It is now time. We would like to begin financial results presentation for Q3 fiscal 2020 by Eisai Company Limited. The presentation is streamed live or broadcast over telephone line. For those of you who are participating via telephone line, please go to our website and download the slides and please quick to advance the slide. That is not necessary for those of you who are watching live streaming.
The first financial part will be presented by CFO, Mr. Ryohei Yanagi. The operation part will be presented by Ivan Chan, President of Neurology Business Group and Terushige Iike, President of Oncology Business Group. To listen to simultaneous interpretation into Japanese. If you wish to listen to English, you will be able to listen to his original presentation.
First financial part will be presented by Mr. Yanagi. Now this is Yanagi, CFO speaking. I would like to report to you on the financial part. Please turn to Page 1.
Here you can see a consolidated statement of income for the Q3 cumulative numbers for FY 2020. Even though there was impacts by COVID-nineteen pandemic, we could achieve increase in revenue. Top line revenue was JPY 498,300,000,000, up 3% from a year earlier. In Japan, there were impacts of revision of drug prices in Japan and foreign exchange rates. But in line with the business development, global brands centering on LENVIMA has increased to achieve increasing revenue as a whole.
And VIMA, in particular, increased sales by more than JPY 20,000,000,000 And particularly throughout the calendar year from January through December, in LENVIMA, the total annual sales achieve the threshold of $1,200,000,000 Therefore, dollars 200,000,000 of milestones from Merck has been recognized in revenue. Cost ratio is low for LENVIMA, which grew significantly and which led to the improvement in the product mix. So cost ratio has improved to 24.1%. With these core profitability, gross profit with JPY 378,200,000,000 up 5% year on year with increased revenue and improvement in core profitability, which have been achieved with the management's will to increase the corporate value in the future. Proactive investment is being continued.
R and D expenses were JPY 108,200,000,000, up 5% from the previous year, which accounts for 21.7 percent of sales. Major part of the increase was due to LENVIMA development and also next generation Alzheimer treatment projects. For your information, Reimbursement from partner is JPY 46,800,000,000 has been received. Therefore, actual expenditures in R and D JPY 155,000,000,000, accounting for 31.1 percent of revenue. We have continued to be one of the global pharma the most aggressively investing in R and D.
On the other hand, our SG and A expenses were JPY 211,400,000,000 up 12% from a year earlier. SG and A ratio has reaching the a little bit abnormally high level to 42.4%. But this HD and A expenses include Positive investment in LENVIMA increased the cost of a shared profit with Merck of JPY 47,000,000,000. Excluding that, SG and A expense ratio was almost 33%, therefore, approaching the global average. SG and A expenses were increased by double digit ratio, but as I said earlier, shared profit over JPY 10,000,000,000 About half of the increase can be explained by that, and the remainder was due to the DayVigo launch preparation as well as preparation for the future contributions to patients with AD with next generation therapies.
Positive investments have been made. Last fiscal year, there was JPY 4,400,000,000 gain on the transfer of Elmet Eisai. In other income and expenses, which is not recorded this year, operating profit was JPY 57,700,000,000, About this 80% level of the last year's level and OP margin has been secured at a little less than 12%, double digit. And OP of JPY 57,700,000,000 means that we could outperform business plan in OP as well. And if you look at profit for the period, bottom line, there were extraordinary items last year to resolve the group's cash imbalance between Japan and U.
S. The paid in capital was paid from a U. S. Sub to the company. As a result, tax benefit of JPY 15,100,000,000 was recorded last fiscal year.
But without such extraordinary factor, this fiscal year, about 20% tax ratio has been recovered. So the profit for the period is JPY 45,200,000,000 although which stands at the 62% of the last year's level. So like in OP, this result for the profit for the period also outperformed the business plan. For the 3rd quarter ROE. Average reference ROE was 8.9%.
Above the ROE was 8.9 percent above the assumption of 8% for cost capital cost and securing positive equity spread and creating value. If you look at the items on balance sheet, net TR was minus EUR 0.20. Therefore, we continue to have net cash position or debt free status has been maintained. Having said that, as we saw in the investment, We regard this fiscal year as a year of investment, almost double the number of the capital expenditure is being made in capital equipment or IT or business development and so forth. Therefore, cash balance itself has been decreased, but Still, we have net cash of over JPY 130,000,000,000 and equity ratio is about 65% with the financial position, very strong position and sound balance sheet has been maintained.
For your information, this fiscal year. R and I rating agency has upgraded us to AA- With this financial integrity, We have been sustaining the proactive investment. This has been reflected in the results for the Q3. Next page, Page 2. Here is the breakdown of our revenue migration on this waterfall chart.
