[Click eStock] "SK바사 Walking a New Path... From Vaccines to a Global Bio Platform"

Becoming a Global Vaccine Production Hub... Increased Possibility of Additional Orders Upon Approval of Self-Developed Vaccine

AstraZeneca vaccine being contract-manufactured at SK Bioscience factory in Andong-si, Gyeongbuk.
[Image source=Yonhap News]

[Asia Economy Reporter Minwoo Lee] SK Bioscience is being recognized as transforming from a leading domestic vaccine company into a global bio-platform enterprise. As the contract development and manufacturing organization (CDMO) for COVID-19 vaccines is gaining momentum, it is also expected that once its self-developed vaccine GBP510 obtains approval, large-scale orders from the World Health Organization (WHO)-led vaccine sharing project 'COVAX' will be possible.

On the 15th, Shinhan Financial Investment issued a new 'Buy' rating and set a target price of 350,000 KRW for SK Bioscience based on this assessment. The closing price the previous day was 276,500 KRW.

SK Bioscience secured a large-scale production facility called L House in Andong, Gyeongbuk in 2012 and made proactive investments to establish vaccine production capacity capable of responding to the spread of COVID-19. Based on this, it signed CDMO contracts for COVID-19 vaccines with AstraZeneca and Novavax. COVID-19 CDMO sales are expected to remain solid in the second half of this year following the first half. Shinhan Financial Investment forecasts SK Bioscience’s sales to reach 781.4 billion KRW and operating profit of 420.3 billion KRW in the second half of this year, representing increases of 203.7% and 250.6% respectively compared to the first half.

The possibility of additional orders from COVAX is also increasing. Donggeon Lee, a senior researcher at Shinhan Financial Investment, stated, "COVAX plans to produce 2.66 billion doses of COVID-19 vaccines by the first quarter of next year and supply a cumulative total of 5.94 billion doses by the end of next year, but so far, the actual supply volume is only 200 million doses to 139 countries." He added, "If SK Bioscience obtains approval for its self-developed COVID-19 vaccine 'GBP510' in the first half of next year, large-scale orders from COVAX will be possible."

It is already known that SK Bioscience recently signed a memorandum of understanding for investment to expand its factory and purchase additional land in Andong, where L House is located. Approximately 150 billion KRW will be invested by 2024 to expand the latest vaccine manufacturing facilities and establish a new vaccine platform. Additionally, the company plans to relocate its headquarters and research institute to the expanded Incheon Technopark complex in Songdo, Incheon by 2024. This move is expected to secure additional production facilities beyond the existing vaccine manufacturing infrastructure.