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.

From here, I would like to talk about Japan and the APEC business. My name is Shio Omae. I would like to talk about the current status of the U.S. pharmaceutical industry. First, I would like to talk about Pibratz. Pibratz is a drug that is used to prevent the formation of blood vessels in the brain that occurs during blood clotting. It is the first self-made drug in Japan. The graph on the left is the sales based on the market. As you can see, there is a high seasonality of the fourth quarter, but if you compare the markets of each year, you can see that there is an increase in the previous year. The second quarter of this year is a sales of 3.4 billion yen, and the second quarter of this year is a sales of 6.3 billion yen. This product has already exceeded 70% of its share, so the current activities are moving towards optimization and expansion of prescription segments. In this respect, important initiatives will be implemented in the actual implementation of the Kurasu Sentan To-Yo Law, which was announced by the Council in March this year. We believe that more appropriate To-Yo will be connected to more patients because we have systematically organized the knowledge about Pibrates To-Yo in the clinical trial. Next slide, please. Next, I would like to talk about Cuvivic, a drug for people with insomnia. It is a new drug called Dora, a drug for people with dual-orexia. First, I would like to show you the changes in the structure of the drug. In the field of insomnia, Dora has been rapidly established instead of conventional drugs. The share of Dora based on the number of drugs is expected to reach 40% this year. In terms of market size, we have expanded to 830 billion yen in total. We believe that this change in the structure is still on the way and that the growth is still great. The chart on the right shows the position of Qubiq. The sales of Qubiq in 2024 was 1.3 billion yen, and last year it increased to 4.3 billion yen. This year, Qubiq has increased from 1.5 billion yen to 1.6 billion yen, and it has increased by 30% in the previous year. Currently, Qubiq has increased by 3.6 billion yen. The total share of Qubic in the Dora class is about 9% by June of this year. It is likely that Rainbow Rexan, which is the leading company, will have a large share, but the fact that Qubic is definitely building up shares and the fact that the class itself is expanding is the background of growth. I would like to continue to work with Shinobi Pharmaceuticals to explain the characteristics of the main product, such as its low yield to the next day and improvement of the day-to-day function. Finally, I would like to explain about the new product, Vamorolon, which was introduced this year. The main product is a drug that is suitable for gynecological dystrophy. In the treatment of this disease, corticosteroids have been used as a standard treatment for many years. However, there are many problems such as osteoporosis, osteoporosis, osteoporosis, osteoporosis, osteoporosis, osteoporosis, osteoporosis, osteoporosis, osteoporosis, osteoporosis, osteoporosis, osteoporosis. In the recent top-line results of the Guardian test, it was shown that the safety was improved significantly while maintaining the effectiveness by comparing the standard corticosteroids while maintaining the effectiveness. There are three specific numbers. The first is growth. The growth of the kidney is maintained accurately, and the average height difference after 5 years is plus 12 cm. The second point is the health of the bones. The vertebral bone fracture was 42% against the Vamorolong 8% against the Defraza Coat. The third is the health of the eyes. The occurrence rate of white blood cells is 5% of the normal number, and the occurrence rate of green blood cells is not. These are both factors that affect whether the patient can continue the treatment for a long time. By reducing the side effects, the continuity of the treatment increases. I think this is the greatest value of the main thing. The figure on the right is the consensus sales forecast for Japanese goods in other countries. According to the forecast of Evaluate Pharma at the end of last year, it is predicted that it will grow up to about 6.7 billion US dollars, combined with Catalyst in North America and Sunslash in Australia. The fact that overseas ratings are in this order is a very important reference point in terms of the potential of Japan and the APEC. My name is Patrick Foerch. I'm the CSO of Nixera. Can you move to the next slide, please?

