Bukwang Pharmaceutical has moved beyond its first goal of "a return to profit" and simultaneously unveiled two tracks: expanding production capacity and overhauling its research and development (R&D) strategy. With the acquisition of UNION KOREA PHARM to broaden its manufacturing base, its Danish subsidiary Contera Pharma formalized a "company split" strategy to grow by dividing into the CP-012 business focused on treating morning akinesia in Parkinson's disease and the RNA platform business. It is read as a signal to change the company's very makeup, not just engineer a simple rebound in results.
Chief Executive Lee Jaeyoung of Bukwang Pharmaceutical said on the 24th at the 66th annual general meeting at the headquarters in Dongjak District, Seoul, "Under consolidation, we will enter the top 20 in industry sales by achieving 600 billion won in revenue and a double-digit operating margin by 2030."
Lee in particular revisited the 2024 "last loss" remark and emphasized it "was not a mere slogan." At the time, Lee said, "The 2023 loss will be the last loss in Bukwang Pharmaceutical's history," and the point is that subsequent directions—streamlining the expense structure, focusing on strategic items, and adjusting excessive investments—are being confirmed in the numbers.
In fact, Bukwang Pharmaceutical's revenue last year under consolidation was 200.7 billion won, surpassing 200 billion won for the first time since its founding. It rose 25% from a year earlier. Operating profit surged 775% to 14.1 billion won.
However, the company defined this as a "starting point." Lee said, "It is hard to say a turnaround to profit alone completes a structural reform," adding, "A tougher task remains to raise the operating margin."
◇ Acquisition of UNION KOREA PHARM to be completed by June… pushing to introduce a smart factory
The first area the company tackled was production capacity. Bukwang Pharmaceutical is pursuing the acquisition of UNION KOREA PHARM based on the 89.3 billion won raised through a paid-in capital increase last year. The roughly 30 billion won acquisition was delayed somewhat due to adjustments in the rehabilitation procedure schedule, but the company expects the transaction can be completed between late May and early June.
The push to acquire UNION KOREA PHARM is underpinned by a sense of crisis that growth limits are clear with only the Ansan plant. Lee said, "The Ansan plant's production capacity aligns with about 160 billion won in sales," adding, "Even if more orders came in, we could not make more."
Once the acquisition is completed, Bukwang Pharmaceutical's solid-dosage production capacity is expected to expand by about 30%, and injectable capacity by roughly twofold. In particular, the cephalosporin antibiotic plant is a production asset the company did not previously have. It is significant given the process's high entry barriers.
The company plans to pursue an early normalization through the transfer of Union Pharm volumes, use of the existing sales network, and application of a smart factory. It aims to return to operating profit within the year and, in the midterm, to recover to the past revenue level of 50 billion won.
◇ Investing 20 billion won in global trials of "CP-012"… "results secured in 2028"
Another pillar of the shareholder meeting was Contera Pharma. Chair Ahn Mijeong of Bukwang Pharmaceutical presented a restructuring strategy to split Contera Pharma into the CP-012-focused business and the RNA platform business. The approach is to lift the value of each asset.
The key is CP-012. CP-012 is an oral delayed-release therapy designed so that when taken at night, its effect peaks in the morning hours. Given that existing treatments are limited to immediate-release or extended-release forms, the company evaluates it as a "first-in-class" candidate.
Bukwang Pharmaceutical, after securing positive results in a phase 1b trial, changed course to conduct the global phase 2 trial directly. The phase 2 will enroll 80 patients across five countries, including the United States and Europe. The company expects results to be confirmed in the first half of 2028.
However, the clinical expense burden is not small. About 10 billion won is expected to be invested this year and next, respectively. Lee said, "Please see it as the process of crouching so a frog can jump farther."
For the RNA platform, the company's stance is that it confirmed technological competitiveness through a strategic joint research collaboration with Denmark's Lundbeck. As announced last year, the company also plans to push for establishing a new corporation based on the RNA platform in the second half of this year.
Chair Ahn said, "We will expand our own research targeting high-difficulty areas such as rare diseases and intractable diseases," adding, "In tandem with expanding open innovation at home and abroad, we are also creating a fund worth 50 billion won."
◇ Responsibility debate over OCI Holdings as the largest shareholder, promise of "enhanced communication" amid capital increase concerns
In the Q&A late in the meeting, uncertainty related to largest shareholder OCI Holdings was put on the table. Some shareholders criticized that the holding company's role was insufficient, pointing to delays in securing additional equity and the possibility of an overhang.
In response, Lee said, "I believe OCI Holdings will fulfill its responsibilities as the largest shareholder," adding, "We will convey related opinions through official procedures."
Concerns were also raised about the possibility of an additional paid-in capital increase. The company said it is fully aware of existing shareholders' concerns.
Meanwhile, Bukwang Pharmaceutical confirmed a year-end dividend of 75 won per share at the meeting. Including the interim dividend of 50 won per share paid in November last year, the total dividend amounts to 12.3 billion won, about 98% of net income.