Special Feature

Strengthening Growth Foundations Through Strategic Investments

01 Strategic business investments funded by the HIV business 

The series of business investments executed in fiscal 2025 were not undertaken simply to expand the scale of our operations. Rather, they represent strategic initiatives aimed at strengthening the business foundation necessary to achieve sustainable growth beyond 2030 and realize the SHIONOGI Group Vision.

The global pharmaceutical market is undergoing significant changes in both growth opportunities and the business environment. In Japan, growth potential has become increasingly limited due to demographic shifts and drug pricing reforms. In contrast, the U.S. market continues to offer strong growth prospects as the world’s largest pharmaceutical market. At the same time, sustainable growth in the pharmaceutical industry requires continued enhancement of drug discovery capabilities to consistently generate innovative medicines originating from in-house research.

Against this backdrop, SHIONOGI leveraged the strong business foundation created by its HIV business to execute strategic investments in fiscal 2025 aimed at: (1) further expanding the HIV business; (2) strengthening its domestic business foundation; (3) expanding its U.S. presence and establishing a rare disease business; and (4) enhancing its in-house drug discovery capabilities.

In fiscal 2025, SHIONOGI made an additional investment in ViiV Healthcare, a pharmaceutical company specialized in HIV, and accounted for it as an equity-method affiliate. SHIONOGI views its partnership with ViiV Healthcare as a key pillar supporting the continued growth of its HIV business. In recent years, the long-acting injectable (LAI) therapies Cabenuva and Apretude have achieved increasing market penetration and have been widely accepted as valuable new options for HIV treatment and prevention. The LAI market is expected to continue expanding, supporting the sustained growth of the HIV franchise.

In addition, S-365598/VH184, a third-generation integrase inhibitor discovered by SHIONOGI, has shown potent antiviral activity and a favorable safety profile in studies to date, while exhibiting a resistance profile distinct from existing therapies. The compound is expected to serve as a future growth driver for the HIV franchise. Development is also underway with the aim of reducing LAI dosing frequency from 6x a year to 2x a year, potentially contributing to further advances in HIV treatment.

Based on these strong prospects for the HIV business, SHIONOGI made an additional investment in ViiV Healthcare. Through this investment, we aim to further deepen our partnership and enhance corporate value over the medium to long term by capturing growth opportunities in the HIV field.

02 Making Torii Pharmaceutical a wholly owned subsidiary to transform our domestic business

SHIONOGI made Torii Pharmaceutical a wholly owned subsidiary in fiscal 2025 to support sustainable growth toward the realization of the SHIONOGI Group Vision. Torii Pharmaceutical’s product portfolio and customer base, primarily in the allergen and dermatology areas, are expected to serve as a new growth driver beyond infectious diseases.

The allergen and dermatology markets are expected to continue growing. In particular, the market for allergen immunotherapy (AIT), a treatment aimed at achieving clinical remission of allergy symptoms, is expected to expand. Unlike infectious disease products, demand in this market is less susceptible to the impact of disease outbreaks. It also has high barriers to entry, as it requires advanced manufacturing and quality control technologies and the accumulation of long-term safety and efficacy evidence. These characteristics also make the market less susceptible to patent cliffs.

By making Torii Pharmaceutical a wholly owned subsidiary, SHIONOGI has acquired a product portfolio that is less susceptible to infectious disease outbreaks and patent cliffs. We are establishing a new pillar of earnings beyond infectious diseases while strengthening the business foundations that support sustainable growth.

Making Torii Pharmaceutical a wholly owned subsidiary has enabled SHIONOGI to further strengthen its domestic sales capabilities as well as expand its product portfolio, primarily in the allergen and dermatology areas. We have significantly broadened our customer base by gaining access to dermatology and otolaryngology practices, where our contact had previously been limited. A wider product portfolio also allows us to provide a broader range of information and better tailor our proposals to customer needs.

On September 1, 2025, when Torii Pharmaceutical joined the Group, the two companies began co-promoting their key products. Shionogi & Co., Ltd., with its strengths in infectious diseases, and Torii Pharmaceutical, with its strengths in allergens and dermatology, are drawing on their respective expertise and business foundations to provide information across medical specialties. From fiscal 2026, we are also progressively assigning a single medical representative to each medical institution, moving toward a more efficient and consistent approach to information provision. These initiatives enable us to offer a wider range of information tailored to customer needs and improve the quality and productivity of our information provision activities.

We will further combine the expertise and customer bases developed by both companies to accelerate sales synergies. We also aim to achieve sustainable growth and enhance corporate value through synergies across multiple aspects of integration, including sharing R&D expertise and improving production efficiency through in-house manufacturing.