The first half of 2026 was a period of strong execution across the portfolio. We achieved multiple milestones spanning discovery, clinical development, partnering and regulatory process. In discovery, our collaboration with Ampli and Lilly generated further milestones reinforcing the value of the NextWave platform. In the clinic, Neurocrine initiated a Phase 2 development for NBI517 schizophrenia, triggering a 22.5 million milestone. We also continued to build value across the Orexin portfolio, receiving milestones linked to the progression of Orexin 142 and 489. Beyond this part of the pipeline, we advance our broader strategic portfolio through the licensing and approvals in Japan and selected Asia-Pacific regions. More importantly, these milestones underline the exceptional commercial potential within our portfolio and particularly our neuroscience portfolio is very compelling. With Neurocrine, we now have the world's broadest muscarinic franchise covering M1, M4 and dual muscarinic agonist. Directine is the most advanced and the first selective M4 agonist currently in phase 3 trials together with a wider muscarinic pipeline across schizophrenia and Alzheimer's disease. and we believe DirectlyDin's competitive position has become even stronger following Mapalite's recent Phase 2 readouts for their M1, M4 program that only achieved a modest placebo-adjusted benefit, dosed once daily. For orexin, the acquisition of Centesa by Ila Lili provides a powerful validation of the quality and the strategic importance of the three orexin agonists discovered through the collaboration with Nixera. We're very excited that Lili indicated progressing all three orexin programs and that they are benefiting from Lili's global capability. The key message for the first half is not only that we delivered a strong series of milestones, but that the underlying clinical pipeline is becoming increasingly valuable. Increasingly validated and increasingly capable of generating significant future return for shareholders as well as value for patients. Can we please move to the next slide? Along these partnered assets, our internal portfolio includes three differentiated clinical stage programs in schizophrenia, IBD and immuno-oncology. each with a clear upcoming value creation opportunity in the second half of 2026. The first programme is NXE149, our GPR52 agonist for schizophrenia, and that represents a generally novel approach to the disease by addressing positive symptoms, improving negative symptoms and co-connection, areas where current therapies remain inadequate. NXE 149 has completed Phase 1 development with a strong data package and is fully Phase 2 ready. And we are in advanced discussion with several parties to partner that program. The second program is NXE 744, a gut-restricted EP4 agonist for IBD. The program has delivered strong Phase 1b data by proving pharmacological activity in a human in the messaging challenge model and therefore showing that it's promoting mucosal healing. As the exposure is gut restricted, we see minimal systemic exposure and an excellent safety profile. As this mechanism is applicable as a monotherapy as well as an add-on to biologics, we do see great interest in the program and have selected a number of major players in the INI space for advanced negotiation. The third program is NXE734, an EP4 antagonist for immuno-oncology. The ongoing Phase IIa study is sponsored and operationally delivered by CIUK, allowing Nexera to generate an important clinical proof of concept in a capital-efficient manner. Importantly, erinose EP4 antagonist data 4578 recently produced positive randomized Phase II results in first-line HER2-negative gastric cancer. and these owner data provide strong independent clinical validation that inhibition of EP4 can enhance anti-tumor activity in combination with checkpoint inhibition and this meaningfully increases our confidence in the therapeutic relevance of the EP4 mechanism as we approach our own phase 2a interim readout. Hence, we are very excited about this recent data and looking forward to our interim Phase 2A results in the second half of this year. If we can move to the next slide, please. This slide captures one of the most important elements of our R&D strategy, building a differentiated high value franchise in obesity, metabolic and endocrine disease. The market opportunity is substantial with the next generation of medicine moving beyond maximum weight loss, especially combining strong efficacy with better tolerability, Improving body composition, durable co-morbidity benefits and allowing broader access and long-term adherence. And this is where Nixera is particularly well positioned. Our NexWave platform allows us to design oral small molecule against highly valuable but technically challenging GPCR targets. Our lead metabolic programs cover several of the most strategically important mechanisms in the sector, GLP-1 agonism, amylin agonism, and the GIP receptor, alongside different sets of endocrine opportunities. The commercial and scientific validation for this mechanism continues to strengthen, Lilly's Oral Small Molecule GLP-1 Ophoclipuron demonstrated that an oral non-peptididic can achieve meaningful efficacy without the administrative restrictions of peptides. Importantly, our GLP-1 chemistry is structurally distinct from the described small molecule scaffolds that we know are primarily based on Danuclipuron and Ophoclipuron. Similarly, for our amylin program, we have generated multiple proprietary series. We achieved a 10,000 fold improvement in potency in just three months. And most importantly, our chemistry is completely distinct from any chemistry described, and we are on track for IND studies next year. Execution is critical, and Nexera has the platform, the chemistry, and the portfolio brass to become A meaningful next-generation player in the metabolic and endocrine disease. And we remain on track for four IND enabling studies in 2027 and subsequent clinical starts in 2028. In summary, our R&D portfolio has made substantial progress in the last six months. Strong delivery of mild zone in the first half, progression of the muscarinic portfolio with neurocrine, The Orexion portfolio attracted a multi-billion dollar strategic investment. We have two phase two ready assets at advanced partnering stage and our discovery pipeline is progressing to deliver multiple IND enabling studies in 2027. And with this, I'm handing over to Chris.

