Hello, this is Kim Tak. Today, let's summarize the recent trends in the bio sector. Please take a look at the Compless notice. Now, let's start the bio sector study. The global pharmaceutical market was approximately 1 trillion in 2016. It has been growing at a CAGR of about 5% and is expected to reach around 1,200 trillion in 2028. The United States accounts for nearly 50% of the market. As the growth of the U.S. market increases in 2028, the pharmaceutical market in the U.S. is also expanding. It would be good to feel that way. Now, let's look at the growth rate and size of the top 22 treatment areas in 2028. The largest market is oncology, with a market size of nearly 500 trillion to 600 trillion. The CAGR growth rate is about 14% to 17%. The next fastest-growing category is obesity. Currently, Liraglutide is also being introduced in various countries.

Stock prices are constantly rising, and Novo Disc is one of the best companies in the biopharmaceutical industry. It has shown an astonishing growth rate of around 255%, nearly reaching 24 to 27%. Indeed, as mentioned earlier, the global anticancer drug market is expanding enormously. In 2013, the market size was about 100 trillion, and by 2028, it is expected to reach nearly 600 trillion. Meanwhile, let's take a closer look at the market capitalization of pharmaceutical and bio companies in the KOSPI. Until the early 2010s, pharmaceutical and bio stocks hardly stood out in the market. I started investing in the pharmaceutical and bio sector in 2005, and since then, I have been drawn to include pharmaceutical and bio in my portfolio. In the past, there were many strategies focused on investing in pharmaceutical and bio, even in the early 2000s.

Then this perception began to change, and there was Hanmi Pharmaceutical. Hanmi had various big pharma deals with companies like Bayer, Regeneron, and Merck. Through licensing agreements with Pfizer, Janssen, and others, their market capitalization increased by 15 to 20 times. Their market share went from 10 trillion won to over 50 trillion won in the pharmaceutical and biotech sectors. Following this, in 2017, Celltrion led the biosimilar market, achieving tremendous margins and high performance with their biosimilar products. Their market capitalization exceeded 100 trillion won, almost reaching 200 trillion won by the end of 2020.

I went there and took a break recently. Let's take a look at the four major trends in the bio industry. The four major trends in the business can be broadly divided into four categories. Oh, it's four trends, so four categories, I see. CDMO, biosimilar, bio better, new drug development. Shall we look at them one by one? CDMO, as the name suggests, is a Contract Development and Manufacturing Organization that develops products for the customers' customers, launches them in the market, and provides various total solutions. CDMO includes R&D, manufacturing, quality control, packaging, and logistics, almost like semiconductors. TSMC, what does TSMC do? TSMC only does manufacturing. What else does CDMO do? They help develop products. So, Samsung Biologics is doing exceptionally well in this field, and biosimilar is a bit different. Biosimilar is already approved.

We are developing drugs similar to biopharmaceuticals, focusing on expired patents. Therefore, what big pharma is most concerned about now is after the expiration of patents, a large number of biosimilars will be introduced, leading to a decrease in market share and drug prices. From the consumer's perspective, this is not a bad thing. However, from the viewpoint of big pharma, they need to somehow prevent this. They want to prevent it, but how can they do that? They want to do it through biosimilar. Among the four major trends in global biopharma, one of them is CDMO, biosimilar, and bio-better. The importance of bio-better is increasing. The reason for this is that bio-better has relatively low costs. Bio-better utilizes existing drug data, saving time and costs. On the other hand, new drug development involves high costs.

Costs and time are involved. You have to make the medicine from the beginning to the end in its raw form. Because of that, there is a high economic risk. It's fortunate if you drop out in Phase 1 of the clinical trials, but if you go up to Phase 2 and Phase 3, going up to Phase 3 costs a lot of money. Why do we test on humans? That's why it incurs a lot of costs. With that, the risk is also significant. Even if you go up to Phase 3, there are many cases where it still fails. So, even for big pharma companies, the risk of losing nearly billions of dollars is significant. Secondly, the second point is crucial. It provides an opportunity for a new patent by improving existing drugs. By filing a new patent, as I mentioned earlier, it can prevent the worry of similar data that big pharma companies are concerned about.

