Daewoong Pharmaceutical, Presenting a Vision of '10 Trillion KRW New Drug Sales,' Shows a 'Pause' in Q3 Performance

Record High for Cumulative Q3
Strong Performance of In-House Developed Drugs Pexuclue and Enblo
Targeting 1 Trillion KRW in New Drug Sales by 2030

Daewoong Pharmaceutical recorded results in the third quarter of this year that somewhat fell short of market expectations. However, the prescription drug segment, led by self-developed new drugs, showed strong performance, bringing the company one step closer to its vision of achieving "10 trillion KRW in new drug sales by 2030."

Daewoong Pharmaceutical Headquarters Building. [Photo by Daewoong Pharmaceutical]

Daewoong Pharmaceutical announced on the 27th that its consolidated sales for the third quarter of this year were preliminarily estimated at 340.9 billion KRW, a 2.71% increase compared to the same period last year. Operating profit for the same period decreased by 2.39% to 29.381 billion KRW, and net profit fell by 25.5% to 15.273 billion KRW. These results slightly missed the securities market consensus of 350 billion KRW in sales and 33.9 billion KRW in operating profit.

However, excluding subsidiaries, Daewoong Pharmaceutical itself achieved an improvement in operating profit. The company’s standalone operating profit for the third quarter rose 12.8% year-on-year to 34.197 billion KRW, with sales increasing by 0.52% to 303.026 billion KRW.

Based on cumulative results from the first to the third quarter of this year, Daewoong Pharmaceutical recorded its highest-ever performance. The company’s standalone cumulative sales through the third quarter reached 902.4 billion KRW, with operating profit at 101.3 billion KRW. The operating profit margin stood at 11.2%. For comparison, cumulative sales through the third quarter last year were 867.4 billion KRW, with operating profit at 90.7 billion KRW.

Daewoong Pharmaceutical explained that the prescription drug (ETC) segment led the third-quarter results. The ETC segment showed stable growth in sales, recording 216.5 billion KRW, driven by strong performance of existing products including the self-developed new drugs Pexuclu and Enblo.

Pexuclu, a potassium-competitive acid blocker (P-CAB) class new drug for gastroesophageal reflux disease (GERD), has achieved cumulative sales exceeding 55 billion KRW since its launch, emerging as a blockbuster drug. Pexuclu’s strength lies in its longest half-life of 9 hours among GERD medications, accelerating its entry into the global market. Recently, it obtained product approval in Mexico, increasing the number of approved countries to four, and was officially launched in the Philippines in July.

Enblo, Korea’s first sodium-glucose co-transporter-2 (SGLT-2) inhibitor new drug, also secured its position in the market by being supplied to major general hospitals within three months of launch. The company is accelerating global expansion, having submitted a product approval application to Saudi Arabia, the largest diabetes market in the Middle East, in August.

The strong performance centered on self-developed new drugs is positive for Daewoong Pharmaceutical’s vision of achieving "10 trillion KRW in new drug sales." Earlier, at CPHI Worldwide 2023, the world’s largest pharmaceutical and biotech exhibition held in Barcelona, Spain, Daewoong Pharmaceutical announced on the 26th (local time) its vision of "10 trillion KRW in new drug sales by 2030" and the "3E Global Super-Gap Strategy" to leap into a global big pharma. The main goal is to achieve global sales of 1 trillion KRW by 2030, focusing on self-developed new drugs such as Pexuclu and Enblo.

Daewoong Pharmaceutical’s announced 3E Global Super-Gap Strategy is summarized into three components: ▲ rapid global product approvals (Efficiency) ▲ simultaneous expansion of new drug lineups (Extension) ▲ overwhelming production excellence (Excellence). Based on this 3E strategy, the company plans to become Korea’s top pharmaceutical company and the first Korean global big pharma.

The high growth potential of the markets to which the two self-developed new drugs belong is also a positive factor. According to data from global market research firms, the worldwide gastroesophageal reflux disease market is approximately 21 trillion KRW, and the type 2 diabetes market is about 93 trillion KRW. Daewoong Pharmaceutical explains that the P-CAB class, to which Pexuclu belongs, and the SGLT-2 inhibitor class, to which Enblo belongs, are replacing existing drugs and thus have high growth potential.

Besides new drugs, the botulinum toxin (BTX) product "Nabota" showed steady growth. Nabota’s third-quarter sales reached 38 billion KRW, with exports accounting for about 80% of total sales at 30.6 billion KRW. Nabota, the first Korean BTX product to obtain approval from the U.S. Food and Drug Administration (FDA), is expanding its market mainly in North America and Europe, including the U.S., the U.K., Germany, and Austria. Nabota recorded its highest-ever sales in the first half of this year, becoming the top-selling Korean BTX product.

Nabota’s entry into therapeutic markets is also becoming visible. In July, Ion Biopharma, Nabota’s U.S. therapeutic indication partner, was listed on the New York Stock Exchange, accelerating clinical trials for indications such as episodic and chronic migraine, cervical dystonia, gastroparesis, and post-traumatic stress disorder (PTSD). Recently, Nabota obtained a migraine treatment patent from the U.S. Patent and Trademark Office (USPTO), bringing it one step closer to entering the therapeutic market. According to market research firm Fortune Business Insights, the global BTX market reached 6.5 billion USD (about 8.3 trillion KRW) last year, with the therapeutic market accounting for 53%.

Seungho Jeon, CEO of Daewoong Pharmaceutical, stated, "Despite the uncertain global business environment, Daewoong Pharmaceutical is showing stable growth through continuous growth of self-developed products and expansion of Nabota’s domestic and international business." He added, "We will continue to strengthen our new pipelines and steadily develop new drugs through research and development (R&D) to become a globally recognized K-representative healthcare group."