■ Company Overview of Medinet <2370>
1. History
(1) Foundation
The company is a pioneer in the field of "cancer immunotherapy" and is a biotech venture. The current Chairman, Mr. Kimura, started the company in 1995 to develop and commercialize cancer immunotherapy after working in sales of contact lenses and medical devices at Hoya Glass Co., Ltd. (currently HOYA <7741>). Subsequently, he collaborated with Professor Koji Egawa, a doctor who has researched cancer immunotherapy at the University of Tokyo's Institute of Medical Science, focusing on immune cells in the blood as a method for cancer immunotherapy. They developed a mechanism to enhance immunity against cancer by cultivating immune cells collected from patients' blood outside the body and reinfusing them. Since then, Mr. Kimura and Mr. Egawa (as an advisor) have led the company together.
At that time, awareness of regenerative and cellular therapies was not high, but it led to commercialization through a new business model known as "comprehensive support services for immune cell therapies." In 1999, they began providing services to the first clinic in Japan specializing in cancer immunotherapy, the "Seta Clinic (currently Koji Medical Foundation Seta Clinic Tokyo)," which was opened by Mr. Egawa.
(2) Difficult period of halved revenue
With the enactment of the "Act on Securing Safety for Regenerative Medicine" and the "Pharmaceutical and Medical Device Act" in November 2014, the company transitioned from its core service, "comprehensive support services for immune cell therapy," to cell processing business. The revenue from cell processing grew to 1,876 million yen at its peak in the fiscal year ending September 2016, but halved to 994 million yen in the fiscal year ending September 2018. The spread of immune checkpoint inhibitors in cancer treatment was one contributing factor, but the biggest reason was the strong opposition to cancer immunotherapy, which is a self-funded treatment. When planning treatment for a patient, the primary physician can contemplate treatments based on standard therapies (such as surgery, radiation, chemotherapy) as well as patient requests. However, many doctors refuse to provide treatments outside of standard therapies, leading to numerous missed applications of the company's cancer immunotherapy.
(3) Black conversion through business structural reform
The company has implemented the medium-term management plan "ACCEPT2021 Global Strategy" from the fiscal year ending September 2018 to the fiscal year ending September 2021, embarking on improvements and reforms in its revenue structure and more. The goals were to streamline the manufacturing system in the cell processing industry and achieve breakeven by the fiscal year ending September 2019, as well as to expand the pipeline of regenerative medicine products and achieve early revenue generation.
Under the business structure reform of the "ACCEPT2021 Global Strategy," from the fiscal year ending September 2018, the company consolidated the four cell culture processing facilities nationwide, merged two consolidated subsidiaries, implemented early retirement recruitment, and significantly reduced research and development investment. As a result, segment profit for the fiscal year ending September 2019 was 89 million yen, achieving profitability in just one period.
(4) New Management Structure
In April 2022, the company transitioned its top management from Mr. Kimura to Mr. Kunishiro Kaneo. Mr. Kunishiro joined the company as a director in December 2020 after working at Tanabe Mitsubishi Pharma and has gathered experience in sales, development, and manufacturing, leveraging his previous role in Pharmaceutical marketing and sales practices. Mr. Kimura became the chairman of the board. Under this management structure, the company has established its corporate vision "VISION2030" and is promoting its medium-term management plan. Transformation based on growth strategies and acceleration of speed management is anticipated.
(Written by: Fisco guest analyst Keiji Shimizu)
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