For the 9 months of last fiscal year, revenue was JPY 486,100,000,000. In Japan Business, there were impact of COVID-nineteen and the revision of drug prices and the generics of Lyrica launched in the market. In Asia, there was the impact of termination of sales contract of HUMIRA. But in other regions, in Americas and China and Europe, centering on the growth of LENVIMA, we have been able to secure the increase in revenue. There were some ups and downs as a factors in business development.
But as I said earlier, dollars 1,200,000,000 threshold was achieved for LENVIMA As the therefore, we have been able to recognize revenue of $200,000,000 of reimbursement or the milestone from Merck. Therefore, revenue was increased by JPY 12,300,000,000 to reach JPY 498,300,000,000. Please turn to next page, Page 3. Here is the breakdown of migration and operating profit. For the 9 months of last fiscal year, OP was JPY 73,300,000,000, Centering with the growth of RENVIMA and other global brands, OP, It could be increased by JPY 23,900,000,000, in line with the revenue increase in those global brands.
With the intention and will of the management. We have been making proactive investment launch cost of DaewiGo, JPY 13,100,000,000 R and D cost of RENVIMA, JPY at JPY 1,700,000,000 and dorembimod related share of profit JPY 10,800,000,000 and next generation AD treatment related costs, JPY JPY 14,300,000,000. Such proactive investment has been made. Therefore, OP with JPY 57,700,000,000. But as I said earlier, this number outperformed by large the business plan.
In the box on your right hand side, you see the breakdown of R and D expenses. As I said, on accounting basis, net R and D expenses were JPY 108 point 1,000,000,000, but there was JPY 46,800,000,000 reimbursement from partners. Therefore, actual Expenditures was over JPY 150,000,000,000. At JPY 155,000,000,000, we have been making the investment proactively for the creation of corporate value in the future. Next page, here is the consolidated earnings forecast.
For this fiscal year, there has been a revision from the announcement made in May. Unfortunately, the revision was made downwardly. But as a summary, we would like to continue to make proactive investment to enhance corporate value in the future while maintaining stable dividend through balance sheet management. This is the key message. But first line top line revenue is expected to reach JPY 6 JPY 47,000,000,000 revised downwardly due to the impacts of COVID-nineteen pandemic, which has been prolonged and more serious than expectation.
So impact was incorporated on the revenue line and other Competitive and market environment has been taken into account. And the largest end Factor could be related to BEMVIMA. The yearly global sales projection was reported to you as JPY 158,000,000,000 in May. However, as we have been disclosed in the reference materials this time, Revise to JPY 145,000,000,000 and another threshold for the last sales based sales milestone. This threshold will not be reached because of this downward revision.
Therefore, Recognition of the last milestone from MAC shall be postponed from this fiscal year. Therefore, such milestone recognition will be postponed to next fiscal year onwards. The milestone for Merck is recorded in this reference other business revenue segment. As you can see in reference material, JPY 59,000,000,000 is planned. However, not only milestone, but the business development and export import related items are included.
But as a segment, Milestones are included in this out of business revenue line. Regarding sales based milestone for Merck, it does not mean that we will not lose the right to receive such milestones by the end of this fiscal year. When conditions are met, We would be able to recognize milestone based on the pro form a agreed upon when the strategic alliance agreement was concluded with Merck. Such milestone was rated for fiscal year 2021. So the medium to long term net present Value generated by BEMBIMA will not be significantly affected.
Cost ratio will be improved to 24.4 percent and gross profit is Expected to be JPY 489,000,000,000. R and D expenses, SG and A expenses, as I have said, actively invested for increasing the corporate value in the future and operating profit for on a full year basis will be JPY 52,000,000,000. And in parallel with the changes in the revenue, there will be the changes in the OP, the single and the largest factor would be the sales based milestone to be postponed. The Board owners of the parent is expected to be JPY 39,500,000,000. The value creation KPI, APS, ROE, DOE are calculated as these, ROE 6% level after revision.
But regarding the value creation for the company, we would like to pursue this KPI over several years. So this means that 5 year average ROE is expected to be over 10%. So we will secure enough ample equity spread. And based on the current volatility, the shareholder capital cost is increasing. Such assumptions can be offset, and We will not fall into short termism, but we will manage the business with the long termism, JPY 160,000,000 dividend, JPY 115% will be the payout ratio and long term is 5 year.
Average payment ratio will be less than 70 and JPY 130,000,000,000 over cash positioned and also net cash is reflected in as a strong balance sheet. So we'd like to continue to have a stable dividends through balance sheet management. This concludes my report on the financial section. Next, I'd like to ask Ivan Chan to explain the Rolodex Business Group.
This is Ivan Cho from Neurology Business Group. Today, I'll provide an update the important progress of our neurology franchise with a special emphasis on Alzheimer's disease. On Slide 5. Alzheimer's disease has been called an invisible pandemic, threatening to be more devastating, long lasting and costly than COVID-nineteen. We believe it's critically important that Alzheimer's disease remains a top health care priority next to COVID-nineteen and that patients are now overlooked during and beyond the current viral pandemic.
