Good afternoon. This is Kate from SanBio , and we are delighted to provide updates today. Thanks for gathering. As usual, we've got three topics today: financial results, SB623 in Japan, and then everything else. Before I start talking about the actual topics, I would like to touch a little bit on the new executive leadership. Many of you may have heard about the resignation of Aki Tsujimura back in January. This is sort of a response to where we stand as of today and show our leadership. As you can see, we have a very strong leadership. We have expanded our leadership in the last year or two quite tremendously. We have professionals and leaders with tons of experience in pharma and biotech. In addition, two founders, myself and Toru Kawamichi, have been on this SanBio since the beginning in 2001.
This is our 23rd year ongoing. This is a new executive leadership, and we believe we have more than, you know, an hour to go through the approval process, our first product approval process and launch, and much, much beyond. Financial results. First, our income statement. In the last 12 months, we have proactively, aggressively spent expenses in R&D and overall operating expenses. Specifically, JPY 6 billion for R&D and JPY 7.8 billion in total. Operating expenses increased for one reason: the weakening yen, unfortunately. Another reason is higher expenditures related to our work towards the approval of our first product, SB623 for TBI. Lastly, due to an increase of R&D expense, which the recording has been changed from the commercial production to R&D. Next is a balance sheet. At the end of the fiscal year, we have JPY 6.7 billion as cash and passives over.
This is sufficient, and we have secured operating funds towards the approval of our SB623 for chronic traumatic brain injury. We did this through the equity financing, which we initiated in the last fiscal year. Lastly, forecast. This upcoming year, our forecast comes with a significant reduction of operating expenses by optimizing our business resource allocation as we move and proceed with the approval of the SB623 TBI program and towards the launch of our product. Specifically, R&D expense we forecast to be JPY 3.1 billion, and the overall operating expense to be JPY 4.6 billion. Now I'd like to move on to talk about our main lead product candidate, SB623, specifically our activities and progress in Japan. We have been focusing much of our resource and attention and focus for Japan with a good reason. I'd like to remind everyone that we have this SB623.
This is a very unique cell therapy product. This product has demonstrated recovery of functions, like, you know, functions of the arm or leg, resulting in, you know, movement improvements such as walking for the chronic patients in TBI and stroke. In the chronic stage, you know, patients have a stable and fixed disability, and it's considered to be almost impossible to provide an improvement. We have worked very hard with a unique product and diligence to get, you know, development and has demonstrated success in providing benefits to these severely diseased patients. Our vision is to take this innovative product and beyond and bring brain regeneration as a reality, globally. Our strategy is to rapidly obtain approval in Japan, because Japan provides the best and most robust approval and the business environment for regenerative medicine.
Our strategy is to get the rapid approval and, you know, that would, you know, bring our position, even yet above and beyond our competition, allowing us to accelerate the global commercialization. In that context, approval and launch in Japan is critical for our overall vision. This slide describes the overall process of the application through the review, approval, and launch, etc. We have completed the filing of our product for approval in Japan in March of 2022, so one year ago. We did this within the framework of the Sakigake designation system, having gone through a rigorous review by the Japanese agency, PMDA. We did this by, based upon the positive Phase 2 clinical trial results. We understand that we were hoping and expecting to get approval within six months. This did not happen.
We continued to work diligently and, for the patient need, we did everything to accelerate the approval. Now I'd like to go deeper into our situation or the progress through to the approval. We have touched a number of times on the production and production-related activities. Now I'm going to talk about the management of production-related items towards approval. Since I'd like to provide a good sort of context of, you know, how things have evolved, I'd like to start off, you know, looking back a year or so and explain from there. One year ago, in March of 2022, we successfully filed our application to the PMDA. This was after we resolved the issues related to the establishment of the post-launch stable supply system. Some of you may recall that we experienced issues in 2019 and 2020, and we rigorously worked resolving these issues. After the resolution, we filed.
Obviously, our production process has well been established. Since the filing completion a year ago, we have been communicating with the PMDA, and the responses to the production-related review made steady progress towards approval. However, recently, production yield issue has surfaced. What this is, is, in the recent production, productions, we experienced lower than usual or lower production yield compared to the yield level at the time of the filing. As we observed this, clearly we saw this as an issue. Rapidly, we worked very rapidly to overcome this. The measures to resolve the issue have been implemented to execute production run. We continue to aim for obtaining approval in this fiscal year. What we have done is, as we observed the issue, we worked on the analysis of the issues, and we developed the resolution measures, and these have now been completed.
Currently, we are working closely with our partner, CMO. We are doing the on-site training by team members to implement resolution measures to improve production operations. I'd like to also go into more sort of details in the next stage here. I'd like to provide more clarity to this issue and our plan for a resolution. Issues and resolution measures towards approval. Issue, again, is, in recent production runs, production yield lower compared to the level at the time of the approval filing. This is the issue. Solution we have is, we need to do is improve the production operations and execute production run for confirmation. Criteria or criteria for success is achieved production yield at the time of the approval already. We basically need to recover the level that we have been producing. Level of difficulty. I would like to provide, I think, sort of the insights into this.
We do have a good, fast track record of achieving yield comparable to the level at the time of the approval filing. Obviously, we have repeatedly producing SB623, and this has been the case, and therefore we filed. Our current effort is therefore to confirm and reproduce the past results. We believe this is something that we have been doing and making sure that we get back to where we were before. The timing of the resolution, we believe that the main result of the resolution measures will be available in June of this year, in three months. In terms of the disclosure, update will be provided in June at the time of the financial disclosure for the first quarter of the fiscal year, and that's our plan. Finally, the outlook.
