Sumitomo Pharma (4506) Q1 2026 earnings summary

Executive summary

• Q1 FY2025 revenue rose 19.1% year-over-year to JPY 108 billion, driven by strong North America sales of ORGOVYX and GEMTESA.

• Core operating profit improved to JPY 20.4 billion, reflecting higher revenue and reduced SG&A and R&D expenses.

• Net profit attributable to owners was JPY 11.2 billion, down 29.7% year-over-year, mainly due to FX losses.

• SG&A and R&D expenses declined due to business structure improvements and realignment of regenerative medicine and cell therapy operations.

• ORGOVYX and GEMTESA exceeded sales targets, with GEMTESA maintaining growth despite generic competition.

Financial highlights

• Operating profit reached JPY 20.4 billion, up from a loss of JPY 3.1 billion in the prior year period.

• Gross profit increased to JPY 63.9 billion, up 14.7% year-over-year.

• SG&A expenses fell 21.4% to JPY 35.7 billion, and R&D expenses dropped 37.7% to JPY 8.2 billion.

• Finance income/costs swung from a gain of JPY 20.3 billion to a loss of JPY 8.5 billion due to currency effects.

• Cash and cash equivalents decreased to JPY 20.5 billion from JPY 78.4 billion at the end of Q1 FY2024.

Outlook and guidance

• Full-year forecast remains unchanged; half-year revenue forecast is JPY 207 billion, with core operating profit expected at JPY 70 billion, including a $100 million ORGOVYX milestone and gains from Asian business divestiture.

• Significant profit items will be concentrated in the first half, with a likely drop in the second half.

• Guidance may be revised at interim results, depending on sales trends of key products.

• External risks include U.S. tariff policy, drug pricing, and key product sales trends.