PhoenixBio Co.,Ltd.

Business Details

The company produces PXB mice, in which over 70% of the mouse liver has been replaced with human hepatocytes, and provides preclinical contract testing services and sales of PXB Mouse and PXB-cells (fresh human hepatocytes) products to major global pharmaceutical companies (mainly in the U.S.). Demand is expanding in the nucleic acid therapeutics and gene therapy fields. In FY2026 (ending March 2026), growth in domestic PXB Mouse sales was the main driver, and cost structure improvement following the liquidation of KMT Hepatech contributed to a turnaround to operating profit.

Recent Overview

Cost structure improved following the liquidation of KMT Hepatech, resulting in a turnaround to profit at all income levels for the first time in two periods

For FY2026 (ending March 2026), revenue was ¥1,566 million (up 1.6% year on year). Following the completion of the liquidation of the overseas manufacturing subsidiary KMT Hepatech, Inc., cost of sales decreased from ¥423 million to ¥365 million, and selling, general and administrative expenses were reduced from ¥1,260 million to ¥1,118 million. Operating profit turned to ¥83 million (prior period: △¥142 million), and ordinary profit turned to ¥131 million (prior period: △¥155 million). On the other hand, full-year orders received decreased significantly to ¥1,039 million (prior period: ¥1,954 million), and the order backlog at period end also shrank to ¥616 million (prior period: ¥1,098 million). For the next fiscal year (FY2027, ending March 2027), the company forecasts revenue of ¥1,610 million, operating profit of ¥86 million, and net income of ¥77 million.

Key Products

Growth Drivers

• Expanding demand for PXB Mouse in the nucleic acid therapeutics and gene therapy fields (supporting new modalities), leading to new customer acquisition
• Increased revenue in the domestic safety and other fields (from ¥246 million in the prior period to ¥377 million in the current period), boosting the domestic market
• Entrenchment of the structural reduction in cost of sales and fixed costs following the completion of the KMT Hepatech liquidation
• Development of new revenue sources through the promotion of PXB-cells expansion in the U.S. (assuming an exchange rate of ¥155 to the U.S. dollar)
• Growing trend of pharmaceutical companies outsourcing preclinical work (CRO outsourcing) in the safety and other fields

Risks

• Customer concentration risk due to revenue concentration with major customer Alnylam Pharmaceuticals, Inc. (current period revenue of ¥592 million, approximately 37.8% of total revenue)
• Significant decrease in overseas orders received due to continued development budget cuts by U.S. pharmaceutical companies (full-year orders received of ¥1,039 million, down approximately 47% year on year) and shrinking order backlog (¥616 million)
• Uncertainty in the U.S. business environment due to the Trump administration's trade policy and tariff measures, as well as rising energy prices
• Risk of profit pressure from increased outsourcing and other costs associated with the U.S. expansion of PXB-cells
• Structural decline in the pharmacology field and contract testing services (contract testing service revenue down from ¥460 million to ¥356 million)