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Consolidated Financial Statements Consolidated Takeda

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					                                                                    Takeda Pharmaceutical Company Limited (4502)
                                                                   Consolidated Financial Statements for Fiscal 2011

4. Consolidated Financial Statements

     (1) Consolidated Balance Sheets

                                                                                      (Millions of yen)
                                                           Fiscal 2010               Fiscal 2011
                                                     (As of March 31, 2011)    (As of March 31, 2012)
    ASSETS
     Current assets
        Cash and deposits                                     217,897                      214,885
        Notes and accounts receivable                         293,995                      344,679
        Marketable securities                                 656,321                      240,740
        Merchandise and products                               59,668                       93,514
        Work in process                                        39,899                       52,594
        Raw materials and supplies                             37,560                       48,906
        Deferred tax assets                                   229,909                      221,230
        Other current assets                                   51,894                       65,303
        Allowance for doubtful receivables                       (891)                      (2,855)
        Total current assets                                1,586,252                    1,278,996
     Noncurrent assets
        Tangible assets
           Buildings and structures                           237,238                      266,580
           Machinery, equipment and carriers                   52,833                       61,058
           Tools and fixtures                                  15,323                       16,421
           Land                                                71,594                       76,314
           Lease assets                                        13,705                       14,785
           Construction in progress                            16,788                       53,545
        Total tangible assets                                 407,480                      488,702
        Intangible assets
           Goodwill                                           217,123                      582,257
           Patent rights                                      291,143                      322,537
           Sales rights                                         1,988                      570,166
           Other intangible assets                              7,173                       41,288
        Total intangible assets                               517,427                    1,516,247
        Investments and other assets
           Investment securities                              165,019                      186,697
           Long-term loans                                        356                          991
           Properties for lease                                19,593                       19,108
           Deferred tax assets                                 26,560                       20,232
           Other noncurrent assets                             63,909                       66,176
           Allowance for doubtful receivables                    (196)                        (119)
        Total investments and other assets                    275,242                      293,085
        Total noncurrent assets                             1,200,150                    2,298,035
     Total Assets                                           2,786,402                    3,577,030




                                                - 21 -
                                                                       Takeda Pharmaceutical Company Limited (4502)
                                                                      Consolidated Financial Statements for Fiscal 2011

                                                                                         (Millions of yen)
                                                              Fiscal 2010               Fiscal 2011
                                                        (As of March 31, 2011)    (As of March 31, 2012)
Liabilities
 Current liabilities
     Notes and accounts payable                                   83,065                      101,950
     Short-term loans                                              1,345                      241,411
     Other accounts payable                                      128,309                      122,081
     Accrued expenses                                            113,999                      170,163
     Income taxes payable                                         41,977                       24,097
     Reserve for employees’ bonuses                               43,520                       35,288
     Other reserves                                                9,471                       11,883
     Other current liabilities                                    14,909                       44,858
     Total current liabilities                                   436,596                      751,731
 Noncurrent liabilities
     Bond                                                                                    190,000
     Long-term loans                                               1,250                      111,393
     Lease obligations                                            15,137                       16,468
     Deferred tax liabilities                                    112,295                      301,758
     Reserve for employees’ retirement benefits                   16,805                       54,430
     Reserve for directors’ retirement allowance                   1,115                        1,265
     Reserve for SMON compensation                                 2,498                        2,386
     Asset retirement obligations                                  6,859                        6,457
     Other noncurrent liabilities                                 57,191                       69,276
     Total noncurrent liabilities                                213,150                      753,433
 Total liabilities                                               649,746                    1,505,165
Net Assets
 Shareholder’s equity
     Common stock                                                 63,541                       63,541
     Capital surplus                                              49,638                       49,638
     Retained earnings                                         2,272,067                    2,254,075
     Treasury stock                                               (1,014)                        (808)
     Total shareholder’s equity                                2,384,232                    2,366,446
 Accumulated other comprehensive income
     Unrealized gains/losses on available-for-sales
     securities                                                   73,944                       87,046
     Deferred gains/losses on derivatives under hedge
     accounting                                                       17                            2
     Foreign currency translation adjustments                   (366,604)                    (441,653)
     Total accumulated other comprehensive income               (292,643)                    (354,605)
 Stock acquisition rights                                            334                          504
 Minority interests                                               44,732                       59,522
 Total net assets                                              2,136,656                    2,071,866
Total liabilities and net assets                               2,786,402                    3,577,030




                                                   - 22 -
                                                                         Takeda Pharmaceutical Company Limited (4502)
                                                                        Consolidated Financial Statements for Fiscal 2011

