Source of Our Growth

ALCs and RDCs: State-of-the-Art Distribution Centers

The ALCs (Area Logistics Centers) and RDCs (Regional Distribution Centers), which are state-ofthe-art distribution centers, are vital distribution bases that enable the MEDIPAL Group to fulfill its role in social infrastructure. We are working to ensure reliable delivery with no stock-outs or errors, and to maintain solid distribution channels that remain in operation even during emergencies, with the aim of optimizing the supply chain as a whole.
ALCs are distribution bases for the Prescription Pharmaceutical Wholesale Business. Located close to our customers, these centers have a full line of over 20,000 items in stock, including pharmaceuticals, medical equipment, and clinical diagnostics. We deliver directly to customers, which shortens the lead time from receipt of order to delivery of goods. Currently, this system is in operation at 12 locations in Japan, with plans to newly establish the Hanshin ALC. This will complete a distribution platform for prescription pharmaceuticals covering the entire country.
RDCs, which are distribution bases for the Cosmetics, Daily Necessities and OTC Pharmaceutical Wholesale Business, are operating in 16^* locations in Japan. RDCs provide efficient, low-cost delivery of over 50,000 items necessary for daily life to suit a range of retail business formats and sales floors.

^* As of September 30, 2022

Features of ALCs

^＊Inspection by individual scans: A method shortening product inspection time by switching from the conventional method of reading packing slips to scanning information for individual products from barcodes on the delivery boxes.

^＊PRESUS®: Pharmacy Real-time Support System: An all-in-one system that functions together with ALCs to conduct automatic ordering and inventory management based on demand forecasts. This system supports the various operations of dispensing pharmacies.

^＊McHIL® (Mediceo Hospital Innovative Logistics): A system that applies ALC functions and know-how to logistics in hospitals. Supports improvement of efficiency in hospital logistics operations.

Features of RDCs

^＊SPAID (Super Productivity Advanced Innovative Distribution): A proprietary developed total-management and operation system for next-generation logistics centers based on the adoption of AI, cutting-edge robot technology, or MUPPS. This system yields twice the volume of conventional systems with the same number of workers.

Positioning and Competitive Advantage of New Businesses

The MEDIPAL Group’s new businesses are built on existing business infrastructure. Taking full advantage of our strengths such as a nationwide distribution platform and the expertise of our human resources, we create markets based on meeting the needs of pharmaceutical companies, medical institutions, and doctors and other medical professionals. We focus on new business activities in the areas of PFM^®, which launched in 2011, the provision of proper information by ARs,^* PMS^* (post-marketing surveillance), digital businesses that integrate face-to-face relationships with digital communication, and overseas businesses.
The competitive superiority of our new businesses lies in our ability to identify projects with potential at an early stage then put in place a business model capable of not only achieving commercial success, but also social value. We are able to do this using our keen business insight and ability to execute.

^* AR (Assist Representatives): An internal designation given to Marketing Specialists (salespeople for the Prescription Pharmaceutical Wholesale Business), pharmacists and others who have passed the MR qualification exam.

^* PMS (Post Marketing Surveillance): Surveillance that the Japanese government requires companies to conduct after launching pharmaceuticals to verify their quality, efficacy, and safety. PMS consists of early post-marketing phase vigilance and Post-Marketing Surveillance.

Appropriate information provision by ARs

ARs promote the appropriate use of pharmaceuticals by providing the right information to medical institutions. In addition, they use their advanced specialized knowledge to secure contracts for information collection and provision with major pharmaceutical companies and the like. ARs are also involved in distribution that requires expertise and specialization, such as for orphan drugs and regenerative medicines.

PFM^® (Project finance & marketing)

PFM^® is a business in which MEDIPAL HOLDINGS CORPORATION invests in the development of new drugs of pharmaceutical companies in order to achieve returns on investment after these drugs are launched (project finance), and sell and distribute them to medical institutions preferentially (marketing).

PMS (Post-marketing surveillance)

PMS consists of early post-marketing phase vigilance and post-marketing surveillance conducted after the sale of pharmaceuticals and medical equipment in order to ensure their quality, efficacy, and safety. The MEDIPAL Group handles a full range of contracted PMS operations from protocol design to report preparation.

Digital businesses

Having developed strong partnerships with ICT companies that possess leading technologies, we are moving forward with DX (digital transformation) of patient-centered healthcare and information provision to medical institutions.

Overseas businesses

We are steadily securing a foothold for overseas expansion. Since our investment in a Chinese pharmaceutical wholesaler in 2009, we have accumulated overseas business experience and know-how, and cultivated human resources.

Contribution of new business initiatives to business performance

Under our “2022 MEDIPAL Medium-Term Vision: Change the Oroshi Future ― Innovation for the Future,” we have shifted new businesses from the “creation” to the “expansion” stage. As a result, they are beginning to steadily generate profit and contribute more to business performance every year.
Gross profit from new business was ¥9.1 billion in the fiscal year ended March 31, 2022. In the 2027 MEDIPAL Medium- Term Vision “Change the Oroshi Forever ― Constant Innovation,” new businesses will contribute to increasing earnings as one of our key growth drivers.

