It is now time we would like to begin financial results presentation from the Q1 of fiscal 2021 by Eisai Company Limited. The presentation will be live streamed and will also be distributed to participants via telephone line. Those who are participating via telephone line, please to our website and download the slides and equip the slides to move forward. Those who are watching live stream, please continue to watch the live stream. Financial parts will be first presented by Mr.
Ryohai Yanagi, CFO and operation parts will be presented by Mr. Ivan Chang, President, Novogoji Business Group and Mr. Terushige Iike, President of Oncology Business Group. Ivan Chan's part will be given in English. Those who wish to listen to Japanese are able to listen to Japanese interpretation.
And Ivan Chan's original English sound is also available. Now presentation will begin. First, financial part will be presented by Mr. Yanagi. Thank you.
Hello, everyone. I am Yanagi, CFO. I will first I'll present the financial part. Next slide, please. This is Slide 2.
This is Q1 fiscal 2021 consolidated statement of income. This page gives PL summary Through partnership model and expansion of global brands, we were able to achieve increase in both revenue and profits. Regarding partnership model, in view of post LENVIMA era, as we announced in our press release the other day regarding MORAP 202 With Bristol Myers Squibb, we have entered into strategic collaboration and lump sum payments related to more of $204,000,000 is reflected in revenue NPL. R and D reimbursement of $200,000,000 is recorded not on the TL but on the balance sheet on the liability side. In the meantime, KRW 650,000,000, which is the total of the 2, were received in cash in July with the timing difference.
In the cash flow statement, it is not reflected in the Q1 but in the Q2. Please take note of that. Now first, I would like to review the top line revenue. It was JPY 198,900,000,000. It was a 20% increase year on year.
As shown on the right side for increase in revenue, decrease in Lyrica Drug Price Provision in Japan were more than offset by increase in global brand, which was plus JPY 13,800,000,000. And from last year and this year, There were increase and decrease in licensing revenue. Last year, there was tazemetostat right transfer. But this year, we have Samsung payment related to Morop 202 of JPY 450,000,000 in yen terms, JPY 49,600,000,000. These are reflected in PL.
As for Global Brands, especially Nenzima enjoys low cost of sales ratio. And because of the increase of Global Brands, mix improved. And with the increase of licensing income, cost of sales ratio is 19.7% in comparison to global top tier. This is very good level. As a result, gross profit was JPY 159,600,000,000, which was an increase of 25% year on year.
And as usual, we would like to continue to not going to short termism, but based on long termism to make contribution for future patient benefit and will be making active investments In SG and A and R and D in forward looking fashion, 1st, R and D expenses, JPY 41,800,000,000, increase of 37% year on year, substantial increase. Major factors for increase are LENVIMA R and D and next generation Alzheimer's disease pipeline investment. In addition, for your reference from partner, there was a reimbursement. And in view of that, actual R and D investment R and D spending was JPY 52,600,000,000. It is 26.4 percent of sales, an increase.
So globally, we are actively making R and D investments. Regarding SG and A expenses, JPY 74,700,000,000, this was a 15 percent increase from year on year, a double digit increase and ratio was 37.6%, at a high range. The major factors for increase included increase of shared profit of LENVIMA paid to Merck, which increased by JPY 3,300,000,000. And the other day, U. S.
FDA granted approval to Aduhelm And increase in costs related to ADU Helm amounted to KRW 3,400,000,000 and therefore, majority of increase in SG and A expenses are these positive Investment of resource in SG and A expenses. And this is also for your information, but Nenbimba related profit sharing excluded, SG and A expense was JPY 54,900,000,000 and ratio to sales was 27.6%, lower than 30% in the global peer range. As for other income and expenses, in Europe, Dunagun rights were transferred and proceed is recorded here. Operating profit was JPY 55,400,000,000, More than 70% increase year on year, operating margin was 27.9 percent nearing global top tier level. Bottom line similarly was JPY 42,200,000,000 recording 70% increase.
In the past 3 years, this is only for reference, But for this term, ROE was 23.7%, which is also equivalent to global top tier level. On the other hand, looking at balance sheet items, earlier, as I mentioned at the outset, MOR202 related Cash receipt of JPY 650,000,000 was recorded in July with the timing difference. And therefore, annual cash might appear to be slightly lower, but net Doctor remains negative 0.2 and net cash of more than JPY 140,000,000,000 is retained. We have ample net cash position, virtually debt free and the ratio of equity is 64.5 percent. And this is this gives us good leeway and sound financial position.
And based on this strong and sound balance sheet, We will be making positive we are making positive investment while achieving increased both revenue and profit in this Q1. Now please turn to Page 3. This gives breakdown of revenue migration. In the Pharmaceutical business, core business Centering around Elevima and Global Brand Growth, we were able to achieve or exceed plan. And based on partnership model, We have paisusing revenue and because of that, we were able to record a large increase in revenue.
