Immuno-Biological Laboratories Co., Ltd.

The Group may establish joint ventures, make companies into subsidiaries, or acquire other companies to execute its strategy, but it does not necessarily hold controlling interests in its business alliance partners or joint venture partners, and the counterparty may significantly change its business strategy. If the shareholding ratio decreases due to third-party allotments of new shares, or if the joint venture partner's business performance deteriorates, there is a possibility that the expected results will not be achieved and business continuity will become difficult. The Group addresses this by conducting due diligence and making investment decisions through a defined approval process.

In the course of conducting business, there is a possibility that the Company may infringe on the intellectual property rights of others without its knowledge, and if litigation is filed, this could have a material impact on business strategy and financial results. This risk is said to increase as business expands, and when infringement of others' intellectual property rights is identified, the Company promptly takes countermeasures such as entering into license agreements. Going forward, the Company plans to further strengthen its management system regarding intellectual property rights.

Confidential information such as information exchanges with external researchers and research institutions, and customers' personal information, is managed on systems, and if stolen by a third party, this could be fatal to the Company. While the Company is strengthening security for its core systems and servers, clarifying information disclosure procedures, and thoroughly disseminating them throughout the organization, in the event of a leak, the Company could suffer significant damage. The Company continues to promote the development of its information management system.

The Group holds personal information, and as increasingly malicious crimes rise, unforeseen leaks of personal information are occurring across the industry. If a leak occurs, the Company would suffer a loss of corporate credibility and social sanctions, which could impact business performance and financial condition. In addition to developing internal regulations and implementing security measures, the Company is working to mitigate this risk by taking out "personal information leakage insurance."

Tsutomu Seifuji, President and Representative Director, has served as chief executive officer since the Company's founding, providing leadership in business planning, operations, and development activities, and given the small scale of the organization, there is a high degree of dependence on the work of individual officers and employees. If key officers or employees become unable to be involved in business development due to unforeseen accidents or other circumstances, this could have a significant impact on the business and business performance. The Company is working to review its personnel-dependent business structure through delegation of authority and division of duties.

The Group's activities extend across the globe, and inherent risks include a wide range of factors such as political and economic factors, public regulations (taxation, exchange controls, trade restrictions, etc.), social disruptions such as war, terrorism, and infectious diseases, and natural disasters such as earthquakes and tsunamis. If these events occur, business performance and financial condition may be affected. The Company strives to prevent and avoid risk through information gathering within the Group and the engagement of external consultants.

In Vitro Diagnostic Pharmaceuticals can only be brought to market after passing strict examination by the relevant regulatory authorities regarding product efficacy, safety, and production control systems, and there is a possibility that the development period may be extended or discontinued due to delays in research and development, prolonged acquisition of approvals, or failure to achieve performance targets during clinical trials. Business performance may be affected if substantial additional investment becomes necessary, if the prospect of recovering research and development investment is lost, if competitors launch groundbreaking products, or depending on the content of medical fee schedule revisions. The Company continuously manages research and development progress and responds to approval requirements.