[Edaily Reporter YU JIN-HEE ] The paradigm of the domestic pharmaceutical and biotech investment market is shifting. The era of an expectation-driven market—where market capitalization would fluctuate by trillions of won based on a single line of clinical data—is coming to an end. Now, a performance-driven market has taken full hold, where only companies that can demonstrate actual sales and cash flow will survive. Amid this trend, small but strong Contract Development and Manufacturing Organization (CDMO) companies are rapidly emerging as key blue-chip stocks in the capital market, following in the footsteps of the sector leader, Celltrion(068270).

Prestige Biologics Co., Ltd. Begins Full-Scale “Revenue Transition” Based on 150,000-Liter Infrastructure

In the past, Celltrion also went through a period as an unlisted biotech venture when it faced skepticism in the capital markets. It is understood that Celltrion first surpassed 50 billion won in annual revenue in 2007, its fifth year since founding.

At that time, the company solidified its foundation by focusing on contract manufacturing (CMO) for global pharmaceutical and biotech firms, recording annual revenue of 63.5 billion won and becoming the first start-up biotech company to break through the 50 billion won barrier. Celltrion’s market capitalization at the time was around 500 billion won. Since then, the company has surpassed 500 billion won in revenue in 2015, 1 trillion won in 2019, and 4 trillion won last year, bringing its enterprise value to nearly 40 trillion won.

Celltrion’s historic trajectory—which saw its corporate value make a quantum leap through the early expansion of large-scale orders and infrastructure development—is now serving as a benchmark for small but strong CDMO companies preparing to take the next leap forward. Among them, the market is paying close attention to small but strong CDMOs such as Prestige Biologics Co., Ltd.(334970), #BTGen, and Dasan Pharmaceutical, which are facing major turning points this year.

Prestige Biologics Co., Ltd.(334970)xml-ph-0000@deepl.internal is regarded as the first to enter the phase where its performance is becoming visible, thanks to the infrastructure secured through large-scale, proactive investments. The company has currently established biopharmaceutical production facilities with a total capacity of 154,000 liters in Osong, North Chungcheong Province, and has completed a one-stop CDMO system capable of handling everything from initial development to commercial production.

Although the company had previously faced criticism in the capital markets for having “oversized facilities,” its earnings growth has begun to show on the books as the actual production of orders secured since 2024 has gained momentum. Last year’s revenue expanded approximately 3.7 times compared to the previous year. It is virtually certain that the company will achieve more than 80% of last year’s total revenue in the first half of this year alone. As existing orders have entered full-scale production, the pace of earnings improvement has accelerated significantly.

Prestige Biologics Co., Ltd. recorded cumulative order value of approximately 58 billion won as of last year. The company continues to secure new projects, including an additional contract worth 4.3 billion won for the contract manufacturing of biopharmaceuticals with a global pharmaceutical company signed earlier this year.

A Prestige Biologics Co., Ltd. official stated, “We have entered a phase of rapid growth where order volumes are translating into actual revenue,” adding, “We plan to accelerate the growth of our global CDMO business based on our stable production capabilities and quality management system at our Osong production facility.”

BTGen, the First Company Selected for the Government’s National Growth Fund… Set to Receive 110 billion won in Investment

BTGen, which rebranded from its former name, STGen Bio, and made a fresh start, has firmly established its presence in the market by securing full-scale policy-based financial support from the government. The Fund Management Committee of the government-established National Growth Fund recently gave final approval for a long-term, low-interest loan of 85 billion won to BTGen. This is considered the first instance in which the National Growth Fund has directly invested in an individual company in the biotech sector. It signifies that the government has officially recognized the CDMO industry as a future strategic technology and a core national growth engine.

Using the policy funding secured this time as a springboard, BTGen is accelerating the expansion of production facilities at its Songdo Plant No. 1 in Incheon, with a total investment of 109 billion won. Once the expansion is complete, the total production capacity will increase from the current 9,000 liters to 14,000 liters. The maximum production capacity for active pharmaceutical ingredients (API) will increase by 44%, and that for finished pharmaceutical products (DP) by 170%. In particular, a new isolator-type finished product filling line—designed to minimize operator intervention and reduce aseptic risks—will be installed to meet the stringent standards of global big pharma companies.

