Sumitomo Dainippon Pharma : Summary of Consolidated Financial Results for the Third Quarter of the Year Ending March 31, 2017 (Unaudited)

Summary of Consolidated Financial Results for the Third Quarter of the Year Ending March 31, 2017[Japanese GAAP](Unaudited)

January 27, 2017

Company Name: SUMITOMO DAINIPPON PHARMA CO., LTD. Stock Exchange Listings: Tokyo Security Code Number: 4506 (URL:http://www.ds-pharma.co.jp) Representative: Masayo Tada, Representative Director, President and Chief Executive Officer Contact: Atsuko Higuchi, Senior Communication Officer Telephone: [phone] Filing Date of Quarterly Financial Report: February 3, 2017 Starting Date of Dividend Payments: － Preparation of Supplementary Financial Data for Quarterly Financial Results: Yes Information Meeting for Quarterly Financial Results to be held: Yes (for institutional investors and analysts)

(Note: All amounts are rounded down to the nearest million yen)

1. Consolidated Financial Results for the Third Quarter of the Year Ending March 31, 2017

   （April 1, 2016 to December 31, 2016）
2. Results of Operations

   (% represents changes from the corresponding period of the previous year)

   Net sales		Operating income		Ordinary income		Net income attributable to owners of the parent
   Yen million	%	Yen million	%	Yen million	%	Yen million	%
   Nine months ended December 31, 2016	305,507	0.3	44,241	42.3	49,864	60.2	29,571	26.7
   Nine months ended December 31, 2015	304,532	9.1	31,086	36.2	31,133	38.3	23,345	22.9

   Note: Comprehensive income Nine months ended December 31, 2016 : ¥34,203 million, 25.9%

   Nine months ended December 31, 2015 : ¥27,169 million, (55.6) %

   Earnings per share	Earnings per share (diluted)
   Nine months ended December 31, 2016	¥74.43	―
   Nine months ended December 31, 2015	¥58.76	―

3. Financial Position

(Millions of yen)

Total assets	Net assets	Shareholders' equity ratio
As of December 31, 2016	750,946	473,715	63.1%
As of March 31, 2016	707,715	446,472	63.1%

Reference: Shareholders' Equity As of December 31, 2016 : ¥473,715 million

As of March 31, 2016 : ¥446,472 million

4. Dividends

   Dividends per share
   1st quarter	2nd quarter	3rd quarter	Year-End	Annual
   Year ended March 31, 2016	―	¥9.00	―	¥9.00	¥18.00
   Year ending March 31, 2017	―	¥9.00	―
   Year ending March 31, 2017 (Forecast)	¥9.00	¥18.00

   Note: Revision of dividend forecasts from the latest announcement: None

5. Consolidated Financial Forecasts for the Year Ending March 31, 2017

   （April 1, 2016 to March 31, 2017）

   (% represents changes from the corresponding period of the previous year)

   Net sales		Operating income		Ordinary income		Net income attributable to owners of the parent		Earnings per share
   Yen million	%	Yen million	%	Yen million	%	Yen million	%
   Year ending March 31, 2017	404,000	0.2	46,000	24.6	46,000	30.6	26,000	5.3	¥65.44

   Note: Revision of consolidated financial forecasts from the latest announcement: Yes

   Notes:

6. Shift of significant subsidiaries during the period (shift of specified subsidiaries accompanied by changes in scope of consolidation) : Yes

   ・Specified subsidiaries

   (New : 4 Companies) Cynapsus Therapeutics Inc.

   Project Pegasus Sub Acquisition ULC

   Sunovion CNS Development Canada ULC(old company)

   Sunovion CNS Development Canada ULC (Excluded : 3 Companies)

   Cynapsus Therapeutics Inc.

   Project Pegasus Sub Acquisition ULC

   Sunovion CNS Development Canada ULC(old company)

   Sunovion Pharmaceuticals Inc. (Sunovion), which is a consolidated subsidiary of the Company completed to acquire Cynapsus Therapeutics Inc (Cynapsus) by way of Plan of Arrangement, which is available under Canadian law.

   In the process, Sunovion established a new wholly-owned subsidiary named Sunovion CNS Development Canada ULC (old company) (Sunovion CNS Canada (old company)) in Canada for the purpose of acquisition of all common shares and warrants issued by Cynapsus. As a result, Sunovion CNS Canada (old company) became a consolidated subsidiary of the Company.

