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Aprogen, 1st Korean biotech firm to win unicorn status

Jeong Sae-im  Published 2019.12.11  13:10  Updated 2019.12.11 17:30

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Aprogen has joined the list of unicorn companies, as the first Korean biotech firm.

CB Insights, a U.S. market research firm, gave the unicorn status to Aprogen on Monday. A unicorn company refers to a firm with a valuation of over $1 billion before going public.

Aprogen attracted 20 billion won ($16.7 million) investment from Lindeman Asia Investment in May, which led its valuation to surpass 1 trillion won and join the unicorn list.

Established in 2000, Aprogen became the third company to develop a biosimilar and earned a title, “the second Celltrion.” Indeed, Aprogen’s business has been similar to that of Celltrion, Korea’s leading biosimilar maker.

Celltrion got funding from Singapore’s sovereign wealth fund Temasek Holdings to develop biosimilars, and Aprogen earned investment from Nichi-Iko Pharmaceutical to win approval for a Remicade biosimilar in Japan in 2017. The foreign investment helped the company

As Celltrion did, Aprogen is also seeking a backdoor listing.

Celltrion attempted to get listed in 2006 and 2008 but failed due to sales controversy. Then, it acquired ORChem, a Kosdaq-listed company, and merged with it to get onto the stock exchange market easily.

Aprogen applied for a preliminary review for listing in 2016 but withdrew its plan due to accounting issues. Instead, the company is pursuing backdoor listing through a merger with Kospi-listed company, Nara KIC (now Aprogen-KIC), which it acquired in 2017. In May, the company named Shinhan Investment Corp. as the lead underwriter.

Aprogen is focusing on commercializing GS071, a Remicade biosimilar, in the global market. Except for Japan in 2017, no country has granted the green light for the treatment. The company applied for the nod in Turkey and Korea in April and June, respectively, but has yet to obtain the license. In the U.S., Nichi-Iko Pharmaceutical completed the phase-3 trial on the biosimilar in May.

Aprogen’s other pipelines include AP063, a biosimilar of anticancer drug Herceptin, and Rituxan biosimilar AP056 for autoimmune diseases. The company finished the phase-1 trial on AP063 in the U.S. in May and will enter the phase-3 study in 2020. The phase-1 study on AP056 will begin in 2020. Nichi-Iko Pharmaceutical owns global commercialization rights for AP063, except for the Korean market.

The company is also aggressive in developing new biologics. It has a variety of technologies to develop antibody-based new drug candidates, including those for macular degeneration, erectile dysfunction, and immunotherapies.

However, Aprogen’s revenue has declined since 2016. The company achieved rapid growth with annual sales of 68 billion won, and an operating profit of 27.3 billion won in 2016. Still, the yearly revenue went down to 62.2 billion won in 2017, and further down to 53.3 billion won in 2018.

This year, the earnings are likely to be more disappointing. The company’s accumulated sales until the third quarter recorded 24.1 billion won, and an operating loss of 27.5 billion won. The poor performance was attributed to a drop in exports of GS071 to Japan.

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