Shionogi has lifted its full-year profit guidance as expected royalties from its HIV treatment surpass prior expectations.

The Japanese pharmaceutical company raised its full-year operating profit by 5.7% to ?185 billion ($1.2 billion), beating analyst estimates.

The group¡¯s Dovato HIV treatment has top market share in Europe and is expected to continue expanding, CEO Isao Teshirogi said at a Monday briefing. Shionogi¡¯s HIV portfolio includes the preventive drug Apretude and the treatment therapies Cabenuva and Dovato.

A stronger-than-expected performance of its overseas businesses also contributed to the improved prospects. Second-quarter revenue at its U.S. and Europe units rose by 42% and 19%, respectively.

Shionogi now plans to accelerate its expansion in Europe and the U.S., while pursuing full-scale growth of its new drug business in China. New growth areas include sleep apnea, pompe disease, hearing loss, immunology and allergy, according to a Monday statement.

The U.S. Food and Drug Administration last month accepted Shionogi¡¯s Ensitrelvir review application for COVID-19 preventative oral medicine. The drug is also under regulatory review by the European Medicines Agency.

If Ensitrelvir can get the FDA¡¯s approval, it will ¡°open up a new sales angle,¡± said Iwai Cosmo Securities analyst Shoichi Arisawa.

The company also plans to strengthen its production system and overseas manufacturing capabilities, said Teshirogi. ¡°It may be better to conduct development in Japan and production in the U.S.¡±

¡°Tariffs won¡¯t have a major impact, but if the most-favored-nation pricing is introduced, I think the consequences could be quite serious,¡± Teshirogi added.

U.S. President Donald Trump said in a Truth Social post last month that companies building pharmaceutical manufacturing plants in the U.S. would be exempted from the policy, though he offered no further details.