In terms of extending the product lifespan and maintaining a monopoly in the market, bio-betters are becoming increasingly important. From the perspective of patients, improving the frequency and method of treatments provides convenience and safety for patients. From the investors' point of view, the likelihood of technology transfer is low. In the past, when Hanmi Pharmaceutical licensed out many products, the stock price suddenly plummeted because big pharma thought it wouldn't work and returned the technology. From the perspective of Hanmi Pharmaceutical, it was a very difficult situation for investors who saw a bright future and invested in it. Recently, in today's news, Yuhan Corporation was selected as the Best of ASCO, with Lactazane and Lazertinib.

But FD approval signal is here. If you look here, the SG administration group has fewer side effects compared to IB. This ASCO, the physical essence is like this. A company that has the technology to administer this method received approval. As I mentioned last week during the weekly briefing, ultimately, I think the essence was not understood. Once again, I would like to emphasize that I am studying, not giving recommendations for buying or selling. Let me summarize Altugen once. As the bio industry in Korea is booming, we cannot skip Altugen. Altogen is simply referred to as Alt B4. It is a human derived product that synthesizes various drugs. If you know only this, it would be helpful. Altogen's main proprietary technology is

It's about Pio injections. So, there are various injection methods. There is a method called intravenous injection, which is for veins. This is for muscles. Next, there are Pio injections. Most of us have received muscle injections for the COVID vaccine, but there is a method to switch from muscle injections to Pio injections. Intravenous injections are placed between the epidermis and dermis layers. It has the advantage of being able to administer large doses, but since precise injections are required, it can only be done in hospitals. Therefore, it is difficult to go to hospitals in Europe and the United States, it is costly, and it takes several hours to get an injection. However, Pio injections can be self-administered at home. Since it is injected into the subcutaneous layer, it is relatively safe, and you can just inject it yourself.

However, the fact that it is slow also acts as an advantage. Because the drug concentration in the blood peaks slowly, rises slowly, and falls slowly, it puts less strain on the body. Recently, the Alt Rotation stock price has been rising differently, and it also rose a lot today. So, the fact that the stock price has risen a lot can be a burden, and I want to make it clear that I am not recommending it to you. I want to show you a bit of recent stock market trends, and foreigners are buying a lot. I showed you the supply and demand situation. If you look at the trajectory of Altogen for the past 8 to 9 years, in June 2020, Altogen signed a non-exclusive technology licensing agreement with a global pharmaceutical company. However, there was little response for a few years, so the stock price dropped again from 6 trillion to almost 1.5 trillion. But recently, since the beginning of this year.

In February 2024, we will announce a change in disclosure. There are several important points in making this disclosure. Let's briefly look at the history of the company. It was listed in 2015 and changed its name to SC Jae-hyeong in 2019. In December 2019, the first technology contract was signed. Even at that time, it couldn't be disclosed. Why? Well, Altosgen was probably an issue back then. In June 2020, there was also a significant genetic technology, but it was still undisclosed. Why? Because even at that time, the contract was uncertain. This year, in February, Merck disclosed Merckratis. The content of the disclosure is that they granted exclusive rights. Merck clearly mentioned Alt B4 and increased the second milestone by over 400 million dollars. The last point is crucial. They give royalty. Even as recently as June 2020, there were no royalty conditions, but now...

Royalty provides as much as that, and Merck has acknowledged the SC formulation of alteo, which is the point of this disclosure. Briefly summarizing the meaning of this disclosure, it concretized the contract that came out in June 2020. They signed an exclusive contract for SC alteo, admitting that Merck had been conducting clinical trials on the SC formulation themselves, which failed. They acknowledged that they had to use Ojin's technology after their own failure, leading to the conversion to an exclusive contract, increasing the milestone payment by 40 million, and Royalty accepted. The significance is that MSD, the contract partner, disclosed it, and formalizing this is crucial. There are various expectations, but do not believe that they are confirmed; there are many rumors in the market, but it is not confirmed yet.

