Research & Development We are maintaining aggressive research & development investment in particular for three focus areas. Direction of R&D: Intersection of Psychiatry and Neurology Focus Research Areas In psychiatry, we are challenging ourselves to tackle treatment-resistant psychiatric disorders, leveraging our disease area expertise and results. In neurology, we are making progress in research and development aiming to discover fundamental disease modifying drugs for neurodegenerative and other Psychiatry & Regenerative Oncology disorders. We will combine our initiatives in these two disease Neurology Medicine / Cell Area areas to address the challenges of peripheral psychiatric symptoms Area Therapy Field related to neurological disorders. With the objective of increasing the success rate of R&D, we are continuing to strengthen drug discovery platforms such as Three Focus Research Areas in-silico/AI technology and iPS drug discovery, and to enhance translational research by integration of research and development division in the Psychiatry & Neurology area. Psychiatry & Neurology Area Psychiatric disorders Foundational area for continuously creating DSP Remodeling our R&D Organization for More Productive original products New Drug Development Drug discovery research In order to enhance our attractive development pipeline with in segments with high unmet medical needs Thoroughly pursue ® (specific symptoms, ® ® ne POC First greater productivity, we revamped the research organization ® treatment-resistance) DIEL Pursue external and consequently renamed it the Drug Research Division in asotrali SE LULLAN LONASEN LATUDA d Efforts in peripheral collaborations October 2017. psychiatric symptoms Adopt and utilize related to neurological cutting-edge As a part of this organizational realignment, we also disorders ® ® ® ® technology ne applied a new “Project-based Research Management System.” RIEF phi Focus on translational DOPS research utilizing TRE APTIOM mor Previously, different departments were in charge of early-stage Efforts in disease- biomarkers EXCEGRAN apo and late-stage research programs. Going forward, Project modifying/curing drugs Leaders, in many cases the originator of the project, will lead the project from the start through the later stages, and have Experience in epilepsy and Parkinson’s disease Neurological disorders budget authority. Additionally, to speed up decision making, drug development Project Leaders will report directly to the Senior Executive Research Director. Project Directors will oversee projects Fiscal 2018 objectives overall, and will offer support for moving each project forward, to accelerate drug discovery. Two NDAs Dasotraline (U.S.): binge eating disorder (BED) LONASEN® (transdermal patch formulation, Japan)*1: schizophrenia Drug Research Division Three treatment approvals Senior Executive Research Director Executive Research Director Dasotraline (U.S.): attention-deficit hyperactivity disorder (ADHD) Head of Research Division Head of Research Operations TRERIEF® (Japan)*2: Parkinsonism in Dementia with Lewy Bodies (DLB) (Research units and labs) Apomorphine (U.S.): OFF episodes associated with Parkinson’s disease Research units covering each R&D *1 Application for LONASEN® transdermal patch submitted in July 2018. Project Project function, labs, Research Planning & *2 Approval for a new indication for TRERIEF® received in July 2018. Directors Leaders Coordination, External Innovation Development Office 19 Sumitomo Dainippon Pharma Co., Ltd. Integrated Report 2018 Oncology Area Regenerative Medicine / Cell Therapy Field Aiming to Build a Unique Pipeline through Strong Group Quickly Establishing Commercial Manufacturing Capability Collaboration for Regenerative and Cellular Medicines Sumitomo Dainippon Pharma’s basic strategy in this therapeutic In order to resolve one of the greatest bottlenecks in the area is to conduct research and development with a focus on commercialization of such products, namely, the development cancer stemness inhibitors, cancer peptide vaccines, and kinase of their production system, we completed the Sumitomo inhibitors and deliver unique, unprecedented products through Dainippon Manufacturing Plant for Regenerative Medicine & collaboration with Cell Therapy (SMaRT) in March 2018. With the assistance of Boston Biomedical Cancer Cancer our industry-academia alliance partners, the facility will use stemness inhibition immunomodulation and Tolero so as to allogeneic iPS cells to manufacture clinical trial and Napabucasin DSP-7888 contribute to the Amcasertib DSP-0509 etc. commercial products for age-related macular degeneration, treatment of cancer DSP-0337 etc.c. Parkinson’s disease, retinitis pigmentosa, spinal cord injury, patients. and other