(2) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income

Consolidated Statements of Income

                                                                                           (Millions of yen)
                                                              Fiscal 2010                 Fiscal 2011
                                                         (From April 1, 2010 to      (From April 1, 2011 to
                                                            March 31, 2011)             March 31, 2012)
Net sales                                                       1,419,385                     1,508,932
Cost of sales                                                     317,582                       433,194
Gross profit                                                    1,101,803                     1,075,738
Selling, general and administrative expenses
   Selling expenses                                                94,522                       125,193
   General and administrative expenses                            640,197                       685,518
   Total selling, general and administrative expenses             734,719                       810,711
Operating income                                                  367,084                       265,027
Non-operating income
   Interest income                                                  1,731                         1,903
   Dividend income                                                  4,460                         4,393
   Gains from foreign exchange                                      4,589                            
   Equity in earnings of affiliates                                   451                           302
   Rent income                                                      5,017                         4,970
   Gains on transfer of operation                                   2,270                         3,490
   Other non-operating income                                      11,886                         8,306
   Total non-operating income                                      30,405                        23,363
Non-operating expenses
   Interest expenses                                                1,335                         1,883
   Noncurrent assets removal costs                                  2,518                            40
   Impairment loss                                                  4,479                           234
   Donations and contributions                                      4,416                         5,324
   Losses from foreign exchange                                                                  2,382
   Other non-operating expenses                                    13,169                         8,198
   Total non-operating expenses                                    25,917                        18,060
Ordinary income                                                   371,572                       270,330
Extraordinary income
   Gain on sales of noncurrent assets                                                   *1      17,636
    Total extraordinary income                                                                  17,636
Extraordinary loss
   Restructuring costs                                                                  *2      35,489
   Total extraordinary loss                                                                     35,489
Income before income taxes and minority interests                 371,572                       252,478
Income taxes -current                                             154,214                       121,183
Income taxes -deferred                                            (32,888)                        4,024
Total income taxes                                                121,326                       125,207
Income before minority interests                                  250,247                       127,270
Minority interests in income                                        2,379                         3,109
Net income                                                        247,868                       124,162




                                                    - 23 -
                                                                          Takeda Pharmaceutical Company Limited (4502)
                                                                         Consolidated Financial Statements for Fiscal 2011

Consolidated Statements of Comprehensive Income

                                                                                            (Millions of yen)
                                                                Fiscal 2010                 Fiscal 2011
                                                           (From April 1, 2010 to      (From April 1, 2011 to
                                                              March 31, 2011)             March 31, 2012)
Income before minority interests                                    250,247                      127,270
Other comprehensive income
   Unrealized gains/losses on available-for-sale
   securities                                                       (17,099)                       13,088
   Deferred gains/losses on derivatives under hedge
   accounting                                                          (140)                          (16)
   Foreign currency translation adjustments                        (119,998)                      (74,882)
   Share of other comprehensive income of associates
   accounted for using equity method                                  1,540                           (66)
   Total other comprehensive income                                (135,697)                      (61,875)
Comprehensive income                                                114,550                        65,395
   [Comprehensive income attributable to]
   Comprehensive income attributable to owners of the
   parent                                                           112,555                        62,199
   Comprehensive income attributable to minority
   interests                                                          1,995                         3,196




                                                  - 24 -
                                                                 Takeda Pharmaceutical Company Limited (4502)
                                                                Consolidated Financial Statements for Fiscal 2011

(3) Consolidated Statements of Changes in Net Assets

                                                                                   (Millions of yen)
                                                      Fiscal 2010                 Fiscal 2011
                                                 (From April 1, 2010 to      (From April 1, 2011 to
                                                    March 31, 2011)             March 31, 2012)
Shareholder’s equity
  Common stock
     Beginning balance                                     63,541                        63,541
     Change during the period
         Total changes                                                                      
     Ending balance                                        63,541                        63,541
  Capital surplus
     Beginning balance                                     49,638                        49,638
     Change during the period
         Total changes                                                                      
     Ending balance                                        49,638                        49,638
  Retained earnings
     Beginning balance                                  2,166,303                     2,272,067
     Change during the period
         Dividends from surplus                          (142,103)                     (142,104)
         Net income                                       247,868                       124,162
         Disposal of treasury stock                            (2)                          (50)
         Total changes                                    105,764                       (17,992)
     Ending balance                                     2,272,067                     2,254,075
  Treasury stock
     Beginning balance                                       (980)                       (1,014)
     Change during the period
         Purchase of treasury stock                           (50)                          (16)
         Disposal of treasury stock                            17                           222
         Total changes                                        (34)                          206
     Ending balance                                        (1,014)                         (808)
  Total shareholder’s equity
     Beginning balance                                  2,278,502                     2,384,232
     Change during the period
         Dividends from surplus                          (142,103)                     (142,104)
         Net income                                       247,868                       124,162
         Purchase of treasury stock                           (50)                          (16)
         Disposal of treasury stock                            15                           172
         Total changes                                    105,730                       (17,786)
     Ending balance                                     2,384,232                     2,366,446




                                            - 25 -
                                                                        Takeda Pharmaceutical Company Limited (4502)
                                                                       Consolidated Financial Statements for Fiscal 2011

                                                                                           (Millions of yen)
                                                             Fiscal 2010                 Fiscal 2011
                                                        (From April 1, 2010 to      (From April 1, 2011 to
                                                           March 31, 2011)             March 31, 2012)
Other comprehensive income
  Unrealized gains/losses on available-for-sales
  securities
      Beginning balance                                           91,037                        73,944
      Change during the period
         Net change in other items than shareholders’
         equity during the period                                (17,094)                       13,103
         Total changes                                           (17,094)                       13,103
      Ending balance                                              73,944                        87,046
  Deferred gains/losses on derivatives under hedge
  accounting
      Beginning balance                                              157                             17
      Change during the period
         Net change in other items than shareholders’
         equity during the period                                   (140)                           (16)
         Total changes                                              (140)                           (16)
      Ending balance                                                  17                              2
  Foreign currency translation adjustments
      Beginning balance                                         (248,524)                     (366,604)
      Change during the period
         Net change in other items than shareholders’
         equity during the period                               (118,079)                      (75,050)
         Total changes                                          (118,079)                      (75,050)
      Ending balance                                            (366,604)                     (441,653)
  Stock acquisition rights
     Beginning balance                                               166                           334
     Change during the period
         Net change in other items than shareholders’
         equity during the period                                    168                           169
         Total changes                                               168                           169
      Ending balance                                                 334                           504
  Minority interests
      Beginning balance                                           43,407                        44,732
      Change during the period
         Net change in other items than shareholders’
         equity during the period                                  1,325                        14,789
         Total changes                                             1,325                        14,789
      Ending balance                                              44,732                        59,522
  Total net assets
      Beginning balance                                        2,164,745                     2,136,656
      Change during the period
         Dividends from surplus                                 (142,103)                     (142,104)
         Net income                                              247,868                       124,162
         Purchase of treasury stock                                  (50)                          (16)
         Disposal of treasury stock                                   15                           172
         Net change in other items than shareholders’
         equity during the period                               (133,820)                      (47,004)
         Total changes                                           (28,090)                      (64,790)
      Ending balance                                           2,136,656                     2,071,866