Wonderful progress. Thank you, Patrick. Let me now take you through the road ahead at Nexera. Can you please turn to the next slide? So we are moving from an investment phase to a delivery phase, and I want to show you how all of the pieces fit together. So we run our business as four value engines, and each one is now substantial and independently valuable. and each engine, as you can see, fuels, de-risks, funds and accelerates the other engines. So let me show you how they compound. Here are the four engines on one page. Please turn to the next slide. So of the, sorry, we might need to go back one slide if that's okay, guys. Of the four value engines, products, platforms, pipeline, and partners, and as I said, each is substantial and independently valuable. Products is a profitable and growing commercial platform in Japan. We're targeting 40 to 50 billion yen in net product sales and an operating profit margin above 30% by 2030. Our NEX-AQ and NEX-WAVE platforms pair artificial intelligence and quantum level simulation with a proprietary GPCR dataset. And this engine is targeting five AI-led discovery projects by 2028. As Patrick just mentioned, PIPELINE is our emerging metabolic and rare disease biotech. We're targeting four clinical stage programs for the US market by 2028. and our partnerships represents more than $4.5 billion of partner funded milestones and royalties. And we have a goal of executing a new partnership above $1 billion in total deal value later on this year. So let me take each engine in turn starting with products. And now we can go to the next slide, please. So our commercial products engine has more than doubled its sales since 2023 and it is profitable and it is cash generative. Since we acquired this business from Edosia Pharmaceuticals Japan in July 2023, we've scaled revenue 2.6 times and we've removed 20% of the cost base. Pivlaz is the market leader with 74% share in the prevention of cerebral vasospasm. Kivivic is growing in triple digits with Shienogi as commercial partner. And our forthcoming Taiwan launch is secured for the second half of 2026. Vomoralone is moving forward in clinical development. And note the product is now broadly approved for Duchenne muscular dystrophy across the US, Europe, UK and China. We see substantial peak sales opportunity across all three products with Pivlaz at 15 to 16 billion yen, Qvivik at 15 to 20 billion yen and Vomoralone at 10 to 20 billion yen. Every well chosen medicine that we add from here lands on this lean, highly focused commercial infrastructure. Now we plan to extend Vomoralone into further rare disease areas as well. Please turn to the next slide. So we plan to take vomoralone beyond Duchenne muscular dystrophy, or DMD, into at least three further rare diseases. We are evaluating vomoralone in Fukuyama congenital muscular dystrophy, FCMD, a disease found almost only in Japan. We're also evaluating it in pediatric nephrotic syndrome and in juvenile dermatomyositis. In each of these, the current standard therapy relies heavily on glucocorticoids, where a more tolerable steroid such as vomoralone could make a real difference to patients. And this keeps us highly focused on serving more rare disease patient populations, particularly in our home market of Japan. Now let me turn to our platforms and the new company that we recently created to drive them. Next slide, please. So on the 1st of July, 2026, we created a dedicated company for our NextAQ platform. And our starting five all experienced drug hunters have now initiated the first AI led research project. It's led by an experienced team spanning computational sciences, data science and engineering, AI and machine learning research, platform engineering and computational engineering. and these are people who have built and applied AI drug discovery techniques at leading organizations. So let me explain what makes this platform different. Please turn to the next slide. So the NextAQ platform pairs fine-tuned AI models, large-scale virtual screening, and quantum-level simulation with more than 15 years of our proprietary GPCR datasets. And this dataset includes Thank you for watching. All training data is private. None of it is available via public databases. This platform is cloud-based. It's built exclusively on AWS infrastructure, giving us compute at an unprecedented scale to be structure-based and prediction-led and