[Viewpoint] The Responsibility of the Eldest Son of a Leading New Drug Company

Lim Jong-yoon Wins Hanmi Pharm Management Dispute
Must Respond to the Founder’s Spirit and Shareholders’ Support

Hanmi Pharm, which was embroiled in integration issues with OCI, has a different aspect compared to other pharmaceutical companies. First of all, its business history is relatively short. Considering Yuhan Yanghang, which has a 98-year history, or Chong Kun Dang with 83 years of tradition, 51-year-old Hanmi Pharm is almost the only case that entered the top pharmaceutical companies in a short period.

The secret was aggressive sales. In the early 2000s, when Hanmi Pharm was rapidly growing, it appeared without fail whenever a rebate scandal broke out. At golf course lobbies, luxury garment bags brought by guests were scattered around, and every two or three bags bore the Hanmi Pharm product logo. The owners of the bags were probably doctors, pharmacists, or public officials. Hanmi Pharm also replaced countless hospital televisions and pharmacy display shelves.

Competitors criticized Hanmi Pharm while simultaneously fearing it. The peak was when Chairman Lim Sung-ki, who was much younger than other founders, attempted a hostile takeover (M&A) of Dong-A Pharmaceutical, led by the late Chairman Kang Shin-ho, the industry elder. After receiving a flood of criticism from industry seniors, he eventually gave up, but the prevailing thought was that Hanmi Pharm would change the pharmaceutical industry landscape in the future.

Recently, a doctor named Roh Hwan-gyu, famous for the phrase "The government cannot beat doctors," also appears in Hanmi Pharm's history. After falling out with Hanmi Pharm, Roh launched a boycott in 2010, and many doctors joined the collective action, causing the company to falter. The company experienced its first deficit since its founding. Chairman Lim and Roh reconciled two years later. The place where the two shook hands was an event hosted by Hanmi Pharm, which at the time offered the industry's highest-level prize money to doctors.

Chairman Lim, who stubbornly grew the company through ups and downs, declared, "The journey to protect pharmaceutical sovereignty is lonely, but the fruits will be rewarding," and focused on investing in new drug development. However, he did not see the fruits of this effort. After Chairman Lim passed away in 2020, the company was embroiled in a management rights dispute within just four years.

Lim Jong-yoon, the eldest son of Chairman Lim, joined the company in 2000 and became president in 2009. Having proven his management skills by successfully growing Beijing Hanmi, he was an unquestionable successor. However, after his father's death, Song Young-sook and Lim Joo-hyun, mother and daughter who became chairman and vice chairman respectively, excluded him and tried to integrate the company with OCI, prompting him to rebel.

At the regular shareholders' meeting of Hanmi Science held on March 28, Lim Jong-yoon, director of Hanmi Pharm, who succeeded in gaining control of the board with 52% of the votes (left), and director Lim Jong-hoon are shaking hands.
[Photo by Lee Chun-hee]

At the Hanmi Science holding company's shareholders' meeting held on March 28, a reversal occurred. Although the National Pension Service sided with the mother and daughter, making defeat likely, small investors, so-called retail investors, overwhelmingly supported Lim Jong-yoon and his younger brother Lim Jong-hoon. The Jong-yoon and Jong-hoon brothers took control of the board of directors, and the integration was ultimately canceled. Now, the responsibility to present a blueprint for Hanmi Pharm's future has been entrusted to Lim Jong-yoon.

There is a phrase that industry insiders regard as a golden rule: "Pharmaceuticals for national prosperity." It means repaying the country with excellent medicine, and one wonders if there is any other private company sector that officially presents such a vision. Does Lim Jong-yoon have a strategy to realize the dream of pharmaceutical national prosperity and becoming a new drug powerhouse, which Chairman Lim repeatedly emphasized during his lifetime?

What about the predecessor chairman's resolute determination, who said, "Research and development (R&D) is my life," and tried to secure funds for new drug development by any means necessary? Now that he finally holds management rights, if he wastes energy on grudges or revenge against the opposing side, his sincerity will be questioned. The founder and employees who devoted their lives to new drug development, as well as the shareholders who trusted him, are waiting for Lim Jong-yoon's answer.