                                                   - 26 -
                                                                           Takeda Pharmaceutical Company Limited (4502)
                                                                          Consolidated Financial Statements for Fiscal 2011

(4) Consolidated Statements of Cash Flows
                                                                                             (Millions of yen)
                                                                   Fiscal 2010               Fiscal 2011
                                                              (From April 1, 2010 to    (From April 1, 2011 to
                                                                 March 31, 2011)           March 31, 2012)
Net cash provided by (used in) operating activities
   Income before income taxes and minority interests                   371,572                      252,478
   Depreciation and amortization                                        92,592                      127,967
   Impairment loss                                                       4,479                          234
   Amortization of goodwill                                             14,130                       22,227
   Interest and dividend income                                         (6,191)                      (6,296)
   Interest expenses                                                     1,335                        1,883
   Equity in losses (earnings) of affiliates                              (397)                         808
   Loss (gain) on sales and disposal of property, plant and
   equipment                                                                862                     (16,796)
   Loss (gain) on sales of marketable securities                         (1,108)                       (121)
   Decrease (increase) in notes and accounts receivable                 (20,261)                     13,782
   Decrease (increase) in inventories                                      (557)           *2        49,312
   Increase (decrease) in notes and accounts payable                     11,658                       1,631
   Other                                                                 (4,168)                     37,091
   Sub total                                                            463,945                     484,199
   Interest and dividends received                                        6,146                       6,299
   Interest paid                                                         (1,329)                     (1,851)
   Income taxes paid                                                   (141,824)                   (152,077)
   Net cash provided by (used in) operating activities                  326,938                     336,570
Net cash provided by (used in) investing activities
   Payments for purchases of marketable securities                       (3,658)                         (87)
   Proceeds from sales and redemption of marketable
   securities                                                            16,755                         368
   Payments for deposit of funds into time deposit                       (1,140)                     (2,190)
   Proceeds from redemption of time deposits                             17,000                       2,567
   Payments for purchases of property, plant and
   equipment                                                           (124,165)                    (61,904)
   Proceeds from sales of property, plant and equipment                     690                      21,058
   Payments for purchases of investment securities                         (396)                       (485)
   Proceeds from sales and redemption of investment
   securities                                                             4,217                         121
   Payments for acquisition of subsidiaries’ shares,
   resulting in consolidation scope change                                                      (1,040,017)
   Proceeds from acquisition of subsidiaries’ shares,
   resulting in consolidation scope change                                3,411                          
   Other                                                                (11,969)                    (13,394)
   Net cash provided by (used in) investing activities                  (99,255)                 (1,093,964)
Net cash provided by (used in) financing activities
   Net increase (decrease) in short-term loans                             (663)                    239,801
   Proceeds from long-term loans payable                                  1,250                     110,000
   Repayment of long-term debts                                          (1,250)                        (72)
   Proceeds from issuance of bonds                                                                 189,568
   Purchase of treasury stock                                               (50)                        (16)
   Dividends paid                                                      (142,055)                   (142,013)
   Other                                                                 (3,775)                     (3,479)
   Net cash provided by (used in) financing activities                 (146,544)                    393,789
Effect of exchange rate changes on cash and cash
equivalents                                                            (60,910)                     (54,859)
Net increase (decrease) in cash and cash equivalents                    20,230                     (418,463)
Cash and cash equivalents, beginning of period                         852,480                      872,710
Cash and cash equivalents, end of period                               872,710             *1       454,247



                                                     - 27 -
                                                                        Takeda Pharmaceutical Company Limited (4502)
                                                                       Consolidated Financial Statements for Fiscal 2011

(5) Notes regarding assumption of a going concern
     No events to be noted for this purpose.

(6) Changes in Basic Important Matters for Preparation of Consolidated Financial Statements
 1) Application of ― Accounting Standard for Earning Per Share‖ and others
     Effective from the current fiscal year, the company adopted new accounting standards, ―   Accounting
     Standard for Earnings Per Share‖ (Accounting Standards Board of Japan [ASBJ] statement No.2,
     published June 30, 2010) and ―    Guidance on Accounting Standard for Earnings Per Share‖ (ASBJ
     Guidance No.4, June 30, 2010). In accordance with the standards, the Company changed a part of the
     calculation method for fully-diluted earnings per share.
     These accounting standards apply to the previous year’s figure retrospectively, thus the figure of the
     previous year is adjusted. However this change had only minor impact to it.

(7) Change in Presentation
  (Consolidated Balance Sheets)
  1) Because the significance of the amount has increased, ―    Sales rights‖ which was included in ―Patent
     rights‖ in the previous fiscal year, is presented as a separate item from the current fiscal year.
     As a result, ¥1,988 million that was recorded as ―  Patent rights‖ on the consolidated balance sheets in
     the previous fiscal year has been included in ―  Sales rights‖.

