SK Biopharmaceuticals seeks to raise W960 billion via IPO
SK Biopharmaceuticals CEO Cho Jeong-woo speaks during an online press conference on the company's initial public offering, Monday. Courtesy of SK Biopharmaceuticals
By Nam Hyun-woo
SK Biopharmaceuticals plans to raise up to 960 billion won or some $794 million through an initial public offering (IPO) in South Korea, the company said, Monday.
SK Group's big drug affiliate added it plans to sell 19.6 million ordinary shares to the equity market setting its “desired price” within 35,000 won and 49,000 won per share. Through this process, it is estimated SK Biopharmaceuticals will raise between 704.8 billion won and 959.3 billion won. NH Investment and Citigroup Global Market Investment are set to manage the entire process with Morgan Stanley and Korea Investment backing it up.
Market analysts expect the estimated market value of the SK affiliate will reach 5 trillion won, at least, with brokerages anticipating the market capitalization of the company could possibly stand at between 2.8 trillion won and 3.8 trillion won. SK Biopharmaceuticals is owned by parent company SK Holdings.
The IPO came after the successful U.S. commercial debut of Cenobamate, the company's partial-onset seizures treatment better known by its product name Xcopri. Since SK Biopharmaceuticals will manage the drug's U.S. sales on its own, not only domestic but also global investors are paying keen attention to the company's IPO.
“SK Biopharmaceuticals will not be complacent with a one-time success,” CEO Cho Jeong-woo said during an online press conference. “By exploiting our capabilities in R&D, we will materialize sustainable growth and become a company providing vitality to the domestic pharmaceutical industry.”
Late last year, SK Biopharmaceuticals claimed to have become the first South Korean company to have two new drugs ― Cenobamate and Solriamfetol ― approved by the U.S. Food and Drug Administration (FDA). The FDA approved Solriamfetol, a sleep disorder treatment licensed out to Jazz Pharmaceutical in March last year, and Cenobamate in November.
One key rationale behind the SK affiliate's confidence in its planned IPO is that the launch of Cenobamate received a positive response here, mostly because the drug was the first developed independently by a South Korean company, from discovering a candidate through to receiving the FDA approval.
Cho reiterated most of the existing treatments for partial on-set seizures will see their patents expire in the next two to three years.
“In terms of epilepsy drugs, a success in the U.S. mostly results in a success in the global market, thus SK Biopharmaceuticals decided to market Cenobamate on its own,” he said. “Though the drug is approved by the FDA for treating partial-onset seizures, physicians usually prescribe it for off-label use for generalized seizures. We are running clinical trials for generalized seizures, and we hope to win additional approval for this as early as 2023.”
Cho said cenobamate will be priced at between $950 and $1,000, which he claimed would be a favorable price for patients.
Over its pipeline projects for future growth, Cho said of Carisbamate, also a treatment for Lennox-Gastaut Syndrome which is a severe form of epilepsy usually occurring in children. The company is conducting phase 1b/2 clinical trial for the drug, and expects to finish the phase 2 trial at the end of this year.
Along with Carisbamate, the company has treatment candidates for schizophrenia, bipolar disorder and an anti-cancer drug, on which clinical trials will begin next year. The executive said, if approved, SK Biopharmaceutical is set to sell Carisbamate directly in the United States and other markets in Asia.
It's been checking expected demands for its offerings from overseas institutional investors since June 10 with the company aiming to close on this, Thursday. It will launch the same process for domestic institutional investors from Wednesday and Thursday, and determine the offering price on Friday. Subscriptions for the shares will be available from June 23 to 24.