TMS Co., Ltd. (4891) FY2026 Interim Earnings Analysis: Global Progress of Lead Candidate TMS-007, Preparation for TMS-008 Phase 2a, and Accelerated Development Strategy Following CORXEL’s Major Funding

TMS Co., Ltd. (Securities Code: 4891) is a biotech venture originating from the Tokyo University of Agriculture and Technology, dedicated to the research and development of its proprietary drug discovery pipeline. Following a change in its fiscal year-end, the company has released its earnings presentation materials for the interim period of the fiscal year ending December 2026 (January 1, 2026, to June 30, 2026).

This report provides a detailed analysis of the company's progress, focusing on 10 key topics extracted from the materials. We cover the development status of the lead acute ischemic stroke treatment candidate " TMS-007 (JX10) " and the acute kidney injury (AKI) candidate " TMS-008 ," the latest developments from partner company CORXEL, an overview of the entire pipeline, and financial highlights.

---

10 Key Topics from the Interim Earnings

1. Global Phase 2/3 trial (ORION study) for TMS-007 (JX10) is progressing ahead of schedule.
2. Licensing structure for TMS-007 with CORXEL and the retention of domestic development and commercialization rights in Japan.
3. First patient enrollment for the ORION study in Japan completed in February 2026, with Part 1 enrollment expected to conclude within the year.
4. Planning for the Phase 2a trial of the novel AKI prevention/treatment candidate TMS-008 and completion of the pre-consultation with the PMDA.
5. TMS-008’s unique dual mechanism of action (antioxidant activity and sEH inhibition).
6. Completion of a $287 million (approx. ¥45.3 billion) major funding round by partner CORXEL to accelerate development.
7. Completion of Phase 1 for the treatment-resistant hypertension candidate JX09 and the background behind its strategic development hold.
8. Expansion of the early-stage pipeline (novel oral sEH inhibitor R-002, spinal cord injury treatment TMS-010, etc.).
9. Analysis of FY2026 interim operating expenses (¥392 million) and operating loss (¥392 million).
10. A robust financial foundation with approx. ¥2.459 billion in cash and cash equivalents, and the full-year expense outlook.

---

1. Clinical Development and Rights Structure of Lead Candidate "TMS-007 (JX10)"

TMS-007 (JX10), created by TMS, is a revolutionary acute ischemic stroke treatment candidate featuring a dual mechanism of action: " thrombolysis " and " neuroprotection ." In the Phase 2a clinical trial conducted in Japan, it demonstrated high superiority over the placebo group with an odds ratio of 3.34 (P<0.05) for the primary endpoint: the proportion of patients with an mRS score of 0-1 (no symptoms or no significant disability).

Regarding the clinical development and licensing history, after signing a large-scale option agreement with Biogen (USA) in 2018, all rights were transferred to CORXEL (formerly Ji Xing Pharmaceuticals) in 2024. The following slide illustrates the structure of the contract changes following this transfer.

[Slide Commentary: Changes and Significance of TMS-007 Rights Structure]

This slide shows the re-licensing structure following the transfer of TMS-007 rights from Biogen to CORXEL. For TMS, this is significant not only because the total contract value increased from a maximum of $335 million to $367.5 million (total milestones) + royalties , but also because TMS secured the development and commercialization rights for TMS-007 (JX10) within Japan . This creates an attractive alliance structure where the partner, CORXEL, bears the massive costs of global development, while TMS retains the initiative to commercialize the product in the Japanese market, effectively mitigating its own risks.

The global Phase 2/3 trial (ORION Study) , led by CORXEL and targeting 740 patients across 150 sites in 20 countries, is currently underway. In Japan, the first patient was enrolled in February 2026, and enrollment for Part 1 (the Phase 2 portion, targeting 240 patients) is expected to be completed within 2026, progressing ahead of the original schedule.

---

2. Development Trends for "TMS-008," Targeting Acute Kidney Injury (AKI)

TMS-008 (a novel AKI prevention/treatment candidate) is expected to be the second pillar of the TMS pipeline after TMS-007. Post-operative AKI is a serious complication that significantly impacts the prognosis of patients undergoing procedures such as cardiac surgery, yet it remains an area of high unmet medical need with no currently effective treatments.

TMS-008 combines antioxidant activity with anti-inflammatory effects based on soluble epoxide hydrolase (sEH) inhibition . Non-clinical models have confirmed its efficacy in suppressing tubular damage and the decline in glomerular filtration rate caused by ischemia-reperfusion injury.

Regarding the development roadmap, the company completed Phase 2a clinical trial design considerations and PMDA pre-consultations in H1 2026. It plans to submit the clinical trial notification and achieve First Patient In during H2 2026. The enrollment period is expected to last approximately one year, with preparations steadily underway to complete enrollment by H2 2027.