 2) Because the significance of the amount has increased, ―   Long-term loans‖ which was included in
    ―Other noncurrent liabilities‖ in the previous fiscal year, is presented as a separate item from the
    current fiscal year.
    As a result, ¥1,250 million that was recorded as ― Other noncurrent liabilities‖ on the consolidated
    balance sheets in the previous fiscal year has been included in ―  Long-term loans‖.

(8) Additional Information
     For the accounting changes and error corrections made in after the beginning of the year ending March
     31, 2012, we have applied the ―Accounting Standard for Accounting Changes and Error Corrections‖
     (ASBJ Statement No.24 of December 4, 2009) and the ―         Guidance on Accounting Standard for
     Accounting Changes and Error Corrections‖ (ASBJ Guidance No.24 of December 4, 2009).




                                                    - 28 -
                                                                                  Takeda Pharmaceutical Company Limited (4502)
                                                                                 Consolidated Financial Statements for Fiscal 2011

 (9) Notes to Consolidated Financial Statements

     (Notes to Consolidated Balance Sheets)
                                                                                                   (Millions of yen)
                                                         As of March 31, 2011             As of March 31, 2012
 1. Accumulated depreciation
        Tangible noncurrent assets                                   448,970                        526,284
        Properties for lease                                           8,673                          9,232
 2. Pledged assets
        Assets pledged as collateral                                   4,148                           4,072
        Debt corresponding to pledged assets                           1,260                           1,260
 3. Guarantees
        Guarantees                                                     1,230                           1,021


     (Notes to Consolidated Statements of Income)
                                                                                                     (Millions of yen)
                                                              Fiscal 2010                       Fiscal 2011
 Selling, general and administrative expenses
 (1) Selling expenses
       Advertising expense                                           24,652                           27,067
       Sales promotion expense                                       43,265                           53,119
       Freight and storage expense                                    8,515                           11,724

 (2) General and administrative expenses
       Salaries                                                       83,959                         97,473
       Bonuses and provision for bonuses                              35,264                         30,870
       Retirement benefit expenses                                     9,750                         10,718
       Depreciation and amortization                                  63,385                         84,833
       R&D expenses                                                  288,874                        281,885

*1 Extraordinary income
  (Gain on sales of noncurrent assets)
   The income is from sales of underutilized real estates, mainly land.

*2 Extraordinary loss
  (Restructuring costs)
  The loss is from reorganization costs including the potential merger or liquidation of subsidiaries and reduction of
   workforce mainly in Europe and the U.S. The major item in the costs is the severance payments for the
   workforce.

     (Notes to Consolidated Statements of Cash Flows)
*1                                                                                     h
      Reconciliation of ending balance of cash and cash equivalents with balance of ―Cas and deposits‖ on consolidated
      balance sheets.
                                                                                                             (Millions of yen)
                                                                 Fiscal 2010                         Fiscal 2011
Cash and deposits                                                 217,897                              214,885
Time deposits with maturities exceeding three months                (1,140)                                (628)
Securities redeemable within three months                         655,953                              239,990
Cash and cash equivalents                                         872,710                              454,247

*2 ― Decrease (increase) in inventories‖ includes the amortization expense for Nycomed inventories’ step-up caused by
  the acquisition as 55,523 millions of yen.




                                                            - 29 -
                                                                                     Takeda Pharmaceutical Company Limited (4502)
                                                                                    Consolidated Financial Statements for Fiscal 2011

(Segment Information)
 1. Overview of business segments
  The Company manages its businesses by product/service type. The Company (or its subsidiary), serving as the
  headquarters of each business segment, creates comprehensive product/service strategies for the Japanese and overseas
  markets and implements such business activities in accordance with such strategies.
  The Company categorizes Ethical Drug, Consumer Healthcare and Other as three business segments. Since financial data
  are available separately for each of these segments, the segments are also used for reporting purposes. The financial results
  for all business segments are periodically reviewed by the Company’s board of directors, in order to make decisions on
  proper allocation of business resources and to evaluate the business performances of the respective segments.
  The Ethical Drug segment includes the manufacture and sale of ethical drugs. The Consumer Healthcare segment includes
  the manufacture and sale of OTC drugs and quasi-drugs. The Other segment includes the manufacture and sale of reagents,
  clinical diagnostics, chemical products and other businesses.

 2. Method of calculating sales and profit (loss), identifiable assets/liabilities and other items by business segment
  Accounting method for business segment reported is based on the accounting method in previous fiscal year and
  presentations on ―Changes in Significant Accounting policies in the Preparation of Consolidated Financial Statements‖.
  Profit by business segment reported are calculated based on operating income.
  Intersegment sales are recognized based on the market price and etc.