As you can see on the left hand side of the slide, by 2,050, 1 in 6 people In the world, we'll be over the age of 65 and the total number of people with dementia is projected to reach 152,000,000, 3 times more than the current number. Nearly 60% of people with dementia are currently living in low and middle income countries And this number is projected to rise to 71% by 2,050. The worldwide cost of dementia was approximately JPY 90,000,000,000,000 in 2015. And if dementia was a country, it would be the world's 18th largest economy. On January 25, as you can see on the right hand side of the slide, our CEO, Doctor.
Naito, Join the panel tackling Alzheimer's at the World Economic Forum's DARPA's Agenda 2021 meeting to discuss the need for global collaboration to fight the challenges with Alzheimer's disease and shared Eisai's vision to bring effective solutions to patients and families worldwide. Specifically, Doctor. Nai to emphasize the importance of not only patient participation, but also people participation to promote preventative actions for brain health as healthy sleep, diet, exercise as well as brain performance checkup. To this end, digital technologies Can offer smart and accessible solutions, which could be used in low and middle income countries as well. Considering the enormous societal economic impact of the Alzheimer's disease crisis, we need public private partnership to come together in finding solutions, in particular, as we get ready for the upcoming arrival of the first disease modifying therapy.
So on the same day of January 25, the Davos Alzheimer's Collaborative, DACC, was officially launched, Modeled after similar health care initiatives catalyzed by the World Economic Forum, such as the Global Alliance For Vaccines and Immunization, Gavi and the Coalition For Epidemic Preparedness Innovations, CEPI, the deck is bringing together governments, Academia, NGOs and partners from various industry sectors in a broad public private partnership, We at Eisai are proud to be part of this first of its kind global effort. Next slide, Slide 6 please. As you saw from last Friday's joint press release with our partner, Biogen, the U. S. FDA Has extended the PDUFA action date of the aducanumab BLA by 3 months to June 7 this year.
We're encouraged by the ongoing communication between the FDA and Biogen. And as part of the ongoing review, Biogen submitted a response to an information request by the FDA, including additional analyses and clinical data, which the FDA considered a major amendment to the application That will require additional time for review. We very much appreciate the FDA for its continued diligence during this review And we very much look forward to continuing to work with the FDA as it completes its review of the aducanumab application. The adjucatibat application is also under review by the EMA in the EU and by the PMDA here in Japan, where Baojun submitted the JNDA to the NHLW on December 10th last year. In addition, We are continuing to conduct regulatory discussions with other health authorities and continuing to enroll eligible patients into the embarked redosing study.
Together with our partner Biogen, we are ready to launch potentially the world's 1st disease modifying therapy for Alzheimer's disease in the United States and we are continuing to ramp up our launch preparations in other key markets Such as Japan and Europe. Next slide, Slide 7 please. Let me now turn to lecadimab for BAN2401. First of all, with regard to CLARITY AD, our Phase 3 program in early AD subjects. We had already closed screening of patients last month and will be completing randomization shortly.
So we're on track for data readout by the end of Q2 in fiscal year 2022 as scheduled. We've been in consultation with the FDA proactively concerning the impact of those patients who temporarily missed doses During the initial wave of COVID-nineteen last year, before we fully put in place our telemedicine and home infusion infrastructure for the study. We thoroughly reviewed the FDA guidelines for addressing COVID-nineteen related issues in ongoing clinical trials And recently received valuable advice from the FDA to implement a sample size increase of approximately 200 subjects to potentially mitigate the impact of those missed doses from last year, So that we can ensure the highest quality of data for the primary analysis for this single pivotal trial. As such, target enrollment number has been expanded from 1566 subjects to 1766 subjects. Please note that this change was implemented without any knowledge of clinical results from Claroty AD.
Once again, we believe we have proactively navigated the tremendous progress of this study over the past year and expect randomization to complete shortly to stay on track for data readout by the end of Q2 fiscal year 2022. Next slide, Slide 8 please. Another ongoing study for lakandemab is study 2,010 OLE, open label extension. After the core study of study 201 ended. And after a gap period of no treatment for about 2 years on average, we were able to redose 100 and 80 subjects from the core study into the OLE study to the highest dose of 10 milligram per kg biweekly, Irrespective of what they received during the core study, over a year ago, we presented the baseline data From Study 201 OLE, as you can see on the left hand side of the slide, which indicated that BRAIN amyloid beta reduction At the end of the core study persisted after the catimab discontinuation and more importantly, The separation in CDR sub boxes between leketimab treatment and placebo at the end of the core study Appear to be maintained after lakedimab discontinuation.
