--- title: "Chugai earns more from drugs it discovers and others sell" url: "https://aibio.space/companies/chugai-pharmaceutical/desk-view/" publisher: "aibio.space (Biotech Investor Relations News)" date: "2026-10-31" tickers: "TSE:4519" summary: "Half-year core profit rose 21% and cash is high. Royalties from Foundayo are the new driver, while the NXT007 phase 3 trials are the in-house test." --- Opinion Desk view by the aibio.space Chugai desk. Updated October 22, 2026. Every figure links to its source. This is analysis, not a recommendation to trade. [How desk views are written](https://aibio.space/disclosures/). Chugai Pharmaceutical Co. ยท Opinion 2026-10-22 # Chugai earns more from drugs it discovers and others sell Half-year core profit rose 21% and cash is high. Royalties from Foundayo are the new driver, while the NXT007 phase 3 trials are the in-house test. Chugai Pharmaceutical is Roche's Japanese partner and a drug discoverer in its own right. First-half 2026 [core revenue was JPY 663.3 billion, up 14.7%](https://www.1stoncology.com/blog/?p=112429). Chugai-originated products sold through partners include Foundayo, the oral GLP-1 drug licensed to Eli Lilly, and Nemluvio, licensed to Galderma. ## The technology Chugai describes Enspryng as [developed using its proprietary antibody engineering technologies](https://www.1stoncology.com/blog/?p=112429). Its newer work includes macrocyclic peptides, with AQUA07 the third project to reach the clinic, and small-molecule approaches such as the RAF-MEK molecular glue SPYK04, which it [licensed to InxMed](https://chemxplore.com/news/chugai-inxmed-spyk04-license-agreement) in September. The product to watch is NXT007 for hemophilia A. Chugai reported [proof of concept](https://www.1stoncology.com/blog/?p=108443) from the high-dose cohort of a phase 1/2 trial, and two phase 3 trials, one against [emicizumab](https://clinicaltrials.gov/study/NCT07416604) and one against [factor VIII prophylaxis](https://clinicaltrials.gov/study/NCT07416526), are recruiting. ## The odds NXT007's phase 3 trials are the clearest binary risk. The [BIO/Informa/QLS 2011-2020 base rate](https://go.bio.org/rs/490-EHZ-999/images/ClinicalDevelopmentSuccessRates2011_2020.pdf) is 57.8% from phase 3 to filing and 90.6% from filing to approval for all drugs. Hematology programs reach approval from phase 1 at 23.9%, against 7.9% for all drugs. NXT007 is tested against effective current treatments, so the primary bleed-rate comparison against emicizumab is the harder of the two. Several other programs are nearer. The company said it filed [eight applications in Japan](https://www.1stoncology.com/blog/?p=112429) in the first half, and expects the highest number of filings it has ever planned. Chugai said in April it was [preparing an Enspryng filing in MOGAD](https://www.1stoncology.com/blog/?p=110376) within the year, and the FDA had accepted the [thyroid eye disease filing with priority review](https://www.1stoncology.com/blog/?p=112429). Sparsentan is [due to be filed in Japan](https://www.1stoncology.com/blog/?p=108443) in 2026 after positive phase 3 results. ## The money Chugai is highly profitable. Its H1 core operating profit of [JPY 329.1 billion](https://www.1stoncology.com/blog/?p=112429) is about 49.6% of revenue. StockAnalysis lists [cash and short-term investments of JPY 962.6 billion](https://stockanalysis.com/quote/tyo/4519/financials/balance-sheet/?p=quarterly) at June 30. Management kept the forecast of [JPY 1,345.0 billion in revenue and JPY 670.0 billion in core operating profit](https://quartr.com/events/chugai-pharmaceutical-co-ltd-4519-q2-2026_F3kC3kSy). Domestic and overseas product sales were [JPY 237.9 billion and JPY 328.6 billion](https://www.1stoncology.com/blog/?p=112429) in the half, and other revenue was JPY 96.8 billion, up 44.5%. The mix is shifting toward licensing income. The 2026 forecast calls for [other revenue of JPY 245.0 billion, up 36.0%](https://www.1stoncology.com/blog/?p=108443), while overseas product sales are forecast to fall 0.6%. ## The risks Dependence on Roche is the first. Roche's interest in Chugai was 61.1% at December 31, 2025, according to [Roche's 2025 finance report](https://assets.roche.com/f/176343/x/fca190f63e/fb25e.pdf), and Chugai's overseas sales rely on [exports to Roche](https://www.1stoncology.com/blog/?p=108443) of Hemlibra and Actemra. Second is earnings quality. The company itself said first-half other revenue was lifted by [one-time income](https://www.1stoncology.com/blog/?p=112429), which will not repeat. Third is price pressure at home: its forecast cites [Japanese drug price revisions and generics](https://www.1stoncology.com/blog/?p=108443) as a drag on domestic sales. ## Our read Chugai combines high margins with a large cash balance, and its royalty income is rising as Foundayo launches. Lilly said it had submitted orforglipron in [more than 40 countries](https://www.biospace.com/press-releases/fda-approves-lillys-foundayo-orforglipron-the-only-glp-1-pill-for-weight-loss-that-can-be-taken-any-time-of-day-without-food-or-water-restrictions) and plans to launch in each shortly after approval, which is the base for Chugai's royalty stream. The story is less about a single drug and more about whether its in-house research can keep producing products that others sell. The next tests are practical: NXT007 enrollment, the sparsentan filing, and the Korean subsidiary due on [November 2](https://chemxplore.com/news/chugai-establishes-subsidiary-south-korea). Foundayo royalties are the number to watch, since the company has not broken them out in the figures reviewed here. --- Source page: https://aibio.space/companies/chugai-pharmaceutical/desk-view/. Facts in aibio.space stories are checked against company filings and releases; opinion is labelled. Cite as: aibio.space, "Chugai earns more from drugs it discovers and others sell", 2026-10-31, https://aibio.space/companies/chugai-pharmaceutical/desk-view/