"MIC" stands for marketing, innovation and challenge - the main themes of our medium-term business plan. Kyorin Pharmaceutical will pursue its management based on this plan.

The Kyorin Group is still implementing the Kyorin MIC-09 medium-term business plan launched in April 2005. With marketing, innovation and challenge as the plan’s keywords, the goal is to realize the corporate vision of becoming an integrated, trusted and unique healthcare organization based on global drug discovery operations. The basic policies of the plan are set out as (1) Evolution, which targets further evolution of the drug discovery model, and (2) Innovation II, which is directed at establishing businesses to support the drug discovery model.

The Kyorin Group is building drug discovery and research bases in Japan, the United States and Europe. This threepronged network is being used to establish a global drug discovery organization that generates operating synergies.

A particular focus is on producing one late-stage compound per year. Late-stage compounds are drug candidates that have established their proof of concept (POC), which indicates their efficacy and safety in humans, up to the end of Phase IIa trials.

We are improving the competitiveness of our pharmaceuticals business by strengthening the domestic sales organization of Kyorin Pharmaceutical and building relationships with longterm customers. In addition, we are focusing on extending the growth curves of our core pharmaceuticals by using a lifecycle management program to develop of additional drug indications and formulations.

We are also actively pursuing our FC3 strategy in respiratory medicine, otolaryngology and urology, and continue to use alliances to strengthen our lineups in those areas through the introduction of new products. The merger of Nisshin Kyorin pharmaceutical with Kyorin Pharmaceutical on October 1, 2008, will create synergies that will strengthen our R&D and sales capabilities.

To complement our drug discovery operations, which rely on a long-term, high-risk, high-return business model, and to stabilize growth, we are developing healthcare-related businesses in accordance with our philosophy. Specifically, we are expanding our generic drug business, which provides trusted products, and our healthcare business, which features the support of physicians.