Research

Japan Tissue Engineering: Teijin-controlled; knee-cartilage indication drives turnaround

Japan Tissue Engineering Co., Ltd. (7774) · Initiated coverage 2026-10-21 · Beluuga AI Research Team · Independent research

Not investment advice or a solicitation. See Important disclosures below.

Business overview

  • Japan Tissue Engineering (J-TEC) develops, makes and sells regenerative medical products grown from patients' own cells. It sells them to hospitals in Japan under the Pharmaceuticals and Medical Devices Act, which requires Ministry of Health, Labour and Welfare approval, including manufacturing and quality-control standards.
  • It has five approved products. JACE is cultured skin for severe burns, giant congenital nevi and epidermolysis bullosa. JACC is cultured knee cartilage, and JACEMIN is pigment-cell-containing skin for vitiligo. Nepic and Ocural treat corneal epithelial stem-cell deficiency and are sold together with Nidec, a co-founder of the company.
  • It reports three segments: Regenerative Medical Products, Regenerative Medicine Contract Services, and LabCyte. Contract Services offers contract development and manufacturing plus clinical-development services. LabCyte sells cultured human tissue models used in place of animal testing, mainly to cosmetics and chemical companies (see Performance & Balance).
  • The company reports on a non-consolidated basis under Japanese GAAP with a March year-end and had 200 employees at March 31, 2026. Its headquarters and production are at one site in Gamagori, Aichi Prefecture.

Investment case

  1. In May 2025, JACC won approval to expand its indication to knee osteoarthritis, and reimbursement followed from January 2026. The annual securities report calls this the most important product for the company's revenue growth. It reports 125 contracted facilities and a record of 30 orders in March 2026.
  2. The first-quarter earnings release for the year to March 2027 shows Regenerative Medical Products sales rising sharply and the company swinging to an operating profit from a loss a year earlier. Management kept its full-year forecast, which calls for revenue growth and a return to operating and net profit (see Performance & Balance).
  3. The balance sheet shows cash and deposits making up most of total assets and no interest-bearing borrowings, with net assets almost entirely shareholders' equity. The company states that it funds short-term working capital from its own resources (see Performance & Balance).
  4. The pipeline includes Allo-JaCE03, a dried, room-temperature-storable donor-cell skin product filed for approval in March 2026 with a launch target in the year to March 2028. It also includes an autologous CAR-T product made by the company and a research intestinal model targeted for launch in the year to March 2027. LabCyte's skin-sensitization test method was added to the OECD test guidelines in June 2024.

Bear case

  1. Teijin holds a majority of voting rights and became the parent through a tender offer in March 2021, so minority holders cannot determine board elections or strategic decisions (see Shareholders). Teijin is also a contract-services customer: its milestone payments slipped into the next year and contributed to that segment's sales decline in the year to March 2026.
  2. In the year to March 2026, revenue fell, the operating loss widened and the net loss grew. The net loss included write-downs on investment securities and losses on disposal of fixed assets. Retained earnings were in deficit at the year-end.
  3. The company states that JACE orders for giant congenital nevi and epidermolysis bullosa fell because the existing patient pool had been treated. Nepic and Ocural orders also declined as new patients at existing hospitals did not grow.
  4. The company paid no dividend for the year to March 2026 and forecasts none for the year to March 2027, so any shareholder return depends on the share price (see stock chart).

Catalysts

  • JACC case volumes after reimbursement: the company targets 350 cases in the year to March 2027 and 600 in the year to March 2028. For JACEMIN it targets 50 and 100 orders over the same years.
  • Progress on the full-year forecast for the year to March 2027 in the second-quarter and later earnings releases. The company does not issue a first-half forecast.
  • The regulatory decision on Allo-JaCE03, aimed at launch in the year to March 2028. Also watch completion of the Nagoya University Phase I/II investigator-initiated CAR-T trial, expected in the year to March 2027, and preparation of a German subsidiary for LabCyte.

Key risks

  • The company rates the market size for its products as limited. It states that sales can swing widely with the number of eligible patients, competitor entry, or contract clients cancelling or scaling back work.
  • Some raw materials and supplies cannot be substituted, and failure to procure them could halt production of both own and contract products. Headquarters and production share a single site, so one disaster could stop both.
  • The company rates loss of specialist staff as high likelihood because competitors are increasing. It also notes that unforeseen changes to law or health-care policy, including pressure on insurance spending, could affect its strategy and results.
  • Transactions with Teijin are a structural conflict of interest. The company requires board approval for such transactions and has a special committee of four independent officers that reviews material dealings with the controlling shareholder. The board has six directors, of whom two are independent outside directors.