 3. Information on sales and profit (loss), identifiable assets/liabilities and other items by business segment
 Fiscal 2010 (April 1, 2010 - March 31, 2011)
                                                                                                                          Millions of yen
                                           Business Segments                                                         Amount reported on
                                                Consumer                             Total       Adjustments        consolidated financial
                               Ethical Drug    Healthcare             Other                                              statements
 Net sales
     Sales to outside
     customers                     1,267,436           60,254           96,328      1,424,017            (4,632)               1,419,385
     Intersegment sales
                                        3,084             128            7,042        10,254           (10,254)                         
     and transfers
            Total                  1,270,520           60,382          103,370      1,434,272          (14,886)                1,419,385
 Segment profit                      345,990           12,235           11,018        369,243            (2,159)                 367,084
 Segment assets                    1,599,363           30,575          156,821      1,786,759           999,643                2,786,402
 Other items
  Depreciation                        86,102              751            5,233        92,086               (623)                  91,464
  Amortization of                     13,667                                 463     14,130                                     14,130
  goodwill
  Investment to equity-
                                        1,447           2,893            1,875         6,215                                       6,215
  method affiliates
  Increase of property,
  plant and equipment                144,718              444            3,724       148,886                                    148,886
  and intangible assets




                                                             - 30 -
                                                                                         Takeda Pharmaceutical Company Limited (4502)
                                                                                        Consolidated Financial Statements for Fiscal 2011


Fiscal 2011 (April 1, 2011 - March 31, 2012)
                                                                                                                                Millions of yen
                                           Business Segments                                                               Amount reported on
                                                Consumer                                 Total         Adjustments        consolidated financial
                               Ethical Drug                              Other
                                               Healthcare                                                                      statements
Net sales
   Sales to outside
   customers                         1,358,802           61,689            93,053       1,513,545               (4,613)              1,508,932
   Intersegment sales
                                        3,202               192             6,737          10,130              (10,130)                     
   and transfers
          Total                      1,362,005           61,881            99,789       1,523,675              (14,743)              1,508,932
Segment profit                        243,754            11,816            11,705        267,275                (2,248)                265,027
Segment assets                       2,786,775           29,094           171,857       2,987,727              589,304               3,577,030
Other items
 Depreciation                         121,682               826             4,912        127,421                 (569)                 126,852
 Amortization of
 goodwill                              22,108                                   119       22,227                                      22,227
 Investment to equity-                  3,263             3,110             1,931           8,304                                        8,304
 method affiliates
 Increase of property,
 plant and equipment                 1,249,089              720             5,379       1,255,188                                   1,255,188
 and intangible assets

4. Major items for adjustments

                                                                                  Millions of yen
                          Net sales                                Fiscal 2010            Fiscal 2011
    Segment total                                                        1,434,272               1,523,675
    Rent income by the real estate subsidiary (Note1)                       (4,632)                  (4,613)
    Elimination of intersegment transactions                               (10,254)                 (10,130)
    Reported on consolidated financial statements                        1,419,385               1,508,932


                                                                                  Millions of yen
                            Profit                                 Fiscal 2010            Fiscal 2011
    Segment total                                                          369,243                  267,275
    Rent income by the real estate subsidiary (Note1)                       (2,309)                  (2,452)
    Adjustments to inventories                                                   (10)                    16
    Elimination of intersegment transactions                                      161                   188
    Reported on consolidated financial statements                          367,084                  265,027


                                                                                  Millions of yen
                            Assets                                 Fiscal 2010            Fiscal 2011
    Segment total                                                        1,786,759               2,987,727
    Company-wide assets (Note2)                                          1,004,643                  594,142
    Elimination of intersegment transactions                                (5,000)                  (4,839)
    Reported on consolidated financial statements                        2,786,402               3,577,030

   (Note1) It represents Rent income by the real estate subsidiary which is transferred to Non-operating profit/loss.

   (Note2) Company-wide assets consist of surplus operating funds (cash, deposits and marketable securities) in TPC group and long-
   term investments (investment securities) related to the parent company and holding companies in the United States and others. But in
   the long-term investments (investment securities), the assets related to the investments to maintain business relationship for each
   segment aren’t included in the company-wide assets.
                                                                - 31 -
                                                                                       Takeda Pharmaceutical Company Limited (4502)
                                                                                      Consolidated Financial Statements for Fiscal 2011


[Relative information]

1. Information regarding regions
Fiscal 2010 (April 1, 2010 - March 31, 2011)

(1)Net sales
                                                                                                                   Millions of yen
                                      Americas                                              Asia and other
         Japan                                                           Europe                                       Total
                                               United States                                   regions
                 721,326          496,435             483,410                 172,883                28,741              1,419,385

(2)Tangible noncurrent assets
                                                                          Millions of yen
         Japan                  Americas              Other                  Total
                 347,557              36,295                 23,629               407,480

Fiscal 2011 (April 1, 2011 - March 31, 2012)

(1)Net sales
                                                                                                                   Millions of yen
                                      Americas                                              Asia and other
         Japan                                                           Europe                                       Total
                                               United States                                   regions
                 733,438          464,399             419,489                 263,589                47,505              1,508,932

(2)Tangible noncurrent assets
                                                                          Millions of yen
         Japan                  Americas              Other                  Total
                 362,788              33,618                 92,296               488,702

2. Information by major clients

                                                                                                Millions of yen
                                                                                            Related business
                                               Fiscal 2010              Fiscal 2011
                                                                                                segment
   Mediceo Co., Ltd.                                  269,486                  272,284 Ethical Drug




                                                               - 32 -
                                                                               Takeda Pharmaceutical Company Limited (4502)
                                                                              Consolidated Financial Statements for Fiscal 2011

[Information on impairment loss in noncurrent assets by business segment]

   Fiscal 2010 (April 1, 2010 - March 31, 2011)
                                                                                                           Millions of yen
                                        Business Segments                                             Amount reported on
                                Ethical     Consumer                   Total        Adjustments      consolidated financial
                                                          Other                                           statements
                                 Drug      Healthcare
     Impairment loss               4,377                     102           4,479                                  4,479

   Fiscal 2011 (April 1, 2011 - March 31, 2012)
                                                                                                           Millions of yen
                                        Business Segments                                             Amount reported on
                                Ethical     Consumer                   Total        Adjustments      consolidated financial
                                                          Other                                           statements
                                 Drug      Healthcare
     Impairment loss                   33                    201            234                                      234

