Sustainability
Message from the President and CEO
We will make further efforts to ensure the realization of our Philosophy
“Delivering a Better QOL to the World” ahead of the steady progress of HX2025.
Facing An Era of “Coexistence with COVID-19”
COVID-19 was reclassified to Class 5 in May 2023. Peace has gradually returned not only in Japan but also globally. On the other hand, social uncertainties such as the emerging geopolitical risks, the risk of infectious diseases that will remain a concern, and the fear of impacts of climate change are also expected to increase.
Even for Hisamitsu, which celebrates its 175th anniversary, such an aspect of social reform is an unexperienced area, and we believe that we must work with reasonable determination to strengthen our partnerships with all stakeholders and fulfill our important responsibilities as a member of society.
We have developed the Medium-term Management Policy to realize sustainable growth under these circumstances, with our FY2025 targets set as follows: sales growth rate (CAGR) at 5% or higher, overseas sales ratio at 50% or higher, return on equity (ROE) at 8% or higher, and growth investment of 150 billion yen.
Progress of the Medium-term Management Policy
In September 2021, Hisamitsu announced HX2025 (Hisamitsu Transformation 2025), its Seventh Medium-term Management Policy, which defines a new mission for the Company to fulfill while inheriting the culture it has nurtured. That is to develop not only transdermal patches but also various products and services aimed at realizing “Promoting ‘TE-A-TE’ Culture Worldwide” of compassion for people all over the world. To achieve this Mission, we have established the following Action Policies: Expand—“Pillars of Growth,” Exceed—“Overcome Challenges,” and Enhance—“Strengthen Functions,” aiming for further growth and improving profitability and establishing a foundation for sustainable growth with a minimum of sales growth rate at 5% CAGR, ROE at 8%, and overseas sales ratio at 50% as our Management Targets by FY2025.
● Expand—“Pillars of Growth”
For overseas expansion of SalonpasⓇ (Concentration of resources on priority regions, expansion of new SalonpasⓇ), sales generally increase as planned, although there were some variations depending on the country/region. In Japan, inbound tourism is increasing as the pandemic has subsided, and there is a sign of recovery.
Besides pain treatment, we are advancing the development of a new area of growth in Rx drugs, such as the expansion of the sales volume of ZICTHORUⓇ Tapes and the launch of APOHIDEⓇ Lotion, a treatment drug for primary palmar hyperhidrosis.
● Exceed—“Overcome Challenges”
Overseas sales including the United States have been doing well, and the overseas sales ratio was 41.8%. As Eco activities, we are working to further expand the “HELLO! eco!” products. Additionally, in overseas Rx drugs, we are working on the development of XELSTRYM (Development code: ATS) in the United States. In the future, we will make further efforts to make a solid contribution from the perspective of the circular economy.
● Enhance—“Strengthen Functions”
The restructuring of the R&D organization for the new research lab scheduled to be completed in March 2024 is also steadily progressing in consideration of the consistency with the overall Medium-term Management Policy. Regarding the pipeline, we are steadily working to further advance the R&D organization including open innovation.As for the establishment of the internal organization, we are working to ensure the achievement of HX2025 by implementing appropriate management of human capital and improving operational efficiency through Digital Transformation and making organizational and business changes as key elements.Against the sales target in HX2025 for the fiscal year ended February 2023 of CAGR 5.0% or higher, it reached 5.9%.Regarding the overseas sales ratio target of “50.0% or more,” the overseas business in the United States and other countries has been brisk, and the actual ratio reached 41.8%. We will continue to make efforts to achieve the target.Regarding ROE target of “8.0% or higher,” the actual ROE is 4.7% leaving a plenty of room for improvement. We will strive to achieve the goal in light of initiatives such as full-scale promotion of Digital Transformation, start of a new R&D organization, and contribution through growth investment.
Measures for Sustainability
We will further enhance the functions of the Sustainability Promotion Committee established in 2021, integrate with management, and foster a corporate culture that can meet the expectations of all stakeholders. We also believe it is important to continue the support for victims of disasters and for social groups through the “Hisamitsu-Hot-Heart Club” in an effort to influence the Company's environment and society.
To address climate change, which has recently become an important issue in general life, is one of the most important issues for Hisamitsu Pharmaceutical. The degree of urgency is increasing as TCFD disclosure is required in the system disclosure in Japan.
As the Hisamitsu Pharmaceutical Group, we believe we need to take measures from the following perspectives:
1．To minimize the energy consumption;
2．To convert the energy source to green energy; and
3．To build all means to offset the remaining external impact.
To reduce the energy consumption, we are constantly reviewing our own operations and also making efforts to participate in regional energy management, such as the Smart Energy Project at Kiyohara Industry Park where our Utsunomiya Factory is located.
Additionally, as an effort to reduce environmental impact through products and services, the reduction of Scope 3 impact through “HELLO! eco!” is also important.
We must cooperate with not only international organizations but also governments, administrative agencies, corporations, and NPOs in various countries.
Regarding the “biodiversity” issues, we should take appropriate actions based on future trends. As with the TCFD Recommendations we currently comply with, we will address TNFD as necessary.The pharmaceutical industry, particularly, did not pay much attention to the post-marketing situation, so we should work on this area as well. Unlike the large city, Tosu City in Saga Prefecture is rich in nature. Given the fact that Hisamitsu has its head office in Tosu, we believe we should discuss this issue seriously.
In terms of society, the issue of “human rights” is also important. This includes a broad range of people including our employees, suppliers, and patients and their families. Having certain business activities overseas, we believe this is an issue we need to work on.
These sustainability challenges are closely related to our business activities in a multilayered way. We recognize that it is important to always have a broad perspective and carry forward our efforts.
To Our Stakeholders
How do we manage the Company in the social situation with unprecedented uncertainty? We know that very challenging steering is required. Conversely, we need a change in our way of thinking that it is now possible to find many opportunities and grow.
What can and should we do towards our 200th anniversary? We hope to be a corporate group that is needed for society with further engagement with various stakeholders. We strongly believe this will be synonymous with our Management Philosophy “Delivering a Better QOL to the World.”
Worldwide, it is obvious that sustainability issues, such as climate change and human rights, are closely related to corporate activities and are important factors in making management decisions.
We will continue to do our best so that we can share the Hisamitsu corporate culture with external stakeholders and refine ourselves continually. In this regard, we look forward to continuing to receive your support as ever.