On the left side box, this is a summary of revenue. Last year, in the Q1, revenue was JPY 165,600,000,000 And this quarter 2021 revenue was JPY 198,900,000,000, increase of JPY 33,300,000,000. And Increasing factors are shown on the right box. Global brands are given in red box and In blue column, below that, impact of drug price provision in Japan and decreasing Lyrica are also mentioned as decreasing factors. But offsetting these, More or less, Pharmaceutical business was almost flat, especially the 4 global brands achieved plus JPY 30,800,000,000 increase in revenue from JPY 50,600,000,000 to JPY 64,400,000,000.
And LENVIMA achieved an increase of JPY 9,500,000,000 from JPY 34,700,000,000 to JPY 44,200,000,000. In Pharmaceutical business, in addition to this strong performance in Pharmaceutical business, we also have others, including licensing revenue, more of 202 lump sum payment and tazemetostat rights transfer, these increase and decrease in licensing revenue resulted in others, JPY 34,500,000,000. And therefore, revenue increased to JPY 33,300,000,000 in this quarter. Next, please turn to Page 4. This graph shows breakdown of operating profit We expanded partnership model and strategic options for exercise and to increase corporate value and to make patient contribution, We are proactively making advanced investment in determined fashion.
On the left side, a box PL summary is given. Q1 fiscal 2020 revenue was JPY 32,100,000,000. In the end, This quarter in 2021 from April to June, it was JPY 55,400,000,000 in revenue, increase of JPY 23,300,000,000, a substantial increase. On the right side in the box, increases and decreases are given. Red is about revenue, as I have explained before.
Blue are expense items. These are advanced investments, R and D expense. And then R and D cost increased JPY 7,500,000,000 from the previous term. Project is progressing smoothly. And for your information, until last year, from Merck, we have reimbursement of R and D expenses from Merck.
So actual R and D spending was not actually incurred by Eisai, but There is no longer reimbursement, so actual R and D spending by Eisai is directly reflected here. And that has resulted in increase in R and D cost of LENVIMA. And AD related pipeline also is receiving continuous investment proactively. As for SG and A expenses, LENEMA related share profit paid to mark increased by JPY 3,300,000,000. As for share profit of FENVIMA paid to mark for last year, it was JPY 16 point 5,000,000,000 last year, and this year, it was JPY 19,800,000,000 in the Q1.
So there was a huge increase in profit. And With the approval of FDA, Aduhelm related cost increased JPY 3,400,000,000. These are proactive positive expenses in SG G and A. As for others, according to IFRS agenda decision, In line with that decision, the licensing in product transfer rights is not recorded in revenue, but in others sales of fixed assets. So transfer of rights for Dunagrand is included in that line item.
With that, Revenue from Q1 was JPY 55,400,000,000, increase of JPY 23,300,000,000 year on year. Left below box Also gives full year reference R and D expense comparisons from last year and this year and partnership model benefit is reflected here. Partner Reimbursement, there is JPY 10,800,000,000 this year. And therefore, actual R and D spending is JPY 52,600,000,000, a large investment for future patient benefits contribution. And we have achieved increasing both revenue and profit, And R and D expenses and SG and A expenses are also increased, and these are all possible due to partnership model.
This is the consolidated result for the Q1 fiscal 2021. As for full year estimate, I would like to come back to present that at the end of the presentation once again. So I would like to conclude the financial part of the presentation. Thank you. Next from Neurology Business, we have Mr.
Ivan Cheung.
This is Ivan Cheung from Neurology Business Group. Let me first provide an update on the important progress of Eduheme. As you can see on this slide, Slide 5, Eduheme's accelerated approval by the U. S. FDA on June 7 was historic and humble moment in our fight against Alzheimer's disease as Pagetouch Health became the first new treatment option in almost 20 years.
Unlike 1st generation anti amyloid antibodies that do not clear amyloid from the brain AGHEL belongs to a next generation as several FDA leaders recently wrote in the New England Journal of Medicine of monoclonal antibodies directed at aggregated amyloid, which also include lakenimab that have achieved larger reductions of amyloid plaque with emerging evidence supporting a consistent relationship between degree of plaque reduction and effect on clinical endpoints. As you can see in the upper box, Regarding the FDA subsequent update of the U. S. Label, both Eisai and Biogen very much welcomed this update As the updated language aligns with our consistent expectation that AchiChen will be prescribed for patients in the early stages of Alzheimer's disease, This update has been well received by prescribers, payers and policymakers. Through our experiences With Aricept, we fully appreciate that being a pioneer building a new market for Alzheimer's disease is both an enormous undertaking and a noble cause in which we must face challenges head on.