[Information on amortization of goodwill and unamortized balance by business segment]

   Fiscal 2010 (April 1, 2010 - March 31, 2011)
                                                                                                           Millions of yen
                                        Business Segments                                             Amount reported on
                                Ethical     Consumer                   Total        Adjustments      consolidated financial
                                                          Other                                           statements
                                 Drug      Healthcare
     Amortization of goodwill     13,667                     463       14,130                                    14,130
     Balance at end of period    216,938                     184      217,123                                   217,123

   Fiscal 2011 (April 1, 2011 - March 31, 2012)
                                                                                                           Millions of yen
                                        Business Segments                                             Amount reported on
                                Ethical     Consumer                   Total        Adjustments      consolidated financial
                                                          Other                                           statements
                                 Drug      Healthcare
     Amortization of goodwill     22,108                     119       22,227                                    22,227
     Balance at end of period    582,243                       14     582,257                                   582,257

[Information on negative goodwill by business segment]

   Fiscal 2010 (April 1, 2010 - March 31, 2011)
    No events to be noted for this purpose.

   Fiscal 2011(April 1, 2011 - March 31, 2012)
    No events to be noted for this purpose.




                                                         - 33 -
                                                                                     Takeda Pharmaceutical Company Limited (4502)
                                                                                    Consolidated Financial Statements for Fiscal 2011

(Tax Effect Accounting)
1. Major components of deferred tax assets and liabilities
                                                                                                                    (Millions of yen)
                                                                                       Fiscal 2010                Fiscal 2011
 (Deferred tax assets)
        Reserve for employees’ bonuses                                                  19,664                     11,688
        Research and development costs                                                 113,911                     98,317
        Enterprise tax                                                                   3,761                      2,010
        Inventories                                                                     14,845                     10,826
        Accrued expenses                                                                31,972                     36,140
        Unrealized profit on inventory                                                   8,220                     13,207
        Tax credits primarily for research and development costs                        51,668                     58,603
        Reserve for employees’ retirement benefits                                       5,583                      8,706
        Patents                                                                         44,516                     35,826
        Sales rights                                                                     9,709                     10,162
        Tax credit for net operating losses                                             24,662                     39,821
        Other                                                                           47,365                     58,372
    Deferred tax assets - subtotal                                                     375,877                    383,678
        Valuation allowance                                                            (34,025)                   (57,267)
    Total deferred tax assets                                                          341,852                    326,411

 (Deferred tax liabilities)
        Prepaid pension costs                                                          (13,353)                    (9,769)
        Unrealized gains on available-for-sale securities                              (36,373)                   (49,418)
        Undistributed earnings of foreign subsidiaries and affiliates                  (16,890)                   (11,797)
        Reserve for reduction of noncurrent assets                                     (12,413)                   (29,460)
        Tax effects from business combination of intangible assets                    (103,321)                  (275,024)
        Other                                                                          (15,327)                   (11,740)
    Total deferred tax liabilities                                                    (197,678)                  (387,209)

 Net deferred tax assets (liabilities)                                                 144,174                    (60,798)

        Net
 (Note) ― deferred tax assets (liabilities)‖ are included in the below items
         in the consolidated balance sheet.
             Current assets      ----Deferred tax assets                               229,909                    221,230
             Noncurrent assets----Deferred tax assets                                   26,560                     20,232
             Current liabilities     ----Others                                                                     (502)
             Noncurrent liabilities----Deferred tax liabilities                       (112,295)                  (301,758)


2. The effective income tax rates of the companies after application of deferred tax accounting differs from the statutory tax rate
   for the following reasons:
                                                                                                                                (%)
                                                                                       Fiscal 2010                Fiscal 2011
 Domestic statutory tax rate                                                                 40.9                       40.6
   (Adjustments)
   Expenses not deductible for tax purposes                                                  1.4                        3.3
   Increase or decrease in valuation allowance                                               1.1                        7.1
   Dividend income and other items permanently nontaxable                                   (0.1)                      (1.8)
   Tax credits primarily for research and development costs                                 (7.8)                     (10.8)
   Amortization of goodwill                                                                  1.4                        3.4
   Increase or decrease in tax effect related to the undistributed profits of
   overseas subsidiaries                                                                     0.1                        0.4
     Tax effect from change in tax rate by tax reform, etc.                                                            7.3
     Difference from consolidated subsidiaries in legally effective tax rate                (3.2)                       0.0
     Other                                                                                  (1.1)                       0.1
 Effective tax rate after application of deferred tax accounting                            32.7                       49.6




                                                              - 34 -
                                                                               Takeda Pharmaceutical Company Limited (4502)
                                                                              Consolidated Financial Statements for Fiscal 2011


3.Collection of Deferred tax assets and Deferred tax liabilities by the corporate tax rate changes, etc.
                                            The
      According to the promulgation of ― Law to Revise the Income Tax, etc., in Order to Construct a Tax
      System Addressing Changes in the Socio-Economic Structure‖ (Act No. 114 of 2011) and ―Spe Measures   cial
      to Secure the Financial Resources to Implement the Restoration from the Great East Japan Earthquake‖ (Act
      No.117 of 2011) on December 2, 2011, the effective tax rate which the company and domestic subsidiaries
      used for calculation of deferred tax assets and deferred tax liabilities has been changed from 40.9% for the
      previous fiscal year to 38.0% or 35.6% for the current fiscal year end. 38.0% is applied to assets and liabilities
      that are expected to be settled from FY 2012 to FY 2014 and 35.6% is applied to those to be settled from FY
      2015.
      As a result of this change, deferred tax assets (after offsetting deferred tax liabilities) have been decreased by
      ¥15,361 million, deferred tax income has been increased by ¥18,452 million, and unrealized gains on
      available-for-sale securities have been increased by ¥3,091 million.




