Ann: Response to ASX Price Query Letter, page-77

lower drug prices in Japan could potentially influence U.S. prices under President Trump’s proposed Most Favored Nation (MFN) pricing model—but only under specific conditions.

Here’s how it could apply:

• The MFN policy aims to tie U.S. drug prices (primarily under Medicare Part B) to the lowest price available in developed nations (e.g., Japan, Germany, UK).
• If a drug sold in the U.S. under Medicare Part B is also sold in Japan at a lower government-regulated price, that Japanese price could become a benchmark for the U.S. price under this policy.

Why this likely doesn't affect Sofdra:

• Sofdra (sofpironium) is a topical gel and is self-administered, so it would typically be reimbursed under Medicare Part D or private insurance, not Part B.
• The MFN model (as currently proposed) applies only to Medicare Part B drugs, which usually involve physician-administered treatments (like injections or infusions).
• Therefore, even if Sofdra (sold as Ecclock in Japan) has a lower price in Japan, it wouldn’t be used as a reference price under this executive order, at least based on what’s currently known.

However:

• There is always some risk of policy expansion. If the MFN approach were broadened in the future to include Part D or more drug types, then Japanese pricing could become a reference for self-administered drugs like Sofdra.
• Market fears may reflect anticipation of broader reformsor confusion over which drugs are included.

In short: While Japanese pricing for Sofdra might raise investor concerns, there is no current mechanism through the MFN model that would directly link those prices to the U.S. market for this specific drug.