Nxera Pharma Co Ltd

Thank you very much for joining us today. I'm Nobura, CFO of Nexara Pharma Co Ltd. Today, we have Chris Cargill, COO of COO and President of Nexera Japan, Toshihiro Maeda, and Patrick Foerch, President of CSO and Nexera UK. We have the same ability, so if you click on the language selection icon of Zoom and choose between Japanese or English, you will be able to listen to the translation sound. If you keep it off, you will be able to hear the original sound of the speaker. Today, we are going to explain the information according to the information in the first half of the video and answer questions in the second half of the video. The information is shared on the screen, but it is also posted on the homepage. If you have access to the information, please enter it from the investors on the left side of the homepage and proceed to the IR library. If you have any questions, please feel free to ask them in the Q&A section below. Please feel free to post your questions in the Q&A section below. Let's move on to the explanation. First, Chris will explain the business highlights, then I will explain the summary of the settlement, the update of the APAC business in Japan from Maeda, and the progress of research and development from Patrik. Finally, I will go back to Chris and explain the future prospects. Please take a look at the five pages of the material. Chris, thank you.

Thank you very much Nomura-san. And just a quick disclaimer, please note that today's presentation does contain forward-looking statements and the actual results may differ from them. The details are here on slide number two. So welcome and thank you for joining us for NextEra Pharma's results for the first half of financial year 2026. I am Chris Cargill, President and Chief Executive Officer of NextEra Pharma. This is the story of a company that is moving rapidly from investment to delivery, and I'm very pleased to take you through it. You will see growth of revenue, a return to profit, and a clear external validation of our science. Now, the next slide brings the whole half together on one page, so please turn to it now. So in the first half, we grew revenue, returned to profit, and so our partner signs validated in the market. On financial performance, revenue grew 25% to 18.9 billion yen. Operating profit moved from a loss of 2.8 billion yen to a profit of 1.9 billion yen and core operating profit increased from 364 million yen to 6.5 billion yen. Both our commercial products business and our platform business turned profitable. In commercial products, PIVLAS sales reached 6.3 billion yen, up 9%, and Kivivic sales reached 3.6 billion yen, up 127%. On the platform side of our business, we achieved multiple revenue generating milestones from Neurocrine, AbbVie, Sentessa, and Lilly, and we created the new company for a GPCR targeted program with up to $275 million in potential milestones, plus royalties, and a significant minority equity ownership stake. Our orexin agonist science was validated in the market. Lilly's acquisition of Sintesa, whose orexin portfolio was generated on our platform, valued that business at up to $7.8 billion. Now, this is an external arm's length reference point for the value that our platform creates, and it highlights just how serious Lilly are in making brain health and broader neuroscience the next big category beyond obesity. Our muscarinic science is also advancing on its own terms. Our partner Neurocrine continues to progress Directlydine, the differentiated M4 program, which is moving towards a phase three data readout in the second half of 2027. And we regard this as a distinct source of value within our partner portfolio. Now, let me turn now to how this progress maps against the objectives that we set out at the start of the year. Please turn to the next slide. So against the five priorities we set for this year, we are on track or ahead on every objective. On net product sales, we've reached 9.9 billion yen, which is 51% of our 19.5 billion yen plus target for the year. On adding late stage assets for Japan and Asia Pacific, we have multiple discussions ongoing. And on new high value partnerships, we are in active term sheet discussions. On partner sponsored trials, we achieved our goal with the start of a phase two study of MBI 570. And on cost and profitability measures, we set out to reduce total costs by 10% and to reach full year profitability on an IFRS basis. And we achieved profitability in the first half following Q1. Now to take you through the financials in detail, let me hand over to our Chief Financial Officer, Nomura-san.

Chris, thank you very much. Now, I would like to show you a summary of the financial statements of the fiscal year of 2026 by selling segments. Please take a look at the slide on page 8. As Chris mentioned, the sales volume increased by 25% to 18.9 billion yen compared to the 15.1 billion yen of last year. The milestone income is 50 to 80 billion yen. The product sales volume Thank you for watching. See you next time. In terms of profits, it was 65 billion yen in core, and 19 billion yen in IFRS base. Compared to the 1.9 billion yen that Milestone was focusing on, it may seem like it's decreasing, but for the future forecast, the sales value and cost will be the best in line at the moment. We will do a breakdown on the next page. Next slide, please. As always, we have divided the business domain into core operating profits and accounting operating profits. The platform business on the far left is a so-called bio-venture business model. The commercial business model is a so-called pharma business model. As for the profit of the platform, it is greatly dependent on the milestone from the partner, and it is difficult to control it by itself. On the other hand, we aim to grow the commercial business, the red part, and stabilize the revenue as a company. As for the paper machine, the firm's milestone progress was also in the platform business, so we processed the black paper based on the core, and the commercial business was also able to grow significantly in terms of sales and profit. The cost reduction that we have been working on for the last few years, especially in terms of half-price research and development, has been a bit uneven in some places, but if you look at the linked part of the forecast of each period, it is 49% and 50% of the cost is progressing, so I think this is extremely in line with the expectations. Also, this has the effect of cost reduction, Thank you for watching.