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Sales Organization (CSO) in Malaysia. Astellas Pharma Singapore will quickly build up its business capabilities in both Singapore and Malaysia. 

## Initiatives to Pursue Operational Excellence and Enhance Asset Efficiency 

To realize sustainable growth while responding to a rapidly changing business environment, the Company is continu- ously working to pursue operational excellence and enhance asset efficiency. 

In September 2013, we signed an agreement with Accenture Japan Ltd. on Business Process Outsourcing in regard to certain Group-wide operations spanning multiple business areas of the Company and its domestic subsidiar- ies. By working with a specialist external partner, we aim to obtain high quality services and promote efficiency in these operations, while allocating resources to businesses that contribute to the Company’s competitive advantage. 

In December 2013, we entered into an agreement with Mitsui Fudosan Co., Ltd. to comprehensively transfer the real estate owned by the Company and domestic group company Lotus Estate Co., Ltd. to Mitsui Fudosan. The transfer was carried out on March 31, 2014. 

In May 2014, we consolidated functions including Clinical Development, QA (Quality Assurance) & RA (Regulatory Affairs) and Pharmacovigilance, and relocated them from Itabashi-ku, Tokyo to an office building close to Astellas’ headquarters in Nihonbashi, Chuo-ku, Tokyo. 

In the areas of production and technology, the Company will work to enhance its own capabilities while also actively pursuing alliances with external partners. By these means, we will work to establish a stable production system that will efficiently realize a “steady supply of high-quality drugs” in a changing environment. As part of these efforts, Astellas Pharma Tech Co., Ltd., the Company’s production subsid- iary, concluded a definitive agreement in December 2013 with Nichi-Iko Pharmaceutical Co., Ltd. under which  Nichi-Iko Pharmaceutical Co., Ltd. would succeed to the Fuji Plant business of Astellas Pharma Tech Co., Ltd. The succession of this business took place and was completed on April 1, 2014. 

In December 2013, we reached agreement with Taiho Pharmaceutical Co., Ltd. (“Taiho”) to transfer assets related to fermentation research owned by the Company to Taiho, 

and entered into a transfer agreement with Taiho. We made a decision to cease in-house fermentation research as part of the reshaping of our research framework in order to enhance our ability to generate innovative drugs (as announced in May 2013), and considered a transfer of our fermentation research-related assets to a third party. With this decision, we will implement a strategic reallocation of resources related to research and development that were previously allocated to fermentation research to further enhance our ability to generate innovative drugs. 

## Consolidated Forecasts for Year Ending March 31, 2015 (Fiscal 2014) (Announced May 2014) 

The Company’s consolidated business forecasts for fiscal 2014 are presented on a core basis. Certain items reported in financial results under IFRS on a full basis that are deemed to be non-recurring items by the Company are excluded as non-core items from these business forecasts on a core basis. 

## Fiscal 2014 Forecasts (Core Basis) 

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We project an increase in sales and higher earnings at every level. We assume the yen will weaken against the euro compared with fiscal 2013, and we expect foreign exchange factors to have an ¥11.8 billion positive impact on sales and a ¥13.2 billion positive impact on core operating profit. 

## Sales 

In fiscal 2014, we forecast a 4.6% year-on-year increase in sales to ¥1,192.0 billion. 

