Dongkook Pharmaceutical is seen to have surpassed 900 billion won in consolidation sales last year. It is the highest performance since its founding in 1968. Its core businesses, prescription drugs and over-the-counter medicines, posted stable sales. On top of that, steady growth in healthcare, including cosmetics, is believed to have brought annual sales close to 1 trillion won.
On the 18th, according to financial data firm FnGuide, Dongkook Pharmaceutical's consolidation sales last year are estimated at 917.2 billion won. That is up 13% from a year earlier. Operating profit is expected at 97 billion won and net profit at 78 billion won. Operating profit rose 21% from a year earlier, and net profit increased 25%.
◇ Madeka cosmetics popular at Asung Daiso Co. and Olive Young … core pharmaceuticals also sailing smoothly
The business that led the record sales was healthcare, including cosmetics and health foods. Dongkook Pharmaceutical posted 232.5 billion won in healthcare sales in the first to third quarters last year. That is 15% growth from a year earlier. A Dongkook Pharmaceutical official said, "By diversifying healthcare distribution channels, profitability improved."
The cosmetics business that Dongkook Pharmaceutical entered in 2015 is firmly serving as a cash cow. Through its cosmetics brand Centellian24, Dongkook Pharmaceutical is pushing products such as Madeka Cream to the fore. It is made with the main ingredient of Madecassol, known as a wound treatment. It is currently carried by Asung Daiso Co., Olive Young and others, and is gaining popularity. In addition, the health food and dietary supplement brand MyFit is also selling smoothly.
Over-the-counter medicines such as Insadol, a gum treatment, and Censia, a venous circulation drug, also saw sales growth. OTC sales reached 129.2 billion won in the first to third quarters last year. That was up 8% from a year earlier. Prescription drug sales came to 164.9 billion won in the same period, up 9% from a year earlier.
A Dongkook Pharmaceutical official said, "Despite the domestic slump, over-the-counter medicines are continuing to grow," adding, "We are expanding new markets at pharmacies with products for companion animals." The official added, "For prescription drugs, in-house manufactured injectables stood out, and Atovanduo, a dyslipidemia combination therapy, and Franpid tablets, an asthma treatment, drove growth."
◇ What to do about generic price cuts … Dongkook Pharmaceutical says it will respond by launching new products
Most of Dongkook Pharmaceutical's prescription drugs are generics, so they are inevitably affected by the government's policy of cutting drug prices. The government is pushing a policy to sequentially lower the reimbursement rate for generics from the 50% range to the 40% range. From Dongkook Pharmaceutical's standpoint, it is important to respond to price cuts and generate stable pharmaceutical revenue.
Dongkook Pharmaceutical plans to strengthen its competitiveness in prescription drugs based on drug delivery technology. Representative platforms include microspheres, a micro-sized drug carrier, and liposomes, a nano-sized drug carrier. Microspheres stably release a drug in the body for several months. They can extend dosing intervals and improve patient convenience. Liposome technology can reduce drug toxicity and deliver drugs precisely to specific tissues to enhance therapeutic effect.
The company also plans to develop improved new drugs. An improved new drug combines existing drugs to produce enhanced effects.
A Dongkook Pharmaceutical official said, "Because drugs listed before 2012 are subject to price cuts, we plan to respond by launching new medicines."
The official added, "Leveraging drug delivery technology, the 3‑month formulation of leuprorelin for treating prostate cancer is in phase 3 clinical trials and is slated for release next year," and "the 2‑month semaglutide injection for obesity and the 1‑month entecavir injection for hepatitis B are in preclinical testing."