ChabioTech Surpasses 800 Billion KRW in Sales Last Year... Operating Profit Turns Negative

CHA Biotech announced on the 2nd that its consolidated sales for last year reached 844.1 billion KRW, marking an all-time high. This represents a 16% increase compared to the previous year.

The company explained that sales grew due to continued expansion of overseas businesses in the US and Australia, as well as strong domestic operations.

However, during the same period, the company posted an operating loss of 45.5 billion KRW, turning to a deficit compared to the previous year, and recorded a net loss of 52.8 billion KRW, an increase of 142%. CHA Biotech attributed the operating loss to "the construction costs of the new Cha Hospital ward in Hollywood, LA, USA, and the production facility and operating expenses of its subsidiary, Matica Biotechnology in Texas, which is engaged in contract development and manufacturing organization (CDMO) services," adding that "increased research and development (R&D) clinical expenses at CHA Biotech and Cha Vaccine Institute also contributed to the operating loss."

On a separate basis, excluding consolidated subsidiaries, sales amounted to 42.3 billion KRW, with an operating loss of 900 million KRW. Sales increased by 20% year-on-year due to strong performance in the cord blood storage business and genomic analysis and diagnostics business, along with the resumption of the immune cell business and expansion of domestic CDMO operations. Although operating profit was affected by increased R&D expenses for commercial clinical trials of solid tumor immune cell therapies and pipelines such as ovarian dysfunction treatment and Parkinson's disease cell therapy, profit growth in business segments helped reduce the deficit.

CHA Biotech explained that it is actively advancing toward the commercialization of cell therapies based on talent acquisition and technological capabilities. The company strengthened the R&D division of CHA Biotech and CHA Biotech Group by recruiting President Hyun-Jung Lee. President Lee is a clinical development expert with 20 years of new drug development experience at global companies such as Pfizer and Eli Lilly.

The company also self-assessed that its pipeline clinical trials are progressing smoothly. The Phase 1 clinical trial report evaluating the tolerability and safety of the solid tumor immune cell therapy 'CBT101' confirmed its effectiveness and safety in anticancer activity. The Phase 2a clinical trial dosing for the ovarian dysfunction treatment 'CordSTEM-DD' was also successfully completed.

In the CDMO business, construction began on 'CGB (Cell Gene Biobank),' the world's largest single-facility cell and gene therapy CDMO facility, located in Pangyo Techno Valley 2. In the US, subsidiary Matica Biotechnology completed the construction of a third-generation cell and gene therapy CDMO facility. Domestically, CDMO project outcomes are becoming more active, and internationally, Matica Biotechnology secured eight CDMO contracts in the second half of last year and is currently negotiating contracts with 34 companies, including four multinational big pharma firms.

Osanghoon Oh, CEO of CHA Biotech, said, "We have built a solid cash-generating business structure within internal business divisions to accelerate R&D progress, and despite ongoing uncertain management conditions, we expanded R&D investments without external financing. Moving forward, we will focus even more on the commercialization of cell therapies and achieving tangible results in the global CDMO business."