[E-Daily Reporter KIM SUNG-JIN ] There is growing speculation that RP Bio, the leader in South Korea’s soft capsule market, may expand its production capacity for health functional foods. This comes as the health functional food market has recently experienced significant growth, leading to an increase in orders for original equipment manufacturing (OEM) and original design manufacturing (ODM). Consequently, the utilization rate at the company’s existing factory has effectively reached its limit. The company has recently been accelerating its efforts to tap into not only the domestic but also overseas OEM and ODM markets. In this regard, it is anticipated that the company will adopt strategies such as installing additional production lines and prioritizing high-value-added products, even if it does not necessarily involve expanding production facilities.

Dietary Supplement Plant Utilization Rate at 93%

According to the semi-annual report recently disclosed by RP Bio on the 19th, the utilization rate of the company’s dietary supplement plant reached 93% in the second quarter of this year. This represents a 3 percentage point (p) increase compared to the end of last year (90%) and a 7% rise compared to 2024 (86%). This is attributed to the resurgence in demand in the dietary supplement market, which had seen its growth slow in recent years.

An industry insider stated, “We understand that orders from clients have increased significantly due to rising demand for dietary supplements,” adding, “From a long-term perspective, we are considering ways to expand the plant’s production capacity or improve efficiency.”

RP Bio is a company specializing in the manufacture of soft gel capsules for pharmaceuticals. Soft gel capsules are a soft form of pill made by encasing liquid or oil-based drugs and nutrients in a soft coating, such as gelatin; they are used not only in pharmaceuticals but also in various dietary supplements, including omega-3 and vitamins.

AlpBio made its full-scale entry into the dietary supplement business in 2004 when it received the second-ever license in Korea to specialize in the manufacturing of dietary supplements. The company subsequently expanded its business by establishing a second dietary supplement plant in Hyangnam, Hwaseong, Gyeonggi Province, and the following year, it transformed into a specialized dietary supplement manufacturer by securing the capability to provide OEM and ODM services for all dosage forms. In 2019, the company established a new dietary supplement factory in Mado, Hwaseong, Gyeonggi Province, taking on its current form.

The RP Bio Mado dietary supplement plant has the capacity to produce 1.08 billion capsules annually. The company has reportedly secured ample land where the Mado plant is located, so there is no need to purchase additional land should expansion become necessary.

As the dietary supplement market has grown steadily, the dietary supplement business has now become ALP Bio’s core business. Looking at the revenue breakdown for the second quarter of this year, ALP Bio’s revenue from the dietary supplement business totaled 41.9 billion won, accounting for 56% of total revenue. The pharmaceutical business accounted for 44% (32.9 billion won).

One of AlpiBio’s key strengths is its technological capability to ensure a 36-month shelf life. Considering that typical competitor products have a shelf life of 24 months, AlpiBio’s products have a shelf life that is one year longer. For companies that outsource OEM and ODM production to AlpiBio, this allows them to enhance the long-term storage stability of their products while significantly reducing inventory burdens.

In addition, the company is actively expanding its portfolio of high-value-added formulations, such as launching jelly-based products alongside capsules. A prime example is “Blister Jelly,” where the jelly is directly filled into aluminum packaging. Starting with omega-3, AlpiBio has launched lutein and multivitamins in blister jelly form and has also obtained approval from the Ministry of Food and Drug Safety (MFDS) for a new formulation of “NeoChu,” a pharmaceutical jelly product.

A Ripple Effect from Drug Price Cuts?

Some analysts suggest that the increase in orders for AlpiBio is a result of the government’s

drug price reduction

policy. An industry official explained, “With the drug price reform system taking effect this month, traditional pharmaceutical companies are expanding their business portfolios into the dietary supplement sector,” adding, “Based on this, orders for dietary supplements are on the rise.”

Last November, the government officially presented the “Plan to Improve the National Health Insurance Drug Pricing System” and announced plans to lower the prices of generic drugs and off-patent medications. While the price of generic drugs had previously been set at 53.55% of the original drug’s price, the core of the plan is to reduce this to a maximum of 40%. The government’s intention is to prevent the market from being flooded with generic drugs containing the same active ingredients.

As these drug price cuts take effect, traditional pharmaceutical companies are increasingly turning their attention to the dietary supplement sector. This is because dietary supplements are not classified as drugs and are therefore not subject to the National Health Insurance drug price reductions. Another industry official stated, “They are attempting to partially replace sales of reimbursed drugs with non-reimbursed and non-insured businesses,” adding, “However, this move should be viewed as a strategy to diversify revenue streams rather than an indication that the dietary supplement business inherently yields high profit margins.”

Acceler

ating Global Expansion… Expanding ODM Exports Abroad

AlpiBio’s pursuit

of

global market

expansion

is another factor suggesting the possibility of factory expansion. While AlpiBio has historically focused on acquiring clients in the domestic market, it is now showing signs of expanding its order intake overseas.

A prime example is the company’s participation in “VitaFood Asia 2026,” Asia’s largest functional food exhibition, to be held in Thailand this September. This marks the first time ALP Bio has participated in an overseas functional food exhibition, and the company plans to target overseas markets, with a focus on Southeast Asia.

In fact, Thailand—the host country for this year’s VitaFood event—is recognized as a market where the health supplement sector has been growing rapidly in recent years. According to the Korea Agro-Fisheries & Food Trade Corporation, Thailand’s health functional food market is estimated to have reached 100 billion baht (approximately 4.6 trillion won) last year. This represents a 15% increase from the previous year and is the highest growth rate in Southeast Asia. Considering that the global average growth rate is around 7–9%, this means the market is growing at nearly twice that pace.

AlpBio stated, “We plan to expand our ODM exports by enhancing our capabilities in obtaining local licenses and complying with regulations overseas, and by establishing a global network centered on the U.S. and Asia.”