A Message from our CEO

AN INTERVIEW WITH KAZUHIRO HATANO

Strengthening our credibility as a trusted partner in new drug development through strategic proposals aligned with client needs and reliable execution 

Driving a solid recovery through enhanced global business development and efficient clinical development strategies

How would you summarize the results of the 21st fiscal year?

Consolidated revenue declined year-on-year, and operating losses widened, resulting in a challenging performance. Although we secured commitments for several large-scale global clinical trials spanning the United States, Europe, and Australia, the start of these studies was delayed due to factors such as government shutdowns. As a result, revenue in the U.S. and Europe fell significantly short of initial expectations, creating strong headwinds for our U.S. business, which had previously been on a steady growth trajectory.

In Japan, despite the continued challenges posed by drug lag and drug loss, revenue increased year-on-year. In addition, we secured multiple projects from domestic and international pharmaceutical and biotech companies in China and Taiwan.

Our sales teams across regions have strengthened their collaboration, leading to an increase in global study awards involving multiple countries. We believe this reflects the progress of one of our key strategic priorities: strengthening our global business development capabilities. We are also focused on building a more agile and responsive commercial organization that can adapt quickly to a rapidly changing market environment, enabling more efficient decision-making.

Furthermore, to address the increasing complexity of clinical trials, we expanded training programs for specialized talent and advanced our internal infrastructure for AI utilization. Through these initiatives, we aim to deliver higher-quality and more efficient clinical development services.

How do you view the current trends in the industry amid ongoing global economic uncertainty?  

Although the global economy remains uncertain due to geopolitical risks, inflation, and currency fluctuations, we believe the pharmaceutical industry continues to demonstrate strong growth potential. In particular, drug discovery activity among biotech companies in the U.S. remains robust, driving increased demand for new therapeutic development. We have secured several large-scale projects in this market and are working to further strengthen our business foundation.

In Japan, drug loss remains a persistent issue. While the government continues to pursue regulatory reforms, meaningful resolution will take time. Under these circumstances, our Drug Development Consulting Division provides market analysis, development strategy planning, and regulatory consulting services, including submissions and consultations with authorities. Working closely with our teams in the U.S., Europe, and Asia, we actively support emerging overseas biotech companies seeking to enter the Japanese market.

Digital technologies—including AI and decentralized clinical trials—are accelerating efficiency in drug development. We are advancing service development that incorporates these technologies, enabling higher-quality and faster clinical trial design and execution. We believe that adopting cutting-edge technologies will be essential to strengthening our competitive advantage globally.

What is your outlook for the 22nd fiscal year?

In the U.S. and Europe, we expect delayed large-scale projects to begin, which should contribute significantly to revenue. We are also making progress in initiatives to improve clinical trial efficiency through digital technologies, enhancing our ability to deliver high-value-added services and strengthen competitiveness. In Japan and across Asia, we will continue to reinforce global business development activities, aiming to drive recovery through new project acquisition and deeper engagement with existing clients.

At the same time, we remain mindful of market risks, including ongoing drug loss issues in Japan, regulatory tightening in the U.S., and developments related to drug pricing systems. Even in this challenging environment, Linical must continue to demonstrate its core strength—providing attentive, client-focused support—and reliably contribute to new drug development.

Additionally, we will optimize resource allocation by improving utilization rates and strengthening cost management through a more efficient management structure. By establishing a foundation for sustainable profitability, we aim to reinforce our ability to achieve stable performance recovery.

Lastly, can you give us a message for shareholders, please?

Since our founding, Linical has pursued the vision of becoming the “Strongest CRO,” supporting new drug development in oncology, CNS, and immunology, and establishing our position as a global CRO. These achievements have been made possible through the warm support of our shareholders and the unwavering dedication of our employees, for which I express my deepest gratitude.

Although the 21st fiscal year was challenging due to changes in the business environment and external factors, we view this period as an opportunity to regain growth. We are strengthening our commercial organization, optimizing utilization rates, and reinforcing cost discipline to drive recovery from the 22nd fiscal year onward.

We will continue to refine the expertise and capabilities we have built in clinical development and drug discovery support, while integrating new technologies such as AI. As a true partner in advancing medical innovation, we remain committed to delivering hope to patients and their families around the world.

We respectfully ask for your continued long-term support of Linical.