Analysis of SK Group's Bio Subsidiaries... No Barriers in 'Future Business'

[Asia Economy Reporter Park Soyeon] SK Group's bio business is broadly divided into two branches. One is SK Biopharm and SK Pharmteco, affiliates of SK Inc. led by Chairman Chey Tae-won, and the other is SK Bioscience and SK Plasma, affiliates of SK Discovery Inc. led by Vice Chairman Chey Chang-won.

In the case of SK Group, the two holding companies SK Inc. and SK Discovery Inc. operate independently in practice. However, it is well known that the SK Group owners have a very close relationship, and recently Chairman Chey Tae-won has been moving seamlessly within the group's bio business, such as encouraging researchers at SK Bioscience under SK Discovery who are actively developing COVID-19 vaccines via video calls.

Vice Chairman Chey Chang-won, the cousin of Chairman Chey Tae-won, established SK Plasma in 2015 by spinning off the blood products division of SK Discovery (then SK Chemicals). In 2017, SK Discovery, the holding company, and SK Chemicals were split by spin-off. SK Chemicals, a subsidiary of SK Discovery, has been focusing intensively on the vaccine business since the mid-2000s. It began to actively participate in the market by launching the shingles vaccine "Sky Zoster" in December 2017. In July last year, the vaccine business division was spun off to launch SK Bioscience as a subsidiary. SK Bioscience is the only company among Korea's top 10 conglomerates to enter COVID-19 vaccine development.

While SK Bioscience and SK Plasma specialize in vaccine development and blood product development respectively, SK Biopharm and SK Pharmteco, affiliates of SK Inc., are companies specialized in new drug development and mass production respectively. SK Pharmteco has become a key base for producing COVID-19 therapeutics in the United States, and SK Biopharm, which has achieved outstanding results in the new drug field, is scheduled to go public in July this year. SK affiliates are each showing prominence in core areas of the global bio industry: new drugs (SK Biopharm), vaccines (SK Bioscience), contract manufacturing (SK Pharmteco), and plasma therapy (SK Plasma). The business community evaluates that considering the portfolio composition and the technological capabilities of individual companies, the competitiveness of SK Group's bio business has reached a considerable level.

In particular, SK Biopharm is praised for rewriting the history of Korea's pharmaceutical and bio industry by directly carrying out all stages of new drug development, from introducing new drug candidates to clinical trials, approval, and sales. On the 11th, with the start of sales of the epilepsy drug "Xcopri" in the United States, the company became the first domestic company to hold two FDA-approved new drugs. The sleep disorder treatment "Solriamfetol" has also been sold in the U.S. since July last year. Accordingly, the financial investment industry predicts that if SK Biopharm succeeds in listing on the KOSPI in the second half of this year, its corporate value could reach up to 5 trillion won. This has also drawn attention to the role of Yoonjung, the eldest daughter of Chairman Chey Tae-won, who is a bio industry expert. Before going abroad last year to pursue a master's degree in bioinformatics at Stanford University in the U.S., Yoonjung worked at SK Biopharm for two and a half years starting in 2017. A business community official said, "The competitiveness of each SK Group bio business affiliate has reached a considerable level externally," adding, "Considering the growth trend of the global bio industry market, it is safe to say that it is a core part of SK Group."

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