Trading liquidity

Median daily trading value US$0.34mn
Average daily volume 140,958 shares

2025-10-01 to 2026-10-20 (250 trading days). Trading value is daily closing price × daily volume on the Tokyo Stock Exchange.

Assumptions

  • Financial figures on this page come from beluuga.ai's daily data set; trading liquidity is measured over the period shown. We do not use consensus estimates.
  • The first-quarter earnings release for the year to March 2027 was not reviewed by the auditor and contains no quarterly cash-flow statement. It was filed about six weeks after the annual securities report.
  • Qualitative statements are taken from the annual securities report for the year to March 2026 and the first-quarter earnings release for the year to March 2027.

This is independent research. No company paid for or reviewed it. We do not publish ratings, price targets or buy/sell views. Figures on the other slides of this page come from beluuga.ai's daily data set.

Important disclosures

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Securities of Japanese issuers. The securities discussed are issued by companies incorporated in Japan and listed on the Tokyo Stock Exchange. They may not be registered under the U.S. Securities Act of 1933, and the issuers may not be subject to the periodic reporting requirements of the Securities Exchange Act of 1934. Information about these issuers may be less extensive than information about U.S. issuers, and their financial statements are prepared under Japanese GAAP, IFRS or U.S. GAAP as each issuer elects. U.S. persons may face restrictions, tax consequences and practical limits on buying, holding or selling these securities. Investments in non-U.S. securities involve risks that include currency movements, lower trading liquidity, and differences in market practice, corporate governance and legal protection.

Currency. Amounts shown in US$ are converted from Japanese yen at a mid-market rate for convenience only. They are not the amounts an investor would receive, and changes in exchange rates may cause the value of a yen-denominated investment to fall in US$ terms even if its value in yen does not.

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Overview
Precision Instruments

Japan Tissue Engineering Co.,Ltd.

Japan Tissue Engineering Co., Ltd. (J-TEC) develops, manufactures, and sells regenerative medicine products based on tissue engineering technology, with five approved autologous cultured products including cultured epidermis (JACE), cultured cartilage (JACC), cultured corneal epithelium (NEPIC), cultured oral mucosal epithelium (OCULAR), and melanocyte-containing cultured epidermis (JASMINE). The company also operates a contract development and manufacturing (CDMO) business for regenerative medicine developers, as well as a research support business providing cultured human tissues for research use. As a member of the Teijin Group since 2021, J-TEC leverages its proprietary cell culture and quality management know-how to serve hospitals, research institutions, and pharmaceutical/biotech developers.

