Fuso Pharmaceutical Industries, Ltd.
4538・Prime Market・Pharmaceuticals
Business
Fuso Pharmaceutical Industries, founded in 1937, is a prescription drug manufacturer whose core products are Infusion Solutions & Injectables and Kindaly (Dialysis Solution for Artificial Kidney). The company manufactures at four plants—Joto, Daito, Okayama, and Ibaraki—and supplies hospitals and dialysis clinics nationwide via wholesalers. Of net sales of ¥62,307 million, the Pharmaceuticals Business accounts for over 99.8%, with the Real Estate Leasing business playing a complementary role. Major customers are the four major pharmaceutical wholesalers Suzuken, Alfresa, Mediceo, and Toho Pharmaceutical, which together account for 64% of net sales. The company is pursuing a transformation into a specialty pharma focused on the kidney and urology fields, and is also advancing development of DMX-200 (R&D Product), a candidate treatment for FSGS.
Business Model
The company manufactures infusion solutions, dialysis solutions, and other products at its four in-house plants, supplying medical institutions nationwide through major pharmaceutical wholesalers. Many of its products are designated as "Essential Pharmaceuticals" or "Supply-Secured Pharmaceuticals," resulting in highly stable demand. On the other hand, logistics costs for heavy products are high, keeping the operating margin at a low level (4.2% in FY2026 (ending March 2026)). The company also supplements earnings through sales promotion of generic drugs and contract manufacturing, and positions the monetization of new drugs through R&D investment (¥2,013 million in FY2026 (ending March 2026)) as a medium- to long-term earnings pillar.
Company Strengths
Launched Japan's first domestically produced dialysis solution for artificial kidneys, Kindaly (Dialysis Solution for Artificial Kidney), in 1969, the company has a track record spanning over 50 years. The "Grape Mark" and "Kindaly" brands enjoy high recognition in dialysis medical settings, and the company has built strong business relationships with hospitals and dialysis clinics nationwide. This customer base forms a barrier to entry that is difficult for competitors to replicate in a short period of time.
Many of the company's core products are designated by the Ministry of Health, Labour and Welfare as "Essential Drugs" or "Drugs for Supply Security," ensuring stable demand that is less susceptible to market fluctuations. The company has established a stable supply system capable of responding to sudden events such as natural disasters, through large-scale manufacturing facilities dispersed across eastern and western Japan and product warehouses in various regions.
The company operates four plants—Joto (Osaka), Daito (Osaka), Okayama, and Ibaraki—and has enhanced its BCP (Business Continuity Plan) capabilities by dispersing manufacturing sites across eastern and western Japan. In January 2024, a new production line for powder-type dialysis solution manufacturing equipment began operation in the second formulation building of the Ibaraki Plant, expanding production capacity. Total capital expenditure of ¥1,270 million was implemented in FY2026 (ending March 2026).
ENVALITH's Perspective
Performance Trend
Revenue achieved five consecutive periods of growth, rising from ¥49,632 million in FY2022 to ¥62,307 million in FY2026. Operating profit, however, peaked at ¥4,131 million in FY2025 before plunging to ¥2,639 million in FY2026 (down 36.1% year on year). The main causes were a greater-than-expected rise in the cost of sales ratio due to higher raw material and labor costs, along with increased R&D expenses for DMX-200 (R&D Product). Net income for the period turned to a profit of ¥2,011 million, reflecting the reversal of the prior period's extraordinary loss (provision for litigation-related loss allowance of ¥8,744 million). However, the FY2027 forecast points to further profit decline, with revenue of ¥63,200 million (+1.4%), operating profit of ¥2,000 million (down 24.2%), and net income of ¥1,300 million (down 35.4%). As an external factor, the forecast conservatively incorporates raw material price surges stemming from the situation in the Middle East.
Growth Strategy
The four pillars of the growth strategy are: maintaining the top market share in dialysis solutions, expanding the generic drug lineup, consolidating production at the Okayama Plant, and developing new therapeutic areas.
Leveraging the external tailwind of strengthened generic drug promotion policies, the company is actively expanding sales of renal/dialysis-related generic drugs. This has been a key driver of the revenue increase in FY2026 (ending March 2026) (up ¥1,744 million year on year), and continues to be positioned as a core initiative for revenue expansion.
The company plans to construct a second formulation building (tentative name) aimed at establishing a new production line for powder-type dialysis solutions and relocating and consolidating the functions of the Daito Plant into the Okayama Plant. A syndicated loan agreement totaling ¥13,400 million, arranged by Sumitomo Mitsui Banking Corporation, was concluded on March 31, 2026, completing the fundraising for this project. Improvements in production efficiency and cost reduction are expected.
The company continues to advance R&D activities for its new drug candidate, DMX-200 (R&D Product). In FY2026 (ending March 2026), increased R&D expenses weighed on operating income, but this is positioned as a strategic investment aimed at future commercialization of new products. The increase in R&D expenses is also factored into the forecast for FY2027.
The company is promoting contract manufacturing of other companies' products with the aim of improving the utilization rate of existing production facilities and diversifying revenue sources. Once production consolidation at the Okayama Plant is complete, the resulting increase in manufacturing capacity is expected to create room for expanding contract manufacturing.
Last updated: July 19, 2026