingemployee health management and mea- sures to prevent the spread of infections

Business continuity

initiatives

• Respond in line with our business continuity plan (BCP)
• Introduced systems in response to new workstyles, such as telework and staggered work hours

Providing disease

information

• Providing information via websites

Cooperation/alli-

ances with interna-

tional societies

• Described our programs in a video submission to the UN's #Uniting Business to Respond to COVID-19 campaign

We believe that helping to restore the safety and well-being	including those who are not at risk of severe exacerbation, we
of society through the early termination of the pandemic is	believe that this will contribute to the restoration of a society
our true contribution to the SDGs. If we gain favorable results	where people can live with peace of mind. Shionogi is making
from the Phase 3 clinical trial of S-217622, a therapeutic	concerted efforts to achieve this goal.
agent that enables early treatment of COVID-19 patients,

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Section 1 SHIONOGI Value Creation Approaches to Achieve the Goals

How

As a leading company in infectious diseases, SHIONOGI is working with public institutions, aca- demia, and our partner companies to develop therapeutic agents for COVID-19. We are building a distribution system so that we can deliver these therapeutic drugs to patients as soon as possi- ble, progressing from drug discovery to clinical research to filing for approval at an unprecedented speed, as we adapt to constantly changing circumstances.

Special COVID-19 Initiative Results and Learning

Feature

SHIONOGICreation Value1 Section

Takafumi Sato

Vice President, Laboratory for Drug Discovery and Disease Research (At the time: Research Project Man-

ager, Pharmaceutical Research Division)

Aware of the risks, taking up the challenge of "clinical trials within six months"

The research project manager guides the selection and evaluation of candidate compounds for development based on the lead compound (the predecessor compound of development candidates) found in the research theme and the drug discovery logic (evaluation methods, etc.). The COVID-19 project required a different level of speed. We were being asked to expedite the process of drug discovery, which normally takes three to five years, so that, through resource investment, we could begin clinical trials within six months. We could not possibly fulfill the deadline using our conventional step-by-step approach. We had to decide on taking the risk to manufacture the necessary drugs in order to quickly advance compounds that met certain criteria in the exploratory compound evaluation to the nonclinical pivotal studies conducted in compliance with the regulatory standards. The series of difficult stages proceeding the decision for clinical development cannot be described here in full. However, we were able to achieve early creation of S-217622 thanks to close strategic coordination between the President, division head, and project members under a general policy of "narrowing down actions to the minimum necessary and proceeding with risk-taking"; thanks to the laboratory's concerted efforts based on our strengths in small-molecule and infectious disease drug discovery; and thanks to the cooperation of our external business partners who readily agreed to my reckless request to "bring all Japanese companies together" in response to the

Yasuhiro Makino

Regulatoryl Affairs Department

The challenge of filing for approval at an unprecedented speed

Our mission is to deliver S-217622 to society, healthcare professionals, and patients as soon as possible in response to the emergency of the COVID-19 pandemic. Although we are working to deliver the product as quickly as possible, we still have to ensure its safety and efficacy as we do with all other pharmaceuticals to date. In the pre-application state, it was crucial that we were able to seek solutions to various issues related to screenings and investigations and carry them out. It was also necessary to take prompt action to resolve issues from an early stage through close communication with the authorities. SHIONOGI began submitting relevant materials to the authorities in October 2021, filed for approval in February 2022 using the conditional approval system, and switched to the emergency approval system in May 2022. Based on the progress of the Phase 3 trial, the matter was continued for further discussion, but we will continue to work with the authorities to deliver the therapeutic drug as soon as possible.

national crisis of COVID-19.

Pursuing quality along with speed

Masato Gomi

Formulation R&D Laboratory

Delivering easy-to-administer formulations to patients as quickly as possible

We took on the challenge of developing drug formulations at an unprecedented speed while adapting to the fast-moving changes in the development situation within a short period of time. We are designing a multi-dose formulation that can handle a wide range of clinical doses and a manufacturing process that enables seamless vertical start-up of commercial production, as well as planning a regulatory strategy to establish a maximum duration of use in a short period of time. Through these we were able to complete the application for manufacturing and marketing approval and begin commercial production (establishing a supply system for one million people in FY2021) within just ten months from the start of formulation development. We also made bold efforts to reduce the size of tablets in order to provide a high value -added formulation with an advantage over leading competitors' products. This process was not always a walk in the park, but the whole team worked together to overcome these challenges and quickly devise ways to improve the situation. This allows us to complete our mission of delivering therapeutic drugs to patients as soon as possible. Our next mission is to provide this formulation globally and help patients in need all over the world.

Yudai Iwaki

Shionogi Pharma Co., Ltd.  Technology Development Division

This COVID-19 project needed to be handled at a speed that would have been unthinkable in the past, as the commercial manufacturing system was to be established and ready for initial manufacturing in four months, before the results of the Phase 1 clinical trial would be available. While various matters such as formulation dosage, packaging capacity, and product name had not yet been decided, we shared and discussed numerous issues across the organization and proceeded with speedy decision-making and implementation in order to clear the extremely high hurdle of establishing an appropriate manufacturing system that complies with Good Manufacturing Practice (GMP). In addition, SHIONOGI Pharma was able to establish a commercial manufacturing system in the fastest possible timeframe by "Be bold" - developing efficient validation strategies to assure the quality of pharmaceutical products based on scientific evidence - while leveraging its accumulated experience and technology, and by making a concerted company-wide effort.

