Annual Report 2012

5 Nipro Corporation Annual Report 2012
there are three measures that we need to do.
The first is to utilize our company’s strengths
and secure top-class global market share. In
order to drive our advantages in economies
of scale and diversity as a manufacturer of
medical equipment and pharmaceuticals, it
will be necessary to secure a healthy share of
the market. We are a manufacturer of medical
equipment and, at the same time, we are putting
our efforts into generic drugs. What this makes
possible is product ideas such as the pre-filled
syringe (a product where the drug has already
been filled inside the syringe), a kind of “collaborative
product” where our medical equipment and
pharmaceutical products have been combined in
a product. Moreover, we have begun construction
of new plants in India and China, locations where
the economy is experiencing rapid growth, with
the aim of starting production during fiscal year
2012. We are also planning to put our efforts into
reinforcing our local direct sales model, in order
to supply products to meet the rapidly growing
demand in the field of dialysis centered on Asia.
Furthermore, the Nipro Pharma has established a
generic drug manufacturing base in Vietnam and
the plant is scheduled to start mass-production
of injection drugs in spring 2015.
The second issue is for the company to
create a system where new products can be
brought to the market in a speedy manner. In
order to make this happen, the company is
committed to M&A should this be required. In
July of last year Nipro entered into an agreement
to form a strategic business alliance with
German company Sandoz regarding generic
drug products. In February of this year, Nipro
acquired shares in 4 medical glass manufacturing
companies based in Germany, such as MGlas AG
(currently Nipro Glass Germany AG), etc. Going
forward with an accurate grasp of the needs in
the medical workplace, our aim is to utilize the
merits of the high yen to identify and acquire
corporations where we can realize high levels of
synergy.
Moreover, it is also important to invigorate
the organization to be able to bring new products
to the market in a speedy manner. When an
organization grows, vertical divisions and sectionalism
are inevitable to a certain degree and this
in turn leads to waste and an inability to make
rapid and accurate decisions. In order to improve
the horizontal integration across the Nipro Group,
we will create several committees horizontally
across the whole group that will promote product
planning, the development of manufacturing
technologies, the procurement of raw materials
and coordination between manufacturing plants.
Furthermore, it is important that the Nipro
Group builds a product planning and development
system that draws upon feedback from
our sales network in order to provide rapid
solutions to meet the needs of the medical
workplace. In real terms, this means reaching
beyond Japanese patients and striving to hear
the direct opinions of patients, medical professionals
and people connected with medical institutions
all over the world, as we move forward
with planning and developing products that meet
the needs of the medical workplace. Moreover,
we will select specific medical ventures all over
the world in which to invest as part of our efforts
to develop a system whereby we can respond to
future high-tech medical needs.
The third issue is how we go about creating
a corporate constitution that can ensure that the
corporations and facilities that we have invested
and acquired in turn a profit steadily. In one way,
ensuring a profit from an investment is persistently
challenging if your goal is to outstrip your
investment, but we feel strongly that this is the
way for us to achieve our goals.
The Nipro Group is actively developing its
business overseas and one important issue in this
regard is the risk posed by currency exchange
fluctuations. By diversifying into multiple markets
and dealing in a variety of currencies, we work
to spread and reduce that risk. Going forward
we intend to continue the approach of having
our local production plants supply our local sales
agents directly.
Dividend Policy
Based upon the Nipro Group dividend policy
of a 50% payout ratio on a unitary basis, our
dividend for the fiscal year was ¥23.5 per
share.
One of the most important management policies
of the Nipro Group is the return of profits and