SEOUL, KOREA - Kyongbo Pharm, a non-listed company with specialty in the manufacturing of active pharmaceutical ingredients (API), achieved sales of 152.8 billion won and an operating profit of 22.5 billion won last year.
In terms of sales and profit, Kyongbo's achievement is similar to those of mid-sized drug companies in Korea. In particular, the company's operating profit-to-sales ratio stands at 14.7 percent, the highest among Korea's pharmaceutical companies. Kyongbo, accordingly, is a lucrative business for Chong Kun Dang Pharmaceutical Co. which owns 59.3 percent of Kyongbo Pharm.
The API subsidiaries of Korea's major pharmaceutical companies are showing outstanding improvements in performances, driven by the demand from their parent companies plus an increase in direct exports to overseas markets. The main outlets for Korean-made APIs include Japan, China, the United States, and India.
In recent days, European countries such as Italy and Germany are also emerging as new outlets. Korea's API exports have been growing by 20 percent per year since 2011, higher than the two-digit growth of the nation's pharmaceutical exports. When it comes to Kyongbo, for example, the share of exports in its total sales stands at 69 percent.
Kyongbo is not alone. Yuhan Chemical Inc., a subsidiary of Yuhan, is also growing at a robust pace with its yearly sales estimated at 77.7 billion won last year, up 33.9 percent from a year ago. Its sales are expected to rise by 18 percent this year to 91.7 billion won, thanks to the increase in its parent company's overall exports.