Daewon Pharmaceutical

Daewon Pharmaceutical is one of Korea's leading players in respiratory prescription and over-the-counter drugs, holding the No. 1 market share of 16.1% in respiratory prescriptions according to UBIST data.

Its flagship products include the chewable cold medicine 'Coldaewon' series and the expectorant lineup 'Codaewon, Codaewon Forte, Codaewon-S, Codaewon Plus,' whose prescription value has grown roughly sixfold over the past five years.

In orthopedics, the company leads with a 6.0% prescription share driven by 'Pelubi,' Korea's 12th domestically developed new drug (an anti-inflammatory), and osteoarthritis treatment 'Sinbaro.' More recently, the company has been expanding into less seasonal chronic-disease areas, centered on the hypertension treatment family 'Edalbi' (Edalbi, Edalbi-Chloro, Edalbi-Dipine) and the dyslipidemia combination drug 'Tabarozet.' The Edalbi family gained additional sales muscle through a co-marketing agreement with Celltrion Pharm signed in January 2026, while Tabarozet ranked No. 1 in its generic ingredient market as of 2024.

The health-supplement business, run through subsidiary Daewon Healthcare, is also expanding, led by sleep-aid product 'Kkuljamshot' and hair/skin-health product 'Hair Collagen 3X.' The company has set a target of raising the chronic-disease revenue share from about 21% in 2024 to 35% by 2028, while respiratory products still accounted for 19% of revenue and 38% when combined with analgesics/anti-inflammatories, underscoring continued seasonal sensitivity.

Competitively, the company contends with large domestic pharmaceutical peers such as Yuhan Corporation in respiratory and gastrointestinal prescription categories, and Codaewon Forte shares an identical active ingredient with Yuhan's Kopu Syrup.

Annual revenue rose for four consecutive years, from KRW 478.9 billion in 2022 to KRW 527.0 billion in 2023, KRW 598.2 billion in 2024, and KRW 605.4 billion in 2025.

Operating margin, however, steadily declined over the same period from 9.0% to 6.1% to 4.7% and then to just 0.6% in 2025, while net profit attributable to owners fell from KRW 30.7 billion in 2022 and KRW 23.9 billion in 2023 to KRW 9.0 billion in 2024 before turning negative at KRW -1.38 billion in 2025.

On a quarterly basis, the third quarter of 2025 was the weakest point, with an operating loss of KRW 10.4 billion and a net loss of KRW 17.4 billion, the main driver of the full-year deterioration.

Results then turned positive in the fourth quarter of 2025, with operating profit of KRW 5.85 billion and net profit of KRW 13.6 billion, and the recovery continued into the first quarter of 2026 with operating profit of KRW 4.38 billion and net profit of KRW 1.92 billion.

In the second quarter of 2026, operating profit was essentially at breakeven at KRW -0.09 billion, but net profit reached KRW 3.78 billion thanks to improved non-operating items including gains on disposal of investment assets.

The company's separately disclosed cumulative first-half 2026 figures—revenue of KRW 310.9 billion (+3.1% year-on-year), operating profit of KRW 4.4 billion (-45.3%), and net profit of KRW 5.7 billion (+308.0%)—are consistent with the sum of the quarterly figures.

The decline in operating profit stemmed from an 8.8% year-on-year increase in first-half selling and administrative expenses tied to R&D spending on new drug candidates and marketing for newly launched health supplements, while the sharp rise in net profit was mainly driven by one-off improvements in non-operating income such as gains on investment asset disposals.

Viewed over the trailing four quarters (Q3 2025 through Q2 2026), operating profit has moved close to breakeven and net profit has stayed positive, indicating a gradual normalization following the sharp loss in the third quarter of 2025.

The domestic pharmaceutical industry faces structural pressures from ongoing drug price cuts and year-to-year volatility in respiratory disease prevalence, and Daewon itself saw sales of core products such as Pelubi and Codaewon decline in the first half of 2026 due to price cuts and a milder respiratory disease season.

In contrast, the chronic-disease prescription market (hypertension, diabetes, dyslipidemia) and the health-supplement market continue to grow structurally on the back of an aging population, prompting companies with heavy seasonal drug exposure to shift focus toward chronic care and supplements.

The obesity treatment market (GLP-1 class) is currently dominated by global big pharma, with domestic drugmakers, including companies with preclinical- or early-stage candidates, attempting to enter as later movers.

Competitors such as Yuhan Corporation, Dong-A ST, and Chong Kun Dang maintain similar respiratory, gastrointestinal, and chronic-disease portfolios and compete in the same prescription markets.

Daewon maintains its position as the top respiratory prescription market-share holder, but its newer growth areas in chronic disease and obesity are still in an early market-validation stage.

The P-CAB (potassium-competitive acid blocker) class is cited as an area of intensifying competition in the gastroesophageal reflux disease treatment market, given its faster onset and sustained efficacy relative to legacy PPI drugs.

The company has stated it will continue diversifying its portfolio toward chronic disease and health supplements in the second half while pursuing profitability improvement through cost efficiency.

On the new product front, the triple-combination hypertension drug 'Twincloro' (launched in April) and the reformulated dyslipidemia drug 'Uptava' (launched in May) have already reached the market, and a new low-dose version of 'Tabarozet' was scheduled for launch in September.

On the R&D side, the P-CAB class GERD drug candidate DW-4421, licensed from Unovia, is undergoing a domestic Phase 3 trial, with Dolwoon Investment & Securities projecting erosive esophagitis results within this year and non-erosive esophagitis results in early 2027.

The obesity/metabolic disease candidate DW4321, a quad-acting agent combining GLP-1, GIP, and glucagon activity with gastrin receptor action, showed preclinical data at the 2026 American Diabetes Association meeting indicating a 50% greater weight-reduction effect versus a comparator after 22 days of dosing, according to the company, though it remains at the preclinical stage and will require time before clinical entry.

The goal of raising the chronic-disease revenue share from 21% in 2024 to 35% by 2028 is being pursued incrementally through the Celltrion Pharm co-marketing deal for the Edalbi family and new combination drug launches.

The health-supplement segment, which posted KRW 20.7 billion in sales in just the first half of 2026, up 639% from the prior period, is emerging as a notable new growth pillar.