to materially accelerate the timeline to a development candidate and to scale our pipeline through automation and agentic orchestration. And the result is going to be a step change in speed and cost. Please turn to the next slide. So the NextAQ platform compresses the time and the cost of early drug discovery dramatically. Traditionally, reaching a development candidate takes four to five years and maybe $10 to $15 million of investment. With NextAQ, we are targeting one to 1.5 years and less than $5 million of investment per program. That is around 70% compression of front-end time and a more than 50% cost reduction. So speed to development candidate is going to be our core measure and we are scaling to five AI led research programs by 2028. And because every program continues to feed the data set, each one makes the next program faster. Our third engine is the pipeline that our platforms are building. Please turn to the next slide. So we believe the next generation of obesity therapies will compete on far more than just weight loss. We are designing for greater efficacy and for better quality of weight loss that preserves lean muscle mass. We are designing for access and adherence with oral small molecules and convenient dosing and we are designing for greater tolerability. Gastrointestinal side effects remain a major issue for current GLP-1 therapies. They drive high discontinuation rates and they limit the maximum dose that can be reached in real-world clinical practice. So a gentler, better tolerated profile is central to adherence and compliance. And the goal is healthy weight reduction that protects muscle and organs and weight reduction that lasts longer. Here is how that pipeline builds over time. Please turn to the next slide. So we are clearly aiming our next generation metabolic and rare disease pipeline at the US market. Our 2026 discovery pipeline spans GLP-1, GIP receptors, and amylase mechanisms alongside targets for rare endocrine diseases. These discovery assets are designed to become clinical programs over the coming years. and our target is clinical programs for the US markets in chronic weight management, muscle preservation, weight loss and rare endocrine diseases. Now our fourth engine turns all of this science into funded development in cash and that is our partnerships. Please turn to the next slide. So we hold more than $4.5 billion of headline economics plus tiered royalties through partners. And the quality of these partners is being validated regularly in real transactions. As we mentioned earlier, Lilly's acquisition of our orexin partner Sintesa valued that business at up to $7.8 billion, an external arm's length reference point that supports the value of the partnered orexin pipeline in which we continue to hold economics. Thank you for watching. Our muscarinic partnership with Neurocrine is progressing towards a Phase 3 data readout for Directladine, the M4 program, in the second half of 2027 and we regard this as one of the largest sources of potential value within this partnership and within our partnered portfolio. So the partnered economics turn our science into funded development and cash and we expect new partners again in the second half of 2026. So let me bring the four engines back together and what comes next for each. Please turn to the next slide. So each of these four engines has a clear next milestone and together they all continue to compound. In commercial products, we expect new in-license products for Japan in the second half of 2026, as well as filing for the approval of a moral loan in Japan. In platforms, we expect the data readout from our first AI-led research program in the second half of 2026. In our pipeline, we expect a new global outlicense transaction in the second half of 2026. And our first metabolic disease program, we're aiming to enter the clinic in 2028. And with our partnerships, we expect further clarity on Lilly's plans for the orexin portfolio in the second half of 2026. And we look forward to Neurocrin's M4 phase three readout for direclidine in the second half of 2027. So with that, that concludes the main presentation. I'm going to go back to open the floor to questions. Please turn to the next slide. So we'd be glad to take your questions now and I'm joined by my colleagues from Finance, Commercial and Research Development and over to you Nomura-san to manage. Thank you.