Recently, at last November's CTAD, We reported amyloid PET findings and incidence of ARIA E after 12 months of treatment by the highest dose of 10 milligram per kg biweekly in the OLE study. You can see on the right hand side of the slide that for those subjects who received placebo during the core study, Now receiving the highest dose of 10 milligram per kg biweekly in the OLE study rapidly drove a vast majority of them to reach amyloid negativity. These data reaffirms the potency of the dosing regimen Of lakatinibab 10 milligram per kg biweekly with no titration as seen in the core study. Moreover, for these same subjects, the Kaplan Meier estimate for Area E incidents is about 10%, which is consistent with a rate of 9.9% observed during the core study. This data reaffirmed the low incidence of ARIA E of lakanumab 10 milligram per kg biweekly at approximately 10%.
Overall, we are very encouraged that these data from Study 201 OLE, Both at baseline and at 12 months of treatment support the favorable efficacy and safety profile of lakanumab. Next slide, Slide 9 please. The 3rd ongoing study for lakanumab is the AHEAD-three forty five Phase 3 program in preclinical AB subjects in collaboration with ACTC. Enrollment is now ongoing both in the United States and Japan And we're making very good progress in site selections in a number of other countries, as you can see on the slide. During the CTAD held in November of last year, Doctor.
Risa Sperling, one of the leaders of ACTC, presented The clinical study design of AHEAD-three forty five and the initial screening results of participants. To recap, AHEAD-three forty five is a platform study with a shared screening protocol to randomize subjects into 2 sister trials of A3 and A45 spanning from early to late preclinical AD. A3, EDROES participants with intermediate or sub threshold amyloid aiming to delay brain amyloid beta accumulation. 845 enrolls participants who are brain amyloid beta positive aiming to reduce the risk for cognitive decline. Dosing regimens are tailored for A3 and A45, respectively, based on amyloid burden at baseline.
We're implementing amyloid PET and tau PET for all subjects and we're also implementing a broad biomarker panel to measure changes of CSF and blood biomarkers. As I mentioned earlier, Doctor. Sperling presented the initial screening results of participants, which showed that the ratio of randomization Into ACE3 and ACE45 was in line with expectation. We look forward to continuing our close collaboration with ACTC to ramp up enrollment into a head 3, 4, 5 globally as we believe lecadivab has an optimal efficacy and safety profile to benefit this very early population. Next slide, Slide 10 please.
In addition to aducanumab and lakedimab that target the aggregated forms of brain amyloid beta, We have 2 additional disease modification therapies in clinical development to tackle the Alzheimer's disease continuum. E-two thousand eight hundred and fourteen is our novel anti MTBR tau antibody that we believe may emerge as the best in class anti tau therapy, specifically for Alzheimer's disease. In Alzheimer's disease, it's believed that the propagation of tau pathology is mediated by tau species containing the NTBR fragments And E-two thousand eight hundred and fourteen is uniquely designed to capture extracellular MTBR tau fragments to prevent accumulation spread of tauciences. At last November, CTAD, we reported the result of the Phase 1 single ascending dose study. Single IV doses of E2814 were well tolerated in healthy volunteers.
Clinical PK and CSF penetration were reasonable and target engagement of E2814 Binding to MTBR tau in CSF was demonstrated. E2814 is now in the multiple ascending dose study We plan to move E-two thousand eight hundred and fourteen into Phase 2 clinical development next fiscal year. We are very excited about the prospect of this unique E2814. E2511 is our novel synapse regenerant that selectively binds with Track A without activating unwanted pathways induced by NGF. E2511 is a unique 1st class molecule that targets the underlying pathophysiology of Alzheimer's disease Through 2 mechanisms.
1 is by restoring damaged cholinergic neurons to functional cholinergic neurons The other one is by preventing cholinergic degeneration. E2511 is now in a Phase 1 single ascending dose study, And we are equally excited about the prospect of this very unique molecule. Next slide, Slide 11, please. Meanwhile, the landscape for simpler diagnostic methods for Alzheimer's disease is also progressing rapidly, Which is critical to address a cast of our society with the upcoming arrival of the first disease modifying therapy. We are working closely with our partner, Cogstate, to introduce Cavegram, a digital cognitive testing tool around the world.
And we are particularly excited to see the recent advance of amyloid beta blood test such as a Shimazu screening test in Japan at the C2N screening test in the United States, which are both based on mass spec technology. At Eisai, We are working closely with our partner, Syspix, to develop an amyloid beta blood test using Syspix Hisclo system, Which we believe holds tremendous potential to realize a low cost and quick turnaround test. As I mentioned earlier, nearly 60% of people with dementia are currently living in low and middle income countries. A simple blood test will be extremely helpful for these communities. We will continue to strongly support the advancement of next generation diagnostic methods, not only M1beta, but also P tau and other key other pathophysiological biomarkers so that disease modifying therapies could truly benefit millions of Alzheimer's disease patients around the world.