 03 Acquiring the edaravone business to strengthen our U.S. business

SHIONOGI is strengthening its business foundations in the United States, the world’s largest pharmaceutical market, to achieve sustainable growth toward 2030. In line with this approach, the acquisition of the edaravone business gives us operational capabilities and a customer base in rare diseases, in addition to sales of Radicava (edaravone), a treatment for amyotrophic lateral sclerosis (ALS) and other conditions.

Although ALS affects a relatively small patient population, unmet needs are high, and the disease requires highly specialized expertise and ongoing patient support. Employees in the edaravone business have built strong networks with patient advocacy groups, specialists, and insurers, and have accumulated expertise in improving patients’ access to treatment. These specialized operational capabilities and the customer base are well suited to SHIONOGI’s U.S. strategy of expanding the business through the effective use of limited resources.

Since acquiring the business, we have focused on three priorities: timely and reliable support for new patients, streamlining treatment initiation, and building a foundation for continued treatment. These initiatives are progressing well, helping us deliver greater value to patients with ALS while contributing to business growth in the United States.

The acquisition of the edaravone business is more than an investment in a single product. Its purpose is to build a platform from which SHIONOGI can establish rare diseases as a growth business.

In rare diseases, having a product alone is not sufficient. To ensure that each patient receives appropriate treatment, we need people with expertise in rare diseases, operational knowhow, and connections with patient networks. The edaravone business has developed these capabilities in ALS over many years. The experience and expertise it has accumulated are important assets that extend beyond a single product and will support our broader expansion in rare diseases. Networks with patients and healthcare professionals, together with the specialists who run the business, will also be major strengths as we expand.

SHIONOGI will use these foundations to continue delivering value in ALS while advancing R&D in its rare disease pipeline. The acquired business capabilities will support the smooth launch and commercialization of future pipeline products, helping us expand our rare disease business and achieve sustainable growth.

04 Acquiring JT Pharmaceutical Business to strengthen in-house drug discovery capabilities

SHIONOGI’s growth has been built on its distinctive strengths in small-molecule drug discovery, primarily in infectious diseases. To continue creating new value beyond 2030, we believe it is essential to further strengthen our R&D base. With this in mind, we acquired JT Pharmaceutical Business, which brings outstanding research talent and advanced foundational technologies for drug discovery, including AI and quantum computing.

JT Pharmaceutical Business also has a strong track record in small-molecule drug discovery, having discovered several original new medicines. The acquisition has significantly expanded SHIONOGI’s R&D resources and further strengthened our capabilities in generating drug discovery ideas, predicting compound profiles, and evaluating pharmacokinetics and safety. Integrating our research talent and drug discovery platform technologies is also expected to accelerate R&D and strengthen our future pipeline generation capabilities.

Through these initiatives, we are strengthening the R&D base that will support future growth and further enhancing our in-house drug discovery capabilities.

The acquisition of JT Pharmaceutical Business goes beyond expanding our R&D resources. It is an important step in applying the small-molecule drug discovery capabilities SHIONOGI has developed over many years in infectious diseases to a broader range of diseases.

JT Pharmaceutical Business has a strong track record in research in QOL diseases, including immunology, inflammation, and central nervous system disorders. These areas offer many drug discovery targets suited to our strengths in small-molecule drug discovery. Many of these diseases also call for flexibility in formulation design, including oral formulations, making them well suited to SHIONOGI’s capabilities. We aim to create new value by applying the small-molecule drug discovery capabilities developed in infectious diseases to these areas. Expanding our research beyond infectious diseases will also enrich our research programs and pipeline.

Drawing on the strengths of both companies, we will work to discover new treatments that meet increasingly diverse medical needs. In doing so, we aim to further diversify our business portfolio and enhance corporate value over the medium to long term.

Strengthening the Business Model

SHIONOGI will continue to evolve by building on its competitive strengths in “research, produce, and promote.” Through M&A and strategic investments, we will strengthen our drug discovery, supply, and commercial capabilities while leveraging the strengths we have developed in infectious diseases to diversify our earnings structure.

※This diagram illustrates SHIONOGI’s business model based on its three competitive strengths in “research, produce, and promote.” In “research,” SHIONOGI is extending its small-molecule drug discovery capabilities from infectious diseases to QOL diseases. In “produce,” SHIONOGI is building a flexible and resilient production and supply system. In “promote,” SHIONOGI is expanding its product portfolio and geographic reach, building on its sales networks in Japan, the U.S., Europe, and China. By operating these capabilities with high efficiency, SHIONOGI aims to ensure high profitability while achieving sustainable growth and creating value.