South Korean biosimilar giant Celltrion Group’s founder Seo Jung-jin has returned to management two years after his departure, pledging to merge the conglomerate’s key units, seek major acquisitions for its global expansion and secure technology of new drugs.
Seo was on Tuesday elected as co-chairman of the board of directors for each of the group’s three listed affiliates Celltrion Inc., Celltrion Healthcare Co. and Celltrion Pharm Inc. at the companies’ annual shareholder meetings with 79.7% support from attending stockholders.
“Risks and opportunities are coming together,” Seo told shareholders. “I will go back to the business field and bring the best results.”
He vowed to spearhead the companies' global business, staying abroad for more than half of the year.
TO COMBINE THREE LISTED AFFILIATESSeo pledged to combine the three listed affiliates, a key task to reform the group’s corporate governance. He aims to complete the governance structure, in which Seo controls the group holding company Celltrion Holdings Co. that manages Celltrion.
Currently, Celltrion develops biosimilars, while Celltrion Pharm sells them in South Korea and Celltrion Healthcare handles their overseas sales.
“I still think the merger is necessary and we are internally preparing for the combination,” he said.
Celltrion in September 2020 announced a plan to unite the three publicly listed companies but the plan has been indefinitely held off due to the company’s lingering window dressing issue first raised in 2018 and that once placed the company on the brink of delisting.
But the Korean financial authorities in March last year freed the company from the accusation of cooking the books, paving the way for the resumption of the merger process.
Seo said the company still needs to file a report on measures to improve internal control to the authorities by July. The submission, the final part of the process with the authorities, will set up conditions to push ahead with the merger, he added.
“The financial market situation will determine the timing of the merger. Once the markets stabilize, we will be able to go ahead with the merger as early as year-end.”
TO ACTIVELY SEEK ACQUISITIONSCelltrion plans to actively seek major takeover deals, Seo said.
“I expect good opportunities for M&As this year,” he said. “We have ample cash but we may pay by our shares in affiliates instead of cash for acquisitions if necessary.”
That indicates Seo may use his own 11% stake in Celltrion Healthcare, which was valued at around 1 trillion won, to take over other companies instead of using the cash of the group holding company, industry sources said.
Seo said
the company has been studying a possible acquisition of the biopharma solutions unit of the US-based Baxter International Inc., a deal estimated at $4 billion.
“We are in an observing stage now,” he said. “Once we see possible synergy from the takeover, we will take action from the end of the year.”
Celltrion has already built a relationship with Baxter after outsourcing the US company with the production of Remsima, the world’s first biosimilar monoclonal antibody it developed.
Seo said the company is looking at various companies for acquisitions in addition to Baxter.
“If there is an M&A deal that can create synergy, we will make a bold decision without delay.”
TO DEVELOP NEW DRUG PLATFORMSCelltrion aims to accelerate to secure platform technology to develop new drugs, Seo said.
“We have been developing our own platform technology through cooperation with bio companies,” he said.
Celltrion became the largest shareholder of the UK's antibody-drug conjugate (ADC) developer Iksuda Therapeutics while
developing an oral antibody drug with US-based Rani Therapeutics. The South Korean company said the discovery of new drug candidates for bispecific antibodies is in the final stages.
“We will make our own messenger ribonucleic acid (mRNA) platform technology used for COVID-19 vaccines in the first half,” Seo said.
The company has been developing the next-generation mRNA vaccine platform with TriLink BioTechnologies Inc., a US life sciences company, since 2021.Write to Jae-Young Han and Yoorim Kim at
jyhan@hankyung.com Jongwoo Cheon edited this article.
