'Protracted Covid-19 was boon for Boryung's 1Q sales

The resurge of Covid-19 infections since February is expected to help Boryung record robust sales growth in the first quarter, a local analyst said Friday.

A local analyst has predicted that the prolonged Covid-19 pandemic helped Boryung bolster its sales in the first quarter.

Kim Hyung-soo, an analyst at Hanwha Investment and Securities Corp., noted in a report that the surge of the Omicron variant, which has more than twice the transmission power of Delta, since February has boosted the sales of Boryung’s prescription and over-the-counter (OTC) drugs to treat symptoms.

"Pfizer's Covid-19 treatment Paxlovid has limitations, as it is available only to patients over 60 and has many prohibited substances in combined use," Kim said. "As a result, Boryung's sales seem to have increased as hospitals prescribed its drugs such as respiratory disease treatment and antibiotics to Covid-19 patients."

Kim added that OTC drugs, such as Younggaksan Powder (Antitussives) and Cold Three lineup (cold medicine), are also expected to show strong growth.

Besides Covid-19 treatments, Kim stressed that the company had shown substantial growth in the anticancer market and its legacy brands acquisition (LBA) strategy.

"The company signed a contract with Kyowa Kirin to jointly sell Grasin and Neulasta, both neutropenia treatments, to expand its influence in the anticancer drug market," Kim said. "The achievements of the two LBA strategies implemented last year will continue this year."

LBA is the acquisition of original drugs whose patents have expired. As a result, it is possible to maintain sales volume and market share above a certain level based on high brand loyalty.

Boryung acquired the Korean rights for Lilly's Zyprexa (schizophrenia treatment) last year and Gemzar (anticancer drug) in 2020.

"Boryung, which focuses on generic drugs, has expanded its market influence by acquiring Gemzar and Zyprexa," Kim said. "The company also received approval for Dukarb plus, a combination antihypertensive drug in March, and will launch it by the second half of the year to mark sales of more than 10 billion won ($8.1 million).

Kim concluded that his brokerage maintained its "buy" opinion for Boryung's shares at a target price of 17,000 won.