Tsumura & Co. (Headquarters: Tokyo, President: Junichi Yoshii) announces that a meeting of its Board of Directors held on May 15, 2007 decided to discontinue development of TU-025 (Keishibukuryogan) in the United States.

1. Description of the drug
TU-025 (Keishibukuryogan) is studied for the treatment of menopausal hot flashes.

2. Reason for discontinuation of development
The results of a phase II clinical trial conducted at the University of Minnesota revealed a tendency for symptoms to improve with TU-025 compared with the placebo. On the basis of these clinical results, Tsumura concluded that an additional Phase II clinical study with a modified study design was necessary, and has been preparing for that.
However, concerns arose that continuation of the development would prolong the development period and the inevitably result in a cost increase. The Company thus ultimately elected to discontinue development.

3. Future outlook
With development of TU-025 (Keishibukuryogan) to be discontinued, Tsumura will concentrate on development of TU-100 (Daikenchuto), currently being studied in the United States. The development schedule for TU-100 remains unchanged.
The impact of today's decision on the Company's medium-term outlook is slight. The decision does not affect research or marketing of Kampo preparations in Japan.