Next slide. Slide 12, please. This is my last slide. And please allow me to reiterate Eisai's long term commitment to transform diagnosis and treatment in neurodegenerative diseases. Firstly, we believe disease diagnosis could be redefined Based on underlying pathophysiology instead of clinical symptoms, for example, Alzheimer's disease could be redefined As amyloid beta aggregate induced neurodegeneration with further subclassification based on additional biomarker footprint So just tap.
Secondly, we believe disease continuum could be redefined based on changes in pathophysiological biomarkers instead of severity of clinical symptoms. For example, the Alzheimer's disease continuum Could be redefined based on changes in amyloid data, tau and other important biomarkers instead of changes in cognitive performance. Thirdly, we believe treatment option could be redefined Based on modifying root causes of diseases instead of addressing clinical symptoms, for example, Treatment selection could be redefined to correct amyloid beta accumulation, tau propagation and synaptic dysfunction. We're confident that Eisai will be the leading company to drive medical and societal contributions to both people at risk of and patients living with neurodegenerative diseases. Thank you very much for your time today.
Let me now turn the presentation over to Mr.
Iike. Next Oncology business presentation will be made by Mr. Iike. Please turn to Slide 13. This page is on LENVIMA, and I will also discuss pipeline in oncology business.
As shown on the left part of this slide, ZENVIMA revenue has reached JPY 103,800,000,000 In total, which was 29% growth year on year, but there was an impact from COVID-nineteen. And this fiscal year, Contrary to our expectation that accelerated approval designation was given will be given to HCC treatment in combination for KEYTRUDA. The designation was not granted, which resulted in delay. In the United States, we see growth in endometrial carcinoma, renal cell carcinoma. Last year, at the end of the year, LENVIMA was added to national reimbursement drug list in China.
Considerable increase in patient access is expected and Eisai's hiring additional medical representatives. With virtual promotion in Europe, 31% growth was achieved. In Japan, we are making contribution to HCC area through LENVIMA for patients who are ineligible for TACE. Next Slide 15 showing additional indications for LENVIMA as shown at left. LENVIMA monotherapy for thyroid cancer was approved in China last year with the results of Phase II study that was conducted in China.
Approval was given in November last year. LENVIMA monotherapy is under review in Japan for thymic carcinoma. As shown in the box on the right side, in combination with KEYTRUDA, in renal cell carcinoma, three our major endpoints were all met, and we are preparing for regulatory filing. The details of this Phase III study We'll be presented at ASCO GU on February 13. Oral presentation will be given.
As for endometrial carcinoma, in the United States, breakthrough therapy designation is already given and validation study for that was conducted. This Phase III study was successful. Results will be presented at SGO in the United States in the plenary session on March 2019. Oral presentation will be given. And globally, we are preparing for regulatory submission.
In the box below that, gastric cancer First line Phase III study was is to be initiated in combination with chemotherapy. We have agreed with Merck to initiate such a study. In basket trial, sample size is expanded taking into consideration possible application program is also underway, silly. Slide 16, nevymakitruda combination in lead study Status is given on this page. In the middle of the slide, towards left of the slide, results for endometrial CarsoMA and RCC are shown.
Combination of LENVIMA and KEYTRUDA yielded positive results. These are the first and the second Phase III studies. Positive results were obtained from both studies. And as shown in the right hand side in the large box, there are more than 10 studies underway, which are pivotal studies. For HCC, as I've mentioned earlier, with the single arm Phase to study.
We were hoping that breakthrough therapy designation will be given. This was not the case, but Phase 3 study 2 study had already completed patient enrollment last spring. As for lung cancer, non small cell lung cancer first line 7 study completed enrollment of patients. There is yet another OCCOMER-six study for lung cancer in first line setting. This will soon complete enrollment of patients.
The 3rd study on MUNCELSR 8 study is also making steady progress. Overall, we were able to minimize the delay the trials due to COVID-nineteen. And we are making good progress towards achieving JPY 500,000,000,000 level revenue in fiscal 2025. Next Slide 16. From the pipeline, breast cancer related two themes are picked up on this page.
At the top is H3B6545. The name of the class of drug is circa. This is an oral drug with novel mechanism that binds with estrogen receptor with covalent binding. 6,545 has been evaluated in around 130 breast cancer patients thus far. Hormone receptor mutation is said to be potentially related to treatment resistance Amongst various mutations, highly frequent prognosis type of mutations are seen in some of the patients, and we have high expectations that 6545 will be effective in such patients.
Below the slide E790 is shown under SAKIVAKI designation development is underway for cholangiocarcinoma, and we have also May progress in preclinical study in breast cancer. In CDK4six resistant breast cancer patients. It was reported that expression of FGF and its receptor is elevated according to clinical data. In breast cancer, clinical study in combination with hormone therapy was started. Slide 18, This shows pipeline in oncology area.
