Q2 FY12/25 Financial Results Briefing Materials

Q2 FY12/25

August 14, 2025

D. Western Therapeutics Institute, Inc.

Stock Code: 4576

Copyright D. Western Therapeutics Institute, Inc. All Rights Reserved.

1. Q2 FY12/25 Financial Results

2. Progress of Business in FY12/25

3. Growth Strategy (Reference) Business Overview

1. Q2 FY12/25 Financial Results

   January 1 - June 30, 2025

   Consolidated Statements of Income（YoY comparison）

   464

   521

   318

   223

   173

   133

   146

   18

   17

   Net sales

   Cost of sales SG&A expenses (R&D expenses)

   (Other)

   Operating loss

   Ordinary loss

   Loss attributable

   to owners of parent

   (449)

   (309)

   (316)

   (459)

   (316)

   654

   （JPYmn）

   2Q FY 12/24
   2Q FY 12/25

   (520)

   Net sales

   • Net sales were down 22.5% YoY, due to the expiration of GLANATEC’s domestic royalties (September 2024)

   • Mainly reflects royalty income from DW-1002 and GLA-ALPHA

     R&D expenses

   • 39.0% YoY decrease due to reduced development costs following completion of H-1337’s Phase IIb and DWR-2206’s Phase II dosing

（JPYmn）

As of June 30, 2025

(change compared to December 31, 2024)

（JPYmn）

O

Cash and deposits

• Decline due mainly to R&D expenditures

• JPY417mn increase due to the exercise of the 12th series of stock acquisition rights

  Accounts receivable - trade

• Decline due to the expiration of GLANATEC’s domestic royalties

  Non-current assets

• JPY20mn in amortization of intangible assets related to the licensing agreement for DW-1002 (Europe)

  Current liabilities

• JPY13mn decrease in accounts payable, JPY11mn decrease in income taxes payable due to capital reduction

  Non-current liabilities

• JPY302mn early redemption of corporate bonds

• JPY22mn increase in long-term borrowings due to loans to fund the development of DWR-2206

  Net assets

• JPY316mn loss attributable to owners of parent recorded

• JPY209mn each recorded in capital and capital reserves through stock acquisition rights and others

• Capital reduction without compensation to offset losses; capital: JPY264mn (as of June 30, 2025)

  Consolidated Statements of Cash Flows

                     Q2 FY 12/24           

  Q2 FY 12/25

  （JPYmn）

  1,867

  233

  1,301

  (790)

  (9)

  1,126

  (211)

  (2)

  135 1,047

  Year-start Operating CF Investment CF Financing CF June 30,2024 Year-start Operating CF Investment CF Financing CF June 30,2025

  Cash flow from operating activities

  • JPY316mn outflow due to the recording of loss before income taxes, JPY44mn due to decrease in trade receivables

  • Key factors behind the YoY decrease : decrease in R&D costs (Clinical development costs for H-1337 and DWR-2206)

    Cash flow from investing activities

  • JPY2mn outflow from acquisition of property, plant and equipment

    Cash flow from financing activities

  • JPY415mn proceeds from the exercise of stock acquisition rights, JPY32mn proceeds from long-term borrowings

  • JPY302mn redemption of bonds

    On-hand liquidity on June 30, 2025 consisted only of JPY1,047mn in cash and deposits (no securities)

    1. Progress of Business in FY12/252-1．Successful launch (commercialization)

       Glaucoma Treatment Ripasudil hydrochloride hydrate

       Royalties for Ripasudil

       (JPYmn)

       GLA-ALPHA® Combination ophthalmic solution

       200

       100

       0

       （Single drug・Combination drug）

       in September GLANATEC®

       End

2021 2022 2023 2024 2025 H1

Combination drug with ripasudil hydrochloride hydrate and brimonidine tartrate

• Growth in royalties in Japan

• Overseas expansion(Launch : Thailand in July 2025, Approval : Singapore in June 2025 and Malaysia in July 2025, Applications for other Asian countries are in preparation)

• Japan: Sales projected to peak at JPY8.1bn (Kowa Co., Ltd. sales) (Ten years following launch; 230,000 patients)

  GLANATEC® Ophthalmic Solution 0.4%

• In Japan, royalty income ended in September 2024

• To receive royalties a little overseas

• GLA-ALPHA®：Growth in royalties in Japan Launched in Thailand in July 2025

• GLANATEC® ：In Japan, royalty income ended in September 2024.

  ⇒Overall royalties are on the decline

  Japanese Market

  ・FY2023: about 85.8 billion yen *

  ・Use of combination drug is on the rise

  *Source: Calculated by DWTI based on the 10th NDB Open Data released by Japan’s Ministry of Health, Labour and Welfare

  Ophthalmic Surgical Adjuvant DW-1002 (Brilliant Blue G)

  （Single drug・Combination drug）

  400

  300

  200

  100

  Presumed number of surgeries

  Europe

  100,000/ yr*

  U.S.