As you can see in the lower box, we are pleased to see strong indication of very high initial patient interest in Agile of the approximately 900 sites, which we expected to be ready shortly after the approval to administer Abjut Home. We are encouraged that over 35% have completed a PNT, Pharmacy and Therapeutics review with a positive outcome were indicated that they will not require a PMT review. We've also seen some sites leverage external infusion centers if they face internal resistance or awaiting outcome of their internal process. With regard to reimbursement, we are pleased to say that We have seen the first examples of Medicare Advantage Plans approving pre authorizations and we're seeing progress With those early reimbursement requests getting submitted to regional MAX, Medicare Administrative Contractors for processing, We welcome the swift opening of an NCD National Coverage Determination Analysis by CMS To provide additional clarity on coverage for Medicare beneficiaries in a consistent manner across the country, We expect that Medicare Advantage Plans and Regional MAX will provide coverage for LG Home, while the NCD analysis is underway. Along with Biogen, we are committed to pursue all options to maximize patient access to AGI Health.
As you know, Alzheimer's is a neurodegenerative disease where time is of essence to patients and their families. Next slide, Slide 6 please. Last week at the AAIC, we are encouraged that Biogen continued to present new data analysis From the clinical trials of aducanumab, as you can see in the upper box, for example, in the second bullet point, Correlation assessment across adjuvant clinical trials supported a relationship between aducanumab induced biomarker changes and slowing of clinical decline. Also from last week, as you can see in the lower box, we are pleased To see an expert panel of 6 Alzheimer's disease specialists publish the first recommendations for the appropriate use of aducanumab in the real world in the Journal of Prevention of Alzheimer's Disease. We believe this is an important first step to move the dialogue among physicians towards how to appropriately use this treatment and how to communicate with patients and their care partners.
We agree with the expert panel that building the infrastructure For the appropriate use of aducanumab, we will require time, resources and planning. Along with Biogen, we are committed to partner with stakeholders to develop such infrastructure, not only in the U. S, but also globally. Next slide on Slide 7. Outside of the U.
S, As you can see in the upper box, we continue to engage with regulators regarding the ongoing review of aducanumab in Europe, Japan and other markets, while also continuing to submit new regulatory filings around the world. Here in Japan, Eiza and Biogen are continuing to have active dialogue with the PMDA and we look forward to the next steps in the PMDA review process. As you can see in the middle box, along with Biogen, we are moving with a sense of urgency to finalize the design of the post marketing confirmatory Phase IV controlled study. In addition, we enrolled our last patient in the AMBARK long term extension study last month, brings the total enrollment to roughly 1700 patients. Moreover, we plan to initiate EyeCare ADUS to collect real world long term effectiveness and safety data on aducanumab.
Lastly, as shown in the lower box, we initiated a new Phase 1 study to evaluate about availability of a subcutaneous formulation of aducanumab. Next slide. On Slide 8, let me now turn to lekanimab or BAN2401, which was recently granted breakthrough therapy designation by the U. S. FDA.
I will first review The important characteristics of lekanimab in amyloid plaque clearance based on PET imaging from our Phase II trial, Study 201. In the graph on this slide, On the left hand side, during the core phase of Study 201, lecanimab 10 milligram per kg biweekly, represented by the red line, converted over 80% of subjects from amyloid positive to amyloid negative after 18 months of treatment, the highest conversion rate reported so far among anti amyloid monoclonal antibodies. In the middle part of the graph, you can see that amyloid plaque reduction was maintained during the off treatment gap period that averaged about 2 years between the core phase and the OLE open label extension phase. Then in the right part of the graph, During the OLE phase, among placebo subjects from the core phase now newly treated with nakanumab 10 milligram per kg biweekly as represented by the blue line. Once again, 80% were converted from amyloid positive to amyloid negative and this time only after 12 months of treatment.
You can also see that Amyloid plaque clearance occurred as early as 3 months of treatment in the OLE phase, aided by No dose titration unlike other anti amyloid monoclonal antibodies. Overall, we are excited about lecanimab's efficacy profile of fast, deep and sustained amyloid plaque clearance. In addition, in the box on the right hand side of the slide, you can see that rate of ARIA E occurrence was 9.9% for subjects treated with lakanumab 10 milligram per kg biweekly in the core phase and 8.9% In the OLE phase for subjects newly treated with lecanumab 10 milligram per kg biweekly, we are equally excited about Lekanimaz safety profile of low rate of area occurrence. In addition, With a large Phase 2 study and a completely enrolled Phase 3 study, lakinumab at this moment has a safety database That already fulfills the ICH guidelines from a regulatory perspective. Next slide on Slide 9.
