With a focus on contributing to stable profits for the entire JT Group, the pharmaceutical business’s basic strategies are:

• Increase drug discovery capability and build unique pipelines
• Reinforce the earnings foundation in the domestic market
• Raise productivity by optimizing the business foundation over the medium and long terms

The pharmaceutical business focuses its R&D on these areas: Kidney and Skeletal Muscle; immunology; and neuroscience.

In our pharmaceutical business, we operate under the business Purpose of “Respecting science, technology and people, we will contribute to patients’ lives.” In 2019, we drew up the following sustainability strategy with three focus areas and five specific initiatives, and report on its progress annually.

The sustainability strategy was reviewed in 2023, and under the newly revised edition that will take affect from 2024, we reorganized the focus areas and set specific indicators and sustainability targets to be addressed. For more details, please refer to the pharmaceutical business section.

In working to fulfill our Purpose, we will contribute to JT Group Materiality efforts.

Materiality		Target items	Targets
		Creating first-in-class drugs	We will continue our efforts and investments in R&D activities for innovative drugs in specific therapeutic areas.
		Emissions reduction	By 2030, we commit to reduce Scope 1 and 2 GHG emissions by 47% in line with a 1.5°C reduction pathway against a 2019 base year. Along the way, we will help the JT Group achieve its goal of Net-Zero GHG emissions across the entire value chain.
		Diversity, equity & inclusion	We promote the creation of an organizational culture where diverse talent can thrive, contributing to the achievement of the JT Group’s target of increasing the ratio of female managers.
		Foster ethical awareness	To cultivate personnel with a sense of mission and ethical awareness aimed at saving patients, we will continue to learn more about patients’ needs by engaging in dialogue with medical experts through our internal educational activity For the Patients Project.
		Provide information responsibly	We continue training our medical representatives to provide medical professionals with up-to-date, appropriate information on pharmaceutical products.

For progress of our sustainability initiatives in the pharmaceutical business up to 2023, refer to KPI progress.

Case study 1

For the Patients Project

Materiality

Good governance

Target items

Foster ethical awareness

To continuously cultivate employees, expand their sense of mission to help patients and maintain ethical awareness about it, we’ve undertaken a Group-wide educational initiative called the For the Patients Project. Every year, we select about 10 members to investigate patient healthcare needs through exchanges with healthcare facilities and internal events. In 2023, we provided information internally about medications that are truly needed in the medical field through interviews with specialists related to our R&D areas such as atopic dermatitis and pediatric allergies. Also, we conducted interviews at children's hospices and organized dementia experiential sessions using VR internally, providing employees with opportunities to consider drug development from various perspectives and empathize with the patient's standpoint.

Case study 2

Pharmaceutical development leveraging patient opinions

Materiality

Value creation that exceeds consumer expectations

Target items

Creating first-in-class drugs

We have undertaken an initiative to incorporate patient opinions in pharmaceutical development.

• Calling this approach “patient centricity,” we continuously provide related information to employees to ensure their understanding.
• To communicate our appreciation to participants in clinical trials, we send them thank-you letters.
• We are preparing a system to provide plain-language summaries of results

We will continue to incorporate patient opinions into the pharmaceutical development process and work to make participation in clinical trials easier.