I apologize, but this slide is very busy. In red box, in the middle part of the page. Endometrial carcinoma, revima, KEYTRUDA combination. And also in the middle of the page in red box, RCC are shown and these are globally preparing for regulatory filing. As for E7438, kazemetostat, this is expected to be Eisai's first ever precision medicine.
And in Japan, submission was already we have already filed submission. And below that, E7777 And brand name is Remitro. This is also under review and the 2nd Committee on Drugs Have decided to give approval. Next, Slide 18. This shows the pipeline of next generation candidates.
Individual patients have different characteristics in terms of cancer characteristics. And those characteristics may be understood at general level eventually to address concerns of the patients based on general information, early diagnosis and patient tailored therapy for each patient Bobiachi. From blood sample to Allied cancer derived DNA and genome At Art Tsukuba Research Institute, Liquid Biopsy Lab was established. In the middle of the slide below the green box, Some of the focus programs are shown. As cancer signal pathway, VEGF, As far as wind and FGF are considered very important.
For LENVIMA. LENVIMA has rich clinical data, and we have accumulation of human biology data related to these pathways. WINT and FGF are associated with resistance to LENVIMA and immune oncology. And when we think about beyond LENVIMA, such experience and information will be essential. We also consider protein decelerator to be one of the important pillars.
In partnership with Bristol Myers SQUED. We are conducting research on neoantigen inducer. And for this research, Our group of compounds that affect splicing will be utilized. With our capability in chemistry, We would like to transform undruggable targets to druggable targets and would like to make contribution to precision prevention and curing cancer. We would like to ask for your continuous support.
With that, I would like to conclude my presentation. Lastly, the presentation will be summarized by Mr. Yanagi's CFO. This is Yanagi's CFO. I would like to make an overall statement before
we end our presentation. Please turn to Page 19,
the last slide. Please turn to Page 19, the last slide. As we have presented thus far, Eisai is at a very important moment. In order to elevate future enterprise value, we have to see huge opportunity that is in front of us. And To achieve that, we are determining the implementing investment for medium- to long term future an AD DMT to make contribution to Alzheimer's disease in the next generation and in oncology lead studies are underway.
And with Dx, we will be conducting business transformation. These are very large projects to support these projects. To have strong balance sheet will be crucial. And based on soundness and integrity of the balance sheet, we aim to allocate capital in appropriate way and make active investment and achieve stable dividend at the same time to maximize patient contribution and corporate value. And this will be in line with our mission and purpose.
And right now is the moment to implement advanced investment for the future. And after the fact, corporate value should be created. Rather than falling into the trap of short termism, we should follow long term return and create enterprise value, for example, based on the targets such as 10% ROE. We would like to ask for your continued support. Thank you very much for your kind patience.
And first person to ask a question from Nomura Securities. Mr. Kotani san, can you hear us? Yes. This is Nomura Securities.
Kotani speaking. Can you hear me? Yes. My first question is related to Adcanvas. On 6th November, advisory committee was held rather than discussing the medical side, but also We were focusing on the statistics, and I think the result was unfortunate.
But this still means that the Approval was denied. And even if it is approved, but with the label of not being effective as a medicine by experts. So generally speaking, what kind of data will be convincing enough? Now, embark the study. Redosing Phase III study for aducanumab is ongoing.
On Page 6, additional clinical data was submitted. Other than this trial, I don't think that there are any other clinical data than this EMBARK study. So I think that the data from this EMBARK study was submitted. So I'm not asking about the details of the data. But personally, TAO PED to see the reduced brain amyloid, OTAL, and a plaque from the hippocampus and limbic system.
At least those are the knowledge gained by the physicians. So if the tau is reduced in brain, I think that They must think that it is effective. On the contrary, Alzheimer disease, tau Okay. Do you think that the Cantel disappear spontaneously? Thank you for your question.
From Neurology Business Group President, Ivan Chan is going to respond.
Thank you very much for the question. And we I agree with you that tau is a very important marker to look at in Alzheimer's disease trials. And I believe Baojun had presented several times about the Taupek findings from the Phase 3 program of aducanumab. And as we've stated previously, we continue to stand behind the efficacy and safety of aducanumab as presented in the positive Study 302, the supportive Study 103 and we Understood very well what happened to Study 301. Thank you very much.
Are you satisfied? Do you think the town can possibly disappear spontaneously? All of these aggregates, production and aggregation clearance are controlling the aggregation of these tau or snickling and Alzheimer's and tauopathy. And such system for disappearance is now damaged. Therefore, If the disease takes a natural course, those agents will continue to aggregate, as Gordon san mentioned, with the medication Tau will be reduced.