Now let me review the new plasma biomarker data from Lechemab Study 201 presented last week at the AAIC, which evaluates longitudinal plasmaabeta42:forty ratio and the relationship to longitudinal amyloid PET and clinical endpoints. As you can see in the graph, plasma A data 42:40 ratio tracked very well with pet SCBR changes, which I showed in a previous slide. Across the core phase on the left, The off treatment gap period in the middle and the OLE phase on the right, discontinuing treatment allows plasmaabeta40to48 ratio to start reducing again, as you can see in the middle part of this graph, which we believe is an early indicator of brained amyloid plaque reaccumulation. Retreatment with lakenimab in the OLE phase, as you can see on the right hand side of the graph, drives plasma A beta 42:40 ratio to increase again, which is likely associated with makenimab clearing newly generated protofibrils even after amyloid plaque removal. These first of its kind data just that we are fast moving into a new era of being able to use plasma biomarkers to track disease progression and monitor drug effects in individual patients.
Next slide on Slide 10. Let me also review the new data of clinical endpoints from the OLE phase of lakanumab study201, which were also presented last week at the AAIC. In graph 1 on the left, subjects with early Alzheimer's disease at OLE baseline who received lakenimab 10 milligram per kg biweekly in the core phase continued to perform better than those who received placebo during off treatment gap period suggesting a potential disease modifying effect of lecanamine. Most importantly, in graph 2 on the right, we traced the same subjects from core phase to off treatment gap period to OLE phase, totaling about 5 years on average. The red line represents subjects who receive lakinumab 10 milligram per kg biweekly, both during the core phase and the OLE phase.
And the blue line represents subjects who received placebo during the core phase and then were retreated for the first time with makenimab 10 milligram per kg biweekly during the OLE phase. As you can see, on the right side of the graph in the OLE phase, both the red line and the blue line showed shallower slope relative to the yellow natural disease progression line such as similar population from ADME, which may support the concept of maintaining disease modification effect with long term treatment when patients are still in the early stage of Alzheimer's disease. In addition, the red line throughout this graph stayed below the blue line the entire time, even after the blue line start to receive lecanumab in the OLE phase, which may support the notion that Early start up therapy is more beneficial than late start up therapy in a neurodegenerative disease like Alzheimer's. Lastly, these clinical effects taken together associated with treatment interruption and the long term dosing may generate insights into formulating the most optimal lakanumab regimen in the real world, possibly tailored by the individual's plasma trajectory as explained in my previous slide. Next slide on Slide 11.
Let me now summarize the current status and upcoming milestones for the Canimab. Firstly, under the breakthrough therapy designation from the FDA, We have initiated communication with the FDA to seek the most optimal and expedited regulatory pathway forward For lakanumab, we will explore all options with the FDA. We will listen to their advice, including the accelerated approval pathway. As I mentioned earlier, we are excited about Lecanimab's robust data on amyloid plaque clearance, impact on clinical endpoints and large safety database. Secondly, on this slide, as you can see, our Phase 3 CLARITY AD study completed enrollment of 1795 early Alzheimer's patients in March this year, which is the largest Phase 3 study ever for this population.
Thirdly, as reported last week at the AAIC, initial experiences with our Phase 3, a HIT-three forty five study suggests it is feasible to identify participants across a continuum of preclinical Alzheimer's disease. We have so far activated almost 80 clinical trial sites across the globe and randomized over 100 subjects. Lastly, subcutaneous formulation development, including device, is now underway with a goal of enhancing patient convenience and we plan to initiate a Phase 1 study to evaluate the pharmacokinetics and bioavailability of this formulation within this year. Next slide, Slide 12. Let me now turn to E-two thousand eight hundred and fourteen, which we believe is the most advanced monoclonal antibody candidate targeting MTBR tau in the clinical stage.
In the upper left part of the slide, you can see the targeted mechanism of E21814 in Alzheimer's disease. On the right hand side, as described in the green box and the blue box, Phase 1 MAB study in healthy volunteers has been progressing smoothly and the Phase 1btwo study in diet Dominantly inherited Alzheimer's disease patients was recently initiated. In addition, as shown in the pink box, As reported last week at the AAIC, E2814 was selected as the 1st anti tau investigational agent to enter DYANTIU's tau next gen global trial that will include up to 3 anti tau drug arms. The tau next gen trial will enroll subjects into 2 cohorts, the asymptomatic tau accumulation cohort, defined as amyloid PET positive, CSFP tau positive, but tau PET negative and the symptomatic tango spread cohort defined as both amyloid PET positive and tau PET positive. We see a potential of this study to serve as a pivotal registrational trial for E2814 for this orphan drug indication.