  200,000/yr*

  *DWTI estimates

  0

  Royalties for DW-1002

  (JPYmn)

  ILM-Blue®, TissueBlue

  Ophthalmic surgical adjuvant with Brilliant Blue G, a dye with excellent staining ability, as the active ingredient

  Characte ristics

  • Enables visualization of the internal limiting membrane (thinness: approx. 0.003mm)

  • Used in vitrectomy for the treatment of diabetic retinopathy, macular hole, etc.

    MembraneBlue-Dual®

    Characteri stics

    Combination of Brilliant Blue G and Trypan Blue

  • Stains internal limiting membrane, epiretinal membrane, and proliferative membrane in proliferative vitreoretinopathy

2021 2022 2023 2024 2025 H1

• Strong sales, 1.3% YoY decrease due to yen appreciation, despite volume growth

• Patents in major countries will expire in December 2025, and US patents have already been extended (until March 2031). After 2026, we expect a decrease in royalties due to the expiration of patents

• There will be no impact in Japan due to the product supply agreement with exclusive know-how licensing provisions

• Used during vitrectomy, such as proliferative vitreoretinopathy, etc.

  2-2．Development Pipeline

  Decision to Develop H-1129 as a New Pipeline (Released July 15)

  H-1129 is an optimized Rho kinase inhibitor based on a seed drug candidate compound

  from DWTI’s compound library

  • 2014: GLANATEC® ophthalmic solution 0.4% launched as a glaucoma treatment

  • 2022: GLA-ALPHA® combination ophthalmic solution launched as a multi-drug alternative

  • K-321 Under development as a treatment for Fuchs corneal endothelial dystrophy (Phase III study dosing completed)

  【1st Generation】Ripasudil 【2nd Generation】H-1129 【3rd Generation】H-1337

  • 2012: Commenced development as a glaucoma treatment

  • 2019: Development discontinued in Phase III study in Japan

  • 2015: Commenced development as a glaucoma treatment

  • 2024: Phase IIb study completed in the US; preparing for Phase III study

  From the perspective of effective asset utilization, exploring potential indications for other diseases (repositioning)

  Significant efficacy demonstrated in animal disease models Decided to develop a treatment for corneal and conjunctival diseases based

  on immune disorders (target indication not disclosed for competitive strategy reasons)

  Immune-Mediated Corneal and Conjunctival Diseases

  • Corneal and conjunctival diseases refer to a general term for conditions that cause inflammation or damage to the cornea and conjunctiva

  • Immune abnormalities are caused by chronic disorders resulting from autoimmune/allogeneic immune responses and excessive immune-inflammatory responses

• Dry eyes, eye redness and pain, blurred vision, etc.

• Severe cases can lead to serious visual impairment

• Rare and intractable diseases with limited treatment options

• Standard treatment focuses on immunosuppression or symptomatic therapy

Immune-mediated corneal and conjunctival diseases are severe conditions with significantly reduced QOL and high medical needs

• Considering an application for orphan drug designation

  • Government support measures, such as subsidies for research and development expenses and priority review for regulatory approval, may be expected

• Aiming for efficient development

  • Small-scale clinical trials

    • Consideration of a formulation (eye drops) similar to previously developed products

    • Phase I study has been completed, and development consideration (consultation with authorities required) is underway for Phase II study

Clinical trial preparations will begin in the second half of FY2025, with Phase II

study scheduled for FY2026

(The development plan will be announced as soon as it is finalized)

Development Pipeline

K-321

Products

Ripasudil hydrochloride hydrate

Brilliant Blue G (BBG)

Clinical indication

Fuchs endothelial corneal dystrophy

ILM staining

Region

U.S., etc.

China

Japan

Non-clinical

P-I

P-II

P-III

Application Approval Launch

Completion of dosing

Preparing for market launch

Negotiating and discussing

Licensee

Kowa

DORC

Wakamoto

DW-1002

ALC staining

Japan

with the authorities in preparation for the application

Pharmaceutical

DW-1001

BBG/

Trypan blue

ILM staining and ERM staining

Ophthalmic treatment agent (undisclosed)

U.S.

Japan

DORC

ROHTO Pharmaceutical

H-1337

DW-5LBT

DWR-2206

Glaucoma and ocular hypertension

Neuropathic pain after shingles

Bullous keratopathy

U.S.

U.S.

