[Edaily Reporter Kim Seung-kwon ] K-Aesthetics (cosmetic medicine) is at the heart of sectors where South Korea leads the global market. We have entered an era where the cash-generating power of a single wrinkle-smoothing injection or an ultrasound device that tightens facial skin surpasses the operating profits of traditional biotech companies that have poured funds into new drug development for decades.

In particular, the medical aesthetics sector is characterized by a commercialization trajectory that is fundamentally different from that of conventional new drugs. While new drugs burn through massive amounts of cash over several years as they progress through Phase 1 to Phase 3 clinical trials, products such as skin boosters, botulinum toxin, and energy-based aesthetic devices enter the market through a relatively rapid medical device certification process.

In fact, while the operating profit margin (OPM) of major domestic new drug developers typically hovers between 5% and 15%, last year’s margins in this sector reached 40% for PharmaResearch, 50.7% for CLASSYS Inc., and 47.3% for Hugel, Inc. This means that for every 1,000 won in sales, 400 to 500 won is left as pure profit. E-Daily’s pharmaceutical and biotech premium content platform, PharmE-Daily, analyzed the profit margins of top-performing companies in the aesthetic industry.

Repeat Purchases of Consumables Combined with Devices… The Aesthetics Industry’s ‘Profit Margin Formula’

PharmaResearch is regarded as a leading high-margin company in the K-Aesthetics sector. Its flagship product, Rejuran, is a skin booster based on polydeoxyribonucleotide (PDRN) and sodium polynucleotide (PN). Unlike hyaluronic acid fillers, which remain in the body permanently, Rejuran is consumed with each treatment, making repeat treatments an essential part of the process. Once a doctor becomes familiar with the Rejuran procedure, it creates a strong repeat-purchase structure that leads to continuous reorders.

Looking at the figures generated by this structure, PharmaResearch’s revenue grew at a high rate of 30–50% for three consecutive years, rising from 2610억 won in 2023 to 3501억 won in 2024 and reaching 5357억 won last year. Last year, the company recorded an operating profit of 2,142억 won, achieving an operating profit margin of 40%.

Exports of Rejuran have been growing steeply year over year, rising from 20 billion won in 2022 to 56.1 billion won in 2024. Furthermore, PharmaResearch set a new record in the first quarter of this year, posting revenue of 146.1 billion won—a 25% increase year-over-year—and operating profit of 57.3 billion won.

Shin Min-soo, an analyst at KIWOOM Securities, commented, “The medical device division, which includes Rejuran, accounts for more than 50% of total revenue and is strongly driving PharmaResearch’s overall earnings growth.” The diversification of export markets is also notable. While exports were previously centered on China and Indonesia, the company successfully completed its first export to Europe through its partner VIVACY in the fourth quarter of last year.

CLASSYS Inc.(214150)This marks another milestone in the company’s profit margin strategy. The HIFU device “Shrink” and the RF device “Volnume” do not end with the delivery of the main unit; they are accompanied by a permanent stream of revenue from cartridges (consumables) that must be replaced for each procedure. This is known as the “razor-and-blades” model, where orders for cartridges continue uninterrupted until the clinic or hospital that has adopted the equipment closes its doors.

Last year, CLASSYS Inc. recorded sales of 336.8 billion won and an operating profit of 170.6 billion won. As sales increased by 39%, operating profit rose in tandem. CLASSYS Inc. is benefiting from profit leverage, where the increase in sales translates directly into profit without incurring additional selling, general, and administrative expenses.

Han Song-hyeop, an analyst at DaishinSecurities, explained, “CLASSYS Inc. secures stable revenue through its recurring consumables revenue model by continuously supplying cartridges after equipment sales.”

'Hugel, Inc.'

in Global Direct Sales – 'Caregen Co.,LTD.,' the Synonym for High Margins

Hugel, Inc. is also recording growth on the global stage with high profit margins. The Botox market is known for high brand loyalty, as doctors’ prescription patterns do not change easily once established. Accordingly, Hugel, Inc. is targeting markets in the U.S., China, and Europe by leveraging its domestic Botulax and U.S.-marketed Retivo products, utilizing partners and a hybrid sales strategy.

Looking at the detailed financial results, Hugel, Inc. recorded sales of 425.1 billion won and operating profit of 200.9 billion won last year, reaching the 200-billion-won operating profit milestone for the first time in its history. This achievement is seen as significant, especially considering it was attained despite an increase in global selling, general, and administrative expenses (SG&A) associated with building local direct sales networks.

An analyst at SANGSANGINVESTMENT&SECURITIES assessed that “high revenue growth will continue this year as the company fully enters the U.S. market” and issued a “BUY” investment recommendation. MIRAE ASSET SECURITIES has revised its forecasts for Hugel, Inc.’s revenue this year upward to 5080억 won and operating profit to 2590억 won.

WONTECH is also cited as a key contender following the same successful formula as PharmaResearch and CLASSYS Inc. Led by its RF beauty device, Olizio, WONTECH has established a recurring revenue model combining devices with cartridge consumables, recording revenue of 1568억 won and operating profit of 525억 won last year. SamsungSecurities expects WONTECH to reach 1790억 won in revenue and 580억 won in operating profit this year, driven by strong exports to emerging Asian markets such as Thailand.

First-quarter indicators for this year also reflect a similar ranking. Among all KOSDAQ-listed companies, peptide-based healthcare firms such as Caregen Co.,LTD.(214370)(51.5%), Hugel, Inc.(145020)(34.8%), and PharmaResearch(214450)(33.4%) demonstrated high profitability. This is attributed to strong exports of global aesthetic and toxin products.

A PharmaResearch official stated, “Based on our technological competitiveness in the field of regenerative medicine, we are continuously enhancing our environmental, social, and governance (ESG) management system to meet global standards,” adding, “Through management improvements, we will grow into a trusted global aesthetic company in the long term.”