Meanwhile, we are continuing to design a clinical trial program for E-two thousand eight hundred and fourteen in sporadic Alzheimer's disease. Next slide on Slide 13, which is my last slide. In conclusion, With the significant progress made with Aduhelm, Vicanimab and E-two thousand eight hundred and fourteen, we are now more optimistic than ever about a transformative roadmap for patients and people at risk to benefit from disease modifying therapies that target the underlying pathophysiology of Alzheimer's disease, Our relentless effort in Eisai to end Alzheimer's disease will now stop at leading the anti amyloid and anti tau areas. We are equally committed to lead the next frontier in Alzheimer's research in areas such as synaptic regeneration with our 2511 in Phase 1 and E2025 in IND enabling studies, microglia normalization with programs in our G2D2 laboratory, inflammasome modulation with our recent collaboration with DZNE, neurogenesis promotion with programs in our SCUBA laboratory, glymphatic system modulation programs in our eKIT laboratory and more. Thank you so very much for your kind attention.
I will now turn to Mr. Iike.
Now with regard to Oncology business, Mr. Iike is going to present. Now I'd like to present our Oncology business. Please turn to Slide 14. RENVIMA sales, the JPY 44,200,000,000 up by 27% year on year.
Americas. Endometrial cancer, in February, we were able to present at Medical Congress The Phase III results since then, the prescription volume in the United States has been growing. Please look at the right hand side box of Americas, which indicates RCC. The first line indication of RCC is currently under regulatory review, And this has already been listed in Category 1 in NCCN guideline. Next, China.
March of this year, this is now listed in National Reimbursement Drug List. Since then, access has been markedly expanding. Compared to the previous year, we achieved 2.5 fold of the sales growth. Japan, In the hepatocellular cancer field, there was the advent of the competitor that we received the impact of that. And we established the oncology business headquarter and increased oncology MRs.
We have been strengthening the commercial organization in all the regions To prepare ourselves for the new indications to come and the new approvals to come, please refer to Slide 15. Endometrial cancer, The full approval in the United States came 6 weeks earlier than the full PDUFA date. And please look at the left hand side graph of the slide. As a result of the Phase III OS, PFS and ORR, in all of these endpoints, We have been able to demonstrate the superiority compared to chemotherapy, the control arm. And on the right hand side, you see the quality of life.
Combination earned demonstrated comparable or better than a control result. So as for the second line treatment of endometrial cancer, there has not been any standard of care over several decades. Chemotherapy has been used for these patients. But this time, with our Phase III data, we have been able to demonstrate OS benefit. And it is believed amongst the specialists This is a very important evidence bringing about the transformation of easy treatment.
And we are strongly expecting that this is going to be the new standard of therapy in this field. Slide 16. And I would like to talk about Vebimas QLL data. The Phase III additional analysis data we recently published, so I would like to share them with you. On the left hand side, RENVIMA Momotherapy.
So QL data for this HCC first line compared to sorafenib control, the comparable better results. On the right side, this in combination with KEYTRUDA for the first line, the renal cell cancer. This is the data presented at ASCO of this year. Compared to sunitinib, the comparable even better profile was demonstrated. So be it monotherapy, so combination therapy, SCC or RCC, irrespective of all these treatment setting, RENVIMA regimen can demonstrate comparable even better QOL benefit to the patients compared to the standard of care.
When you think about the very high level of the response rate, we think that this has all the qualification to become the new standard of care. Please refer to Slide 17. On the left hand side, you see the 5 different indications for Beema has already been approved: thyroid cancer, thymic cancer, HCC and RCC and endometrial cancer. And on the right hand side, you see in these 13 cancers, We are currently carrying out the LEAP study, the pivotal study with RENVIMA and KEYTRUDA combination therapy. The third one from the top, non small cell lung cancer, the LEAP-seven study.
And upon the recommendation from the data monitoring committee, the study was terminated. Based upon the pre specified futility standard, it was judged that it is quite unlikely to achieve the efficacy endpoints. And thus, the study was terminated, but there was no safety new signal and it has no impact on other studies as indicated in red. So gastric cancers and LEEP-fifteen as well as the correct cancer, the LEEP-seventeen, These are the newly initiated studies in agreement with SMART. And in order to achieve the potential of greater than JPY 500,000,000,000, We would like to further explore the new indications.
Slide 18, this is MOR202 and this is a proprietary Antibodies for etussumab and eripline conjugate ATC, and This is developed in a research lab in Pennsylvania, United States. And as you can see on the left hand side of the slide, the 4 rate receptor offer is highly expressed in the lineage dependent tumor cells that is immune called IR resistant cancer cells. And so this with a single enzyme reactions, this linker would be cleaved in the tumor cells and would be released as free erylubin. And so compared to other ADCs in the field, we believe that this is a very important advantage So the characteristics of Erbilin is its effect on the cancer microenvironment. So it has a direct toxic effect, plus its bystander effect can be expected as ADC payroll delivery is believed to be a very important compound.
As you can see on the right hand side of the slide, in the multiple the cancer indications, the high level of the response has been observed. Even for the cancers with low level of folate receptor expressions And the tumor responses observed, myelosuppressive toxicity is significantly alleviated compared to Erwin in terms of severity and easiness. And we believe that this has the best in class kind of potential as a folate receptor for ADC. Slide 19, with regard to more of 202, we have entered into the global alliance with BMS. And between the two companies, we are going to co develop and co commercialize this.