So this is this should be thought to be the effect of the medicine. Understood. The second question, this is my last question, which is about LENVIMA. Now for RCC, The first line clear study result will become available of Chivo, Yaboi and KEYTRUDA, Cogometyx and competitors are launching. And in light, Cogmedix will be the control, in my opinion.
So before this, I would like to organize my thinking. For RCC data, how to interpret in Korea study LENVIMA and KEYTRUBA, ORR over 50% and OS over 50 months. So this to be the minimum, ORR over 70%, OS over 60 months. And I think it will be pretty favorable results. So is this correct understanding?
And compared to Inlyta and Cogmatics, I think discontinuation rate is almost 30% because of the for both agents. And I think that below that threshold, it would be also important. So how to interpret the data for RECC? Do you think my understanding is correct? This is my last question.
Thank you for your question. Regarding your question, I would like to invite Oncology Business Group, Doctor. Owa, who is in charge of science, will respond. Thank you very much, Mr. Kotani, for your question.
Rather than me responding to your question, I think the points you have raised are All very important. If I may repeat, response rate is very important. This is to be used in first line. So how Much regression of tumor can be seen how powerful it will be in reducing the tumor mass. It will be encouraging to patients.
And as you said, complete response rate does matter in as the key opinion leaders of the ROCE's area. I think that, that's all you understand, Mr. Kotani. Response rate and the complete response rate in particular. And in this first line, there are some agents which have demonstrated survival benefits.
So survival benefits, extension of OS, not only PFS. So what are the expected level for these indicators, which are also important, not only extending survival, but also without having a discontinuation. And can patients continue to be on the therapy for many long time. So please pay attention to the presentation to be made at ASCO. Thank you very much.
Next Question is from Mr. Yamaguchi, Citigroup Securities. Mr. Yamaguchi from Citi, can you hear me? Yes, I can hear you.
Can you hear me? Yes, please go ahead. I have two questions. First It's about downward revision, significant downward revision. And the cause of that milestone of LENVIMA, from where to where and how much that is not disclosed externally.
And 1.2 from January to October. And I think our next threshold for full year JPY 150,000,000,000. So next year, if it exceeds JPY 150,000,000,000, and I naturally expect that it will exceed JPY 150,000,000,000, then JPY 50,000,000,000 milestone or thereabouts will be paid. And in later years, I believe that there were other milestones. So we will receive double milestones.
If our sales is delayed, it may also be delayed. But milestone payment for next year, How will it be accounted for? And as for the future milestones, can you share some thoughts on that, please. Thank you for your question. CFO, Mr.
Yanagi, will respond. This is Yanagi, CFO speaking. Mr. Yamaguchi, thank you for your question. As You are aware this is not a business that is carried out by Eisai single handedly.
We have a partner. And as for disclosure, for the term that is ended in our financial reports, Milestone threshold and the amount received are disclosed, but for future milestone The threshold and the amount of milestone itself are not disclosed. However, a large amount is expected and The amount was deferred to next year and beyond, and that is one of the reasons for the downward revision. And the milestone information is included in segment information. In the reference section in the change in other businesses and the movement will the in parallel with that movement.
Please make estimate based on that. And it's not that we have lost the right to receive a milestone In fiscal 2021, if a certain threshold are satisfied, then full amount of milestone will be paid. As for the business plan for the next fiscal year, the plan is now being developed and I cannot discuss this in precise terms, but there will be milestones in the future. And in next fiscal year, there is, of course, the possibility that multiple milestone payments may occur. But once again, this is based on the partnership with Merck.
And milestones that had already been paid are disclosed as information, but we are not able to disclose information regarding the future milestone. Thank you for that. The second question, I wonder this is an appropriate question myself, but I feel compelled to ask this question about 3 months extension of aducanumab. Information request was made by FDA and analysis and clinical data further analysis and clinical data were submitted to FDA, specifically what was done. And as a result of that, the RUSA date, action date was moved from March 7 to June And is that so that FDA can be more confident in giving approval?
And are you also growing in confidence? It may be difficult to comment, but I would appreciate if you could share some information. Ivan Chan will respond.
Thank you for A very important question, I understand. Let me say this, both Baozun and Eisai, we continue to be very encouraged by the ongoing communication with the FDA on this application. And as I said earlier, we Very much appreciate the diligent efforts by the FDA on this application. And as part of this ongoing review, This is an important request from the FDA that the Biogen team, I must say in a very timely and diligent manner, put together the responses including additional analyses and clinical data for this response. And As I mentioned many times, we continue to stand behind the efficacy and safety of aducanumab.
And our belief in aducanumab remains the same with this PDUFA extension to June 7 this year. Thank you.
Are you satisfied, Mr. Yamaguchi? Yes. Thank you very much. Next person is from JPMorgan Securities, Wakao san from JPMorgan Securities, Wakao san.
