KOSDAQBiotech & Pharma376270

HEM Pharma

₩34,950▲ 6.07%2026-10-02 close

Market Cap

₩250.9B

Turnover

₩500M

Volume

20,000 shares

Shares out.

7.2M

PER

—

PBR

—

EPS

-₩2,953

Dividend Yield

0.00%

PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩0 per share · Prices as of the 2026-10-02 close

Report overview

Amway-Led Overseas Push Tests the Path to Profitability

HEM Pharma is expanding its Japan myLAB business and global probiotics supply through its Amway partnership, while accumulated losses and a sharply higher debt ratio continue to weigh on its balance sheet.

1
In June 2026 the company received a roughly KRW 4.6 billion purchase order from Amway's global supply chain unit ABG for a new probiotics product, launched in Korea in September
2
Japan's myLAB PLUS pre-orders have grown to roughly 90,000 cases worth about KRW 9.3 billion, emerging as a key overseas growth driver
3
A KRW 54 billion second-round convertible bond was paid in in August 2026, funding a new Sejong Plant No. 2 and analysis automation equipment
4
The 2025 annual net loss reached KRW 23.8 billion and the debt ratio jumped to 894% from 41.1% a year earlier, widening financial strain
5
Operating losses persisted in Q2 2026, yet net income attributable to owners turned positive for the first time—likely reflecting non-operating items that warrant cautious interpretation

Business structure

HEM Pharma is a microbiome-focused company built around its proprietary gut microbe simulator technology PMAS, operating both a personalized healthcare business (myLAB) and a live biotherapeutic products (LBP) drug development platform.

According to a Eugene Investment & Securities report dated January 26, 2026, the personalized healthcare business myLAB accounted for about 42% of revenue and the Phytobiome business for about 42.4%, together forming the bulk of sales.

The myLAB service collects customer stool samples, analyzes the microbiome and metabolome, and recommends a customized probiotics solution; it operates through Amway Korea members under a 20-year exclusive contract.

The service has recently expanded into Japan, where a local subsidiary collects and pre-processes samples before final analysis is performed at the company's Gwanggyo research center in Korea.

The company has also begun exporting its 'Body Key Grain' products to Hong Kong and Vietnam and established a Tokyo subsidiary as part of broader Asian expansion. Its LBP drug pipeline has progressed beyond the research stage into clinical development, with depression candidate HEMP-001 receiving U.S.

FDA IND approval for a Phase 2a trial and LARS syndrome candidate HEMP-002 receiving Australian HREC IND approval for a Phase 2a trial.

More recently, the company added an AI platform called BiGNAL—a toilet-attachable device that collects and analyzes biosignals—as a new growth pillar, and signed a pilot agreement with Celltrion.

Competitively, the company positions its data-driven personalized service as a differentiator versus large domestic and overseas CMOs/CDMOs, though its revenue base remains heavily dependent on a single partner, Amway.

Earnings trend

Quarterly revenue · Operating profit

₩2.8B-₩2.9B25Q2₩3B-₩3.6B25Q3₩3.7B-₩6.8B25Q4₩4.9B-₩3.8B26Q1₩4.6B-₩2.9B26Q2

RevenueOperating profit

Annual revenue · Operating profit

₩3.7B-₩13.2B2022₩5.3B-₩11.8B2023₩15.1B-₩7.7B2024₩13B-₩15.6B2025

RevenueOperating profit

Quarterly results · Last 5 quarters
Quarter	Revenue	Operating profit	Op. margin
2025Q2	₩2.8B	-₩2.9B	−102.1%
2025Q3	₩3B	-₩3.6B	−120.4%
2025Q4	₩3.7B	-₩6.8B	−184.1%
2026Q1	₩4.9B	-₩3.8B	−77.8%
2026Q2	₩4.6B	-₩2.9B	−62.5%

Annual results
Year	Revenue	Operating profit	Net income (parent)	Op. margin	ROE	Debt-to-equity
2022	₩3.7B	-₩13.2B	-₩13B	−361.0%	−64.3%	72.2%
2023	₩5.3B	-₩11.8B	-₩11.7B	−220.1%	−67.1%	60.1%
2024	₩15.1B	-₩7.7B	-₩7.6B	−51.0%	−29.3%	41.1%
2025	₩13B	-₩15.6B	-₩23.8B	−120.1%	−478.1%	894.0%

Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-09-04

Earnings analysis

Annual revenue rose from KRW 3.7 billion in 2022 to KRW 5.3 billion in 2023 and KRW 15.1 billion in 2024, before slipping to KRW 13.0 billion in 2025.