We would like to further accelerate the development and further And the approved indication that is going to be our short term focus and we would like to start the pivotal studies next year in the multiple number of cancers including ovarian cancers and lung cancer. As was mentioned By Mr. Yanagi at the outset, we received $650,000,000 of upfront payment and will be entitled to receive up to the total of 3 point $1,000,000,000 from these deals. Slide 20. In the hematological cancer field and with triaxin, Eisai has been working in this field for more than 10 years, and we received 2 new additional approval in this field.
On the left hand side, this is Remitro. So this is interleukin 2 angiotheria toxin. These 2 different proteins have been coded into Recombinant Biologics, so it has a very unique modalities with protein as a payload and the relapse And the refractory T cell lymphoma has a very high level of standard medical needs and the doctors are expecting this to be the first line treatment for CD25 positive patients. On the right hand side, Tazveric. So this is the 1st in class oral agent targeting at EGH2, the enzyme related to epigenetic and it is approved for the indication of EGH2 2 positive relapsed and refractory follicular lymphoma.
So this is a very typical VCO lymphoma. It progress is very slowly, but it's very difficult to cure and it tends to remit and relapse. And there is high level of the need for the treatment So with these 2 new approvals, we'd like to continue to contribute to the lymphoma patients in Japan. Slide 21. So including QL data, we have shared with you some new data for RENVIMA.
We expect such evidence to come into the future And the new indications in combination with RENVIMA and KEYTRUDA are expected to be approved one after another this year in different regions. So we would like to grow RENVIMA to be the cancer backbone therapy as the standard of care in many different cancers. But at the same time, there are certainly the patients who cannot be treated just with RENVIMA and KEYTRODA. And so by leveraging partnership models, I would like to first explore the next generation trucks, which is more of 202, and we'd like to create a new treatment paradigm for the post RENVIMA and post IO era. Thank you very much.
Lastly, Mr. Yanagi, going to international public 1st year. Once again, myself, Yanagi, the CFO, is going to present The financial forecast for fiscal 2021. Please refer to the Slide 22. And here you the consolidated financial forecast for fiscal 2021.
So as was presented, we are making this upward revision. In the neurologies and oncology field, we want to achieve the innovation and by overlooking this post LABIMA stage. And we would like to further pursue the greater the corporate values. Please look at these lines. So First of all, we are looking to this revenue forecast at the JPY 701,000,000,000.
On the right hand side for your reference, The disclosure we made in May is indicated. And so this is upward revision by JPY 20,000,000,000 from JPY 6 81,000,000,000. We talked about the MORA202, and we have received $450,000,000 upfront payment for this deal that is recognized in the top line. So this strategic the partnership has been factored into these numbers from the beginning of the term at the certain probability of success. And also at this point in time, it will be called as realistic management options, various BDs and license kind of deals depending upon the process of negotiations and the probability of success.
We have been making some latest updating of these numbers. And as a result of this, all in all, we are making this upside revision of JPY 20,000,000,000 And that was RENVIMA's sales forecast and also the milestone payment from Merx related to RENVIMA. These are the points that have not been changed. So with them, in terms of the expenses, We have not made any significant changes to the original forecast. The result, we are estimating the operating profit to be JPY 76 billion and other operating revisions.
So when you look at the May disclosure number, it was stated JPY 58,000,000,000. So it is an upside of JPY 18,000,000,000 or a little over 30% of upward revision. So as you can see, by looking into the posturing BMO, we are pursuing the partnership and also the global products are growing very smoothly. And so we are making this operator revision of through the term, the financial performance. And again, so the JPY 70,100,000,000 of sales And the gross profit, and so this RMB 159,000,000,000 and SG and A, So JPY 351,000,000,000 and then operating net profit JPY 76,000,000,000, up by 30% and also versus previous term, the 50% of a significant increase in the profit is expected.
And so as for this net income, the bottom line, JPY 58.5 billion is expected as a significant upside. So ROA through the year is 8.2% And we are ensuring the positive equity spread to achieve the value creations. When you look at EPS, So in May, we stated mentioned JPY 158 and now it is up by JPY 50, JPY 208. And the pay The ratio is 77%. And as for this payout ratio, same over 2 years, it becomes 93%.
And also as for the balance sheet, through the year, we are ensuring greater the 6% of equity ratio and we can ensure this greater than 100,000,000 of net cash. And so by ensuring the financial integrity, we believe that we can continue with the very active investment for the patient contributions and to also achieve the stable dividend payments. So these are the upward revision that we are making for the financial forecast. So lastly, I would like to get by closing the remarks on the Page 23. So including Morab 202 partnership, and we would like to further deepen the partnership model.