                                                          - 35 -
                                                                                           Takeda Pharmaceutical Company Limited (4502)
                                                                                          Consolidated Financial Statements for Fiscal 2011

(Retirement Benefits)
1. Description of retirement benefits plan adopted
   The Company and its consolidated subsidiaries have adopted a corporate pension fund plan and a lump-sum retirement
   payment plan as its defined benefit system. In addition, the Company and its consolidated subsidiaries have also adopted a
   defined contribution pension plan.

2. Retirement benefit obligation
                                                                                                                          (Millions of yen)
                                                                                            Fiscal 2010                 Fiscal 2011
 (1) Projected benefit obligation (Note)                                                     (221,256)                   (263,691)
 (2) Pension value of plan assets                                                             229,610                     235,655
 (3) Funded status ((1)+(2))                                                                    8,355                     (28,036)
 (4) Unrecognized actuarial gains and losses                                                    9,753                          757
 (5) Unrecognized prior service cost                                                           (2,265)                       (110)
 (6) Net liability ((3)+(4)+(5))                                                               15,843                     (27,389)
 (7) Prepaid pension costs                                                                     32,648                      27,041
 (8) Reserve for employees’ retirement benefits ((6)-(7))                                     (16,805)                    (54,430)
 (Note) Some consolidated subsidiaries have adopted simplified methods in the calculating of their pension benefit liabilities.

3. Retirement benefit costs
                                                                                                                         (Millions of yen)
                                                                                            Fiscal 2010                 Fiscal 2011
 (1) Service cost (Note)                                                                        4,568                       5,303
 (2) Interest cost                                                                              4,499                       5,386
 (3) Expected return on plan assets                                                            (4,774)                     (4,792)
 (4) Recognized actuarial gains and losses                                                      9,733                       9,093
 (5) Amortization of prior service cost                                                        (2,853)                     (2,155)
 (6) Net retirement benefit costs ((1)+(2)+(3)+(4)+(5))                                        11,173                      12,834
 (7) Contributions paid to the defined-contribution pension                                     1,364                       1,830
 (8) Total ((6)+(7))                                                                           12,537                      14,664
(Note)
  1. The portion of cost for seconded employees which is borne by the companies at which such employees work is deducted.
  2. The service cost includes retirement benefit costs of consolidated subsidiaries that adopt simplified methods.

4. Items related to basis of calculation of retirement benefit obligation

                                                                            Fiscal 2010                            Fiscal 2011
   (1) Method of the projected benefits allocation to         Straight-line method                        Mainly Straight-line
       each fiscal year                                                                                   method
   (2) Discount rate                                          1.3% - 2.0%                                 1.0% - 3.9%
   (3) Expected rate of return on plan assets                 1.5% - 2.3%                                 1.5% - 3.6%
   (4) Recognition period of prior service cost               Generally five years (using the             Same as in the left column
                                                              straight-line method over a fixed
                                                              number of years within the average
                                                              remaining years of service when
                                                              obligations arise)
   (5) Recognition period of actuarial gains and losses       Generally five years (expensed from Same as in the left column
                                                              the period of occurrence, mainly
                                                              using the straight-line method over
                                                              a fixed number of years within the
                                                              average remaining years of service
                                                              when obligations arise)




                                                                - 36 -
                                                                                       Takeda Pharmaceutical Company Limited (4502)
                                                                                      Consolidated Financial Statements for Fiscal 2011

(Production, Orders and Sales)

1. Production
                                                                                (Millions of yen)
                                         Fiscal 2010                       Fiscal 2011
 Ethical Drug                          581,663        89.1               691,761         90.6
 Consumer Healthcare                    31,507         4.8                31,696          4.2
 Other Businesses                       39,650         6.1                39,968          5.2
 Total                                 652,821       100.0               763,425        100.0

2. Purchases
                                                                                (Millions of yen)
                                         Fiscal 2010                       Fiscal 2011
 Ethical Drug                          147,444        79.7               174,830         83.1
 Consumer Healthcare                    14,947         8.1                14,493          6.9
 Other Businesses                       22,627        12.2                21,028         10.0
 Total                                 185,018       100.0               210,351        100.0

3. Conditions of Orders
  The Takeda Group carries out production according to production plans, which are based primarily on marketing plans.
  Order production is carried out at certain businesses, but is not significant in the total amount of orders.

4. Sales
                                                                                (Millions of yen)
                                         Fiscal 2010                       Fiscal 2011
 Ethical Drug                           1,267,436       89.3%             1,358,802      90.0%
    [Japan]                             [578,456]      [40.8%]            [592,242] [39.2%]
    [Overseas]                          [688,979]      [48.5%]            [766,560] [50.8%]
 Consumer Healthcare                        60,254       4.2%                 61,689      4.1%
 Other                                      96,328       6.8%                 93,053      6.2%
 Adjustments                               (4,632)      (0.3%)               (4,613)     (0.3%)
 Amount reported on
 consolidated statement of              1,419,385      100.0%             1,508,932      100.0%
 income
 [Royalty Income in Total]                [41,370]      [2.9%]              [42,477]      [2.8%]

(Per Share Information)
1. Net assets per share
                     Fiscal 2010                                            Fiscal 2011
                                      2,649.69 yen                                              2,548.53 yen

