Alteogen is showing strong performance. Securities firms' analysis that the company will benefit when U.S. Merck launches the subcutaneous (SC) formulation of the anticancer drug Keytruda appears to be influencing the stock price.
As of 9:25 a.m. on the 12th, Alteogen is trading at 59,000 KRW, up 5.97% from the previous day.
Minyong Eom, a researcher at Hyundai Motor Securities, explained, "Merck plans to launch Keytruda SC in 2025 and proactively restructure the intravenous (IV) market into the subcutaneous (SC) market to defend against biosimilars."
He added, "Merck currently has a non-exclusive contract with Alteogen. If Merck transfers the Keytruda SC biosimilar technology to competitors, it could suffer significant revenue losses, so a shift to an exclusive contract will be necessary."
Researcher Eom estimated, "Since June 2020, under a non-exclusive contract structure, the total contract scale is approximately 4.7 trillion KRW, covering development rights for six products." He emphasized, "If the contract changes to exclusive, the scale of technology transfers to secondary contractors will enter a completely new phase."
He forecasted, "If the Keytruda SC exclusive contract is changed, assuming a 20 trillion KRW annual revenue by 2028 after the 2025 launch, the cumulative milestones received by Alteogen could grow to several trillion KRW depending on revenue achievement conditions." Furthermore, he added, "Assuming a peer group Halozyme's 2-5% royalty contract level, and annual sales of 20 trillion KRW for Keytruda SC, Alteogen could achieve the largest sales scale among domestic biotech companies."
Researcher Eom also stated, "The Sandoz contract is important," explaining, "Only Sandoz and Alteogen will be able to launch the Darzalex SC biosimilar." He analyzed, "Of the 14.5 billion USD sales projected for 2028, 85% or 12 billion USD is the SC market, which they can uniquely enter. Even conservatively assuming a 30% market share, that translates to annual sales of 3 trillion KRW, and assuming a 12% royalty from Sandoz, this contract could generate several hundred billion KRW in annual royalties in addition to Keytruda SC."
Researcher Eom maintained a target stock price of 75,000 KRW, stating, "Considering the peer group Halozyme's market capitalization of 7 trillion KRW, the change to exclusive Keytruda SC contracts, sales commencement, and BS business expansion, Alteogen's SC business structure and value could surpass Halozyme."
Alteogen possesses technology that uses human hyaluronidase to convert existing intravenous formulations into subcutaneous (SC) formulations. It is known that U.S. Merck (MSD) is one of the companies utilizing Alteogen's technology.
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