Kyowa Kirin Co., Ltd.

Revenue was JPY230.7 billion, down JPY0.3 billion, or 1%, year over year. Core operating profit was JPY35 billion, down JPY9.1 billion, or 21%, and interim profit was JPY16.3 billion, down JPY21.5 billion, or 57%. Gross profit decreased JPY3.4 billion, with gross margin down 1 percentage point year over year; SG&A was down JPY0.5 billion, while R&D rose JPY3.3 billion. H1 Crysvita sales were JPY99.8 billion, up 10%, and H1 Poteligeo sales were JPY21.6 billion, up 14%. Ziftomenib was submitted to the FDA in June and received priority review with a target action date of November 30. Management said the quarter was broadly in line with plan and reaffirmed the goal of achieving the full-year forecast.

CEO Masashi Miyamoto framed the quarter as a solid operational period despite headline profit pressure, repeatedly saying the underlying business is moving strongly and remains on plan. He pointed to global strategic products in North America and EMEA, progress in Crysvita and Poteligeo, and advancing R&D assets such as Ziftomenib and rocatinlimab. He also emphasized the company’s structural changes in Japan, including the special voluntary retirement program, as part of its Vision 2030 transformation.

CFO Motohiko Kawaguchi said the gross margin decline and profitability pressure were driven by one-time and transitory items rather than a change in the core trend. He cited approximately JPY2 billion of transitory cost-of-sales impact from domestic item retirement/write-downs, JPY9.4 billion of special voluntary retirement expenses, and a JPY1.3 billion negative forex impact on core operating profit. He added that the retirement program was slightly larger than planned, but the company still expects to achieve the annual plan, and that R&D expense progress was consistent with plan after shifting to activity-based costing.

Analysts focused on the gross margin weakness, Crysvita inventory swings in North America, rocatinlimab’s differentiation versus competitors, and the timing of Ziftomenib and OTL-203 milestones. Management said the gross margin hit was due to a one-time domestic cost of sales issue of about JPY2 billion, that Crysvita demand remains steady despite inventory fluctuations, and that adult Crysvita penetration in the US is 14%. On rocatinlimab, management said they will wait for ASCEND and ASTRO readouts before discussing next steps with Amgen, including any additional studies or strategy changes. On Ziftomenib, they said the mechanism may have value even in patients with FLT3 mutations and that first-line development in combination with FLT inhibitors remains scientifically plausible.