Chris, thank you very much. As Chris said, I would like to move on to the next question. If you have any questions, please press the button on the screen. The question has already been raised, so I would like to take the first question. Mr. Hashiguchi from Daiwa Shoken, please unmute yourself and ask your question.

Thank you for your cooperation. Thank you for your cooperation. Thank you for your cooperation. Thank you for your cooperation. Thank you for your cooperation. Thank you for your cooperation. It's been a few months since we started a full-scale negotiation in January. I think there were two main targets, but at this point, I would like to ask you about the possibility that the same number of contracts will be able to be made this year.

Yes, thank you very much Nomura-san and thank you Hashikuchi for the question. I think you will understand from our previous experiences that partnership negotiations can take some time, but that usually

We open the year at the JPMorgan Healthcare Conference where we have many strong and good conversations with potential partners and then we move forward through the rest of the year with a goal usually towards executing these partnerships by the end of the 12 monthly cycle. Thank you for joining us. and I mentioned it on our previous slides, execute at least one new major out license across some of our clinical projects. And we're on track to do that. So we are now moving into the second half of the year. Discussions with partners are becoming much more serious, much more focused. And you can expect to hear from us in the second half of the year regarding a new potential transaction. So thank you very much for your question.

Thank you very much. One more question, please. It seems that the sales of Pebrats and Kubibik have not been corrected this time, but what do you think about the achievement of the air traffic forecast at this point in time? In particular, the progress rate of Kubibik seems to be quite high, but how about the possibility of overflowing with air traffic?

Thank you very much. I would like to answer from my side. Both of them are in-line companies, but they are a bit different from Pibrats and Kubik. First of all, Pibrats is sold by ourselves, and the sales will continue as it is, so this place is in-line and in-line. and so on. As Mr. Hachiguchi pointed out, as you know, we don't sell directly. Moreover, in our sales, we have a lot of supply of products. If Mr. Shionogi buys more in the future, the sales will grow very much, and if we reduce the stock, it will not be so. In other words, we will gradually increase Thank you very much. That's all. Thank you very much. Let's move on to the next question. Nomura Shoken Matsubara-sama, please unmute yourself.

Hi, my name is Matsubara Nomura. Can you hear me? Yes, we can hear you. Thank you for your explanation. I would like to ask you about the two items of the same quality. I think it is one of the same quality at least this year. As for the phase 2 system, it is still in the form of preparation and before the start. In other words, if the same quality is not possible, the P2 system will not start. Do you understand?

Thank you for the question, Matsubara-san. That's correct. If we don't out-license the EP4 agonist or the GPR52 agonist, it is not our intention to conduct global phase 2 studies ourselves. These... Stacey Southall, Kieran Johnson IBD, very, very large global indication that is much better suited to a large company that has an IBD franchise to take that program forward through phase two and phase three. Similarly, GPR 52, this is a mechanism of action that is indicated for schizophrenia or psychosis in Alzheimer's disease patients. Again, it's a very, very large indication. We need the support and the expertise of a large partner to move that forward through Phase 2 and Phase 3. So hopefully that answers your question.

I understand. Thank you very much. Regarding the inflammation growth, we are currently working on the combination of fluorescent materials, so I thought that if a partner doesn't move forward well, it would be a loss of opportunity. Is it better to say that the cost is more important than that?

Let's start with Chris.

