ENVALITH
日本ケミファ株式会社 logo

NIPPON CHEMIPHAR CO., LTD.

4539Standard MarketPharmaceuticals

日本ケミファ株式会社 logo
NIPPON CHEMIPHAR CO., LTD.4539

Business

Nippon Chemiphar Co., Ltd. is a pharmaceutical group comprising 4 consolidated subsidiaries and 1 affiliate. It consists of two segments: the Pharmaceuticals Business (net sales of ¥31,868 million), centered on the manufacture and sale of prescription pharmaceuticals, and the "Other" segment (net sales of ¥1,222 million), which handles contract safety testing, healthcare, and real estate leasing. The Pharmaceuticals Business has three business domains: Generic Drugs; clinical diagnostic reagents centered on the allergy screening device/reagent "Dropscreen (Clinical Diagnostic Reagents)"; and new drug development centered on alkalizing therapy. The company is also expanding overseas, including into Vietnam and China. Its main customers are medical institutions and dispensing pharmacies, with distribution primarily handled through wholesalers (Medipal Holdings and Alfresa).

Business Model

Generic Drugs generate revenue through manufacturing at the company group's own facilities (Nippon Yakuhin Kogyo's Tsukuba plant and Vietnam plant) and sales via domestic MRs and wholesalers. The clinical diagnostic reagent "Dropscreen (Clinical Diagnostic Reagents)" follows a recurring revenue model based on instrument installation and ongoing reagent sales. For new drugs, development costs are shared through AMED support, joint development with Sumitomo Pharma, and license introduction from Delta-Fly Pharma, while aiming for sales rights revenue after approval. Overseas, the Vietnam plant is utilized as a manufacturing base, and sales channels are expanded in cooperation with local partners.

Company Strengths

Dropscreen, an allergy screening device and reagent that can measure 41 allergens in 30 minutes from just one drop of blood, exceeded 1,800 cumulative domestic installations as of the end of FY2026 (ending March 2026). Sales of clinical diagnostic reagents for the fiscal year expanded steadily to ¥5,436 million (up 11.3% year on year), supported by product strength that captures the need for in-house testing at hospitals, driving continued adoption.

The company operates the Nippon Chemiphar Tsukuba Plant (installation work for new facilities on the 2nd floor of Building No. 3 completed in August 2024, with shipments starting from May 2026) and a Vietnam plant (Nippon Chemiphar Vietnam Co., Ltd.), building a structure in which development, manufacturing, and sales are handled consistently within its own group. The Vietnam plant has also begun contract manufacturing for other companies' products, with a group-wide quality assurance division ensuring quality control at the same level as in Japan.

NC-2800, a delta opioid receptor agonist, began case enrollment for a Phase IIa clinical trial at 27 domestic institutions from January 2026. DFP-14323, an anticancer drug candidate, is undergoing a Phase III trial at approximately 30 domestic institutions. For DFP-17729, targeted at pancreatic cancer, case enrollment for the Phase II portion of a Phase II/III trial was completed in May 2026. R&D expenses of ¥2,134 million have been invested.

ENVALITH's Perspective

Revenue increased to ¥33,090 million (up 1.6% year on year), securing revenue growth, but each profit stage declined substantially: operating profit fell to ¥179 million (down 70.4% year on year), ordinary profit fell to ¥227 million (down 48.6% year on year), and profit attributable to owners of parent fell to ¥198 million (down 32.8% year on year). The main causes were a decline in gross profit margin (cost of sales rose to ¥24,693 million, up ¥869 million year on year) and elevated SG&A expenses remaining high (¥8,217 million). As an external factor, the annual drug price revisions continued to pressure profitability, and a sharp decline in sales of Core Products / New Drugs to ¥968 million (down 25.7% year on year) also weighed on results.

The company's forecast for FY2027 (ending March 2027) calls for revenue of ¥35,000 million (up 5.8% year on year) and operating profit of ¥250 million (up 39.0% year on year), indicating an expected recovery at the operating profit level. On the other hand, ordinary profit is forecast to fall to ¥100 million (down 56.1% year on year), and profit attributable to owners of parent is forecast to fall to ¥60 million (down 69.7% year on year), representing a substantial decline. The gap between operating profit and ordinary profit suggests an increase in non-operating expenses (such as interest expense), reflecting a continuing structure in which the burden of repaying interest-bearing debt (long-term borrowings of ¥12,297 million plus short-term borrowings of ¥174 million) weighs heavily. The dividend payout ratio stands at 91.2% (FY2026, ending March 2026), a high level relative to profit, leaving limited financial flexibility.

Cash and cash equivalents at the end of FY2026 (ending March 2026) stood at ¥5,342 million (down 23.9% from the previous fiscal year-end). Cash flow from financing activities showed an outflow of ¥1,673 million (against repayment of long-term borrowings of ¥3,326 million and new borrowings of ¥2,100 million), a substantial deterioration from the previous fiscal year's outflow of ¥305 million. An increase in inventories of ¥2,232 million also limited operating cash flow to an inflow of just ¥620 million, leaving free cash flow (operating cash flow of ¥620 million minus investing cash flow outflow of ¥661 million) close to zero. While the interest coverage ratio improved to 4.2x (compared with negative in the previous fiscal year), the balance of interest-bearing debt remains at an elevated level, and ongoing close attention to cash flow trends is warranted.

Growth Strategy

Sustainable growth through strengthening of the three domains—Generic Drugs, clinical diagnostic reagents, and new drugs—together with overseas expansion

New equipment on the 2nd floor of Building No. 3 at Nihon Yakuhin Kogyo Co., Ltd.'s Tsukuba Plant will begin sequential product shipments from May 2026. The company is strengthening inter-company collaboration, including participation in a consortium concept involving multiple Generic Drugs companies, to build a supply system capable of responding to increased demand associated with changes in the drug price positioning of authorized generics (AG).

As of the end of FY2026 (ending March 2026), the cumulative number of domestic installations exceeded 1,800 units, and sales of clinical diagnostic reagents were solid at ¥5,436 million (up 11.3% year on year). The company continues to expand its sales structure while promoting product improvements and manufacturing cost reductions. Product development for overseas expansion, regulatory compliance in various countries, and partner selection are also underway.

Enrollment for the Phase IIa clinical trial of the delta opioid receptor agonist "NC-2800" began in January 2026 at 27 sites in Japan. Development is being advanced under a joint research and development and option agreement with Sumitomo Pharma Co., Ltd., with support from AMED's "CiCLE Program." Efficacy and safety are being evaluated in a double-blind comparative trial targeting patients with depression.

In Vietnam, sales of "Rebamipide Tablets 100mg" and "Febuxostat Tablets 80mg" are expanding, and approval for "Allopurinol Tablets 100mg" was obtained in March 2026. In China, products such as "Epinastine Hydrochloride Tablets 20mg" are being exported. For the Middle East and Africa, under an advisory agreement with the IFC, the company is narrowing down target countries and partners and negotiating products. As of the end of March 2026, products were being sold in 4 countries across 8 items.

"DFP-17729," based on a licensing agreement with Delta-Fly Pharma, Inc., is undergoing enrollment at 16 domestic sites in a Phase II/III trial targeting pancreatic cancer patients that began in March 2025. Completion of enrollment for the Phase II portion is expected around July 2026. In the chronic kidney disease field, a physician-initiated clinical study at Nagoya University is also underway.

Last updated: July 19, 2026