Keytruda, quietly mentioning the possibility of clinical phase 3 being completed this year, is currently undergoing phase 3 trials in about 15 countries with an investment of over one trillion won from Merck. After receiving FDA approval, it is expected to be on the market around the end of next year. Currently, Keytruda is only administered through intravenous injection. Regarding Ter Gazet, which is sold domestically, please look it up. It is used for skin purposes and provides pain relief for various skin conditions. Additionally, there is talk about ADC being hot right now, and SanDoz is also expanding its biosimilar contracts. Biosimilars have very high royalties, contributing to the expansion of Hybe.

Various assumptions are being made about the value of Keytruda right now. This means that assumptions are being made. It seems that Keytruda's sales in the market will exceed $30 billion in two years. Even if it's assumed that there is almost no growth, it would be around 285% in 2024. From 2016, the SC conversion is assumed to be 20%. So, in 2026, it would be $60 billion, in 2027, 40%, which would be $120 billion, and in 2028, 50%, which would be $150 billion. This is related to SC Keytruda sales, so assuming a sales royalty of 2%, from 2028, it would be recognized as $300 billion in substantial sales, and 5% means $1 trillion. These are various assumptions, but regarding Alteogen, they do a lot of PR about Halozyme. Why does Halozyme have the first SC formulation? The company that had an IPO in 2017 increased its market capitalization from $10 billion to $80 billion now, with the stock price rising seven times, but Halozyme's PR is only about PR.

So, why do you have to receive a premium even though you are a latecomer in the allergy field as a Halozyme employee? Halozyme's lens, that's what it's called. Earlier, what did I say? It's called Alteo. Now, what did I say? It's Hyzyme. That's the name of the medicine. So, lenses are fragile at room temperature and have low durability, while Hyzyme has higher profitability and the advantage of having a patent until 2040. What I mentioned secondly is that ADC is confirmed. Then, what is ADC? It's an Antibody Drug Conjugate, also known as a magic bullet, and it is expected to grow to a market size of 80 billion dollars by 2030. ADC is composed of three drugs, three components. It consists of an antibody, a linker, and a drug. So, to put it simply, if I explain ADC, it is currently a very important trend in the pharmaceutical industry.

Targeted cancer therapies are about blocking cell signaling pathways by targeting specific gene mutations or proteins. By blocking cell signaling pathways, it reduces universality and expandability. It literally binds to the surface of cancer cells through the upper body, delivering cancer drugs directly to kill the cancer. Therefore, the upper body specifically recognizes antigens on certain cancer cell surfaces and acts accordingly. The linker connects antibodies and cytotoxic drugs, binding and connecting the drugs to the linker, which then attaches the drug to the so-called cancer cell to release the drug. It releases very potent drugs to kill only cancer cells.

That's the type of structure, so currently, C is in charge of the Aibo type, and this market is expected to grow enormously, well, it's growing and expected to grow larger. Inu 2 is growing rapidly. It's an ADC type. It is expected to grow from $3 billion this year to $12 billion in 2030. Therefore, we are now thinking a lot about changing to an ADC S type. As a result, we are considering companies like Alteogen. I briefly mentioned Kitluda earlier. Kitluda has a 2% royalty. If it's valued at 5 trillion won, it's 10 trillion won with 5%. This is not my calculation, but this is how the market thinks. So recently, I want to point out that Alteogen's stock price is doing well in this related situation. It's not a recommendation to buy or sell, but currently, the recent trend in biotech is like this, especially in the SG type.

Many of you are now calling this bio vector a platform and I talked about why this bio vector is gaining so much attention in the market. I filmed this video with the thought that it would be nice if you could organize the bio sector like this once this time. Thank you. Goodbye.

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바이오 최근 핫이슈 정리 - 알테오젠 신고가 경신의 의미는?

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