[Edaily Reporter KIM SAE-MI ] Alteogen Inc.(196170)is being recognized as a global platform company that has moved beyond the stage of accumulating numerous technology export achievements and is now generating revenue linked to the sales of commercialized products. This is because “Keytruda Qurex,” the first commercialized product incorporating ALT-B4, is rapidly penetrating the market, and sales milestones are now being fully reflected in the company’s financial results. Market attention is now shifting to the pace of ‘Keytruda Qurex’ market penetration and whether the company will secure its fourth technology export contract this year.
‘Keytruda Qurex’ Takes Off… Sales Milestones Also Soar
According to U.S.-based Merck (MSD) on the 10th, sales of “Keytruda Qurex,” the subcutaneous (SC) formulation of Keytruda, surged 262% from $128 million (approximately 183 billion won) in the first quarter of this year to $463 million (approximately 662.1 billion won) in the second quarter. This represents a 3.6-fold increase in just one quarter. MSD explained that adoption of Qurex has been increasing since April 1, when the permanent J-code was applied.
The sales growth of Keytruda Qurex has continued into the third quarter. Based on Bloomberg’s Wholesale Acquisition Cost (WAC), U.S. prescriptions for Keytruda Qurex in July totaled $201.6 million (approximately 288.3 billion won), an increase of about 20% from the previous month.
The share of U.S. Keytruda prescriptions accounted for by Qurex also rose by 1.7 percentage points in just one month, from 8.9% in June to 10.6% in July. Cumulative prescription sales from January through July of this year, based on WAC, are estimated to exceed $688 million (approximately 983.8 billion won). Given that the subcutaneous (SC) conversion rate in the U.S. remains in the low 10% range, observers note that there is still room for further market penetration.
As sales of Keytruda Qurex grow rapidly, revenue linked to commercial product sales—beyond the one-time technology fees from the technology transfer agreement—is now being fully reflected in the company’s financial results. Jeon Tae-yeon, CEO of Alteogen Inc., commented, “The first half of this year is particularly significant because we have begun generating revenue from commercial product sales, moving beyond the achievements of technology exports for the Hybrozyme platform.”
In fact, Alteogen Inc.’s consolidated revenue for the second quarter surged 269.5% year-over-year to 68.9 billion won, and operating profit reached 34.2 billion won, marking a turnaround from a loss in the 400-million-won range during the same period last year. The operating profit margin for the second quarter reached 49.6%. In the first half of the year, the company’s financial results reflected upfront payments and milestone payments generated from technology exports of ALT-B4 to Tesaro, a GSK subsidiary, and Biogen.
Third-Quarter Results Also Expected… Expanding Curex Sales and New Contract Payments
The impact of expanding sales of Keytruda Qurex on Alteogen Inc.’s earnings is expected to grow even further. MSD has already recognized related liabilities on its books, having determined that sales of Keytruda Qurex following approvals in the U.S. and Europe are highly likely to generate sales-based milestones totaling $890 million (approximately 1.2727 trillion won) for Alteogen Inc.
Earnings for the third quarter of this year are also anticipated. Previously, on the 4th, Alteogen Inc. signed a technology transfer agreement for ALT-B4 with an undisclosed global pharmaceutical company worth up to $365 million (approximately 521.9 billion won). Although the amount of the upfront payment was not disclosed, it is highly likely to be reflected in the third-quarter earnings.
The key point to watch right now is how quickly the market penetration rate of Keytruda Qurex in the U.S. will rise. This is because increased sales of Qurex could directly lead to an expansion of Alteogen Inc.’s sales milestones. MSD is also expressing confidence in the sales momentum of Keytruda Qurex.
Caroline Richfield, MSD’s Chief Financial Officer (CFO), recently stated, “Qurex already accounts for a double-digit share of the overall Keytruda business in the U.S.,” adding, “We are on track to achieve an adoption rate of 30–40% by the end of 2027.” In its second-quarter earnings announcement, MSD also noted, “Adoption by physicians and patients has increased since the introduction of the J-code, and we remain confident in the adoption trajectory of Qurex.”
Will a Fourth Technology Export Agreement Be Signed This Year? Attention on ALT-B4’s ScalabilityAnother key driver of momentum is additional technology exports. CEO Jeon recently hinted at the possibility of further agreements, stating, “In addition to the three technology export deals already completed this year, we aim to turn ongoing discussions into additional achievements.”
Alteogen Inc. signed a contract worth up to $285 million (approximately 407.6 billion won) with Tesaro, a subsidiary of GSK Holdings, in January of this year, followed by a contract worth up to $579 million (approximately 828 billion won) with Biogen in March, and then finalized a contract worth up to $365 million with an undisclosed global pharmaceutical company in August. The total value of these three contracts exceeds $1.229 billion (approximately 1.7 trillion won).
The securities industry also views additional ALT-B4 technology exports as a key driver of the company’s value growth. Shinhan Investment Securities projected that, following this year’s three agreements, multiple additional license-outs (L/O) are likely in the second half of the year. DaishinSecurities went a step further, incorporating the baseline assumption of two new ALT-B4 license agreements per year into its valuation of Alteogen Inc.
Clinical progress in the pipelines of existing partners is also providing momentum. Daiichi Sankyo is conducting clinical development of a subcutaneous (SC) formulation of “Enhertu” incorporating ALT-B4, while Sanofi is also conducting clinical trials for subcutaneous administration of “Dupixent” in combination with vera hyaluronidase alfa. GSK is developing a subcutaneous formulation of the immunotherapy “Zemperi” using ALT-B4.
As these partners’ development efforts progress through clinical trials and toward regulatory approval, the likelihood of additional milestone payments increases. Furthermore, as the number of commercialized products grows in the future, Alteogen Inc.’s revenue streams—currently concentrated on Keytruda—are expected to diversify.
In the medium to long term, the potential for expanding the scope of the ALT-B4 platform is also worth noting. Alteogen Inc. is broadening the business development scope of ALT-B4 to include not only existing monoclonal antibodies and bispecific antibodies but also antibody-drug conjugates (ADCs) and ribonucleic acid (RNA) therapeutics. The company reported that demand for subcutaneous (SC) formulations is growing across various modalities, including bispecific antibodies and RNA.
More concrete data is emerging in the ADC field. Last May, Alteogen Inc. disclosed results from preclinical studies in pigs combining ALT-B4 with Becton Dickinson’s (BD) wearable drug delivery device, the “10mL BD Libertas,” showing improvements in injection time and drug release rate. In June, at the “World ADC Summit South Korea,” the company announced that preclinical studies in minipigs using ALT-B4 in combination with an ADC showed increased drug absorption and bioavailability, as well as a trend toward improved local skin toxicity and certain hematological safety indicators.
Hong Ga-hye, an analyst at DaishinSecurities, noted that global competitor Halozyme has also signed its first licensing agreement to expand the application scope of its “ENHANZE” platform from ADCs to nucleic acid therapeutics. She analyzed that if the application of ALT-B4 to RNA becomes a reality, the accessible market itself could expand.
Researcher Hong predicted, “Future expansion into new modalities, such as RNA, will strengthen Alteogen Inc.’s medium- to long-term growth momentum and lead to a further revaluation of the platform’s value.”
