Shionogi & Co (4507) Investor Day 2024 summary

Sustainable growth and business model transformation

• Pursuing stable earnings growth by transforming into a drug-discovery pharmaceutical company with high operating margins, leveraging in-house product development and strategic out-licensing partnerships.

• Successfully mitigated patent cliffs through agreement revisions and diversification, notably with Crestor and HIV treatments, ensuring stable revenue streams beyond 2030.

• Building on expertise in infectious diseases, innovation, and alliances, with a focus on new products and acute respiratory infection business for future growth.

• 2030 Vision centers on creating innovation platforms to shape the future of healthcare.

Human capital strategy and organizational development

• Advancing a human capital strategy to develop globally competitive individuals and leverage diversity, with engagement surveys and KPIs to drive corporate value.

• Transforming the HR portfolio through new systems, early retirement programs, and targeted recruitment, especially in DX/IT and global business roles.

• Implementing work style reforms, including elective 4-day workweeks, self-investment support, and side-job programs to foster reskilling and diverse workstyles.

• Promoting internal mobility, mid-career hiring, and a compensation system based on contribution and role, regardless of age or background.

• Focusing on globalization of personnel systems, autonomous career culture, and further reskilling to realize the 2030 Vision.

Corporate governance and sustainability initiatives

• Enhanced governance with a majority of outside directors, advisory committees, and succession planning, including performance reviews for the CEO and other officers.

• Compensation system increasingly linked to medium- and long-term performance, with expanded stock-based incentives to align with shareholder value.

• Material issues include protecting against infectious diseases, innovation, access to healthcare, human rights, and environmental sustainability, with measurable progress in diversity, health, and supply chain management.

• Ongoing initiatives to reduce CO2 emissions, promote occupational health and safety, and ensure supplier compliance with sustainability standards.