Market Cap
¥29.4B
US$187M
EV
¥25.9B
US$165M
Stock¥723▼-3.60%
US$1 = ¥157.05 (2026-10-22)
LTM EV/EBITDA
NM
LTM EV/EBIT
NM
LTM PER
NM
LTM PBR
5.7
x
Stock vs TOPIX (1Y, base=100)vs TOPIX ▲+22.2%pt
1001
Oct 22, 25 – Oct 22, 26StockTOPIX
1Jul 30, 26Q1 FY2027/03 earnings announced
MC → EV Bridge
29.4BUS$187MMarket Cap0.00BUS$0.00M+ Debt3.35BUS$21.3M− Cash0.10BUS$0.64M− Inv. Sec.25.9BUS$165MEV
AI Briefing
J-TEC: Japan's regenerative medicine pioneer—five approved autologous tissue products spanning dermatology, orthopedics, ophthalmology, plus CDMO and research-tissue segments. FY26/3 revenue ¥2.2B, operating loss ¥-0.5B, deepening from prior year—growth has yet to translate into profitability despite scaling CDMO ambitions. Majority-controlled by Teijin (57.71%) with Nidec holding 10.40%; strategic positioning around Teijin Regenett ties the platform's trajectory to group-level scale-up rather than standalone re-rating.
Performance & Balance
Revenue 5Y (¥B)
2.10US$13.4M'22/32.03US$12.9M'23/32.51US$16.0M'24/32.46US$15.6M'25/32.18US$13.9M'26/3
EBITDA 5Y (¥B)
-0.37-US$2.38M'22/3-0.60-US$3.80M'23/30.28US$1.77M'24/3-0.08-US$0.51M'25/3-0.39-US$2.49M'26/3
Net Income 5Y (¥B)
-0.50-US$3.16M'22/3-0.73-US$4.64M'23/30.14US$0.91M'24/3-0.26-US$1.62M'25/3-0.73-US$4.67M'26/3
Capital Structure
100%
EquityD/E 0.00xDebt
Liquidity vs Debt 5Y (¥B)▲ Net Cash
CashInv. Sec.Debt
4.93US$31.4M0.00US$0.01M'22/34.13US$26.3M0.00US$0.00M'23/34.27US$27.2M'24/34.04US$25.7M'25/33.35US$21.3M'26/3
Shareholders
Top 10 hold 72.5%
1
TEIJIN LIMITED
57.71%
2
NIDEC CORPORATION
10.40%
3
Yoko MAEDA
0.84%
4
Daisuke GOMI
0.81%
5
Yosuke OZAWA
0.71%
6
J-TEC Employee Stock Ownership Association
0.60%
7
Saara Energy Co., Ltd.
0.45%
8
Ueda Yagi Tanshi Co., Ltd.
0.36%
9
Rakuten Securities, Inc.
0.34%
10
BNY GCM CLIENT ACCOUNT JPRD AC ISG (FE-AC)
0.28%
Management
9 officers
Kazuto YAMADA
Representative Director, President and Executive Officer
Jun 2000 Joined the Company; Research & Development Department Jan 2007 Quality Control, Production Management Division Apr 2013 Quality Assurance, Reliability Assurance Department Apr 2021 General Manager, Reliability Assurance Department Jul 2024 Executive Officer Jan 2025 Senior Vice President, Executive Officer Jun 2025 Representative Director, President and Executive Officer (current)
1973-01-30
Toshihiro OSUGA
Director, Senior Managing Executive Officer
Mar 1980 Joined Natco Paint Co., Ltd. (now Natco Corporation) Oct 1986 Joined Nidec Corporation Feb 1999 Seconded from Nidec Corporation to the Company as Director in charge of Management Administration Apr 2003 Transferred from Nidec Corporation to the Company Jun 2004 Managing Director of the Company Apr 2007 Managing Director; General Manager, Management Administration Department; in charge of Compliance May 2007 Managing Director, in charge of Compliance Apr 2010 Managing Director; General Manager, Reliability Assurance Department; in charge of Compliance Apr 2011 Managing Director Apr 2012 Managing Director; General Manager, Reliability Assurance Department Mar 2014 Managing Director; General Manager, Sales Department Jun 2015 Director, Senior Managing Executive Officer; General Manager, Sales Department Apr 2016 Director, Senior Managing Executive Officer Apr 2017 Director, Senior Managing Executive Officer; General Manager, Sales Promotion Headquarters Apr 2018 Director, Senior Managing Executive Officer; General Manager, Production Management Headquarters and Manufacturing Department Apr 2019 Director, Senior Managing Executive Officer; General Manager, Production Management Headquarters Jun 2021 Director, Senior Managing Executive Officer (current)
1957-01-15
Takayuki NAKANO
Non-Executive Director
