Chugai’s Value Creation Model | Our Strategy | About Chugai

Chugai has adopted “creating shared value” as its basic management policy, in line with the philosophy of growing together with its various stakeholders by resolving social issues through business activities. The goal of this shared value, which is also part of our Envisioned Future, is to realize advanced and sustainable patient-centric healthcare.
The following value creation model explains the cycle in which both our company and society achieve sustainable development.

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Management Resources and Material Issues for Realization of Advanced and Sustainable Patient-Centric Healthcare

The external environment that we have envisaged is one where more sustainable healthcare systems are needed around the world due to factors such as global population growth and aging, the risk of new infectious diseases, technological advances and changes in social structures, and healthcare finances. Given the limited resources, the trend toward value-based healthcare (VBHC), in which only truly valuable solutions are selected, is accelerating.

Based on this environmental outlook, Chugai has identified the elements that are the source of its value creation: human resources, technology and intellectual property, collaborations with Roche and external partners; pharmaceutical technology and facilities; the environment and energy; and finance and management-related. Under our material issues for the creation of shared value through the effective use of management resources, we will advance initiatives for value creation (value creation strategies) from a medium- to long-term perspective.
Click here for more information on Chugai’s Material Issues.

Sources of Value Creation

Category	Key themes	Sources of value creation	Recognition of issues and countermeasures
Human resources (Human capital)	Increase employees’ job satisfaction, improve sense of fulfillment Acquire and develop human resources who will contribute to innovation Continuously pursue DE&I	Employees Organizational culture (Environment for engagement and employee enablement)	Acquisition and development of highly specialized human resource Creation of an environment where each employee can exercise autonomy and be enabled Building of environment and systems for innovation, maintaining and enhancing corporate culture
Technology and IP (Intellectual capital)	Advance multi-modality approach Expand patents for world-leading drug discovery technology and platforms Strengthen drug discovery platforms leveraging digital technology Deepen our understanding of biology research	Antibody engineering technology Macrocyclic peptide drug discovery platform technology (SnipeTide) Small molecule drug discovery technology Research process library IP related to research and pharmaceutical technology	Concentration on R&D investment Complementation of multi-modality technology and enhancement of IP strategy Deepening of understanding of disease biology and external collaboration
Collaborations with Roche and external partners (Social capital)	Develop in-house products globally via the Roche Group and other networks Collaborate with external parties on technology, science, and DX Engage in dialogue with stakeholders	Exclusive marketing rights to Roche products and infrastructure Networks with academia and investment in start-ups Dialogue with patient groups, patients, investors, and others	Ongoing substantial contribution to collaboration with Roche Collaboration with academia, start-ups, and others Initiatives for creation of shared value with patient groups, etc.
Pharmaceutical technology and facilities (Manufacturing capital)	Evolve modalities and technologies, and advance research and production suited to DX Develop systems for flexible and rapid development and next-generation production Ensure stable supply and rigorous quality assurance	Research sites (Yokohama, Ukima, and Singapore) Production sites (Ukima, Fujieda, and Utsunomiya) Quality management system	Establishment of systems to keep pace with increasing R&D output Continuous response to quality and supply risks, and risk reduction
Environment and energy (Natural capital)	Contribute to climate change countermeasures and protection of biodiversity Recycle resources consistent with a circular economy	Technical and operational expertise in decarbonization and water resource management Environmental management system Networks with external partners	Promotion of best mix of environmental impact and cost Development of manufacturing processes with low EHS risk Cooperation with external partners
Financial and management-related (Financial capital)	Continuously evolve revenue structures Increase cash flows to ensure strategic investment	Earnings structure	Continuous reinvestment Continuous build-up of reputation in capital markets

Be a Top Innovator in the Healthcare Industry to Create Shared Value

Focus on innovation is key to promoting our value creation strategy. To continuously create innovative new drugs that satisfy unmet medical needs, we must explore new therapeutic targets, achieve further innovation in drug discovery technologies, and acquire a deeper understanding of biology. It is therefore important to make maximum use of our unique business model, which is based on our unique science and technology capabilities and our strategic alliance with Roche.

In designing our value creation strategy, we started by defining our vision of becoming a top innovator in the healthcare industry in 2030. Chugai needs to be a company that generates expectations from patients all over the world, attracts healthcare-related talent and players, and is a global role model that resolves social issues. TOP I 2030 is our roadmap for realizing this goal by enhancing our growth strategy and foundation for growth. To enhance the value we provide, we have formed a business structure that enables high productivity and reinvestment based on the two pillars of global first-class drug discovery and a futuristic business model. With this, we aim to double R&D output and launch in-house global products every year.

We will also enhance our foundation for growth by implementing initiatives targeting key themes including human resources and organizations, digital and quality, and environmental preservation. The areas of compliance, governance and risk management, construction of a healthy and safe business foundation, and engagement with society are not items for transformation under TOP I 2030. Rather, we will continuously maintain and evolve these throughout the Company and in each business division.

Through the promotion of this value creation strategy, Chugai will create innovative drugs that deliver true value and continuously supply them to patients worldwide. In terms of value provided (impact on society), Chugai aims to resolve not only medical issues, namely unmet medical needs, but also unmet social needs. In addition to therapeutic aspects such as optimal treatment and improved QOL for each patient, Chugai aims to provide value from a medical perspective, including reducing the burden on healthcare professionals and caregivers, and from the perspective of society as a whole, including sustainable health financing and the realization of a circular economy.