May 16, 2008

Takeda Pharmaceutical Company Limited

Proposed Amendments of the Remuneration System
For Members of Board of Directors and Corporate Auditors

Osaka, Japan, May 16, 2007 --- Takeda Pharmaceutical Company Limited ("Takeda") announced that its Board of Directors Meeting held today revolved that the amendments of the Remuneration System for members of Board of Directors and Corporate Auditors will be proposed at the 132nd Ordinary General Shareholders Meeting scheduled on June 26, 2008 to further increase corporate value. The proposed amendments are detailed below.

1. Introduction of a new remuneration system for Board of Directors

The current remuneration for members of Board of Directors consists of basic (monthly) remuneration, bonuses and retirement allowances. Takeda will propose to introduce a new remuneration system which will further linkage between the said system and shareholder value in order to elevate the motivation and incentive of its members of Board of Directors for improving the mid and long term corporate performance.

The new system shall consist of a fixed-amount basic (monthly) remuneration, bonuses determined with consideration of the consolidated results and other factors in each fiscal year, and stock option (stock acquisition rights) linked with the mid and long term corporate performance.

(The amount and details of stock option remuneration)

Each fiscal year, Takeda shall allot stock options with principal terms described below to its members of Board of Directors as a part of remuneration. The ceiling for remuneration through these stock options shall be 350 million Japanese yen per year, and the rounded down number by dividing this ceiling by the fair value per stock option calculated by the Black-Scholes model(*) on the day of allotment shall be the maximum stock option for the corresponding year. The amount of this remuneration has been decided by taking into consideration the current remuneration and also the appropriate system and levels of the remuneration for members of the Board of Directors for the future. This remuneration will be an independent one from the amount of remuneration for members of the Board of Directors approved at the 114th ordinary general meeting of shareholders held on June 28, 1990 (no more than 40 million Japanese yen per month, excluding pay for serving as employees).

The principal terms of the stock options are as follows.

(1) Class and number of shares to be issued or transferred upon exercise of stock options

1) Class of shares

Shares of common stock of Takeda.

2) Number of shares

100 shares of common stock of Takeda for each option.

In the event Takeda conducts initiatives requiring adjustment of the number of shares to be issued or transferred upon exercise of stock options, such as stock split, free distribution of shares or stock consolidation, this number would be adjustable within a reasonable range.

(2) Amount of assets contributed upon the exercise of stock options

The assets to be contributed upon exercise of stock options shall be cash, and the amount of the assets per share shall be one Japanese yen, and the contribution amount shall be determined by multiplying this per-share value by the number of shares to be issued or transferred upon exercise of the stock options.

(3) Period during which stock options may be exercised

The period during which stock options may be exercised shall be from the day marking the end of three years after the day of stock option allotment up to the end of ten years after the same day. However, even within three years counting from the day of stock option allotment, a member of the Board of Directors may exercise stock options beginning on the following day of their retirement if it is due to the expiration of his/her term of office or there is legitimate reason for such retirement.

(4) Restrictions on transfer of stock options

Acquisition of stock options through transfer shall be subject to approval by the Board of Directors.

(5) Conditions for exercise of stock options

• 1) The holder of stock options must be a member of the Board of Directors of Takeda at the time of exercise of stock options. However, this provision shall not apply if the option is exercised after retirement if it is due to the expiration of his/her term of office or there is legitimate reason for such retirement.
• 2) It shall not be allowed to exercise a stock option in part.

(6) Others

Other matters related to stock options shall be determined at a meeting of the Board of Directors to be held for the purpose of the stock option solicitation.

2. Introduction of a new remuneration system for Corporate Auditors

The current remuneration for corporate auditors consists of basic (monthly) remuneration, bonuses and retirement allowance. In the light of the role of corporate auditors, it shall be consolidated into the fixed-amount basic (monthly) remuneration with certain increase.

3. Abolition of the retirement allowances system for Members of Board of Directors and Corporate Auditors

Upon the conclusion of the 132nd Ordinary General Meeting of Shareholders, the system of retirement allowances for members of Board of Directors and Corporate Auditors will be abolished. As to retirement allowances corresponding to the period of services up to that day for each member of Board of Director and Corporate Auditor, the payment will be made at the time of retirement.

[*] Black-Scholes model is frequently used calculation method for the fair value of stock options based on the market price, execution price of option, period till maturity, implied volatility and others. The fair value per share as of March 31, 2008 calculated using the Black-Scholes model would be 4,023 Japanese yen. Division of the sum of 350 million as the annual ceiling for stock option remuneration by this fair value would be 869 for the annual number of stock options allotted. The number of shares represented by these stock options would be 86,900. This represents approximately 0.01 percent of the 842,943,646 shares remaining after subtraction of 46,328,749 shares in treasury stock from the total of 889,272,395 shares of Takeda's outstanding stock volume as of 31 March 2008.

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