And also with the success of global brands including Revima and we are making the very significant upward revision of our focus. And as you heard in today's presentation, centering around AD field in urology field and also RENVIMA and also So the oncology field post RENVIMA are also very much progressing successfully. And through the appropriate capital allocation based on the strong balance sheet and financial funders And following the HSE purpose, instead of falling into the short termism with the long termism view, we want to continue with the aggressive investment for the patient contribution and further achieve the sustainable growth of long term corporate value. And so I hope that you will continue to extend the support from the long term perspective. We would like to conclude the presentation.
Thank you very much. We will now And I will be connecting persons with questions 1 by 1. We are currently accepting questions. Please wait for a moment. First question Mr.
Kotani from Nomura Securities. Mr. Kotani from Nomura Securities. Can you hear me? Thank you.
Thank you for taking my question. This is Kotani. Can you hear me? Yes. I have a question each for Alzheimer's and Oncology.
First about Alzheimer's, When we look at press report in the West, in whatever A beta antibody, if amyloid plaque is reduced, it seems it's approved. So it seems hurdle has been lowered. But when you look at the package, not only reducing A beta plus but A beta accumulation reduction and progression suppression were shown with Aduhelm. I think these were important. The plaque reduction itself may not lead to improvement in symptoms.
So these are proof will be necessary. And as for ADHEM, Like EMERGE study, the latecomers will have to show primary endpoints and secondary endpoints and show statistical significance in all of these endpoints, so it will not be easy given these 2, unlike Western analysts are thinking is a hurdle for approval lower. Do you think that EBITDA antibody approval hurdle has been lowered? Odenumab has only one Phase So for approval, I think it is still not sufficient. What is your view?
Thank you for your question. The question will be addressed by Mr. Ivan Chan.
Mr. Kohtani, thank you very much to your question. You're right. As I mentioned earlier, if you look at the article in the New England Journal of Medicine recently written by several leaders in the FDA. They specifically talked about antibodies that are showing correlation between significant amyloid plaque reduction and impact on clinical endpoints.
So this is quite important for the FDA, I believe, to distinguish between antibodies that could potentially impact the clinical progression of the disease in a meaningful manner versus that do not. So as I mentioned earlier, we are in active communication with the FDA about the pathway forward for Lakenimab. And meanwhile, we, of course, are very committed to driving adoption and improving access for Atrium. Thank you very much for your question.
I have a follow-up question on Alzheimer's. BAN2401, the preventive study the only preventive study is ongoing in the world. I think Alzheimer's should be prevented rather than being treated. And looking at right below chart in Page 10, early elimination of A beta may be preferred. So this is a question for Kymunasan BAN24 and QUARITY AD study, if it is effective.
Can you say that the logic of prevention rather than treatment will apply? And what is the time line for this? Thank you very much for that question. Testing microphone. Testing microphone.
Can you hear me? Testing microphone. Yes, I can hear you. Thank you for your question. Your question will be addressed by Mr.
Kimura, who is responsible for Science in Neurology Business Group. Thank you, Mr. Kotani, for your question. I'm Kimura from Neurology Business Group. As Mr.
Kotani rightly mentioned, As soon as possible, to treat will be more effective in clearer fashion. That would be logical way of thinking in many experts are supporting that hypothesis. On our part, As Ivan Chan presented today, we are trying to look at that population of patients to identify the population of patients and to treat them to show efficacy in a clinical trial To prove, we believe we have to prove in this way. So hypothesis is very promising. And through clinical trials, we would like to prove the hypothesis.
Now as for the time line, by when, in comparison to Clarity AD study, the usual study In comparison to usual study, this is going to take longer. We have some indication of the time line, but to discuss Specifically, by when is somewhat premature. Please give us some time. I have a question on oncology. More of 2 congratulations.
In 2019, ASCO, you had wonderful data, so this is not a surprising result. But I believe you will be giving update on the trial result anyway. So I have a question regarding mechanism bystander effect, not only that, but as shown on Page 18 below, microenvironment of cancer can be changed. And so in Phase 1 Phase 2 study in subsequent Phase 2 study was disconfirmed. And MORA-one hundred and nine is also a Mrs.
Flynn anti mode with erivoline linker. This is on ADC. This was not mentioned in today's presentation, but similar effect was similar effect observed. Thank you for that question. Regarding the question, person responsible for Science in Oncology, Doctor.
Owa, will respond. Thank you, Mr. Kotani, for your question. I am Owa. I'd like to answer your question.
