Astellas Pharma Inc.

With the expanding use of AI, cyberattack methods are becoming more diverse and sophisticated, and confidential data and critical systems held by the pharmaceutical industry are becoming targets of attack. Malicious activities could result in failures of critical systems or breaches/leakage of confidential data, including personal information. The Company addresses this through operation of an information security program based on the NIST CSF, management and oversight by the CISO, and introduction of the latest AI-powered tools.

The United States is aiming to introduce a most-favored-nation drug pricing policy (a policy to lower domestic U.S. drug prices to the lowest level among other developed countries), and if applied to the Company's products, this could lead to a decrease in revenue in the U.S. market. It could also have a ripple effect on market strategies in other developed country markets. The Company addresses this through monitoring of policy and regulatory trends, advocacy to industry associations and government agencies, and estimation of financial impact.

Governments in various countries are advancing "data nationalism," strengthening control over domestic data, and there is an increasing trend of prohibiting or restricting cross-border data transfers and formulating unique personal information protection laws that do not conform to global standards. Regulatory changes may require modifications to business processes and IT systems, potentially leading to additional costs, increased operational complexity and inefficiency, and hindrance to innovation. The Company addresses this through monitoring of relevant regulations, implementation of country/region-specific compliance projects, and response to the U.S. Data Security Program (DSP).

Ahead of the launch of the next mid-term business plan, the Company is pursuing multiple organizational transformations in parallel, and insufficient understanding and coordination of the interrelationships among these initiatives could adversely affect corporate culture and external reputation. There is a risk that a lack of coordination in the simultaneous implementation of multiple initiatives could lead to a decline in overall organizational performance. The Company addresses this through operation of coordination meeting bodies among key initiatives, provision of a status-tracking platform, and building change management capabilities.

As of April 2026, the United States has announced the introduction of tariffs on pharmaceuticals and pharmaceutical raw materials, changing the zero-tariff treatment that has been maintained since the establishment of the WTO. Depending on the specific implementation details of the tariffs, this could lead to an increase in the Company's manufacturing costs. The Company addresses this through impact analysis based on multiple tariff scenarios and formulation of a strategic framework for its global supply chain network that incorporates tariff and geopolitical risks.

The Company's sites are geographically dispersed and are at risk of being affected by natural disasters and extreme weather caused by climate change in each region. Over the medium to long term, climate change may increase the frequency of extreme weather events, and particularly destructive natural disasters could disrupt business operations and affect the stable supply of pharmaceuticals to patients. The FY2024 physical risk analysis identified the Shenyang plant as high risk, and the Company addresses this through expansion of business continuity plans, conducting drills, and site-specific risk assessments.

With the advancement of AI utilization in the pharmaceutical industry, regulatory authorities have begun clarifying conditions for AI use in GxP environments through guidance and other means, requiring continuous response to future regulatory evolution. Although the Company has established a compliance framework based on current laws and regulations, a delayed response to regulatory changes could hinder business activities. The Company addresses this through establishment of Responsible AI principles, a review process for new AI projects, and establishment of a system validation process for AI utilization in GxP.

As a risk specific to the pharmaceutical industry, there is uncertainty in research and development, and development candidates may not receive approval. If substantial investment in research and development fails to produce results, this could affect the Company's business results and financial condition. This is explicitly stated as a risk in the Annual Securities Report, but specific mitigation activities are not described in detail in this section.

There is a risk that the Company may infringe on third parties' intellectual property rights, or that the Company's intellectual property rights may be infringed by third parties. Infringement of intellectual property rights could lead to litigation, damages, suspension of product sales, and other consequences, potentially affecting the Company's business results and financial condition. This is explicitly stated in the Annual Securities Report as a risk specific to the pharmaceutical industry, but specific mitigation activities are not described in detail in this section.

There is a risk that side effects or safety issues may arise with products currently marketed or under development, which could lead to market withdrawal, suspension of sales, litigation, or stricter regulation by authorities. This is explicitly stated in the Annual Securities Report as a risk specific to the pharmaceutical industry and could affect the Company's business results and financial condition. This is explicitly stated in the Annual Securities Report as a risk specific to the pharmaceutical industry, but specific mitigation activities are not described in detail in this section.