[NA Eun-kyung, Edaily Reporter] On Oct. 30, South Korea’s pharmaceuticals and healthcare sector saw sharp gains among smaller players such as KYUNG NAM PHARM and SAMIK PHARMACEUTICAL COMPANY. Momentum from D&D Pharmatech’s bonus share announcement continued for a second day.

D&D Pharmatech weighs perpetual CBs after bonus issue

D&D Pharmatech closed at 222,000 won on Oct. 30, up 11.8 percent, extending the rally that followed its Oct. 29 disclosure of a stock bonus. The bonus issue will increase the company’s shares outstanding fourfold to 43,425,276 from 10,856,319.

The company had explored issuing more than 50 billion won in perpetual convertible bonds. That plan now appears unlikely, according to people familiar with the matter, given that liquidity is adequate and a bonus issue has already been executed.

Companies often announce stock bonuses alongside rights offerings to defend share prices, or conduct them after issuing CBs. Lunit paired a 100 percent stock bonus with a 200 billion won rights issue, and Curiox disclosed a 100 percent stock bonus when it announced 20 billion won in CBs last year. When a stock bonus precedes a CB, the conversion price can be set higher, which is generally unfavorable for CB investors.

“Even considering U.S. clinical progress, we do not see a major funding gap through the end of next year,” Hong Seong-hoon, D&D Pharmatech’s CFO, said in a phone interview. As of end-June, the company held roughly 40 billion won in cash. Phase 2 costs for DD01 are supported by the Korea Drug Development Fund, securing related funding.

D&D Pharmatech received a proposal in August from a securities firm to issue perpetual CBs and began related procedures. The company halted the effort after the firm decided against a fully underwritten structure. D&D Pharmatech said it would instead pursue direct investment.



SAMIK PHARMACEUTICAL COMPANY extends post-listing surge

SAMIK PHARMACEUTICAL COMPANY, which listed on KOSDAQ on Oct. 27 through a merger with Hana Financial No. 28 SPAC, hit the upper limit for a fourth straight session. The stock has already tripled its 7,119-won offer price, reaching 21,300 won. With a relatively small free float, volatility is expected to remain elevated.

As indicated in its prospectus, the company disclosed new facility investments on Oct. 30. Of the 17 billion won raised in the listing, about 7.27 billion won will expand product and API warehousing to boost capacity.

Known for over-the-counter brands such as the cold remedy “Maparam,” the children’s supplement “Kiddy,” and the motion-sickness drug “Nosobomin,” the company plans to enter the global CDMO market and pursue new drug development. Its lead program, SIKD1977 for postherpetic neuralgia, is in Phase 2 in Korea. The global PHN market is projected to reach about 2.5 billion dollars by 2033.

“The market backdrop has been favorable, and the share trend remains positive,” a company official said. “We will focus on R&D investment and capacity expansion using KOSDAQ proceeds to strengthen a sustainable growth base.”

KYUNG NAM PHARM considers options for Sindang-dong building

KYUNG NAM PHARM, best known for Lemona vitamin C, rose 14.5 percent to 871 won. The stock, which topped 10,000 won in 2019, has trended lower for years but has seen sudden intraday spikes recently.

Investor attention has turned to a newly rebuilt headquarters building in Seoul’s Jung-gu, Sindang-dong. The company invested a total of 17.2 billion won, including 8.2 billion won for the original purchase, to redevelop the site, initially envisioning an entertainment-related base. After exiting that business last year, the building’s use shifted to general offices. The property spans three basement levels and six above ground, with a total floor area of 1,662.34 square meters.

KYUNG NAM PHARM ‘LEMONA-S’ (Source=KYUNG NAM PHARM)

Construction began in February 2024 and is nearing completion. “Reconstruction of the Sindang-dong building is almost finished,” a company official said. “We have no fixed plan to relocate headquarters there. A sale is under review but nothing has been decided.”

Industry watchers see a higher likelihood of holding the property as a real-estate asset and selling later rather than moving in. KYUNG NAM PHARM has posted operating losses since 2021, and sales growth has been limited amid intensifying competition in health supplements such as Lemona and frequent leadership changes.

Regarding the stock move, the company said it had no specific information to share. It added that from November through next March it is targeting launches of over-the-counter cold medicines and vitamin and health-functional products, which could support results.