Celltrion eyes record high sales in 2025, fueled by high-margin biosimilars

Celltrion Inc., South Korea’s leading biosimilar drug developer, is poised to reap nearly 5 trillion won ($3.6 billion) in revenue this year after reporting its highest-ever second-quarter earnings on robust demand for new high-margin biosimilar medicines.

In a preliminary earnings disclosure on Monday, Celltrion projected a consolidated operating profit of 242.5 billion won for the April-June period, marking its all-time high second-quarter profit.

Sales rose to a quarterly record of 961.5 billion won, up 9.9% from a year earlier. Operating profit more than tripled, lifting the operating margin to 25%, according to the filing.

First-half sales totaled 1.80 trillion won, another record, and up 11.9% from the same period a year ago.

The company attributed the stellar performance to accelerating sales of its newer, high-margin biosimilars – Remsima SC (marketed as Zymfentra in the US), Yuflyma, Vegzelma and Steqeyma.

The high-margin new biosimilars accounted for 53% of the company’s total sales in the quarter, up from 30% a year ago.

In particular, Steqeyma swept the US market, gaining a 90% share within one month of its rollout in the country.

Celltrion’s cost-of-sales ratio in the quarter also narrowed to 43% from 58% in the same quarter last year and 4 percentage points lower than the previous quarter, boosting profitability.

Following its merger with sales and marketing affiliate Celltrion Healthcare Co. in late 2023, its direct costs surged. But the company said the impact has eased as high-cost inventories were depleted, production yields improved and utilization at its third plant increased.

ROSY H2 OUTLOOK

Celltrion expects its earnings momentum to continue into the upcoming quarters with the launch of four new medicines – Omlyclo, Avtozma, Eydenzelt and Stoboclo-Osenvelt – in key markets such as Europe and the US in phases in the second half.

Especially, the company is betting on Omlyclo and Avtozma, the first biosimilars referencing Roche’s Xolair and Actemra, respectively, a company official said.

Following the upbeat performance, Celltrion is on pace to hit 5 trillion won in annual sales in 2025, for its highest annual sales ever, analysts forecast.

THIS YEAR’S 8TH SHARE BUYBACK

Reflecting confidence in its outlook, Celltrion announced its eighth share buyback program of the year, totaling 100 billion won.

Celltrion will start repurchasing company shares during market hours on Tuesday.

Including the latest round, Celltrion’s cumulative buybacks this year amount to about 750 billion won. It has canceled about 900 billion won worth of treasury shares year to date.

The Korean biosimilar giant plans to complete a portfolio of 34 biosimilars by 2030.

It also plans to file investigational new drug (IND) applications with the US Food and Drug Administration for nine antibody-drug conjugates (ADCs) and four multispecific antibody candidates by 2028.

Celltrion shares ended up 0.5% at 181,200 won on Monday.

TARIFF RISKS AND US STRATEGY

In response to concerns over potential hefty US tariffs on imported pharmaceuticals, Celltrion has already secured a two-year inventory supply and plans to maintain this two-year inventory on a rolling basis, according to the company’s statement on its website.

It also reiterates that it is currently considering acquiring a US-based company with manufacturing facilities to mitigate tariff risks and will produce its US-bound drugs through its local contract manufacturing partners.

Write to Hyun-Ah Oh at 5hyun@hankyung.com

Sookyung Seo edited this article.