Hana Securities evaluated Alteogen's recent $365 million technology export contract as a reaffirmation of its platform's competitiveness. As a result, the firm raised its target price from 440,000 won to 580,000 won while maintaining a 'buy' rating.
Kim Seon-a, a researcher at Hana Securities, noted, "The stock price has significantly adjusted due to market misunderstandings surrounding the subcutaneous injection platform for biosimilars. This contract demonstrates that demand for Alteogen's platform will persist even with the emergence of competing biosimilars."
Alteogen announced that it signed a technology transfer agreement worth $365 million, including upfront payments and milestone fees. The ongoing royalties are separate. Kim projected that the upfront payment would be around $20 million, considering the existing contract structure.
He added, "Any product in this category is likely to have an impact comparable to the cancer drug 'Enhertu,' which generates over $5 billion in annual sales."
The faster-than-expected expansion of Keytruda's subcutaneous injection sales is also a positive development. Kim explained, "Previously, we anticipated an annual conversion rate of 6-7%, but as of June, the actual conversion rate reached 8.9%. Sales from the subcutaneous injection form have already expanded to about 5.5% of Keytruda's total sales."
He continued, "During MSD's earnings announcement on August 4, Keytruda's intravenous sales remained stable compared to the previous quarter, but subcutaneous sales surged by 262% to $463 million. Cumulative sales for the first half of the year have exceeded $590 million, indicating a strong possibility of receiving the first sales milestone in the second quarter of this year."
Kim concluded, "If the current sales pace continues, achieving MSD's target of a 30% conversion rate for subcutaneous injections by 2027 and reaching $10 billion in annual sales by 2029 is feasible."
* This article has been translated by AI.
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