Apr 2000 Joined Takeda Pharmaceutical Company Limited Apr 2007 Seconded to Takeda Global R&D Center, Inc. (stationed in the United States) Apr 2009 Chief Staff Member, Development Strategy Department, Pharmaceutical Development Division, Takeda Pharmaceutical Company Limited Apr 2011 Director, seconded to Takeda Pharmaceutical International Inc. (stationed in the United States) May 2014 Global Business Planning Head and Japan Business Coordinator, Takeda Vaccines, Inc. (stationed in the United States) Jan 2021 Joined Teijin Limited; Assistant to Executive in charge of Corporate Planning Apr 2021 Assistant to Executive in charge of Corporate Planning; General Manager, Regenerative Medicine New Business Division Jun 2021 Director of the Company (current) Apr 2022 Deputy Head, Corporate Business Incubation Division; General Manager, Regenerative Medicine New Business Division, Teijin Group; Director, Teijin Nakashima Medical Co., Ltd. Apr 2023 Mission Executive; Head, Regenerative Medicine and Implantable Medical Device Division, Teijin Limited Apr 2023 Director, Teijin Medical Technologies Co., Ltd. (current) Jun 2023 Director, Regenerative Medicine Innovation Forum (current) Aug 2023 Director, Teijin Regenet Co., Ltd. Mar 2025 Outside Director (Audit and Supervisory Committee Member), Laquaria Pharmaceutical Inc. (current) Apr 2026 Corporate Executive; Head, Corporate New Business Division, Teijin Limited (current)
1971-07-09
Akinobu WAKABAYASHI
Director, Executive Officer
Apr 2007 Joined Teijin Creative Staff Co., Ltd.; Accounting Department May 2013 Stationed in the Netherlands at Teijin Holdings Netherlands B.V. Apr 2016 Teijin Pharma Limited; Administration Department, in charge of New Business Planning Oct 2020 Teijin Limited; Corporate Strategy Department, in charge of Medium-Term Management Plan Development Oct 2023 Seconded from Teijin Limited to the Company; Management Administration Department Jul 2024 Executive Officer; General Manager, Strategic Planning Office, the Company Apr 2025 Registered Small and Medium Enterprise Management Consultant Jun 2025 Director, Executive Officer of the Company Oct 2025 Director, Executive Officer; General Manager, Management Administration Department (current)
1984-10-16
Toshiyuki MASAI
Outside Director (Note 2)
Mar 1980 Joined Nikon Corporation Sep 2001 General Manager, Public Relations Department, Nikon Corporation Jan 2004 Executive Officer; President, Nikon Inc. (Americas), Nikon Corporation Sep 2007 Executive Officer; President, Nikon Europe B.V. (Europe), Nikon Corporation Jun 2009 Director; Managing Executive Officer; President, Instruments Company, Nikon Corporation Jul 2009 Vice Chairman, Japan Microscope Industry Association Jun 2013 Chairman, Japan Optical Measuring Instruments Manufacturers' Association Jun 2014 Director, Nikon Corporation; Director; Senior Vice President, Executive Officer, JEOL Ltd. Jun 2017 Advisor, Nikon Corporation; Advisor, JEOL Ltd. Mar 2022 Director, Fuchu Country Club Co., Ltd. Jun 2022 Outside Director of the Company (current) Mar 2024 Managing Director, Fuchu Country Club Co., Ltd.
1952-08-05
Yasuo KITAJIMA
Outside Director (Note 2)
Apr 1968 Resident, Department of Pediatrics, Gifu University School of Medicine Dec 1968 Obtained medical license Apr 1969 Graduate School of Medicine, Gifu University (Biochemistry) Jan 1974 Awarded Doctor of Medicine Mar 1975 Postdoctoral Fellow, Department of Cell Biology, Botany, University of Texas, United States Apr 1977 Assistant, Department of Dermatology, Gifu University School of Medicine Jul 1981 Board-certified Dermatologist, Japanese Dermatological Association Oct 1981 Lecturer, Department of Dermatology, Gifu University School of Medicine Jun 1983 Associate Professor, Department of Dermatology, Jichi Medical University Jul 1993 Associate Professor, Department of Dermatology, Gifu University School of Medicine Apr 1994 Professor, Department of Dermatology, Gifu University School of Medicine Sep 2000 Board-certified Specialist, Japanese Society for Medical Mycology Apr 2002 Director, Gifu University Hospital Apr 2009 Acting Director and Board Member, Kisawa Memorial Hospital, Kosei-kai Medical Corporation Apr 2011 Director and Board Member, Kisawa Memorial Hospital, Kosei-kai Medical Corporation Mar 2018 Honorary Director and Board Member, Kisawa Memorial Hospital, Kosei-kai Medical Corporation Apr 2020 Chairman, Seijinkai General Incorporated Foundation (current) Jan 2022 Honorary Director and Board Member, Chubu International Medical Center, Kosei-kai Medical Corporation (current) Jun 2023 Outside Director of the Company (current)
