Revising our forecasts: Core profits up, but Xtandi contribution disappearing

研报英文原文证据摘录

Revising our forecasts: Core profits up, but Xtandi contribution disappearing

Global Markets Research

1 July 2026Astellas Pharma

4503.T 4503 JP / EQUITY: JAPAN PHARMACEUTICALS

RatingRevising our forecasts: Core profits up, but Xtandi

Remains Neutralcontribution disappearing

Target price JPY 2,500Xtandi contribution disappearing, new drug contributions likely to take Remains

time

Closing price JPY 2,175.0We retain Neutral rating, think it will take time for new drugs to contribute to 30 June 2026

earnings

We revise our earnings forecasts for Astellas Pharma in view of 26/3 Q4 results. We factor Implied upside +14.9%

in: (1) drug price revisions in Japan and drug price initiatives in the US, (2) settlements

related to generics, and (3) cost savings. We revise our risk-free rate assumption from

1.5% to 2.0% and our WACC assumption from 4.4% to 4.9%, to reflect current conditions.

We maintain our DCF-based target price of ¥2,500 and our Neutral rating. The company Relative performance chart

has been making steady progress with the development of promising new drugs, but we

think it will take some time for these to contribute to earnings.

What's new: We expect reduction in US drug price for Xtandi to spread to private

health insurance

(1) Xtandi (prostate cancer): We expect the benefits of IRA reforms to disappear as the

drug price is reduced under the IRA from 1 January 2027. The price reduction covers

Medicare (covering patients aged 65 and older), but we also factor in the possibility that

reductions will spread to private health insurance. We lower our sales forecasts from

¥964.4bn to ¥935.0bn for 27/3 and from ¥812.9bn to ¥675.0bn for 28/3 as we think a

decline in sales is unavoidable given the impending patent expiration in the US in August

2027.