Currently, BTGen serves as the production base for IMULDOSA, a biosimilar for autoimmune diseases developed by Donga ST(170900), which creates a financial variable in that approximately 75% of its revenue is concentrated on orders from affiliated companies. Of last year’s revenue of 103.7 billion won, orders secured from Donga ST amounted to 77.7 billion won.

A BTGen official stated, “This expansion is intended not only for IMULDOSA but also to proactively accommodate our future domestic and international pipeline,” adding, “External orders are also growing rapidly.”

Dasan Pharmaceutical Completes Inspection by Japanese Regulatory Authorities with Advanced ‘Pellet’ Technology

Celebrating its 30th anniversary this year, Dasan Pharmaceutical is on a differentiated high-growth trajectory by integrating advanced formulation technology into its CDMO operations in the chemical pharmaceuticals sector—a strategy that sets it apart from other companies focused on biosimilars. Dasan Pharmaceutical recently successfully completed an on-site inspection of its Asan, Chungnam plant by Japan’s Pharmaceutical and Medical Devices Agency (PMDA) and is awaiting final approval notification.

Regarded as one of the world’s top regulatory agencies alongside the U.S. Food and Drug Administration (FDA) and the European Medicines Agency (EMA), the PMDA is renowned for its stringent data integrity and quality standards; as a result, only four manufacturers in South Korea have received approval for finished pharmaceutical products from the agency. If Dasan Pharmaceutical obtains final approval by the end of this month, the company’s quality management capabilities will be officially recognized as among the best in the world.

Dasan Pharmaceutical’s key strength is its highly sophisticated pellet manufacturing technology, which coats drugs onto microscopic spherical particles. Release control technology—which regulates the gradual release of the drug within the body over a set period—is essential. Dasan Pharmaceutical has expanded sales in Japan of duloxetine hydrochloride pellets—an antidepressant utilizing this technology—while also meeting the quality requirements for the official launch of its next-generation product, venlafaxine pellets, in Japan next year. Dasan Pharmaceutical has already established a solid partnership with Kyowa Pharmaceutical Co., Ltd., a major player in Japan’s central nervous system (CNS) market, and will begin full-scale supply starting next month.

Dasan Pharmaceutical’s revenue growth is widely regarded as exceptional. Revenue, which stood at 51.9 billion won in 2021, more than doubled to 106.9 billion won last year—marking a more than twofold increase in just four years. Having successfully secured 13 billion won in pre-IPO funding at the end of last year, Dasan Pharmaceutical is set to pursue a listing on the KOSDAQ market in the second half of this year, fueling heightened investor anticipation.

A Dasan Pharmaceutical official stated, “Once approval is granted, pellet supply will begin, and revenue from venlafaxine will be fully reflected in our financial statements starting next year,” adding, “With this on-site inspection as a starting point, we will begin expanding our CDMO business to global pharmaceutical companies beyond the Japanese market.”

Experts in the pharmaceutical and biotech industries analyze that the rise of these small but strong contract development and manufacturing organizations (CDMOs) signals a turnaround in South Korea’s biotech sector. While new drug development is a high-risk field often likened to winning the lottery, CDMOs serve as a reliable cash cow that underpins a company’s fundamental financial strength.

This effectively completes a virtuous cycle in which stable revenue generated through manufacturing operations is reinvested into R&D for innovative new drugs. According to market research firm Business Research Insights, the global pharmaceutical and biotech CDMO market is projected to grow at a steep annual average rate of 7.8%, expanding from $21.01 billion (approximately 32 trillion won) in 2022 to $41.31 billion (approximately 63 trillion won) by 2032.

Hong Soon-jae, CEO of BioBook, emphasized, “Few people predicted that Celltrion—which once cost just a few thousand won and was mired in distrust after being labeled a ‘scam’—would become a company with a market capitalization of 40 trillion won today,” adding, “The value of small but strong CDMO companies, which are currently filling their global order books based on advanced hardware and proprietary formulation technologies, will be completely reevaluated in the capital markets in the future.”