SK pharmteco pushes back IPO plan until 2024

SK pharmteco, a California-based contract development and manufacturing organization under Korean conglomerate SK Inc., is expected to postpone its initial public offering at least until 2024 due to market volatility, top officials from the firm and SK affiliates said Wednesday.

The year of 2024 will be “the earliest possible period” to reconsider the company's stock market debut, said SK pharmteco CEO Joerg Ahlgrimm.

SK's CDMO unit initially planned to go public on Korea’s secondary bourse Kosdaq or the US tech-heavy Nasdaq in 2023.

Ahlgrimm's remark came during an event titled SK Bio Night held at the Four Seasons Hotel in San Francisco.

The event was attended by 100 executives from over 50 companies, including SK subsidiaries, their global partners and investment companies. SK Inc. Vice Chairman Jang Dong-hyun too joined the meeting.

SK Bio Investment Center chief Kim Yeon-tae will seek to float the CDMO's shares on the stock market when it sees more tangible outcomes from its investment in its cell and gene therapy contract development and manufacturing business. Kim expected it would take another year to bear fruit.

SK pharmteco is still interested in an IPO on the US stock market, according to Kim.

Sales from SK pharmteco are predicted to increase in the coming years. According to SK Inc., the company’s sales for 2022 are expected to reach $780 million, up from $99 million in 2017.

SK pharmteco’s goal is to have its earnings before interest, taxes, depreciation, and amortization reach $2 billion, with a margin of 20 percent by 2025.

Meanwhile, SK biopharmaceuticals also plans to increase its presence in the US market.

SK biopharmaceuticals CEO Lee said the company’s sales are expected to grow further this year, backed by increased sales of its anti-seizure medication.

“I think there will be no big issue for SK biopharmaceuticals to turn a profit this year, and we will make it happen,” said Lee.

The pharmaceutical firm has been recording losses in its balance sheet since the first quarter of last year.

According to Lee, sales of the company's anti-seizure medication cenobamate, sold under the brand name Xcopri in the US, are continuing to rise.

Xcopri was first introduced in the US in 2020, and its sales are posting an annual growth rate of over-200 percent. In the third quarter last year, Sales of Xcopri reached 88.8 billion won, up 271 percent on-year.

SK biopharmaceuticals has been also ramping up its efforts to develop new drug pipelines.

Lee said the company will develop new drugs that work on the central nervous system. The company could also initiate new research for anti-cancer drugs and cell and gene therapies, Lee added.