Pharmaceutical and Bio Industry, Who Will Extend the 'CEO Life'?

Major Company Heads' Positions in Focus Ahead of Term Expiry Next Month
Conservative Industry Traits Suggest Many Reappointments... Recent Performance and Other Variables

[Asia Economy Reporter Kim Ji-hee] As the shareholder meeting season approaches this year, industry interest is growing in whether the CEOs of major domestic pharmaceutical and bio companies will be reappointed. While prominent companies such as Samsung Biologics, Celltrion, and Yuhan Corporation have already confirmed leadership changes, there are still many CEOs whose positions have not been decided ahead of their term expirations next month. Given the industry's tendency to choose stability over change amid the COVID-19 crisis, it is widely expected that many will be retained. However, since there are various factors at play for each company, it is difficult to be certain about reappointments until the last moment.

According to the industry on the 18th, major pharmaceutical companies with key executives' terms expiring next month include Celltrion, Yuhan Corporation, Chong Kun Dang, Daewoong Pharmaceutical, Green Cross Holdings, Ildong Holdings, JW Holdings, and Dong-A ST. Samsung Biologics and Celltrion, considered leading bio companies in Korea, completed their key executive appointments ahead of schedule at the end of last year. In December last year, the board appointed John Rim as the new CEO overseeing the operation of Plant 3, succeeding Kim Tae-han, who had led Samsung Biologics since its establishment in 2011.

Similarly, at Celltrion, Chairman Seo Jung-jin stepped down at the end of last year, and Vice Chairman Ki Woo-sung took over. Seo maintains the chairman position until his term expires on the 23rd of next month but has stepped back from day-to-day management to assist the transition to a professional management system led by Vice Chairman Ki and Vice Chairman Kim Hyung-gi of Celltrion Healthcare. Industry insiders expect no major changes immediately, as the two representatives have been founding members working closely with Chairman Seo for a long time. A Celltrion official stated, "Currently, Chairman Seo is only involved in COVID-19 therapeutics."

Yuhan Corporation’s CEO Lee Jung-hee will also step down when his term ends on the 20th of next month. The CEO term at Yuhan is three years, with only one possible renewal. It is expected that through the upcoming shareholder meeting, Executive Vice President Cho Wook-je will be appointed as the next CEO, filling Lee’s position and serving a six-year term.

The situation at Green Cross Holdings, where Chairman Heo Il-seop and CEO Heo Yong-jun’s terms both expire on the 27th of next month, is somewhat complex. In December last year, with Heo Yong-jun’s promotion, a ‘brother CEO’ system was established alongside Heo Eun-chul, president of GC Green Cross. As the sons of the late former chairman Heo Young-seop, who was Chairman Heo’s elder brother, have begun to take an active role in management, industry attention is focused on Chairman Heo’s future.

Other pharmaceutical industry professional managers whose terms are nearing expiration include Kim Young-joo of Chong Kun Dang, Jeon Seung-ho and Yoon Jae-chun of Daewoong Pharmaceutical, Eom Dae-sik of Dong-A ST, Lee Jung-chi of Ildong Holdings, Han Sung-kwon of JW Holdings, and Lee Woo-seok of Kolon Life Science. An industry insider explained, "Due to the long development cycles and conservative nature of the industry, it is true that many professional managers have long tenures in the pharmaceutical sector. This trend is expected to continue this year due to COVID-19, but there are also signs of change with younger executives rising in recent years, which could become a variable."

The reappointment of these pharmaceutical company professional managers is expected to consider a complex mix of internal and external factors, including recent performance. Kim Young-joo of Chong Kun Dang, whose term expires on March 20, is expected to be smoothly reappointed for a second term as he is credited with leading sales growth. Since his appointment in 2015, Chong Kun Dang’s sales have nearly doubled in five years. On the other hand, Jeon Seung-ho and Yoon Jae-chun, whose terms both end on the 23rd of next month, face uncertainty regarding renewal as Daewoong Pharmaceutical’s performance has declined. Last year, Daewoong Pharmaceutical’s operating profit was 16.9 billion KRW, down 62% from the previous year. The reappointment of Lee Woo-seok, CEO of Kolon Life Science, who is currently on trial over the ‘Invossa K Injection’ gene therapy for osteoarthritis scandal, is also uncertain.

This content was produced with the assistance of AI translation services.