Japan

Preparing for Phase III

Reapplication completed

Target date for review completion: September 24

Under evaluation/observation

Developed internally

Jointly developed with MEDRx

Joint development with ActualEyes

・・・ophthalmology pipeline

Fuchs Endothelial Corneal Dystrophy K-321

Patient dosing completed for Global Phase III (two

studies) in March and June 2025

The end of follow-up observation has been changed to March 2026

The application is expected to be submitted

at the end of 2026 or in 2027 (our forecast)

• After going on sale, to receive royalties until end of data protection period*

  Out-licensed

  *Patent royalty rate differs from GLANATEC, GLA-ALPHA

  Europe

  Approx. 16mn patients*1

  U.S.

  Fuchs endothelial corneal dystrophy (FECD)：

  A progressive condition that causes corneal endothelial disorders, corneal edema and clouding impair vision and lead to bullous keratopathy.

Approx. 6mn patients*2

Expansion of indications ; Ripasudil hydrochloride hydrate

*1: Obtained by multiplying the population over 40 estimated by the Company based on the United Nations’ “World Population Prospects 2022” by the morbidity rate of 4% (*2)

*2: Moshirfar M et al., Fuchs Endothelial Dystrophy. Treasure Island (FL): StatePearls Publishing; 2021

＜Phase III study＞

Ophthalmic Surgical Adjuvant DW-1002

Japan: 100,000 procedures*1

Japan: Less than 10%*1 of

1.2mn*2 procedures

*1: DWTI estimate (based on interviews with related parties, etc.)

*2: June 2019 data of MHLW’s Statistics of Medical Care Activities in Public Health Insurance, 2019

Approved in China in February 2025, and preparing for launch.

We continue to work towards approval in Japan and the U.S.

• China : Planning to launch in 2025, treated as a medical device Contract expected to last until patent expires

• Japan : Issues related to standards and quality in the use of U.S. approved data

• U.S. : The FDA has instructed us to conduct a small-scale trial

  Out-licensed

  *

  （Worldwide (excluding Japan)）

  （Japan）

  (Reference) Unit price per piece

  Charact eristics

  EU／CE-marked product	€55
  US／Pharmaceutical products	$140

  • The active ingredient is BBG250, a highly staining dye

  • Temporarily stains the inner boundary membrane inside the eye to assist in vitreous and cataract

    surgery

    *D.O.R.C.’s logo is a registered trademark of D.O.R.C. Dutch Ophthalmic Research Center

    (International) B.V., an independent company

    Glaucoma Treatment H-1337 First Choice as Second-Line Drug

    Phase III study preparation underway (manufacturing of investigational drug, promotion of toxicity testing, etc.) Licensing activities are also underway

• Presentation at ARVO, the world's largest and most prestigious ophthalmology society, in May 2025

• Phase III study: Evaluation of group composition, dosage and administration

  US Phase IIb results (study period: Aug. 2023, - Aug. 2024, 201 cases)

  All three groups of H-1337 significantly reduced intraocular pressure by up to 30% (p<0.001)

  Efficacy

  Safety

  Conjunctival hyperemia occurred, but most cases were mild

  In-house development

  19

  Confirmed reduction in intraocular pressure with once-daily eye drops

Charact eristics

• Facilitates drainage of aqueous humor through the trabecular meshwork and Schlemm’s canal

• Multikinase inhibitor

Copyright D. Western Therapeutics Institute, Inc. All Rights Reserved.

Priority on launching in the US market

*1

• Market: approx. $3 bn (FY2020)

• Market estimate: up to 40% of the above

• Aiming for JPY 30 bn in sales of the single-agent

【Evaluation as a second-line drug】ROCK inhibitor comparison

Copyright D. Western Therapeutics Institute, Inc. All Rights Reserved.

*1 :Classified and compiled by DWTI based on IQVIA MIDAS Dec 2020 MAT Reprinted with permission

*2: Label of GLANATEC®

*3: Label of RHOPRESSA®

*4: Label of XALATAN®

20

P II study in Japan, undergoing follow-up observation

No reports of serious adverse events for which a causal relationship with the investigational product

Phase II study design Overview:

Transplantation completed

in all subject (December 2024)

cannot be ruled out

Scheduled to complete evaluation and observation by the end of Dec. 2025

• In Japan, we will conduct clinical trials as usual (without using the early approval system)

• In China, we plan to begin clinical trials in 2025

- The leading developer is the Chinese company ArcticVision (a bio-venture). We receive a portion of the revenue (such as milestone revenue) that ActualEyes receives

Joint development

Targeting bullous keratopathy, cultured human corneal endothelial cells and a suspension are injected into the anterior chamber of the eye to regenerate corneal endothelium

• Multi-center, open-label, uncontrolled study to determine the safety and efficacy of DWR-2206 in patients with bullous keratopathy

  Warmed to thaw, and injected

  Frozen corneal endothelial cell preparation

  Copyright D. Western Therapeutics Institute, Inc. All Rights Reserved.