Yuko Tsuge

Development Project Leader Clinical Research Department

"All SHIONOGI" to take on a global mission

The Research Division staked its reputation as an infectious disease company on S-217622, a development compound to formulate entered the clinical stage in July 2021. At this point, there was no oral COVID-19 treatment in practical use, and there was a need for an innovative oral therapeutic that could be easily prescribed to a wide range of patients in order to control this unprecedented pandemic. From here, the fight began for the development project to deliver S-217622 to patients in Japan and around the world as quickly as possible. The development of S-217622 is a social responsibility, and the "All SHIONOGI" team, transcending organizational boundaries, aimed to obtain approval as quickly as possi- ble. Through daily discussions with project members and management, I felt a sense of company-wide unity and the powerful impetus that comes with it. As a result of everyone's continuous efforts to do their best, we were able to file for approval within a short period of about seven months from the start of Phase 1 clinical trial. We will continue the ongoing clinical trials to completion without any relaxation of efforts, aiming to obtain official approval.

Nobuaki Tanaka

New Product Planning Department

In order to deliver to patients promptly and reliably

As the commercial team, we united under the shared mission of the research and development project teams to deliver S-217622 to patients as soon as possible, and collaborated in building a distribution sys- tem. We were required to finish as quickly as possible while responding flexibly to the ever-changing social environment and needs, such as the transition to the Omicron variant and the emergence of oral therapeutics. By making full use of our experience and know-how in building prescription registration systems for Vyvanse and OxyContin, we were able to build such a system (which is required post-ap- proval) that meets all the necessary conditions in just three months from the start of the project. We are still working to build a system that will enable us to start providing S-217622 as quickly as possible by mobilizing the power of our team and responding to each of these ever-changing circumstances by adding the necessary support and expanded functions.

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Section 1 SHIONOGI Value Creation Approaches to Achieve the Goals

Learning from here

Since the outbreak of the pandemic in 2020, SHIONOGI has given top priority to the development

Special COVID-19 Initiative Results and Learning

Feature

Difficulties in the Infectious Disease Business

Creation Value1 Section

of various solutions to achieve total care for COVID-19, while also making bold resource shifts. In the area of therapeutic drugs, SHIONOGI has promoted the establishment of R&D and production systems at an exceptional speed, and filed for manufacture and sales approval in Japan just about seven months after the start of clinical trials in July 2021. And we have learned a lot from our experience in this exceptional environment.

When we look at the global acute infectious disease market, we see cases of successful drug development that fail to pay back their investment and are subsequently bankrupt or acquired because not only is the market less predictable than in other disease areas, but also more powerful drugs are used only when other drugs are not effective in terms of proper

recoup their huge R&D costs and maintenance costs for manufacturing facilities. If this situation continues, the number of specialized personnel conducting research in the area of infectious diseases, where investment is scarce, will also decrease, and the market will become less and less dynamic - a vicious circle that will keep expanding. Although dealing with infec-

SHIONOGI

What SHIONOGI has learned

Importance of the ability to innovate

The COVID-19 pandemic instantly shattered preconceptions about the pharmaceutical business, where it is said to take 10 to 15 years before a new drug is launched. Without this expe- rience, we could not have developed the risk-taking and speed-oriented way of proceeding in an emergency and the decision-making and judgment skills necessary to determine

global scale by negotiating with governments and regulatory authorities in various countries. And we will continue to contribute to global health by clearly defining where we will put in the hard work and where we will entrust it to our partners.

Pursuing a sustainable infectious disease business model

use to prevent the development of new resistant bacteria or viruses. Even major pharmaceutical companies are withdrawing from this market one after another, citing inability to

• The Collapsed Acute Infectious Disease Market

Society's needs	Investment
Enormous R&D costs

Maintenance costs for manufacturing facilities

tious diseases is an indispensable initiative for society, it is an extremely challenging business model for pharmaceutical companies.

Revenue	Difficult epidemic
	forecasting
	Appropriate use
	Promotion of switching to
	GE products

the effectiveness and safety aspects of a project. We have already begun to replace some of our Standard Operating Procedures (SOPs) for normal times with these emergency R&D procedures and have begun to deploy them in initiatives other than COVID-19. In addition, there are currently only two pharmaceutical companies in the world that have launched oral therapeutics that have been proven effective and safe, and that can be taken easily, and we are the closest to becoming the third company to do so. We were also able

This pandemic has given us an opportunity to clarify the reasons why SHIONOGI has been able to continue its infectious disease business to date and the challenges we must confront in order to sustainably continue our infectious disease business in the future. One of the reasons why we have been able to sustain our infectious disease business to date is that we have been dealing with drugs for chronic infectious diseases, such as HIV. Unlike acute infectious diseases, chronic infectious diseases require continuous treatment over a long period of time,