Can you hear us? Yes. This is Wakao speaking. I'm from JPMorgan Securities. I have two questions.
One is as a follow-up question to the previous one. Now there has been an extension of PDFA date by 3 months. And do you think that there is possibility that this will be further extended? Because the analysis is done and additional information has been provided in response to the request and there will be extension of 3 months in review. Do you think there is a possibility of further delay or extension?
And are you submitting the additional data to other regulatory authorities, FDA and in other regions. I think the review is separately being done. So FDA has extended PDFA date, but it's not relevant to other regulatory authorities. Thank you for your question. Alvin Chan is going to respond.
Thank you for your questions. Of course, This is the FDA's regulatory review process. As where we stand today, We do not believe there's going to be further extensions by the FDA. We have confidence, as I mentioned earlier, in the diligent efforts of the FDA in this application. Everything has been very timely over the past few months.
So I don't have any reason to believe that any further extension beyond 3 months by the FDA. That's where we believe. With regard to your other question on the other health authorities, we are under review by the EMA And by PMDA, and those processes are ongoing in terms of dialogue with those agencies. And as always, the sponsor and the agencies are going back and forth with queries and questions and answers. And of course, all the data that all the data and analysis that we have in our hands depending on the queries and questions from with other authorities.
We will, of course, respond in a timely and diligent manner as always. Thank you very much.
Wakao san, are you satisfied? Yes. Thank you very much. Regarding the second question about Renvima, I think that you have a downward revision by about JPY 70,000,000,000 and The credit approval was not obtained and also impacts of the COVID-nineteen and also the HCC and a downward revision Yes, it's made by JPY 70,000,000,000. Is this because of the mainly by the not being able to get the approval for HCC?
And how should we looking to the outlook going forward. Regarding this question, President of Quality Business Unit, Mr. Iike is going to respond. Thank you very much for your question. The COVID-nineteen impact, not limited to LENVIMA, but so called overall business of Eisai.
We believe that there will be impact of 7% downside impacts compared to the business plans. So the impact for RENVIMA is also in line with that. Regarding the approval for HCC, hepatocellular carcinoma. Originally, when we started the alliance with Merck, such accelerator approval was not factored in. But this year, we incorporated in our plan as an upside for this fiscal year.
But Such accelerated approval was not granted. Therefore, compared to the business plan, this part has been the downside, making it behind the plan. As you know, in this indication, there are competitors being launched. So There was such an impact as well. So that's what we can respond to.
Thank you. Thank you very much. That's all I have. We have gone beyond the scheduled time, but we would like to continue to take questions. Next, we have question from Mr.
Hashiguchi of Daiwa Securities. Yes. Thank you for taking my question. This is Hashiguchi. I have a Question on aducanumab.
The additional analysis and clinical data are now being reviewed. Will there be another advisory committee meeting? Thank you for your question. Ivan Chan will respond.
Thank you for the question. This PDUFA extension Means that aducanumab is still within the current review cycle. And the advisory committee for this review cycle already occurred last year on November 6, as you know. Therefore, we don't believe so. I would just say this one more time that Advisory Committee recommendations are non binding and the FDA makes decisions to approve the FDA makes decisions to approve drugs independently.
Thank you.
Mr. Hashiguchi, does this address your question? Thank you very much. Jan. Morgan Stanley, MFG Securities, Mr.
Muraoka. Thank you for taking my question. This is Muraoka. About aducanumab, the preparation for launch In terms of expenses, I think it was JPY 14,300,000,000 in 9 months. I have a question related to this.
I think it will be in excess of JPY 20,000,000,000 for full year with a of JPY 20,000,000,000 for full year. With Biogen, I think about JPY 40,000,000,000 will be spent. And if it is launched in June next year, then is there going to be a significant increase in spending in comparison to this fiscal year. And launch spending seems to be very large Even though the product is yet to be launched, could you elaborate on what the spending is made? Ivan Chan will respond.
Thank you very much for your question. As you know, this, If approved, will be the 1st so called disease modifying therapy for Alzheimer's disease. And that means We have to put a lot of efforts between both companies to make sure that the market And the health care infrastructure are in place for this to happen. For example, and you've heard from Baojun several times, In the United States, a lot of efforts are being put in place in the past many months in making sure that hundreds of sites, hospitals, health systems in the United States will be ready to prescribe, administer aducanumab And also monitor the patients and understanding how to take care of the patients, get reimbursement And these are very, very important efforts that do come with expenses when you launch a drug that is 1st in class that will have to reshape the market. So we believe those expenses We're fairly justified and necessary to be able to really transform a very important disease area.
Thank you very much for your question.
Mr. Muraka, does this address your question? Thank you very much. We have run out of time. Unfortunately, we would like to conclude today's presentation session.