"We will prove it through management and results."
Jeon In-seok, CEO of Samchundang Pharm, said at a news briefing Monday at the company’s Seoul headquarters that he would restore trust by delivering business results amid controversy over a recent technology export agreement.
The company disclosed March 30 that it had signed a $100 million (about 1.5 trillion won) technology export deal with a U.S. partner for an oral diabetes and obesity treatment. Market doubts spread over the profit-sharing structure and contract terms, and the controversy intensified after Jeon’s plan to sell a 2.5 trillion won stake in a block deal became public.
Samchundang Pharm said it scrapped the block deal plan Monday morning and pushed back against suspicions. Jeon said, "We decided to eliminate the block deal itself, which became the basis for the rumors," adding, "I judged that protecting the company’s value and shareholder trust comes before my personal tax issues."
Attention has shifted to whether the company’s technology and business case can be verified. At the briefing, the company focused on its platform technology, S-PASS, which it says converts injectable drugs into oral formulations. Samchundang Pharm said the technology delivers efficacy equivalent to the original product while avoiding existing formulation patents.
Jeon said, "Malicious rumors about S-PASS are not true," adding that materials submitted to the U.S. Food and Drug Administration include the drug mechanism, stability data and the applied technology. "You cannot proceed through regulatory procedures with false technology or data," he said.
The company said it uses an S-PASS-based substance (SNAC Free) to avoid formulation patents without existing excipients and to improve cost competitiveness. It said the biopolymer used instead of SNAC costs about one-tenth as much, and that it has secured competitiveness at what it called a global low of about $20 per gram.
The company said it is developing oral semaglutide (Rybelsus and Wegovy oral generics) based on the technology and has signed an exclusive supply agreement with its U.S. partner.
Addressing the structure under which it receives 90% of sales revenue, Jeon said it is possible because Samchundang Pharm develops and produces products with its own technology and supplies them to global markets. He described it not as a technology transfer deal but as a revenue-sharing supply agreement in which the partner sells the product and pays sales proceeds over 10 to 15 years. On milestones, he said the core of the contract is not one-time milestone payments but revenue generated from long-term product supply.
Responding to criticism of its R&D capabilities, Jeon said the company has used a "strategically distributed innovation" structure from the start, with each team focused only on its project to minimize information leaks.
Jeon apologized, saying communication with shareholders had been insufficient, and said the company would rebuild trust by proving global results in the second half of the year with numbers and outcomes.
According to the Korea Exchange, Samchundang Pharm shares surged intraday to as high as 706,000 won but gave up gains to close down 4.63% at 618,000 won from the previous session. The stock has jumped 400% this year, overtaking EcoPro to rank No. 1 by market capitalization on the KOSDAQ and earning the nickname "imperial stock" for trading above 1 million won, but a recent sharp decline has jolted the market.
* This article has been translated by AI.
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