[Click eStock] "Daewoong Pharmaceutical, Nabota Issue Resolved, Stock Price Expected to Rise"

[Asia Economy Reporter Ji Yeon-jin] SangSangIn Securities announced on the 18th that it expects Daewoong Pharmaceutical's corporate value to rise as the global business of the wrinkle improvement treatment Nabota gains momentum again, and the domestic and international business of the gastroesophageal reflux disease drug Gastro gains traction, setting a target stock price of 200,000 KRW.

Researcher Ha Tae-gi of SangSangIn Securities said, "There was an issue with the US International Trade Commission (ITC) lawsuit related to Nabota, which led to excessive litigation costs and the company's resources being focused on the lawsuit, weakening the global business momentum and deteriorating profitability. Since most of these issues have been resolved, although some time is needed for a full-fledged stock price increase, it is judged that buying is possible around the current stock price of about 140,000 KRW."

Daewoong Pharmaceutical is expected to relaunch its global business centered on Nabota. Daewoong Pharmaceutical developed the wrinkle improvement agent Nabota and is selling it in the North American market through its partner Evolus, with plans to launch in Europe next year. In China, the results of Phase 3 clinical trials were announced last month, and after submitting a Biologics License Application (BLA), it plans to obtain product approval next year, select distributors, and launch in 2023.

The therapeutic Nabota is also undergoing Phase 2 clinical trials in the US with partner Aeon Biopharma for two indications (including migraine). Nabota's sales are estimated to be around 75 billion KRW this year (25 billion KRW domestic, 50 billion KRW export). With European sales next year and Chinese sales in 2023 added, the growth rate is expected to expand. Nabota's sales are projected to be around 100 billion KRW in 2022.

The gastroesophageal reflux disease drug Gastro (Pexuprazan) is considered to have the potential to grow into a blockbuster product. It is a next-generation gastroesophageal reflux disease drug with a 'P-CAB' mechanism, competing with HK Innoen's K-CAB. Gastro is expected to receive domestic product approval in the fourth quarter of 2021. HK Innoen's K-CAB has grown into a product with annual sales of around 100 billion KRW.

Considering Daewoong Pharmaceutical's marketing power, Gastro appears to have the potential to grow into a 100 billion KRW product in a short period. Gastro has signed supply contracts for export with Neurogastrx Inc in the US, Shanghai Haini in China, EMS in Brazil, and Moksha8 in Mexico. In particular, once product approval is obtained in Korea, it can be launched immediately in the Brazilian and Mexican markets using bridging documents. In China and the US, it plans to launch after conducting long-term clinical trials.