Samik Pharmaceutical Company, which entered KOSDAQ at the end of last month, is drawing industry attention. The stock showed strong momentum with four straight days of hitting the upper price limit from the listing date.
As a result, the Oner family's equity value also surged. Samik Pharmaceutical Company was founded in 1973 by Chair Lee Se-young (89), a graduate of Seoul National University College of Pharmacy, and CEO Lee Chung-hwan (58), the chair's eldest son, has taken over management. Founded the same year as Hanmi Pharmaceutical, the company's KOSDAQ market debut after more than 50 years has prompted various interpretations in the industry.
◇ "SPAC listing effect"… Oner family equity ratio reaches 63.4%
Samik Pharmaceutical Company newly listed on KOSDAQ on the 27th of last month through a merger by absorption with Hana Financial No. 28 SPAC (SPAC·special purpose acquisition company). The offering price was 7,480 won, and within four days of listing, it surpassed the 20,000-won level. Accordingly, the equity value of the Oner family and major shareholders swelled significantly.
On the 19th, Samik Pharmaceutical Company's intraday high reached 25,050 won. This is the highest since listing and about 3.35 times the offering price of 7,480 won. The closing price that day was 20,950 won.
After a decline, on the 25th the company's stock closed at 18,150 won, up 10.47% from the previous day's close. As of that day, the market capitalization was about 166.5 billion won.
Looking at Samik Pharmaceutical Company's governance, as of the disclosure on the 31st of last month, the combined equity ratio of 15 people, including largest shareholder CEO Lee Chung-hwan and relatives of the Oner family, comes to 63.41%.
CEO Lee Chung-hwan's equity ratio is 21.81%, Chair Lee Se-young's is 11.63%, Executive Vice President Lee Yong-seok, the chair's second son and the CEO's younger brother, has 10.9%, and the CEO's maternal uncle Kim Sun-uk has 10.16%.
Based on the offering price, the equity value of the 15 specially related parties, including the CEO, was about 43.5 billion won, but within a month of listing, the equity value swelled into the 100 billion-won range.
Calculated at the closing price on the 25th, the total equity value of the 15 major shareholders is estimated at about 105.6 billion won. The CEO's equity is valued at about 36.3 billion won, the chair at about 19.4 billion won, and the executive vice president at about 18.1 billion won.
There is also analysis that a backdoor listing strategy via a SPAC influenced the recent stock trend. A SPAC listing is a method of listing in which a SPAC, a paper company, is listed, capital is raised through a public offering, and the raised capital is used to merge with another unlisted corporations. As a corporation, it has the advantage of being faster and having a lower threshold than a direct or general listing.
A SPAC listing can also be advantageous in attracting investor interest. SPAC stocks are low-priced, and key investors' equity is locked up under restricted deposits (mandatory holding), resulting in low initial float.
An industry official said, "Because of these characteristics, some investors aim for short-term spikes and invest only in newly listed SPAC stocks, but the volatility is high, so caution is needed." Samik Pharmaceutical Company's stock also swung up and down after posting four straight upper-limit days from the listing date.
◇ Diabetes drug passes top-tier general hospital review; industry reads the move
The company said on the 18th that its diabetes treatment Piosita (tablet) passed the Drug Committee review at Seoul National University Bundang Hospital. Expectations for expanded prescriptions rose on the grounds that it cleared the review hurdle of a top-tier general hospital, where formulary reviews are strict.
A university hospital Drug Committee is a decision-making body to introduce new medicines at the hospital and manage the effectiveness and safety of drug use. If it passes review, the medicine is added to the hospital's formulary and a prescription code is created so it can be prescribed at the hospital.
A pharmaceutical industry official said, "It is true that entry into a top-tier general hospital is difficult," and noted, "At Seoul National University Bundang Hospital, pharmaceutical companies cannot transact directly and must transact with wholesalers."
Piosita is an oral fixed-dose combination that combines sitagliptin, a DPP-4 inhibitor effective at lowering blood sugar, with pioglitazone, a TZD that improves insulin sensitivity, in a single tablet. The company received reimbursement coverage in Nov. 2023.
However, assessments and interpretations in the pharmaceutical industry differ. An official at Company A said, "There are already many sitagliptin combinations on the market, and pioglitazone has been around a long time, so it is not the trend ingredient in the current diabetes treatment market."
Actos, a diabetes treatment from Japan's Takeda Pharmaceutical, contains pioglitazone. It received U.S. Food and Drug Administration (FDA) approval in 1999, and after the patent expired, Yuhan Corp., JEIL PHARMACEUTICAL, GC Biopharma, KyungDong Pharm, Hyundai Pharm, and others rolled out generics in succession.
Januvia, the world's first DPP-4 inhibitor, which the U.S. Merck (MSD) launched after receiving U.S. Food and Drug Administration (FDA) approval in 2006, contains sitagliptin. After Januvia's patent expired, starting in Sept. 2023, Korea saw a flood of single-ingredient sitagliptin generics or combinations pairing sitagliptin with other ingredients.
An official at Company B said, "Given that there are already many combinations in the diabetes market, I don't think Piosita tablets will drive groundbreaking sales growth."
◇ Second-generation Oner boosts production capacity and drives new businesses
At Samik Pharmaceutical Company, after founder Chair Lee Se-young stepped back from the front line of management, CEO Kwon Young-i joined in 2017, and the company has been run under a co-CEO structure with CEO Lee and CEO Kwon. CEO Lee oversees finance and overall operations, while CEO Kwon, a pharmacist by training, leads research and development (R&D) and technology overall.
According to Samik Pharmaceutical Company, last year's sales were 55.857 billion won, up about 9.03% from a year earlier. Operating profit rose 31.5% year over year to 3.678 billion won, and net profit increased 18.6% to 3.522 billion won.
Key products include prescription drugs such as treatments for hypertension, diabetes, and hyperlipidemia and antifungals, as well as over-the-counter motion sickness medicine Sobomin. The company established the pharmaceutical distribution wholesaler PharmBay in Jan. 2020 as a subsidiary.
Considering that top-tier pharmaceutical companies post annual sales of more than 1 trillion won, the company's business size is small relative to its operating history, but it is credited with maintaining profitability for more than 20 years.
The company has made "long-acting injectable development," which has been drawing attention for growth potential in the pharmaceutical industry, a new business. Long-acting injectables are technologies that make the effects of drugs taken daily or injected daily or weekly last with a single injection every one to three months. There is high demand in markets for treatments for mental disorders, diabetes and obesity, and autoimmune diseases.
Samik Pharmaceutical Company has moved to expand production facilities with funds raised through the listing. The company said it will invest 7.27 billion won to build an annex at its Incheon plant, aiming for completion in Oct. next year. The company also plans to establish a second plant in Wonju, Gangwon Province, with the goal of producing long-acting injectables.