As major Korean drugmakers have released their first-quarter earnings one after another, market attention is shifting to growth catalysts in the second half, including new drug development and clinical trial progress. Chong Kun Dang (185750.KS) extended its top-line growth on the back of its distribution deal for obesity treatment Wegovy, while Yuhan Corporation (000100.KS) maintained growth despite delayed milestone payments from its non-small cell lung cancer drug Lazcluze. Hanmi Pharmaceutical (128940.KS) saw operating profit decline on one-off base effects, but clinical progress in its obesity and metabolic disease pipeline is emerging as a key variable for the second half.
According to the industry on the 2nd, Chong Kun Dang posted first-quarter revenue of 447.7 billion won and operating profit of 17.6 billion won on a separate basis. The figures represent year-on-year increases of 12.2% and 36.9%, respectively. Wegovy drove the results with 48.8 billion won in revenue during the first quarter alone. Despite declines in existing products due to the patent expiration of osteoporosis treatment Prolia and the application of selective reimbursement for brain function improvement drug Gliatilin, distributed products filled the revenue gap, according to industry assessments.
However, the expanding share of distributed products remains a burden on profitability. Samsung Securities said in a report that the share of distributed products in Chong Kun Dang's total revenue is estimated at more than 40%, making an increase in the cost ratio inevitable.
Going forward, clinical results from the new drug pipeline are expected to be a key variable for corporate value. Chong Kun Dang is conducting a Phase 2 clinical trial for the atrial fibrillation indication of CKD-510, a new drug candidate licensed to Novartis. The clinical trial is expected to conclude next year. Lee Ji-soo, a researcher at Daol Investment & Securities, said, "As this is an area with high unmet demand due to toxicity concerns and rhythm control limitations of existing treatments, the new drug's value could be reassessed depending on the clinical results."
Yuhan Operating Profit Up 37%... "Milestone Payments Expected in Q2"
Yuhan Corporation posted preliminary first-quarter revenue of 526.8 billion won and operating profit of 8.8 billion won on a consolidated basis, up 7.2% and 37.3% year-on-year, respectively. The results fell short of market expectations as approximately 44 billion won in European milestone payments for Lazcluze was not reflected in the first quarter. According to financial information provider FnGuide, Yuhan's first-quarter consensus (market forecast average) was 538.4 billion won in revenue and 22.1 billion won in operating profit.
Securities firms assessed that Yuhan's growth momentum remains intact. Hur Hye-min, a researcher at Kiwoom Securities, said, "As insurance listings in European countries are being completed one by one, Lazcluze milestone payments could flow in during the second quarter." Analysts also noted that Lazcluze has entered a phase of expanding U.S. royalty revenue. One securities analyst said, "Lazcluze royalties slightly exceeded 10 billion won last year, but we expect around 50 billion won this year." In the second half, the release of overall survival (mOS) data for the Lazcluze combination therapy is cited as a key event that will influence investor sentiment and earnings outlook.
The active pharmaceutical ingredient (API) segment and next-generation pipeline are also pointed to as factors raising earnings expectations. Yuhan's API revenue exceeded 100 billion won in the first quarter, leading its overseas business. In addition, YH25724, a candidate for metabolic dysfunction-associated steatohepatitis (MASH), is progressing smoothly after demonstrating efficacy in a global Phase 1 clinical trial.
"Hanmi Pharmaceutical, Obesity and Metabolic Disease Pipeline Trials Expected in H2"
Hanmi Pharmaceutical posted first-quarter revenue of 392.9 billion won and operating profit of 53.6 billion won on a consolidated basis. Revenue rose 0.5% year-on-year, but operating profit fell 9.1%. The decline is attributed to base effects from last year's first quarter, which reflected clinical sample supply revenue to Merck (MSD) in the U.S. and royalties from neutropenia treatment Rolvedon. Net profit reached 51.1 billion won, up 14.4% year-on-year, thanks to improved foreign exchange gains from a stronger dollar and dividend income from Beijing Hanmi.
Excluding one-off effects, real growth is being maintained solidly, according to industry assessments. According to Meritz Securities, sales of Rosuzet, a combination drug for dyslipidemia treatment, reached 59.3 billion won (+9.2%), while Beijing Hanmi posted revenue of 106.4 billion won (+10.3%) and operating profit of 23.6 billion won (+107.7%), continuing its growth trajectory.
Hanmi Pharmaceutical's key point to watch in the second half is the clinical progress of its obesity and metabolic disease pipeline. Kim Jun-young, a researcher at Meritz Securities, said, "In the second half, Phase 2 clinical trial results for efinopegdutide, a MASH treatment being co-developed with Merck, will be released." He also projected that obesity treatment LA-TRIA has completed Phase 2 patient recruitment in the U.S., with the trial expected to conclude in the first quarter of next year and enter a Phase 2 diabetes trial starting in May. "As Hanmi Pharmaceutical's pipeline clinical trials are progressing smoothly, attention should be paid to R&D momentum in the second half," Kim said.