Thank you for the question. Generally speaking, our preference is to out-license to a large partner that is fully funded to do all of the clinical development required to make the medicine a success. As you know from our history as a company, There are other ways that we can move programs forward without necessarily doing a licensing deal as well. Now our current focus and our current priority is to find a licensing partner. However, if we were unable to find a licensing partner, We could create a spin co and we could bring venture capital investors in to fund the trial and we could, in return, own a significant minority equity stake in that spin co. and the venture capital funds could move the project forward cost effectively. That would be another way that we could realize value from these projects. I just want to make it very clear that Nexera will not be spending 100% of the development costs on these projects. So priority number one is a licensing transaction with a major pharmaceutical company. If we were not able to do that, priority number two would be a spin co with top tier venture capital providers to move the asset forward in that fashion. Hopefully that answers your question, Matsubara-san. Thank you.

Thank you for your time. Second, I would like to ask about the development strategy of AI-based drugs. This time, we were able to understand that it is possible to accelerate the development speed and shorten the time by collecting data such as the application of G. On the other hand, the G.I.P. Amirin, which is shown on the 26th page on the left, has a priority. In the development of the future on the right, we are aiming for first-in-class or best-in-class drugs. Thank you for the question. Generally, when you look at...

The targets that we work on, they are currently primarily dominated by peptide drugs. There are certainly in the GLP-1 and amyloid other small molecules. Thank you very much. Thank you very much. Thank you very much. Chris Cargill, Hironoshin Nomura, Kieran Johnson

Toshihiro Maeda, Toshihiro Maeda, Kieran Johnson Thank you.

Thank you very much for taking my question and congratulations on a fantastic quarter. I have two questions. The first regarding cube physique.

I note what you've said, Nomura-san, regarding the situation with inventory and also the class expanding. But I wonder if you can add anything related to new patient starts versus patients switching from competing therapies regarding this. Thank you.

What are you doing tonight? Time is up.

Thank you very much.

Thank you very much. Currently, we are focusing on the treatment of patients who are starting their new sleep therapy, and we are working on it. We are focusing on the treatment of patients who are starting their new sleep therapy, and we are working on it. We are working on it. We are working on it. Thank you for watching. Thank you very much. There was a little back noise, so I muted it, but I would like you to continue the question.

Thank you very much Nomura-san, that was perfectly clear. My second question is just regarding Sentessa and with the acquisition now closed, I wonder if there's anything that you can comment on the economics that you receive or will receive from the transaction and whether there will be any additional proceeds related to the transaction. Thank you.

Thank you. Chris will answer this question.

Yeah, thanks, Dion. Thanks for the question. Obviously, our agreement with Syntesa is confidential, so I can't disclose the specifics. Certain details have been disclosed previously in the public filings of Sintesa, so I can confirm that there are still milestones that we are to receive for the progress of the three molecules, and they will continue to progress under Lilly's stewardship. That's clear. Toshihiro Maeda, It's truly fantastic that Lilly have recognized the value, not only in the programs we discovered, but the incredible effort that the team at Sintesa did to develop those molecules so quickly. And we're just really excited to hear more about what Lilly plans to do. So far, there's been general comments publicly from CEO and CSO of Lilly around what they plan to do with these programs, but clearly, They have ambitions beyond just sleep-wake disorders and, as I said, into broader brain health and neuroscience, looking at potentially cognition, mood disorders, fatigue disorders, etc. So, yeah, we're really excited. And, yeah, what a great outcome for the team at Centessa. And we really look forward to seeing what Lily will do with the programs going forward. Thank you. That concludes my response.

Thank you very much. Can I just ask one further question, if possible, regarding your NextAQ platform, which is very exciting. And I wonder, you mentioned creating spin cars or involving VC funds. And given the value, what must be very large value of 15 years of proprietary GPCR data, if there's Any opportunities that you can think of to leverage this asset beyond keeping it internally and potentially suffering a bit of a conglomerate discount, if I can use that term, given the valuations achieved generally by AI companies? Can you make any comments on that? Thank you.