Significance of PFM^® and Main Products
By supporting the development of orphan drugs, we contribute to improving the quality of life for patients and their families.

The PFM^® business model encompasses the development and stable supply of orphan drugs, thus embodying the MEDIPAL Group’s social mission of contributing to patients suffering from rare diseases and their families. Going forward, we will continue to support the development and stable supply of orphan drugs, for which the number of patients is small.

Providing Groundbreaking Services Unique to MEDIPAL

To continue to respond to diversified social needs, we are collaborating with companies in various business fields, as well as medical institutions and local governments, to create unprecedented business models. In addition to the MEDIPAL Group’s network of pharmaceutical companies and medical institutions, we leverage our special capabilities, such as our nationwide distribution network and technology for special temperaturecontrolled distribution of pharmaceuticals, to develop groundbreaking services unique to the Group.

Main Initiatives with Partners

• SBI Investment Co., Ltd.

  We jointly established a CVC (corporate venture capital) fund called MEDIPAL Innovation Fund in 2021. Leveraging SBI Investment’s accumulated experience in nurturing venture businesses, we have invested in startup companies where synergies with MEDIPAL’s businesses can be expected.

• H.U. Group Holdings, Inc.

  We entered into a strategic business alliance in the medical and healthcare sectors in 2020. We aim to realize ESG/SDGfriendly low-environmental burden operations through the sharing of ordering systems, warehouse infrastructure, and other logistics functions. In addition, the initiative aims to promote the utilization of medical and healthcare information and exploration of projects in the field of regenerative medicines.

• Mitsubishi Logistics Corporation

  We entered into a business alliance in 2019. We aim to establish an optimal pharmaceutical distribution system covering all processes from the time products leave the manufacturer’s facility until they reach patients. In addition, the initiative aims to establish a platform for distribution under strict temperature control using DP-Cool, a refrigerated pharmaceutical transportation service compliant with GDP (Good Distribution Practice) guidelines.

• MTI Ltd.

  We entered into a capital and business alliance in 2016. Various projects including promotion of the Luna-Luna Medico service, which connects women with physicians, and the maternal and child health handbook app “Boshi-mo” operated by MTI. MTI’s subsidiary CARADA medica Inc. also promotes the spread of “CARADA online medical consultation” and the CARADA electronic medication history system, “Solamichi.”

• Medical Data Vision Co., Ltd.

  We entered into a capital and business alliance in 2006. Creation of the medical information portal site “Clinical Cloud by MEDIPAL” began in collaboration with Medical Data Vision subsidiary Doctorbook Inc.

Main Initiatives in Building Partnerships

• 2006 –
  Improving the efficiency of medical care

  We entered into a capital and business alliance with Medical Data Vision Co., Ltd. in 2006. We began joint operation of the medical information portal site “Clinical Cloud by MEDIPAL” with Medical Data Vision subsidiary Doctorbook in 2019.

• 2016 –
  Improving health

  We entered into a capital and business alliance with MTI Ltd. We are working to increase market share by expanding MTI’s “Luna-Luna Medico” service, which connects women with physicians, and the maternal and child health handbook app “Boshi-mo.”

• 2019 –
  Stable supply of pharmaceuticals

  We entered into a capital and business alliance with Mitsubishi Logistics Corporation. We aim to establish an optimal pharmaceutical distribution system covering all processes from the time products leave the manufacturer’s facility until they reach patients.

• 2020 –
  Integration of distribution functions

  We entered into a strategic business alliance agreement with H.U. Group Holdings, Inc., in the medical and healthcare sectors.

• 2020 –
  Enhancing productivity throughout the supply chain

  We are engaged in a joint initiative with major dispensing pharmacy groups and drugstores with the aim of creating a new pharmaceutical distribution model to support achievement of the SDGs.

• 2021 –
  Making active investments for growth

  We jointly established MEDIPAL Innovation Fund with SBI Investment Co., Ltd.

Building Digital Healthcare Platforms

Our digital healthcare solutions, which integrate face-to-face relationships with digital communication, in the medical and healthcare sectors provide numerous services that benefit not only medical institutions but also the health of patients and the general public.
The trend toward the use of digital technology in medicine and personal health monitoring is expected to accelerate. We are focusing on building digital healthcare platforms to make the MEDIPAL Group a player in that area.

Building Digital Healthcare Platforms: Integrating Face-to-Face Relationships with Digital Communication

Shared Values

As the basis for decision making in daily operations, we have set forth three shared values - integrity, morality and a sense of mission - in addition to realizing our management philosophy.

Integrity

Always take a sincere approach and behave with fairness and honesty

Morality

Act with general common sense as well as in compliance with laws and industry rules

Sense of mission

Take responsibility and behave in accordance with what is right for the organization and oneself

Human Resources with Advanced and Specialized Knowledge

As a “medical coordinator” that links customers, manufacturers, and patients, the MEDIPAL Group supports its sustainable growth by developing human resources with a strong ethical sense and specialized knowledge to enable them to propose solutions.