ST Pharm Makes a "Quantum Jump" as an Oligo CDMO, Emerging as Dong-A Socio Group's Next-Generation Growth Pillar

Operating Profit Doubled Last Year
Surging CDMO Demand for Oligo and Small-Molecule APIs

ST Pharm has achieved a structural transformation of its oligonucleotide (oligo) contract development and manufacturing organization (CDMO) business, simultaneously capturing both top-line growth and improved profitability.

According to the Financial Supervisory Service's electronic disclosure system on the 11th, ST Pharm posted consolidated sales of 331.6 billion won and operating profit of 55.1 billion won last year. Compared with the previous year, sales surged by 21.1% and operating profit by 98.9%. In the fourth quarter alone, the company recorded sales of 129.0 billion won and operating profit of 26.4 billion won, achieving a quarterly operating margin of 20.5%. The market assesses that ST Pharm has moved beyond a simple top-line expansion phase and entered a stage where profit leverage is fully kicking in. The operating margin, which was only 3.4% in 2021, jumped to 11.8% in 2023 and 16.6% in 2025, proving that the company has completely escaped its past low-margin structure. There is a growing view that ST Pharm, through its explosive growth, is firmly establishing itself as a clear next-generation growth pillar of the Dong-A Socio Group.

The driving force behind the improved profitability is the "qualitative shift in sales." Last year, the oligo division generated annual sales of 237.6 billion won, up 35% from the previous year, with high-margin commercial-stage sales reaching 174.4 billion won, accounting for 73% of total oligo sales. As the company has moved away from a structure centered on clinical-stage pipelines and significantly expanded the share of commercial volumes, a virtuous cycle has taken hold in which both sales and profits increase relative to the same level of facilities and manpower投入. ST Pharm explained that, in addition to rising sales of commercialized oligo drugs, successful clinical progress of chronic disease pipelines has led to a surge in demand for active pharmaceutical ingredients (APIs).

Oligo therapeutics are rapidly expanding their application from rare disease targets to chronic indications such as cardiovascular and metabolic diseases, demonstrating enormous market potential. Because chronic diseases involve frequent dosing and large patient populations, demand for APIs structurally soars once products enter the commercial stage. For example, global sales of Novartis's hyperlipidemia treatment Leqvio, one of the leading commercialized oligo therapeutics, are expected to jump more than threefold from 1.198 billion dollars (about 1.74 trillion won) last year to 3.931 billion dollars (about 5.72 trillion won) in 2031. In addition, the small-molecule chemically synthesized API segment alone generated 18.4 billion won in sales in the fourth quarter, giving a strong boost to the company-wide top-line growth.

The earnings outlook for this year is also considered bright. In January, ST Pharm signed an 82.5 billion won supply contract for oligo APIs with a global biotech company based in the United States, and on the 10th it signed a 14.89 million dollar (about 21.7 billion won) supply contract for small-molecule new drug APIs with a European global pharmaceutical company. The full-scale operation of the second oligo plant in the second half of this year is expected to maximize ST Pharm's capacity utilization.

IBK Investment & Securities has raised its target price for ST Pharm sharply to 180,000 won, forecasting 2026 sales of 401.4 billion won and operating profit of 72.4 billion won. Kiwoom Securities also raised its target price to 190,000 won, projecting that the company will benefit from favorable investor sentiment toward RNA modalities (therapeutic approaches) and increased investment by big pharma. Heo Hyemin, an analyst at Kiwoom Securities, said, "We expect top-line growth and product mix improvement in both the oligo and small-molecule businesses this year," adding, "As global big pharma companies expand their investment in RNA modalities, attention to the sector is rising, and additional share price re-rating is expected depending on news of pipeline progress at key customers and the topline results of the Phase 2a trial of the HIV (AIDS) treatment STP0404 in the third quarter."

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