[Click eStock] "Celltrion Healthcare Lowers Earnings Forecast... Target Price Down"

Yuanta Securities lowered the target price for Celltrion Healthcare from KRW 93,000 to KRW 85,000 on the 16th. The investment rating was maintained as 'Buy.'

Celltrion Healthcare recorded sales of KRW 525.8 billion (consolidated basis) and an operating profit of KRW 34.1 billion in the second quarter. Compared to the same period last year, sales increased by 1.3%, but operating profit fell to less than half (-54.0%), missing market expectations. This is attributed to a slight increase in cost ratio due to price adjustments of Truxima (anticancer drug) and increased selling and administrative expenses from expanded direct sales and marketing activities in the U.S.

This year, Celltrion Healthcare's direct sales performance in the U.S. essentially depends on RemsimaSC. RemsimaSC, which changed Remsima (an intravenous autoimmune disease treatment) to a subcutaneous injection, aims for U.S. approval within the year and plans to launch early next year.

While Celltrion Healthcare's direct sales products in the U.S. are limited to biosimilars such as Vegzelma (Avastin biosimilar) and Uplyma (Humira biosimilar), RemsimaSC is expected to be launched as a new drug without any identical competing products.

Hyunsoo Ha, a researcher at Yuanta Securities, said, "The target price adjustment is due to the downward revision of earnings forecasts influenced by increased costs from direct sales in the U.S.," but added, "Direct sales in the U.S. are in the early stages, and after the launch of RemsimaSC, there is an expectation of sales growth from an increase in the number of biosimilar products as Celltrion aims to submit approval applications for five biosimilar products within the year and expand negotiation power with Pharmacy Benefit Managers (PBMs)."

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