(130A) Stock Price

Veritas In Silico specializes in creating small-molecule drugs that target messenger RNA (mRNA). The company conducts joint drug discovery with pharmaceutical companies using its ibVIS platform, which integrates computer analysis with experimental techniques. Using proprietary tools such as the RNA structure analysis software "MobyDick" and a quantified screening method (qFRET), the company executes a complete drug discovery process—from identifying target structures on mRNA through to generating drug candidate compounds.

The company's primary customers are major pharmaceutical companies and drug discovery firms, with multiple ongoing collaborative research projects including Toray, Shionogi Pharma, Lacuoria Drug Discovery, and Takeda Pharmaceutical. Revenue consists of upfront contract fees, annual research support payments, research and development milestones, and future royalties. As of the end of 2024, the company has received approximately 843 million yen, with additional revenue potential in the short, medium, and long term from existing contracts.

The business is centered on a single segment: the drug discovery platform. Its strength lies in providing one-stop services covering target exploration, screening, hit validation, and lead optimization. Additionally, the company is developing its own pipeline of nucleic acid drugs (ASO) and mRNA therapeutics. From fiscal 2025 onward, the company plans to transition to a hybrid model combining its platform business with proprietary pipeline assets.

The company has set a medium- to long-term goal of establishing itself as a specialty pharmaceutical company by 2030. To achieve this, it plans to transition to a hybrid model by strengthening the revenue base of its drug discovery platform business while ramping up in-house pipeline creation from fiscal 2025 onward. Specifically, the company will secure multiple revenue streams including upfront payments, annual research support fees, development milestones, and future royalties. Based on approximately 843 million yen received as of end-2024, the company has set new contract targets for fiscal 2025 (aiming for four contracts in total, including three from companies currently under confidentiality agreements, with progress managed according to KPIs). The company is committed to management that enhances shareholder value over the long term.

Priority investment areas are small-molecule drug discovery targeting mRNA and nucleic acid therapeutics. On the technology front, the company focuses on its proprietary in silico platform "ibVIS" as the core, combined with RNA structure analysis software (MobyDick) and quantitative screening methods (qFRET), enabling one-stop provision from target identification to lead optimization. As a differentiation strategy, the company leverages its ability to identify diverse target structures and expertise accumulated through collaborative research with multiple pharmaceutical companies, creating competitive advantages in target discovery capability and project execution compared to rivals. The company also advances patent filings, international expansion, and confidentiality of software and databases to secure technological exclusivity.

For new market development and business expansion, the company will strengthen collaboration in European markets alongside traditional domestic business development to accelerate joint drug discovery contract acquisition. The business model will expand the platform approach in the near term, then shift to in-house nucleic acid and small-molecule pipeline creation from 2025 onward, with a KPI of one in-house candidate per year starting in 2025. The company is also investing in organizational capabilities, functions, and talent required of a specialty pharmaceutical company, building a structure that spans from research and development through post-launch operations to ensure sustainable growth and enhanced shareholder value. The company aims for growth through both steady contract execution and in-house pipeline development.

For technological innovation, the company will continuously strengthen foundational technologies through collaborative research with universities and advance internal software and database sophistication. Specifically, it will execute algorithm improvements for enhanced analytical accuracy, standardization of experimental methods, and prioritization of candidate compounds with an eye toward reducing time to clinic and lowering costs. Furthermore, through active patent filings and international expansion in collaboration with patent attorneys and the recruitment and development of in-house talent, the company will strengthen technological competitiveness and maintain exclusivity, building a framework to responsibly deliver pharmaceuticals to society in the future.