GNI Group Completes Acquisition of Ayumi Pharmaceutical

GNI Group, Ltd. (TSE: 2160, "the Company") today completed the procedures to acquire all shares of Ayumi Pharmaceutical Holdings Co., Ltd. from shareholders led by Blackstone. As a result, Ayumi Pharmaceutical Holdings Co., Ltd. and its subsidiary, Ayumi Pharmaceutical Corporation, will become wholly owned subsidiaries of the Company.

Since our founding in 2001 and listing in 2007, aiming for global expansion as a Japanese company, we have developed businesses in China, the United States, and Australia. Meanwhile, we have long positioned our pharmaceutical foundation in Japan as a "missing piece" and have continuously explored all possibilities, including partnerships and M&A. With this acquisition, we have obtained the final piece in the optimal form and now position this as our "Second Founding Period (True Global Founding Period)". As a global biopharmaceutical company capable of demonstrating strong synergy across Japan, the US, China, and Australia, we will move forward to the next stage of sustainable growth.

Ayumi Pharmaceutical is a pharmaceutical company with a solid earnings base, strong in pain management, including "Calonal," which has been favored in medical settings as an antipyretic and analgesic for over 40 years. Its domestic market share for acetaminophen formulations exceeds 80% (83%), and its sales revenue for the fiscal year ending March 2026 is approximately 38.5 billion yen.

The acquisition price (valuation of approximately 44.8 billion yen) was settled through cash and the issuance of new GNI Group shares. With this transaction, we also welcome Blackstone, Toho Holdings, and Hisamitsu Pharmaceutical as new shareholders.

Following the completion of this acquisition, the company name of Ayumi Pharmaceutical and all current product brand names, including the flagship product Calonal® (acetaminophen), will be maintained. We will fully respect Ayumi Pharmaceutical's high presence as a specialty pharmaceutical company in the orthopedic and rheumatology fields that it has built, and will continue to strive for the stable supply of safe and secure medicines as before.

Dr. Ying Luo, Representative Executive Officer, President and CEO of GNI Group, commented on the future prospects of the group and his gratitude to stakeholders as follows:

"The acquisition of Ayumi Pharmaceutical is an extremely important milestone in evolving our global business foundation spanning Japan, the US, China, and Australia into a more robust one. By integrating Ayumi Pharmaceutical's strong domestic sales infrastructure and product portfolio in pain management into our group, we will be able to deliver more products directly to patients with unmet medical needs. We are honored to welcome Blackstone, Toho Holdings, and Hisamitsu Pharmaceutical as new shareholders. We will work closely with all stakeholders to drive the next phase of growth for our group."

Through this acquisition, the Company is expected to significantly expand its sales base in Japan and build a pharmaceutical platform that will accelerate the introduction of innovative drugs, biosimilars, and proprietary products into the Japanese market. This will secure a continuous revenue base in Japan, diversify our regional sales base across Japan, the US, China, and Australia, and support long-term, sustainable growth.

[Strategic Significance of this Acquisition]

Our group positions this acquisition as its "Second Founding Period (True Global Founding Period)" and will strongly expand its business base in Japan going forward. The specific strategic significance is as follows:

Establishment of a Strong Business Foundation in Japan (Transformation of Revenue Structure)

For our group, which has driven business growth primarily in the US and China, we will acquire a platform that generates continuous revenue and cash flow in Japan. This will aim for structural profitability in Japan and transform the Japanese region into a growth business that contributes to the entire group.

Acceleration of Introduction of Proprietary and Overseas Pharmaceuticals into the Japanese Market

We will acquire Ayumi Pharmaceutical's strong sales network covering medical institutions nationwide in the fields of orthopedics and rheumatology. Leveraging this infrastructure, we will promote the rapid deployment of our group's innovative development products and rapidly growing overseas products.

Strengthening of Global Management Foundation and Risk Diversification

With the addition of a solid business foundation in Japan, our group will establish a robust management foundation with a balanced revenue structure across Japan, the US, China, and Australia. By building a portfolio that is not dependent on any single region, we will effectively reduce geopolitical risks and promote the enhancement of corporate value in the medium to long term.

About GNI Group https://www.gnipharma.com/

GNI Group is a global biopharmaceutical company headquartered in Japan, with business bases in Japan, China, the United States, and Australia, engaged in everything from research and development to manufacturing and sales. The group develops and sells pharmaceuticals from drug discovery, as well as operates a medtech business as an integrated group.

Our group has established a system capable of completing everything from innovative drug discovery and basic research using its proprietary drug discovery platform technology for Targeted Protein Degradation (TPD) to global clinical development within its own group. The pipeline includes F351 (a candidate drug for liver fibrosis caused by hepatitis B, for which no effective treatment currently exists), as well as a wide range of areas such as fibrosis, cancer, inflammatory diseases, and acute pain. Furthermore, we have a stable production system through our own factories, a strong sales network including our own MRs (Medical Representatives) covering medical institutions, and contract manufacturing services, thereby building a robust foundation for the next generation of business.