We believe that resolution of this issue is a milestone, and this would facilitate obtaining the approval, product approval in this coming fiscal year. The important thing is that we resolve this issue, and then this would lead to, we believe, in obtaining the approval. We hope that we are giving, I think, some clarity on the recent issue that we experienced and the measures that were taken and the plan, which is around the June time, we plan to have the result and disclose to the public. Now, changing the sort of the mode from the issue to more of the other areas of progress, in the last fiscal quarter or two, what we have done successfully is to establish an in-house facility, and we also acquired license for this facility. What this facility does is manufacturing, specifically packaging, labeling, and storage of our regenerative medicine product.
We believe that this is a very important milestone in progress as our team has put the tremendous efforts in order to get the license. Our team has done a lot of the effort securing the quality of the facility, documentation, operations, etc., and having gone through a rigorous inspection. Now I would like to turn over to Naoki Tsukahara for the exciting preparation of our efforts into the Japanese market.
Okay. Thank you, Keita. Let me explain about the current status of SB623 post-launch activities. We have made progress in post-launch activities since last year, and there are two areas that we are focusing on. The first one is our overall strategy and activities for sales and marketing. We will make sure that all of our activities are in compliance with expected approval criteria, which will be available when SB623 is approved. The second one is how to provide TBI patients with access to SB623 as soon as it is approved. As you know, our target patients are in the chronic phase, and it is very important how to establish a system for patient referral in collaboration with the external stakeholders. These two items are of focus, and we have made steady progress on that.
In this chart in the table, you can see the current status of each item, including the two items I mentioned: the drug price, medical treatment fees, sales structure, logistics, promotional materials, and assistance to provide the appropriate use of SB623. These items are, again, I would say that we have made steady progress, and we are ready for launch of SB623 once it is approved.
I'll be once of this is Shinya Hirata. I'll talk about the one maximizing corporate value. At first, it's a great honor. Dr. Kabori at Hokkaido University received a Hirakawa Award at the 46th annual meeting of the Japanese Society of Neurotrauma in 2023. As you know, Dr. Kabori is the first author of the paper presenting the interim analysis results of stem cell trial in neurosis. The Hirakawa Award is given annually for outstanding papers related to neurotrauma. We believe this award represents the recognition of the academic value of the stem cell trial in Japan. It also represents the tremendous clinical significance of the stem cell trial as a therapeutic approach to neurotrauma. Next topic is our latest publication. This is the result from our joint research with Okayama University in Japan. The article has been accepted for publication in Stem Cell Research and Therapy at JANED.
The aim of this study is to investigate the combined effects of SB623 administration and also rehabilitation treatment. In this experimental model, using the stroke model, we examine the SB623 administration group and spontaneous exercise group with running wheel and also the combination groups. The behavioral assessment and the psychological analysis were conducted before and after the intervention of treatment. Other results, the combination group showed higher efficacy than both of our single treatment groups, including the reduction in the impulse barrier, the upregulation of neurogenesis and angiogenesis, and also increased expression of trophic factor in brain tissue. This will be an important evidence because those results indicate that neurological recovery by SB623 treatment and rehabilitation will work, so shinagesically. We also believe the combination of SB623 and rehabilitation will be a more effective therapeutic approach to TBI, also in a real-world clinical practice.
The last part is about the recent academic presentation. The result of the joint research with Okayama University is presented orally at the Stroke 2023, which is currently being held in Yokohama. In addition, Dr. Yasuhara at Okayama University will make a presentation related to SB623 at the annual meeting of the Japanese Society for Regenerative Medicine, which will be held in Kyoto next week. Dr. Wang Qiao will present the 48-week analysis, which is the final result of the stem cell trial at the 40th World Congress on Brain Injury, in Ireland later this month. We will continue to proactively disseminate the result of clinical trial and research findings in the future.
As Hirota's father mentioned, we and our principal investigators are very active in publishing and communicating the results, not only in Japan but globally, because our vision is to really commercialize our product globally to help the patient. This is a development plan with a priority under this. Maybe as I mentioned in the beginning of my presentation, our priority is the TBI in Japan for the good reason. This would give us a rapid approval. With this, we believe we can accelerate the entire global and multi communication, commercialization. That's our strategy. In terms of the applied pipeline, I think we need to also talk about things beyond SB623. As you can see, we have in total five cell therapy product candidates, starting from SB623 to SB618, SB308, MSC1, and MSC2.
In terms of medication, we are heavily focusing on brain regeneration because there are no effective drugs, and there are so many patients who are in need. The other reason is the brain area or the CNS, there is believed to be no immunorejection, and we believe our approach of the allogeneic cell therapy will be very effective in this type of indications. As you can see, we have many brain, CNS-related indications: TBI, ischemic stroke, hemorrhagic stroke, dry AMD, retinitis pigmentosa, Parkinson's disease, spinal cord injury, Alzheimer's disease. Those are all CNS indications. We have some other indications that are beyond CNS, such as peripheral nerve damage or muscle dystrophy or cancer or inflammatory disease. We will continue to initially focus on SB623, but once we make that success in the initial approval and launch, we will obviously expand our activities in the rest of our pipeline.
To wrap up, our aim, our vision is to become a global leader in regenerative medicine. We believe that, looking at the brain regeneration field, our data and the status is clearly above and beyond our competition's ability. There is no other company that is so close to the first product approval in brain regeneration. We believe that we have a good opportunity to really become the global leader. Before that, we need to get the approval in Japan, really help the patients, initially in Japan and also globally. We have so many patients that we need to help. Thank you very much for your attention.