conditions. Kinase inhibition / others From the foundational stages to commercial manufacturing, Alvocidib we will establish integrated platform technology related to iPS TP-0903 TP-0184 etc. cell-derived cellular medicines, aiming to introduce regenerative cellular medicines as early as possible. Pursuing Smart R&D Anticipating Environmental Changes in the Oncology Area Fiscal 2018 objectives In the Oncology area, the demand for better therapeutic Promote development of SB623, allogeneic iPS cell-derived outcomes is rising, while the development success rate is falling. medicines (age-related macular degeneration, Competition is intensifying as the disease itself becomes more Parkinson’s disease and others) segmented and drug discovery-related technology and science advance for each form of cancer. An R&D model (Smart R&D) that is significantly more compact and quicker than conventional Developing Frontier Fields models, while also achieving a high success rate, is critical amidst these changes in the development environment. Sumitomo Dainippon Pharma is dedicating effort to three Sumitomo Dainippon Pharma will utilize leading-edge focus areas: Psychiatry & Neurology, Oncology, and analytic technology, diagnostic tools, and biomarkers as we Regenerative Medicine / Cell Therapy. In addition to these, promote network-oriented R&D leveraging external parties. As we want to target new frontier fields in healthcare areas a result, we will design leading-edge clinical trials and pursue other than pharmaceuticals in order to establish a second opportunities for rapid approval under the latest regulatory earnings pillar of the future. Building on the foundation of affairs systems. our pharmaceutical products business, we are exploring complementary projects and opportunities. Smart R&D Focus research areas and overall R&D organization A model utilizing cutting-edge technologies and pharmaceutical High unmet medical needs regulatory and development methods that are distinctive in the Oncology area, enabling more compact, rapid and successful R&D Markets expected to show mid- to long-term growth as we pursue innovation Leading-edge Leading-edge regulatory analytic Network- affairs Psychiatry & oriented R&D Oncology technology systems Pursuing Sumitomo Neurology Area Tolero opportunities for Pharma Area R&D process rapid approval of (U.S.) (China Suzhou) Leading-edge Leading-edge all types of diagnostic tools clinical trial projects and biomarkers designs Boston Sumitomo Biomedical Dainippon Pharma Sunovion (U.S.) (U.S.) Regenerative & Cellular Medicine Fiscal 2018 objectives DSK Office Regenerative Promote development to accelerate NDAs for Medicine / Cell Therapy napabucasin, alvocidib, etc. DSK: Kyoto University and Sumitomo Dainippon Field Pharma Joint Research Project Sumitomo Dainippon Pharma Co., Ltd. Integrated Report 2018 20 Research & Development Alliances with Outside Institutions Consideration in Clinical Studies Signing a Licensing Agreement with Clinical Studies Put the Human Rights of Subjects First JCR Pharmaceuticals for Blood-Brain Barrier We conduct human clinical studies required for new drug Penetration Technology applications in accordance with the utmost consideration of Sumitomo Dainippon Pharma signed a licensing agreement the subjects’ human rights. with JCR Pharmaceuticals for discovering treatments for central Since clinical studies are conducted during the intermediate nervous system diseases by applying J-Brain Cargo® blood-brain stages of confirming the efficacy (effectiveness) and safety of barrier penetration technology. drug candidates, our clinical studies follow such regulations as This agreement will give us exclusive R&D and Japan’s ministerial ordinance on GCP (Good Clinical Practice), commercialization rights, in Japan and North America, which was established to protect the human rights, maintain for specific central nervous system disorders. the safety and improve the welfare of subjects participating in studies. Joint Research with the Kitasato Institute, Targeting New Treatments for Antimicrobial-Resistant Bacterial Infections Ethical Approach to Human Tissue Research Sumitomo Dainippon Pharma signed a joint drug discovery The Research Ethical Review Committee, part of the Corporate research agreement with the Kitasato Institute for infections Regulatory Compliance & Quality Assurance Division, reviews caused by bacteria with antimicrobial resistance (AMR). the appropriateness of implementing research from the Pursuant to this agreement, a group led by Dr. Satoshi Omura, perspectives of the significance and necessity of research, Distinguished Emeritus Professor of Kitasato University and the the scientific rationality of plans, the provision of adequate 2015 laureate of the Nobel