[Special Stock] Aprogen Benefits from US Biosecurity Act... Accelerates Entry into CDMO Market

Aprogen is showing strong performance. This is interpreted as being influenced by securities analysts' assessments that Aprogen is making a full-scale entry into the CDMO (Contract Development and Manufacturing Organization) market amid the expansion of the domestic CDMO market due to the U.S. Biosecurity Act.

As of 9:07 AM on the 26th, Aprogen is trading at 1,190 KRW, up 5.64% compared to the previous day.

Aprogen entered the biopharmaceutical development and manufacturing business in 2022 and is preparing to fully launch its CDMO business through the continuous culture (Perfusion) method, characterized by high productivity. Currently, it owns four bioreactors with a capacity of 2,000 to 2,500 liters each, and the culture medium producible through these is estimated to exceed 400,000 liters annually.

Jeyoon Han, a researcher at KB Securities, explained, "The upcycle of the CDMO industry is expected to begin in earnest from the second half of this year," adding, "This is because the growth of the biopharmaceutical market is expected to drive this."

The researcher said, "First, the number of biosimilars launched due to patent expirations of new drugs will increase, and the U.S. IRA (Inflation Reduction Act) is expected to boost demand for biosimilars. Additionally, with the continuous increase in new clinical trials and the blockbuster status of biopharmaceuticals, the inherent growth drivers of the upstream industry are solid, so the CDMO industry is highly likely to directly and indirectly benefit from the upstream sector."

Based on Humira biosimilars, Aprogen has secured a large-scale production capacity (CAPA) worth approximately 5 trillion KRW. Although there are some differences in actual CAPA depending on the unit price of each substance, it is explained that Aprogen possesses a considerable level of production capacity.

He stated, "In the changing global environment, including the introduction of the Biosecurity Act, Aprogen's CAPA can be attractive to global pharmaceutical and bio companies that need new production bases. Moreover, Aprogen has a track record of successfully developing the Remicade biosimilar 'GS071' for autoimmune diseases and supplying it to Japanese companies. In other words, with both large-scale CAPA and production references secured, Aprogen is expected to fully benefit from entering the CDMO industry upcycle."