[Special Stock] Jinwon Saengmyeong Produces mRNA Raw Materials Amid 'Supply Shortage'... Expected 500 Billion KRW Sales Next Year

[Asia Economy Reporter Hyungsoo Park] The stock price of Jinwon Life Sciences is soaring. It appears that the analysis of being a practical beneficiary stock due to the opening of the messenger ribonucleic acid (mRNA) market for gene therapy drugs has influenced the stock price.

As of 12:38 PM on the 17th, Jinwon Life Sciences is trading at 23,750 KRW, up 23.0% from the previous trading day.

Lee Yeon Pharmaceutical surged to the price limit.

Oh Byung-yong, a researcher at Hanyang Securities, explained in a report on the same day, "Jinwon Life Sciences owns a cGMP-grade factory that consignment-produces 'Plasmid DNA,' a key raw material for gene therapy drugs, through its US subsidiary ‘VGXI.’"

He added, "It is a gene therapy drug contract manufacturing organization (CMO) company that is not yet well known in the stock market," and "Plasmid DNA is not only a key raw material for producing viral vectors, which are mainstream in gene therapy drugs, but also a major raw material for mRNA, whose market is rapidly opening recently."

Demand for Plasmid DNA has surged recently, so Jinwon Life Sciences' existing factory has been operating at full capacity since 2019, and a large-scale new factory is also under construction. The new factory is scheduled to be completed in the fourth quarter of this year and is expected to start full operation from the second quarter of next year. The existing factory has a capacity of 500L, and once the new factory is completed, it will increase tenfold to 5,000L. There are plans to expand further to 7,500L in the future.

Researcher Oh predicted, "Currently, as the gene therapy drug market grows, there is a shortage of supply of Plasmid DNA, which is a raw material for mRNA," and "Moreover, with the emergence of mRNA vaccines starting from Moderna and Pfizer this year, the supply shortage is expected to worsen."

He continued, "According to Jinwon Life Sciences, there are many clients that could not be accommodated due to the capacity shortage of the existing factory, and naturally, there is significant waiting demand for the new factory," and "Jinwon Life Sciences expects the new factory to be fully operational from 2022 and anticipates annual sales exceeding 500 billion KRW."

Furthermore, he analyzed, "Since Jinwon Life Sciences produces cGMP-grade Plasmid DNA, a raw material needed by any mRNA developer, it can be expected to directly benefit from the mRNA market, which will grow for decades," and "It is undoubtedly the practical beneficiary stock among Korean companies."

Researcher Oh analyzed, "In the case of ST Pharm, which possesses LNP technology among major production technologies, the market capitalization reaches 2.2 trillion KRW due to expectations," and "Jinwon Life Sciences' market capitalization is only 874.4 billion KRW." He added, "Although it is difficult to discuss valuation now, even five times the expected sales from the new factory would value it in the trillions of KRW," emphasizing, "It is time to pay attention to Jinwon Life Sciences."