Unable to recoup investment and form a healthy pipeline

Big Pharma exits antimicrobial market		Bankruptcies and acquisitions of small companies
• AstraZeneca sold its small-molecule antimicrobial business to Pfizer (2016)		• Achaogen filed for bankruptcy within a year of plazomicin approval in July 2018 (April 2019)
• Sanofi transferred its infectious disease division and 100 employees to Evotec (2018)		• Melinta Therapeutics filed for bankruptcy (December 2019)
• Novartis withdrew from antimicrobial research (2018)		• La Jolla Pharmaceutical acquired Tetraphase Pharmaceuticals following approval of
		eravacycline in August 2018 (July 2020)

Building an Infectious Disease Business Model and Transforming to a HaaS Company

to reaffirm that SHIONOGI has the capability to create drugs at a high level, as it is taking on the challenge of developing drugs that can be used by a wider range of patients than the two preceding drugs. It was also an opportunity to recognize once again that SHIONOGI cannot continue to demonstrate its value to society unless it transforms its desire to solve the world's problems into "the power of monozukuri (product creation)" and continues to innovate.

Determination to deliver globally with our own hands

In the development of our COVID-19 treatment, we have to ask ourselves why there was such a large difference in the timing of our market launch compared to the two companies that preceded us, despite the fact that there was only a few months difference in the time it took to create the compound that would form the base of the drug. Various causes have

and thus can be expected to provide a stable revenue stream. On the other hand, acute infectious diseases, such as seasonal influenza, are an extremely difficult business, as revenues are largely dependent on the presence or absence of epidemics, and even if an innovative new drug is launched, revenues can be significantly lower than expected for three consecutive fiscal years, as with Xofluza. As the world has reaffirmed during the recent pandemic, this business is indispensable for social and economic stability. Therefore, as a leading company in infectious diseases, we must urgently establish new business models in this area in order to continue in efforts to "protect people worldwide from the threat of infectious diseases", which we have identified as a key material issue.

• SHIONOGI's Goals for FY2022 and Beyond

FY2021 Learning in the exceptional environment of a pandemic

In order to build a sustainable infectious disease business model, SHIONOGI intends to combine efforts in chronic infectious diseases and vaccines, for which a healthy pipeline can be formed through stable earnings, and acute infectious dis- eases, for which profitability is difficult to predict but essential, to create an infectious disease business that is sustainable in its totality. The key issue for making this business model work is still how to manage the acute infectious disease business, but this is not a problem that can be solved by one company alone. The COVID-19 situation has triggered, especially among G7 countries, a renewed awareness of the importance of strengthening preparedness for global health threats, such as antimicrobial resistance (AMR), and has accelerated discussions on how to resolve this issue as an international community. In Japan, society as a whole is beginning to accelerate its efforts to strengthen preparedness. For example, the proposal for the formulation of the "Basic Policy for 2022" includes the early

establishment of an incentive system to ensure sustainable innovation in antimicrobial drug research and development. In addition to the pull incentives represented by the subscription model and stockpiling, we believe that enhancing mechanisms to promote pipeline formation through push incentives, which are support to promote research and development, will help maintain stability in the infectious disease market and, as a result, enhance preparedness for new pandemics. Of course, companies that receive incentives must always be prepared to make their maximum contribution in the event of an emer- gency, including the drugs they provide and the human resources to respond. It is essential that not only companies but also society as a whole have a system to continuously tackle infectious diseases. We aim to become a company that can grow sustainably with society by establishing a platform that can provide total care for infectious diseases to prevent a repeat of pandemics or otherwise minimize their damage.

been identified, such as differences in the countries where development took place and differences in the prevalent strains at the time of clinical trials. One possible cause raised is a "lack of commitment to global development". Until now, SHIONOGI has relied on its business partners for much of its global expansion, despite creating drugs that have attracted worldwide attention, such as dolutegravir-related products and Xofluza. An over-emphasis on entrusting global matters to our partners can limit the options for finding the fastest, most optimal solution. We at SHIONOGI are confident in the drugs we create, and are committed to delivering them on a

• Significant resource shifts and process changes drove R&D and production at a new and amazing speed
• Recommendations for policy changes through the pharmaceutical industry

FY2022 and Beyond	Establishment of a sustainable infectious disease busi-
	ness model

• World-classdrug discovery capability with speed, advanced decision-making, and effective resource allocation honed during the COVID-19 situation
• Further strengthening of the vaccine business
• Global expansion of the infectious disease business

Leveraging the experience of the pandemic, continue pushing

forward to achieve our goals without changing gears

• Toward Building a Sustainable Infectious Disease Business

Promotion of R&D

Human resource development (Push incentives)

BARDA, CARB-X, GARDP, CEPI, etc.

Profit structure that is not affected by	Strengthening and maintaining the
epidemics (Pull incentives)	supply chain
Stockpiling, subscription-based reimbursement	GARDP, CHAI

Current Infectious Disease Business

Unstable business affected by epidemics and external factors

Sustainable infectious disease business

Continued society-wide commitment to infectious disease measures is necessary to maximize contribution in emergency situations

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