Yeah, that's a really good question. I think it's clearly been very front of mind for me. And in a way, I mean, We set this platform up as a separate company already. So if you look at the company's house filings in the UK, you will see that Nexera Pharma Co Ltd has already been established as a separate entity. And what that means is it gives us flexibility in the future. Should we want to attract direct investment into that entity and the build out of the platform, We can. And also, of course, with a view to the future, Dion, we're always considering what is the most appropriate venue for a company like this? Is the most appropriate place for our AI and quantum platform to be sitting within a Japanese pharmaceutical company? Maybe that's not the case in the future. And because we've already established it as a separate legal entity, Thank you for watching. What I would call not traditional pharmaceutical investors, right? Currently, a lot of the money that's being invested in this space comes from the likes of the soft banks of the world, the NVIDIAs of the world, the tech bio investment community. We've already set it up from day one to be structured so that it's really easy to do that. So hopefully that answers your question without giving you too much detail.

Thank you very much.

I'm Yamashita from Jefferies. First, I'd like to ask you about the return of fair value and market evaluation. Even though there's a lot of positive news this year, I don't think the stock market is shaking much. On the other hand, if you look at the market, biotech stocks are recovering in the U.S. However, Japan is still weak in terms of biotech, including sound. I have a question for you. If you think that it is not evaluated in the Japanese market, what is the possibility of buying from other companies for the sake of fair value and economic development in Japan? Please comment on the idea of fair value and the way of economic development. Thank you. I would like to answer this question from Chris.

Thank you, Yamakita-san. This is quite topical for us at the moment in our discussions, particularly with US institutional investors this year. This question continues to be raised. Thank you for joining us. I've said for many years we're very proud that we were founded and we're very proud that we are listed in Japan and it is my duty to make sure Nexera becomes a Japanese biotech champion and just to be clear we are not considering delisting from Japan but I do think it is a fair comment that if we were starting this company today We have options available. We could do a direct dual listing, or we could do a carve-out listing. Now, regarding the latter, the concept of a carve-out listing, I have already proposed this to our board of directors, and the board of directors is already considering it as part of our midterm business plan. So for this strategy, We firmly believe our obesity and rare endocrine disease pipeline, plus even the AI discovery platform, which I just mentioned, we've already established it in a separate legal entity. We think that the pipeline and the platform would be valued far more highly by US institutional investors and perhaps in the future, and many more. Thank you for joining us. Only we know the confidential information in our contracts and our agreements, and therefore we know how to appropriately value it. And I think the last thing I would say on this topic of fair valuation, I mean, another reference point, Lilly has acquired Sintesa for 6.3 billion, maybe up to 7.8 billion. Sintesa's entire pipeline came from our platform, right? So that's a very fantastic validation of... Not only the quality of our science, but the value of what we produce. So I'll leave my response there, but hopefully I've given you lots to think about. Thank you, Yamakitsu-san.

Yamakita-sama, arigatou gozaimashita. Chotto jikan ga subesu hiro ni oshitte orimasu ga, saigo ni ichimon dake desu, watakusha chatto no hou kara hitotsu dake toriage sasete itadakitai tomoimasu. Chodo ima utsushite iru peiji no kono product no tokoro no mokkyou desu ne, kono 2030 ne uriage daka 400 kara 500 okuen chou to iu fu ni kaite arimasu keredo mo, kono suuji no imi ga, izen wareware no 2030 ne vision to iu no wo, There is a corporate presentation on the homepage, but I would like to ask you what kind of connection there is with this 5 billion yen. As for the finance, I will answer as it is. In the past, I said that 5 billion yen in 2030 was a milestone or a sales value of a platform business. I think it was in the range of 100 to 150 billion yen. In addition to these 400 to 500 billion yen, this is only the number of products, so if you add it up, it will be about 500 billion to 600 billion yen, or 650 billion yen. I think it will be such a number, so the previous 500 billion yen, at least 500 billion yen, is of course proven. Thank you for listening to the Q&A. Thank you very much.