---

3. Overview and Roadmap of the Diversified Drug Discovery Pipeline

To avoid the risks associated with relying on a single compound, TMS is expanding its pipeline with various mechanisms of action. The following slide lists the progress and development phases of all pipeline projects.

[Slide Commentary: Pipeline Overview and Development Stages]

This slide comprehensively summarizes the development code, indication, mechanism of action (MoA), development stage, and regional rights for each project.

• TMS-007 (JX10) : Phase 2/3 for acute ischemic stroke (Japan: TMS, Rest of World: CORXEL).
• TMS-008 : Pre-Phase 2a stage for acute kidney injury (Global rights held by TMS).
• JX09 : Phase 1 clinical trial completed in Australia for treatment-resistant hypertension (Development strategy under review/hold by CORXEL).
• TMS-010 : Spinal cord injury treatment candidate with a blood-brain barrier (BBSCB) protection mechanism (Non-clinical).
• R-001 / R-002 : Early-stage exploratory pipeline including resolvin analogs and novel oral sEH inhibitors.

This portfolio balances in-house development (e.g., TMS-008) with joint development/out-licensing (e.g., TMS-007), providing a clear view of a sustainable drug discovery ecosystem spanning diverse therapeutic areas.

Key milestones from FY2026 onwards include the submission of the TMS-008 Phase 2a clinical trial notification and start of dosing in H2 2026 , top-line results for the ORION study Part 1 in H1 2027 , and preliminary toxicity/safety studies for the novel oral sEH inhibitor (R-002) in H1 2027 .

---

4. Partner CORXEL’s Major Funding and Academic Topics

A significant external development accelerating TMS’s progress is the major funding round by its partner, CORXEL . On January 22, 2026, CORXEL announced the completion of a $287 million (approx. ¥45.3 billion at an exchange rate of ¥158/$) financing round. This is an exceptionally large deal compared to funding for private biotech companies in the U.S. in 2025.

In addition to existing shareholder RTW Investments, world-leading biomedical institutional investors such as SR One, TCG Crossover, RA Capital Management, and HBM Healthcare Investments participated. The funds are earmarked for the development of the obesity candidate CX11, as well as JX10 (TMS-007) and JX09 . The resolution of financial concerns regarding the execution of the global TMS-007 trial is a major tailwind for TMS.

In research, the company has steadily accumulated scientific evidence, including the start of a joint research project with Kyushu University on AKI prevention/treatment and the publication of a paper on SMTP compounds in the journal Biological and Pharmaceutical Bulletin.

---

5. FY2026 Interim Financial Performance and Status

Financially, the company maintains the cost-heavy structure typical of a drug discovery biotech venture while appropriately controlling R&D expenses. The interim profit/loss and full-year expense outlook are as follows.

[Slide Commentary: FY2026 Interim Income Statement and Full-Year Expense Outlook]

This slide shows the actual profit and loss for the interim period of FY2026 (January–June 2026) and the expense forecast for the full year ending December 2026. Operating expenses for the interim period were ¥392 million (a 16.9% decrease year-on-year) . This includes R&D expenses of ¥239 million (down 19.7% YoY) and SG&A expenses of ¥152 million (down 12.0% YoY), with the decrease attributed to the completion of the TMS-008 Phase 1 trial costs incurred in the previous interim period. Consequently, the operating loss was ¥392 million , and the interim net loss was ¥393 million .

Expenses are expected to increase from the second half due to the start of the TMS-008 Phase 2a trial, with full-year operating expenses projected at ¥900 million to ¥1.3 billion (including ¥600 million to ¥900 million in R&D expenses) .

Financial Foundation and Cash Flow Health

• Cash Flow : Cash flow from operating activities was -¥339 million (expenditures for R&D, etc.). Reflecting income from financing (¥17 million), the ending balance of cash and cash equivalents was ¥2.459 billion (a decrease of ¥321 million from the beginning of the period).
• Balance Sheet : Current assets stand at ¥2.512 billion (including ¥2.459 billion in cash and deposits), with net assets of ¥2.41 billion (equity ratio of 95.8%) and current liabilities of only ¥104 million.

Given the annual expense pace of ¥900 million to ¥1.3 billion and over ¥2.4 billion in cash on hand, the company has secured a sufficient runway to independently carry out its current pipeline development and the TMS-008 Phase 2a trial.

---

Conclusion

TMS Co., Ltd.’s FY2026 interim earnings report demonstrates that its two major projects are steadily advancing: the ahead-of-schedule progress of the global ORION study for lead candidate TMS-007 (JX10) and the completion of preparations for the Phase 2a trial of the next-generation candidate TMS-008 .

With partner CORXEL’s completion of a ¥45.3 billion funding round, the global clinical promotion structure for TMS-007 is now solid. Meanwhile, TMS is well-positioned to lead domestic development of TMS-008, backed by approximately ¥2.459 billion in cash. Future progress on key milestones, such as the start of patient dosing for TMS-008 and the announcement of ORION study data, remains a focal point for investors.