"SK Biopharmaceuticals Raises Target Price Despite Spending 1.1 Trillion Won on New Drug Acquisition [Weekend Money]"

Acquisition of New Epilepsy Drug Candidate Opacalime
Synergy Expected Through Utilization of Existing Sales Network

Domestic securities firms have successively raised their target prices for SK Biopharmaceuticals, which recently introduced the epilepsy drug candidate 'Opcalim' with an investment of approximately 1.1 trillion won. There is an assessment that SK Biopharmaceuticals has secured medium- to long-term growth engines by introducing a follow-up pipeline after Xcopri (cenobamate).

According to the securities industry on August 29, Hana Securities, Daol Investment & Securities, and Meritz Securities recently raised their target prices for SK Biopharmaceuticals to 160,000 won. The previous target prices were 150,000 won, 150,000 won, and 140,000 won, respectively. On the same day, DS Investment & Securities also increased its target price from 145,000 won to 155,000 won. Samsung Securities raised its target price from 130,000 won to 140,000 won. SK Biopharmaceuticals closed at 91,600 won on August 26, the day before the series of target price hikes.

This came after SK Biopharmaceuticals announced on August 26 that it had secured exclusive global rights for the drug candidate Opcalim, currently in global Phase 2·3 trials, other candidates in the Kv7 family, and a drug discovery platform from the global biotech company Biohaven. The contract is valued at up to USD 795 million (approximately 1.0995 trillion won), making it the largest-ever overseas drug candidate in-licensing deal by a Korean pharmaceutical or biotech company.

Minjeong Kim, a researcher at DS Investment & Securities, commented, "With this acquisition, SK Biopharmaceuticals has built an epilepsy franchise that connects Xcopri and Opcalim. Based on the differentiated characteristics of these two products, the company can deploy various marketing strategies according to patient profiles and treatment stages, which also gives it significant strategic value."

Junyoung Kim, a researcher at Meritz Securities, also noted, "The key element of this deal is not simply the addition of a pipeline, but the expansion of the U.S. business model, previously focused on Xcopri, into an epilepsy franchise. Since the existing Xcopri sales force and prescription networks can be utilized as they are, Opcalim's strategic value could be even higher for SK Biopharmaceuticals."

The ability to leverage the already established direct sales system in the U.S. is expected to create synergies in terms of cost and marketing. Currently, SK Biopharmaceuticals operates through its U.S. subsidiary SK Life Science, which has a dedicated field sales force of more than 150 people and networks with epilepsy centers and neurologists.

In terms of product characteristics, while Xcopri is primarily prescribed for treatment-resistant patients, Opcalim—thanks to its tolerability profile—can be used for patients in the initial stages of treatment. Thus, the two products are considered complementary. In particular, the acquisition of Opcalim ahead of the core substance patent expiry for Xcopri in the U.S. in October 2032 is viewed positively within the securities industry. Geunhee Suh, a researcher at Samsung Securities, remarked, "There had been significant concerns about a potential decline in revenue due to the launch of generics after Xcopri's patent expiration in 2032, given its high dependence on a single product. This licensing deal is positive from a life-cycle management perspective."

Opcalim is targeting the release of topline results from its first Phase 3 clinical trial (RISE-3) at the end of this year, additional results from a second Phase 3 trial in early 2028, and a U.S. launch in the first quarter of 2029. Jisoo Lee, a researcher at Daol Investment & Securities, analyzed, "An increase in short-term borrowings and R&D expenses is inevitable, but after the completion of Phase 3 clinical trials in 2028, R&D costs will decrease."

Currently, the valuation of Opcalim differs by securities firm. Hana Securities, for example, estimates its value at 3.2199 trillion won—the highest among the firms that raised their target price on the same day. Seonah Kim, a researcher at Hana Securities, said, "The end of 2026 will be crucial. If the first topline results at the end of this year confirm superiority over Xenon's azetucalner, the valuation, which has so far been marked down compared to peers, may increase."

Samsung Securities set the present value of the drug candidate at 1.7853 trillion won, reflecting risk factors until commercialization, probability of success, and annual R&D costs. Meritz Securities presented a value of 984.7 billion won, and Daol Investment & Securities valued it at 717.5 billion won, respectively.

Researcher Lee said, "Factoring in the offsetting effect of increased borrowings on the value uptick, we raised the fair target price to 160,000 won. We expect profitability to improve across the epilepsy lineup due to the synergy with Xcopri and utilization of the existing U.S. sales infrastructure." Researcher Suh added, "In 2026, net cash will temporarily drop sharply due to the first milestone payment of 472.5 billion won; however, thanks to the stable operating cash flows from the Xcopri franchise, net cash is projected to recover to around 346.5 billion won in 2027, even after the second milestone payment of 67.5 billion won."

This content was produced with the assistance of AI translation services.