   On completion of the acquisition, Cynapsus and its wholly-owned subsidiary Project Pegasus Sub Acquisition ULC (Pegasus) became in the scope of consolidated subsidiaries.

   Furthermore, on the closing day of the acquisition, Sunovion CNS Canada(old company), Cynapsus and Pegasus integrated into Sunovion CNS Development Canada ULC (Sunovion CNS Canada) in accordance with the "Amalgamation" under the British Columbia Law in Canada. As a result of this reorganization, Sunovion CNS Canada became a consolidated subsidiary and Sunovion CNS Canada (old company), Cynapsus and Pegasus were out of scope in consolidation.

7. Application of specific accounting methods for preparing quarterly consolidated financial statements: Yes

   ・Calculation of income taxes

   The effective tax rate, after applying tax effect accounting, expected to be imposed on income before income taxes for the fiscal year in which this current quarter is included is estimated based on reasonable assumptions. Then, tax expenses are calculated by multiplying the income before income taxes for the quarter by the estimated effective tax rate.

8. Changes in accounting policies, accounting estimates, and retrospective restatements

   ① Changes due to changes in accounting standards: Yes

   ・Guidance on "Recoverability of Deferred Tax Assets"

   The company has applied the "Guidance on Recoverability of Deferred Tax Assets" (Accounting Standards Board of Japan [ASBJ] Guidance No.26, March 28, 2016.) from the beginning of the current fiscal year and revised a part of the accounting method for recoverability of deferred tax assets.

   With regard to the application, in accordance with the provisions on transitional implementation indicated in

   Paragraph 49(4) of Guidance on Recoverability of Deferred Tax Assets, the differences between the amount of deferred tax assets and deferred tax liabilities when Paragraph 49(3)① to③of Guidance on Recoverability of Deferred Tax Assets are applied at the beginning of the current fiscal year, and the amount of deferred tax and

   deferred tax liabilities at the end of the previous fiscal year have been added to or subtracted from retained earnings and accumulated other comprehensive income(loss) at the beginning of the current fiscal year.

   As a result, at the beginning of the current fiscal year, deferred tax assets (in "Investments and other assets") increased by 193 million yen, retained earnings increased by 385 million yen and unrealized gains on available-for-sale securities decreased by 192 million yen.

   ② Changes due to changes in accounting standards other than (3),①: None

   ③ Changes in accounting estimates: None

   ④ Retrospective restatements: None

9. Number of shares outstanding (Common stock) at the end of period

   ① Number of shares outstanding (Including treasury stock) December 31, 2016: 397,900,154 shares

   March 31, 2016 : 397,900,154 shares

   ② Number of treasury stock

   December 31, 2016: 599,896 shares

   March 31, 2016 : 598,599 shares

   ③ Average number of shares during the period December 31, 2016 : 397,300,708 shares

   December 31, 2015 : 397,302,836 shares

   Indication of quarterly review procedure implementation status:

   This summary of financial results is exempt from quarterly review procedure based upon the Financial Instruments and Exchange Act. It is under the quarterly review procedure process at the time of disclosure of this report.

   Explanation for Appropriate Use of Forecasts and Other Notes:

   This document contains forward-looking statements which are based on management's assumptions and beliefs in light of the information currently available and involves risks and uncertainties, and are not the commitment made by the Company. Actual financial results may differ materially depending on a number of factors, including economic conditions. Please refer to page 3 of attachment document with regard to the assumptions and other related matters concerning financial forecasts.

   The Company holds the earnings presentation for institutional investors and analysts on Friday, January 27, 2017. The documents distributed at the presentation are scheduled to be posted on our website.

   【Attachment Documents】

10. Qualitative Information for the Nine Months Ended December 31, 2016 2

11. Qualitative Information on Business Results 2

12. Qualitative Information on Financial Condition 3

13. Qualitative Information on Consolidated Financial Forecasts 3

14. Consolidated Financial Statements 5

15. Consolidated Balance Sheets 5

16. Consolidated Statements of (Comprehensive) Income 7

17. Notes to Consolidated Financial Statements 8

(Notes on Premise of Going Concern) 8

(Notes on Significant Changes in Shareholders' Equity) 8

(Segment Information) 8

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