Factory Expansion with 100 Billion Investment... Daewoong Shows Confidence Despite 'Nabota' Lawsuit Risk

Daewoong Pharmaceutical is investing 100 billion KRW to build an additional production plant for its botulinum toxin (BTX) formulation, 'Nabota.'

Daewoong Pharmaceutical Botulinum Toxin 'Nabota' Third Factory Bird's-eye View. [Image provided by Daewoong Pharmaceutical]

On the 2nd, Daewoong Pharmaceutical announced, "We have decided to construct the third Nabota plant to expand the Nabota business and respond to rising demand." The third plant is planned to be built in Hyangnam-eup, Hwaseong-si, Gyeonggi-do, with the company planning to invest 101.36 billion KRW for the construction. This is a large-scale investment amounting to 13.7% of Daewoong Pharmaceutical's equity capital as of the 2nd. Nabota is the only botulinum toxin formulation approved by the U.S. Food and Drug Administration (FDA) not only in Korea but across Asia. Exports have also steadily increased, with exports last year rising 123.3% compared to the previous year. Daewoong Pharmaceutical expects Nabota's sales volume to grow at an average annual rate of 20% until 2030, with overseas sales alone exceeding 10 million vials (vial - injectable glass container). Nabota, currently launched in the U.S. and European markets, is also exploring entry into the Oceania and European markets.

The newly decided third plant is known to have an annual production capacity of about 13 million vials. Considering that the combined annual production of the existing first and second plants producing Nabota is 5 million vials, this represents a significant increase in production capacity. While promoting the construction of the new plant, Daewoong Pharmaceutical also revealed plans for next-generation formulation production, aiming to expand BTX formulations currently produced only as injectables to next-generation formulations such as liquid type, sustained-release, and microneedles in the future.

A variable factor is that Daewoong Pharmaceutical is currently engaged in a civil lawsuit with Medytox in Korea. This is because a ruling was made in February in the first trial of Medytox's lawsuit against Daewoong Pharmaceutical for trade secret infringement, ordering the suspension of Nabota production. Daewoong Pharmaceutical called it a "clear misjudgment," immediately appealed, and applied for a stay of execution on the first trial. The second trial between the two companies is currently underway, and with the stay of execution accepted, Nabota's production, sales, and exports continue normally until a verdict is reached.

Experts also view that the uncertainty of the lawsuit has a limited short-term impact on Nabota's business viability. Seungmin Kim and Jihyun Lee, researchers at Mirae Asset Securities, diagnosed, "Although there is uncertainty due to the first trial loss in the civil lawsuit with Medytox, the impact on short-term performance is limited." However, since uncertainty remains around Nabota, there is also analysis that achievements in other areas are needed. Byungguk Park, a researcher at NH Investment & Securities, said, "The uncertainty about Nabota continues to lower the multiple (corporate value relative to profitability), so wise responses to the lawsuit are necessary," adding, "Additionally, it is a crucial time to achieve results from 'Versiporosin,' a new drug for idiopathic pulmonary fibrosis currently undergoing phase 2 trials in the U.S."

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