1943-06-22
Yoshihiko HANDA
Full-time Audit & Supervisory Board Member
Apr 1981 Joined Nidec Corporation Feb 1999 Seconded from Nidec Corporation to the Company; General Manager, Legal Affairs Planning Department Apr 2004 Transferred from Nidec Corporation to the Company Jun 2004 Director of the Company; General Manager, Quality Assurance Department Jun 2006 Retired as Director of the Company; General Manager, Quality Assurance Department Apr 2007 General Manager, Accounting Department and General Manager, Internal Audit Office of the Company (Released Apr 2017) Apr 2023 General Manager, Operations Department of the Company Jul 2024 General Manager, Audit Office of the Company Jun 2025 Full-time Audit & Supervisory Board Member of the Company (current)
1958-09-19
Takahiro KATO
Outside Audit & Supervisory Board Member (Note 2)
Apr 1991 Joined Sato Sumio Tax Accountant Office (now Meinan Management Tax Corporation) Oct 1998 Joined Tohmatsu & Co. (now Deloitte Touche Tohmatsu LLC) Apr 2002 Registered as Certified Public Accountant Oct 2005 Opened Takahiro Kato Accounting Office (current) Nov 2005 Registered as Certified Tax Accountant Dec 2006 Established Clover Brain Co., Ltd.; Representative Director (current) Jun 2008 Outside Audit & Supervisory Board Member of the Company (current) Jan 2015 Audit & Supervisory Board Member, Gifu Engei Co., Ltd. (current)
1969-03-21
Kaoru OGAWA
Outside Audit & Supervisory Board Member (Note 2)
Oct 1981 Joined Tohmatsu & Aoki Audit Corporation (now Deloitte Touche Tohmatsu LLC) Mar 1985 Registered as Certified Public Accountant Jun 2013 Vice Chairman, Tokai Chapter, Japanese Institute of Certified Public Accountants Jul 2013 Director, Japanese Institute of Certified Public Accountants Oct 2014 Opened Kaoru Ogawa CPA Office (current) Jun 2017 Outside Audit & Supervisory Board Member of the Company (current) Jan 2018 Joined Gyosei Audit Corporation Oct 2018 Partner, Gyosei Audit Corporation Jun 2020 Audit & Supervisory Board Member, AT Group Co., Ltd. Jun 2024 Outside Audit & Supervisory Board Member, Nippon Chemi-Con Corporation (current)
1958-04-03
Large Shareholding Reports
No filings
Disclosures
No disclosures
Primary Source Filings
TDnet
2026-07-30
Q1 Earnings Flash
FY ending Mar 2027
EDINET
2026-06-18
Annual Securities Report
Period: Apr 2025 – Mar 2026
TDnet
2026-01-30
Q3 Earnings Flash
FY ending Mar 2026
EDINET
2025-11-13
Semi-Annual Securities Report
Period: Apr 2025 – Mar 2026
TDnet
2025-07-30
Q1 Earnings Flash
FY ending Mar 2026
EDINET
2025-06-19
Annual Securities Report
Period: Apr 2024 – Mar 2025
TDnet
2025-01-31
Q3 Earnings Flash
FY ending Mar 2025
EDINET
2024-11-13
Semi-Annual Securities Report
Period: Apr 2024 – Mar 2025
TDnet
2024-07-30
Q1 Earnings Flash
FY ending Mar 2025
EDINET
2024-06-19
Annual Securities Report
Period: Apr 2023 – Mar 2024
EDINET
2024-02-13
Quarterly Securities Report
Period: Oct 2023 – Dec 2023
EDINET
2023-11-14
Quarterly Securities Report
Period: Jul 2023 – Sep 2023
EDINET
2023-08-10
Quarterly Securities Report
Period: Apr 2023 – Jun 2023
EDINET
2023-06-15
Annual Securities Report
Period: Apr 2022 – Mar 2023
EDINET
2023-02-14
Quarterly Securities Report
Period: Oct 2022 – Dec 2022
EDINETAmended
2023-02-03
Amended Annual Securities Report
Period: Apr 2021 – Mar 2022
EDINET
2022-11-11
Quarterly Securities Report
EDINET
2022-08-10
Quarterly Securities Report
EDINET
2022-06-16
Annual Securities Report
EDINET
2022-02-14
Quarterly Securities Report
EDINET
2021-11-12
Quarterly Securities Report
EDINET
2021-08-12
Quarterly Securities Report
EDINET
2021-06-25
Annual Securities Report
EDINET
2021-02-12
Quarterly Securities Report
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