• Mitsubishi Kagaku Bio-Clinical Laboratories, Inc. (“MBC”, Head Office: Itabashi-ku, Tokyo; President: Naotoshi Sagawa);
• Mitsubishi Kagaku Iatron, Inc. (“MKI”, Head Office: Shinjuku-ku, Tokyo; President: Toshihiko Yoshitomi); and
• Mitsubishi Kagaku Iatron, Inc.
• Mitsubishi Chemical Safety Institute Ltd. (“MSI”, Head Office: Minato-ku, Tokyo; President: Hiroshi Kawai)

have entered into a basic agreement to commence studies on their possible integration. The schedule is aimed at October 2006, and details of integration, such as the form or manner of integration, are yet to be determined.

1. Purpose of Integration:

Drastic change is going on these years in the circumstances surrounding the pharmaceutical and medical care industries. Significant influence is also expected over the current operations of MBC, MKI and MSI established through their respective technologies and products.

Pharmaceuticals’ further safety is strongly demanded. Meanwhile, the role of diagnostic testing is expected to be further increased, and both the government authorities and private sectors are taking various initiatives for the realization of the so-called “personalized medicine” that would provide individual persons with best medical treatments fit to their respective physical conditions and constitutions. Time is anticipated to come, in future, when medical examinations/diagnoses will be conducted to select a best-fit treatment on an individual patient basis, and therefore medicines and examinations/diagnoses will be co-developed.

The Japanese Government’s “Health Frontier Strategy” aims to build a society where every citizen can spend his/her entire life in good health. This means, “prevention” (to prolong healthy lives) will become a very important key word from now onward.

In these business circumstances, MCHC has, in its mid-term management plan “KAKUSHIN Plan: Phase 2”, designated “health care” as one of the three business pillars and studied, together with MCHC-group companies, concrete measures to implement the strategy. As a result, a conclusion has been reached that, in order to flexibly and actively cope with the changes of business circumstances and to securely grasp opportunities for growth, the three Companies be integrated to increase in the value of undertakings in line with the following business strategy

2. Purpose of Integration:

MBC, MKI and MSI, have heretofore operated their businesses in a cooperated manner, as MCHC-group Companies. The three Companies have started studying the subject integration. The proposed integration is aimed to increase additional business opportunities through the implementation of the following strategies:

1) Synergetic enhancement of the current operations:

	(a)	Combine MBC’s clinical testing with MKI’s diagnostic reagents and instruments for in vitro diagnostics. This will enable them to make comprehensive proposals in respect of diagnostic testing field.
	(b)	Integrate MSI’s non-clinical test operations and MBC’s clinical test operations. This will enable them to offer broader range of services supporting the development of pharmaceuticals from non-clinical tests to clinical trials and even to post-marketing surveillance studies.
	(c)	Unify the operation systems. This will contribute to further cost reductions and strengthen the operational structure.

2) Development aimed at the new operations of ”personalized medicine" and “prevention”.

R&D of the new Company will take on a role enabling diagnostic testing and drug development support to be intricately linked. Further, the integration of experience, technologies and know-how cultivated by the three Companies can also tie up with MCHC’s R&D, thereby contributing to the realization of “personalized medicine“. Moreover, we will advance into the new field of “prevention”. For example, the R&D in the fields of proteomics^*1, metabolomics^*2 and glycoscience^*3 carried out by the other MCHC-group Companies can be combined with the technology and know-how of MBC, MKI and MSI, leading to the expected acquisition of a biomarker^*4 that may become an index for “prevention”.

MCHC Group will continue to challenge technology innovation in the filed of “personalized medicine” and “prevention”, by uniting pharmaceuticals with clinical testing, diagnostics and safety testing.

Notes

^*1 Proteomics ---
The field of studying whole proteins (proteomes) existing in various biological systems such as certain type of living things, their tissues, cells in a certain state etc. For example, it may be used in the study of causes and treatment methods for the formation of cancer cells by comparing the proteomes of cancer cells and normal cells.

^*2 Metabolomics ---
The comprehensive analysis of metabolites in living organisms. By the comprehensive analysis of the increase and decrease of such metabolites that exist in living organisms as nucleic acids, amino acids, sugars, fats, new markers have been discovered for the efficacy of drugs, disease or side effects etc.

^*3 Glycoscience---
The study of sugar chains. Sugars are often combine with proteins or fats in living organisms and there are many examples to show that this is doing an important work in showing biological activity and it is expected to be applied in medicines and diagnostic testing.

^*4 Biomarker---
This is a marker used in determining the extent of an illness or state of health. For example, blood sugar level is used as a biomarker for diabetes.