MEDICAL SYSTEM NETWORK Co.,Ltd.
4350・Standard Market・Retail Trade
Business
Medical System Network Co., Ltd. is a comprehensive service company in the medical and pharmaceutical field, founded in Sapporo in 1999. With 13 consolidated subsidiaries, its core operations center on directly-operated regional pharmacies (472 stores) and the Pharmaceutical Network Division (12,003 affiliated members), covering the entire pharmaceutical supply chain including generic drug manufacturing & sales, pharmaceutical logistics, digital shift support, leasing & facilities, food service, and home nursing care. Its main customers are pharmacies, hospitals/clinics, and welfare facilities nationwide, and it is listed on the Standard Market of the Tokyo Stock Exchange.
Business Model
The core of profitability is the Pharmaceutical Network Division's operations, which mediate between pharmaceutical wholesalers and pharmacies/hospitals, handling item-by-item price negotiations, settlement agency services, and inventory management support. The company builds up multi-layered revenue through cross-selling of accounts receivable securitization support for dispensing fee claims to member pharmacies, along with generic drug manufacturing & sales, logistics, and DX services. Combined with the operating revenue from 472 directly-managed pharmacy locations, the Regional Pharmacy Network Business accounts for the majority of net sales of ¥132,186 million.
Company Strengths
As of the end of March 2026, the number of Pharmaceutical Network member outlets reached 12,003 (up 1,000 from the previous fiscal year-end), and pharmaceutical order transaction volume reached ¥755,761 million (up 11.4% year on year). The wide-area membership network built up over many years functions as an entry barrier that is difficult for competitors to replicate in a short period.
The company operates five divisions in an integrated manner: directly operated regional pharmacies, the Pharmaceutical Network, generic drug manufacturing and sales (56 ingredients, 130 products), pharmaceutical logistics (3,690 client stores), and DX support (6,658 stores implemented). It has a vertically integrated business structure in which each division shares its customer base with the others to realize cross-selling.
As of the end of March 2026, the company directly operated 472 Regional Pharmacy stores. In FY2026 (ending March 2026) alone, it opened 17 new stores and acquired 9 stores through M&A, maintaining a net increase even after subtracting 11 stores that were closed or transferred. Of the ¥4,494 million in capital expenditures, ¥4,142 million was invested in the Regional Pharmacy Network Business, achieving continuous expansion of the store network.
ENVALITH's Perspective
Performance Trend
Revenue increased for five consecutive fiscal years, from ¥106,685 million in FY2022 (ended March 2022) to ¥132,186 million in FY2026 (ending March 2026) (up 8.0% year on year in FY2026). Operating profit, however, has languished since peaking at ¥3,852 million in FY2022, and although it recovered slightly to ¥3,313 million in FY2026 (up 5.0% year on year), profit attributable to owners of the parent stood at ¥1,070 million, the lowest level in five years. Profit was squeezed by rising personnel expenses from wage increases, a decline in the number of prescriptions handled at existing pharmacies, and losses recognized on equity-method investments. The temporary suspension of dispensing receivables securitization pushed operating cash flow into a deficit of ¥3,441 million, while a sharp increase in short-term borrowings expanded financial leverage. As an external factor, a decrease in patients with acute illnesses affected the number of prescriptions handled at existing pharmacies.
Growth Strategy
Positioned as a structural transformation period under the 7th Medium-Term Management Plan, the company is advancing its shift toward a highly profitable portfolio.
Promoting service expansion including regional pharmaceutical inventory information sharing services and various training programs. Achieved 12,003 locations (up 1,000 from the previous fiscal year-end) as of the end of FY2026 (ending March 2026). Continuing to expand the foundation toward the long-term vision target of 45,000 supported facilities by FY2035 (ending March 2035).
The Pharmaceutical Logistics Division (Medi-Logi-Net), which commenced operations in the previous fiscal year, rapidly expanded in FY2026 (ending March 2026) to 3,690 transacting stores (up 2,118 from the previous fiscal year-end), with profitability also improving. Positioned as the core of the medical supply domain responsible for enhancing efficiency and ensuring stable supply within the pharmaceutical supply chain, the company aims to further expand its business partners.
The number of stores adopting DX support services utilizing the LINE official account "Tsunagaru Yakkyoku" (Connected Pharmacy) and other tools developed by Pharmashift steadily expanded to 6,658 stores (up 638 from the previous fiscal year-end). The company continues to expand its customer base by providing DX experiences to both patients and pharmacies, aiming to reduce dependence on prescriptions.
Data platform integration for centralized management of customer data is planned for implementation in FY2027 (ending March 2027). While an increase in one-time expenses is expected, this is positioned as an advance investment toward future revenue expansion. The company will promote the transition to a highly profitable portfolio through the construction of the Medisys Network (a platform utilizing nationwide pharmacies and diverse data).
Manufacturing and sales of generic pharmaceuticals conducted by Felsen Pharma steadily expanded, with transacting stores reaching 9,082 (up 1,901 from the previous fiscal year-end). As of the end of FY2026 (ending March 2026), the company sold 130 products across 56 active ingredients (with 20 products across 10 active ingredients under shipment adjustment). The company will continue to develop new business partners and enhance profit contribution from the pharmaceutical supply domain.
Last updated: July 19, 2026