Can Diagnostic Kits Break the '3 Trillion Won Annual Sales' Barrier?

SD Biosensor Approaches 3 Trillion Won Milestone Difficult Even for Large Corporations
Traditional Pharmaceutical Companies Show Steady Growth with Increased New Drug Sales

[Asia Economy Reporter Lee Chun-hee] The COVID-19 pandemic has significantly boosted the performance growth of domestic pharmaceutical and bio companies. Diagnostic kit company SD Biosensor is on the verge of achieving 'annual sales of 3 trillion won,' and most companies related to vaccines and therapeutics have shown strong results. Traditional pharmaceutical companies are also expected to improve their performance thanks to expanded sales of new drugs.

Pharmaceutical and Bio Industry Experiences Explosive Growth Due to COVID-19

According to financial information firm FnGuide on the 7th, SD Biosensor's estimated annual sales for last year reached 2.9207 trillion won, a 73.2% increase from the previous year, approaching 3 trillion won. The cumulative sales for the third quarter alone last year were 2.4862 trillion won, easily surpassing 2 trillion won. Although quarterly sales have shown a declining trend, considering the global spread of the Omicron variant from December, there is a possibility that sales will increase again this year.

Among large pharmaceutical and bio companies, many exceeded annual sales of 1 trillion won, but the 2 trillion won threshold was not easily crossed. However, the small and medium-sized company SD Biosensor is the first to aim for 3 trillion won. Despite annual research and development (R&D) expenses being at the 10 billion won level, the company's swift response to COVID-19, including starting diagnostic kit development even before domestic confirmed cases occurred, is credited for its success. Diagnostic kit company Seegene is also expected to achieve annual sales of 1.3446 trillion won, a 19.5% increase from 2020, making it likely to reach 1 trillion won in annual sales for two consecutive years.

Other pharmaceutical and bio companies are also expected to continue their growth with strong performance. According to FnGuide, the estimated sales of 11 major listed pharmaceutical and bio companies last year increased by an average of 22.4% compared to the previous year.

Besides SD Biosensor, the company expected to have the highest annual sales is Celltrion (1.8822 trillion won). Although Celltrion recorded an 'earnings shock' in the third quarter last year, with quarterly sales decreasing by 11.7% compared to the same period the previous year, the COVID-19 antibody treatment 'Rekkirona' received approvals in various countries worldwide in the fourth quarter, leading to exports and a likely recovery of quarterly sales to the 500 billion won level.

Samsung Biologics, which has already announced its results, continues to maintain steady growth. Its annual sales reached 1.568 trillion won, a 34.6% increase, marking four consecutive years of sales exceeding 1 trillion won, and operating profit rose by 83.5% to 537.3 billion won. This is attributed to higher utilization rates of its third plant and the reflected effect of contract manufacturing organization (CMO) sales for the Moderna vaccine, which began full-scale shipments.

Traditional Pharmaceutical Companies Also Show Steady Performance

Among traditional pharmaceutical companies, Daewoong Pharmaceutical is expected to show strong results. Last year's sales and operating profit are estimated at 1.1153 trillion won and 86.7 billion won, respectively. Operating profit surged by a remarkable 410.4% compared to the previous year. The high sales growth of the botulinum toxin 'Nabota' is credited for driving the performance improvement. Nabota's export sales in the third quarter last year reached 20.9 billion won, about double the 11.3 billion won recorded in the same period the previous year.

Hanmi Pharmaceutical and Green Cross also showed steady growth, with operating profits expected to increase by about 1.5 times compared to the previous year. Hanmi Pharmaceutical disclosed sales of 1.2061 trillion won and operating profit of 127.4 billion won on the 27th of last month. Major improved and combination new drugs such as the 'Amozaltan Family' led sales, while Beijing Hanmi Pharmaceutical in China contributed to performance improvement with sales of 288.7 billion won and operating profit of 66.9 billion won.

Green Cross is also expected to see increased sales in China, as its Hunter syndrome treatment 'Hunterase' obtained approval there. Additionally, recognition of flu vaccine sales and the full-scale shipment of the Moderna vaccine, which it distributes domestically, are expected to result in the first fourth-quarter profit since 2018.

SK Bioscience's 'L House Vaccine Center' in Andong-si, Gyeongbuk (Photo by SK Bioscience)

SK Bioscience, which will announce its results this afternoon, is expected to achieve its first-ever annual sales of 1 trillion won. Having focused on COVID-19 vaccine production since the early days of the pandemic, its sales last year are projected to have increased 3.3 times to 968.6 billion won, with operating profit soaring 11.4 times to 468.4 billion won. Following the domestic approval of the Novavax vaccine and its successive entry into global markets, if the domestically developed 'GBP510' vaccine receives approval within this year, even steeper growth is anticipated.

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