  Cultured corneal endothelial cells

  Target number of patients	6
  Evaluation and monitoring period	48 weeks after transplantation of the investigational product
  Primary endpoints	Number of cases and incidence rate (%) of adverse events and adverse events that cannot be ruled out as related to the investigational product
  Secondary endpoints	・Monitoring and evaluation of safety endpoints ・Number and incidence rate (%) of significant adverse events ・Improvement in visual acuity at 24 weeks after transplantation of the investigational product ・Change in best corrected visual acuity over time ・Change in corneal thickness over time ・Change in corneal endothelial cell density over time

  ＋ROCK inhibitor

  21

  DWR-2206 Marketability and competition

  Japan

  Bullous keratopathy patients : 7,000-10,000 *1

  Patients on waiting list : 10,000-20,000 *2

  *1：source: MHLW *2：source: DWTI

  (Reference) Major Competitors of DWR-2206

  About competitor Aurion Biotech, Inc.

  • The main pipeline is Vyznova, which is currently focusing on clinical trials in the US

    ⇒In FY2022, raised $120 mn in Series C

    ⇒Alcon acquires majority stake in FY2025

    VyznovaⓇ

    Cell transplantation Developed by Development stage

    Cultured human corneal endothelial cells Aurion Biotech,Inc.

    JP: Launch【Drug Price：JPY9.5 million】

    US: PI / PII

    Market Size Forecast（peak : 6th year） *by Japan’s Ministry of Health, Labour and Welfare

    ・Number of patients using this medical device：160

    ・Forecast sales： Approx. JPY1.5bn

    Neuropathic Pain Treatment DW-5LBT

    Reapplied in March 2025

    PDUFA date : September 24, 2025 Currently negotiating partnerships with

    potential sales partners, aiming for launch in

    the first half of FY2026

    Lidocaine patch products Market Estimates

    U.S.

    USD 162 million※

    ※MEDRx’s documents

    Joint development

    Lidocaine patch products for a treatment for neuropathic pain after shingles

    Characteristics

    • Confirmatory comparative (bioequivalence) clinical trial comparing DW-5LBT with innovator product Lidoderm® generated favorable results

    • Low skin irritation

    • Excellent adhesive strength

    • Capable of maintaining adhesive strength during exercise

Ophthalmology

In-house

Jan. 28 Joint research on treatment drugs for eye diseases

Evaluate the efficiency endpoints of our compounds for retinal degenerative diseases and ocular inflammatory diseases

non-ophthalmology

In-house

Mar. 27 Joint research on schizophrenia treatment drugs using our company's compounds

Pursuing the potential of innovative therapeutic drugs with new mechanisms of action

Other company

Ophthalmology

Apr. 28 Development of next-generation formulations aimed at creating new treatments for eye diseases

Research into formulations that enhance efficacy and intraocular penetration suitable for eye disease treatment drugs

In-house

non-ophthalmology

Apr. 30 Joint research on lifestyle-related diseases using our company's compounds

Ophthalmology

Other company

Evaluation using zebrafish screening

May. 15 Joint research aimed at developing a drug to treat cataracts

Development of eye drops for the prevention and treatment of cataracts

Ophthalmology

Other company

Jul. 8 Joint research on therapeutic drugs for eye diseases

Chordia's kinase inhibitors to be evaluated for efficacy in eye diseases

Retinal degenerative diseases

Ophthalmic diseases

Selection

Newly developed products

Growth Investment in Research Activities Aimed at Creating Newly Developed Products

Ophthalmic diseases

Ophthalmic diseases

Lifestyle-related diseases

Schizophrenia

Oncology

Erectile dysfunction

①Ophthalmic kinase inhibitors

②Expansion of fields based on knowledge of

ophthalmic diseases

Ophthalmology

③Expansion of the field through the

development of kinase inhibitors

Other

Cataract

Dry eye

Glaucoma surgery

Gene therapy

pipeline

1. Growth Strategy

Kinase inhibitors

Core technologies

Ophthalmic disease development

Development know-how and an efficient development system

Strengths and achievements

We have multiple development pipelines and are building a synergistic portfolio (Multiple disease areas / Various phases of development pipeline / In-house development and

out-license)

Risk diversification/maximization of returns

Aiming to maximize corporate value by creating numerous revenue opportunities

Capital/ financial markets

Financing

Growth investment

Recovery phase ; Aiming to return to profitability

・Development costs: High

・Profitability: High

・High development risks

In-house development

Earnings Image

Creation of new drug candidates

Early out-license

H-1337 DWR-2206

Newly developed

products

Base Revenue

・Out-licensed development pipeline

・Development costs: Low

・Profitability: Low

・Affected by out-licensing contracts and development policies

・late-stage joint development product

Time

Current Development Pipeline

The partner has been determined (out-licensed)

Many products are in late development

Focus Pipeline Focus Pipeline

Growth investment in the above focus pipeline and the following new products is important