(Note) Net assets per share were calculated on the basis of the following data.
                                  Item                                       Fiscal 2010         Fiscal 2011
Total net assets on consolidated balance sheet (million yen)                  2,136,656           2,071,866
Net assets attributable to common stock (million yen)                         2,091,589           2,011,841
Main item of differences (million yen)
       Stock acquisition right                                                      334                 504
       Minority interests                                                        44,732              59,522
Number of shares of common stock outstanding (thousand shares)                  789,666             789,666
Number of shares of common stock as treasury stock (thousand shares)                295                 252
Number of shares of common stock used as basis for calculation of net
                                                                                789,371             789,414
assets per share (thousand shares)


2. Earnings per share
Fiscal 2010 (April 1, 2010 - March 31, 2011)           Fiscal 2011 (April 1, 2011 - March 31, 2012)
Earnings per share                      314.01 yen     Earnings per share                      157.29 yen
Fully diluted earnings per share        313.96 yen     Fully diluted earnings per share        157.26 yen

                                                                - 37 -
                                                                                   Takeda Pharmaceutical Company Limited (4502)
                                                                                  Consolidated Financial Statements for Fiscal 2011

(Note) Earnings per share were calculated on the basis of the following data.
                                 Item                                       Fiscal 2010     Fiscal 2011
Earnings per share
 Net income on consolidated statement of income (million yen)                  247,868          124,162
 Amounts not attributable to common stock (million yen)                                              
 Net income attributable to common stock (million yen)                         247,868          124,162
 Average number of shares of common stock during the period
                                                                               789,376          789,399
 (thousand shares)
Fully diluted earnings per share
 Adjustment to net income (million yen)                                                              
 Increase in number of common stocks (thousand shares)                              109             135


(Significant Subsequent Events)

Fiscal 2010 (April 1, 2010 - March 31, 2011)

   No events to be noted for this purpose.


Fiscal 2011 (April 1, 2011 - March 31, 2012)

1. Acquisition of URL Pharma
   The Company entered into a definitive agreement with URL Pharma, Inc. ―      URL Pharma‖ that the Company’s
   wholly-owned subsidiary, Takeda America Holdings, Inc. will acquire URL Pharma headquartered in
   Philadelphia, Pennsylvania, the U.S. for an upfront payment of $800 million. Pending the satisfaction of
   customary closing conditions, the deal is expected to close within 60 days. Upon completion of the acquisition,
   URL Pharma will be managed by Takeda Pharmaceuticals U.S.A., Inc. ―       TPUSA‖ headquartered in Deerfield,
   Illinois, the U.S.

 (1) Purpose of the acquisition
   TPUSA is currently selling Uloric (generic name; febxostat) for the gout treatment in adults. The completion of
   this acquisition will allow it to provide multiple treatment options to manage acute and chronic gout in the U.S.
   through adding URL Pharma’s leading product Colcrys (generic name; colchicines) used to treat and prevent
   gout flares to its product portfolio. This means the acquisition will strengthen TPUSA’s offerings in the gout
   treatment drug market. With expected continued growth of Colcrys after its estimated 2012 net sales of more
   than $550 million, the acquisition will contribute to the Company’s revenues, operating income, and cash flow
   beginning in FY 2013.

 (2) Profile of URL Pharma
   1) Corporate name: URL Pharma, Inc.
   2) Location of executive offices: Philadelphia, Pennsylvania, the U.S.
   3) Representative: Richard H. Roberts
   4) Number of employees: Approximately 880 (including contracted sales force of approximately 350 individuals)
   5) Common Stock Equity: $1,000
   6) Shares: Non-listed
   7) Main business: Production, marketing, research and development of medical products

 (3) Acquiring company: Takeda America Holdings, Inc.

 (4) Shareholders of URL Pharma: Elliott Associates L.P., Momar Corporation and Dr. Richard H. Roberts

 (5) Number of common and preferred stock: equivalent to common stock outstanding shares: 356,669

 (6) Payment: Cash
                                                             - 38 -
                                                                              Takeda Pharmaceutical Company Limited (4502)
                                                                             Consolidated Financial Statements for Fiscal 2011



 (7) Acquisition amount: $800 million (The Company will make future performance-based contingent earn out
     payments to URL Pharma’s current owners during certain period beginning in 2015.)

 (8) Percentage of total shares
    100%

 (9) Planned date of completion: Q1 of FY2012

2. Correction for transfer pricing taxation
   On June 28, 2006, the Company received a notice of correction for transfer pricing taxation from the Osaka
   Regional Taxation Bureau (ORTB). ORTB concluded that taxable income of the Company should be corrected
   in relation to product supply and license transactions for Prevacid between the Company and TAP over the six
   fiscal years from the year ended March 31, 2000 through the year ended March 31, 2005. The total taxable
   income assessed was ¥122.3 billion and the additional tax due, including local and other taxes, was ¥57.1 billion.
   The Company paid these additional taxes in July 2006. However, in protest against this corrective action, Takeda
   filed a written objection with ORTB on August 25, 2006.
   On April 6, 2012, the Company received a notice that the ORTB has concluded the reinvestigation with a
   decision to reduce the original assessment of ¥122.3 billion in taxable income by the amount of ¥97.7 billion. On
   May 7, 2012, the Company submitted a new request for reconsideration to the Osaka Regional Tax Tribunal,
   petitioning for the cancellation of the portion of the original correction that still remains after the conclusion of
   ORTB’s reinvestigation.




                                                         - 39 -

				
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