As you rightly mentioned, Having eribulin derived bystander effect, it's not a simple bystander effect, but In cancer microenvironment, there is possibly modulation and data suggesting this regarding the data that suggests this in the size that we used in presentation, 48 alpha receptor expression level is low in some cancers, but in those cancer types and at 1.2 milligram per kilogram at that dose or at 0.86 milligram per kilogram, half dose MORA-two zero two in ovarian cancer and triple negative breast cancer in only one patient each, but deep reduction in tumor and PR were observed. At 0.94 milligram per kilogram in ovarian cancer, CR was observed after a long treatment. In other ADCs, these are not observed usually. So this is a deep PR or CR that were observed. This is not a near bystander effect bystander effect, but we believe additive effect of affecting micro tumor environment was observed.
And we are currently study We have an ongoing study to look at this and would like to predict the results in the future. You've raised question regarding MORF109. Thank you very much for asking about MORF109. Target antigen is mesothelin And eribulin ADC well, dollar drug antibody ratio, antibody and the drug ratio per ADC is 2. With eribulin, even though the number is low, strong antitumor effect was observed in preclinical study.
And simply put, with a low number, direct effect may not be sufficient, but We are able to have a comparable result. So tumor microenvironment effect is expected and therefore, Irbilin payload platform has room for further expansion in our view. Thank you for your question. Next question, Mr. Yamaguchi from Citigroup Securities.
Thank you. This is Yemaguji speaking. Thank you very much. Since we have lost the time very much, I would like to ask you one question. So the factors for the operating revisions and also last payment There seems to have been some differences in the number.
You have already explained this, but what you have received what you have factored in initially? And also, other deals have also been modified. Is it correct? That is to say that when all the Other deals have proceeded as expected. Do you think that the number could even be bigger?
So with regard To that question, Mr. Masaka, who is in charge of the business plan, is going to respond. Thank you very much. My name is Masaka, in charge of the planning, As was already explained by Mr. Yanagi, our CFO, and as a lump sum payment, and we have received JPY 450,000,000 from BMS.
And this is recognized in the top line revenue, but again, the probability of success at a certain rate has been and assumed and incorporated the number into the disclosed number at the time of May. And now this has been finalized this time. And also there are other strategic options factored into the May the disclosure numbers and also other the deals and the current status have been the factors in to really achieve this level. And also for the maximization of RENVIMA and R and D investment is expected to peak in a few years. And also, at the helm, the investment is also expected to be going forward.
And therefore, R and D investment is hovering at a very high level. And as SG and A to step up on the sales of RENVIMA and also in order to invest for the patient contributions to the maximum level and SG and A rate is 46%. And R and D and SG and A, The cost altogether would amount to 70%, which may be higher than the global standard. But we believe that this is advanced investment for the future In order to further maximize the value of the companies rather than the short term perspective, we'd like to continue with your This endeavors from the long term perspective. Thank you very much.
Next, Mr. Hashiguchi from Daiwa Securities. Mr. Hashiguchi from Daiwa Securities. Can you hear me?
Yes. This is Hashiguchi from Daiwa Securities. LENVIMALLETE 7 study, HCC first line in combination with KEYTRUDA, after interim analysis, I think you are about to have interim analysis. What is the current status? Thank you for your question.
Doctor. Owa will respond. Mr. Hashiguchi, thank you for your question. LEAP-two correction, LEAP-two study, The study itself is ongoing very well.
As you know, primary endpoint is PFS and OS. And right now, carefully, we are looking at the progress towards events. We are currently carefully monitoring how things develop. And therefore, when endpoint will be reached events will be reached, we cannot say prematurely, but it is not that in study itself, we have any problem or troubles. When we have data, we will be presenting.
So that is the extent of answer that I'm able to provide today. Interim analysis are planned several times and after enrollment 1 year after enrollment completion in April this year, I think first interim analysis was conducted, and so GMC decided to allow study to continue. Internal analysis is taking place quite early on, so our assumption is that more mature data points should be used to look at both endpoints, PFS So one last question is from Credit Suisse, Mr. Sakai. Thank you.
I'm Sakai. I have one question. So about the Harbin delivering, So this name really sounds familiar to us. Last year at ESMO, liposome drug and the data was presented, which showed very good results. So this time, so by combining this with Morab, And I think that you should be able to really increase significantly this tumor cells concentration level.
And so with regard to Harbin, in this way, including some drug deliveries, we are expecting the further Expansion of the approved indications going forward. Is this something that we can expect? Thank you very much. Oya Oya would like to respond to this question. Certainly, the mechanism of verrublende is not just cytotoxic, But it has the effect on the tumor microenvironment.
So it can be loaded on antibody and through the liposome. And certainly, we can expect further extension of this cancer indications. And also immunomodulation is another mechanism. As you know that For HaraBand, we are also working on the combination with the immuno checkpoint inhibitors and therefore, it has the opportunities is to developing all of these possibilities. Thank you very much.
Thank you for all of Those questions, unfortunately, we have run out of time. We would like to conclude today's presentation. This is the end of Q1 fiscal 2021 financial results presentation by Isai Company Limited. Thank you once again for taking time out of your busy schedule to participate,