Operating losses had been narrowing from KRW 13.2 billion in 2022 to KRW 11.8 billion in 2023 and KRW 7.7 billion in 2024, but widened again to KRW 15.6 billion in 2025, with an operating margin of -120.1%.

Net loss attributable to owners also expanded sharply, from KRW 7.6 billion in 2024 to KRW 23.8 billion in 2025; on a quarterly basis, the Q4 2025 net loss attributable to owners alone reached KRW 14.7 billion, accounting for most of the full-year deterioration.

That figure was far larger than the same quarter's operating loss of KRW 6.8 billion, suggesting a significant non-operating factor was at play.

By contrast, in Q1 2026 (net loss of KRW 4.2 billion) and Q2 2026 (net income of KRW 1.5 billion), operating losses of KRW 3.8 billion and KRW 2.9 billion respectively still persisted, yet Q2 net income attributable to owners turned positive for the first time.

This again shows a clear divergence between operating results and net income, pointing to one-off or non-operating factors that make it premature to characterize this purely as an operating turnaround.

Total equity plunged from KRW 26.1 billion in 2024 to KRW 5.2 billion in 2025 (KRW 5.0 billion attributable to owners), while total liabilities grew from KRW 10.7 billion to KRW 46.6 billion over the same period, pushing the debt ratio from 41.1% to 894.0%.

Operating cash flow remained negative every year from 2022 through 2025 (KRW -11.1 billion, -5.3 billion, -7.7 billion, and -8.3 billion respectively), underscoring continued reliance on external financing.

Industry analysis

The global microbiome and personalized healthcare industry is growing on the back of rising demand for individualized health management and advances in data-driven diagnostics.

The U.S. dietary supplement market that HEM Pharma is targeting is estimated at roughly KRW 95 trillion, with a projected 5.8% annual growth rate through 2031.

Japan, where about 30% of the population is aged 65 or older, has a strong culture of fermented foods and gut-health awareness, driving fast-growing demand for preventive healthcare services, and ranks among Amway's top five markets globally by sales.

In this environment, HEM Pharma is pursuing a strategy of routing around the distribution and customer-acquisition cost challenges that early microbiome companies faced, by leveraging Amway's global distribution network.

At the same time, this strategy creates a structural dependence on a single partner channel for a large share of revenue.

On the competitive front, large domestic and overseas CMOs/CDMOs are entering the live biotherapeutic products (LBP) contract development and manufacturing market, prompting HEM Pharma to lean on its proprietary data assets and PMAS analysis technology as points of differentiation.

In terms of industry cycle positioning, consumer-facing services like myLAB have moved past the early commercialization stage into an overseas expansion phase, while the LBP drug pipeline remains at the Phase 2a clinical stage and still requires considerable time before commercialization.

Outlook

HEM Pharma plans to deploy KRW 27 billion from the KRW 54 billion second-round convertible bond completed in August 2026 toward building a new Sejong Plant No. 2, and KRW 7.5 billion toward automating its analysis pipeline.

Using land it has already secured, the company aims to break ground on Sejong Plant No. 2 within the year and target operation in the second half of 2027, while expanding analysis processing capacity to twice current levels by the end of 2027 and more than five times by the end of 2028.

The Nutrilite Probiotics product co-developed with Amway launched in Korea in September 2026 and is scheduled to roll out sequentially to major global markets including the U.S. and Japan starting in 2027, with the company expecting additional orders within the year following the Korea launch.

In Japan, pre-orders for myLAB PLUS have already grown to exceed last year's domestic annual revenue, and the company has stated plans to expand into additional markets such as Taiwan, Thailand, and the U.S.

The AI-based platform BiGNAL is at an early stage, having begun an employee pilot program with Celltrion, and will require further validation before commercialization.

Overall, the company's near-term outlook hinges on how quickly the expansion of existing Japan and Korea operations and new overseas orders convert into actual revenue and profit, and on whether new production facilities come online as planned.

Valuation

PER

—

PBR

—

ROE

-115.4%

EPS

-₩2,953

BPS

—

Dividend per share

₩0

Because HEM Pharma's equity base has shrunk sharply from sustained net losses while its market capitalization trades at a much larger multiple of that shrunken book value, the stock sits in a segment where the premium to net assets is considerable.

This appears to reflect market expectations tied to the growth narrative around overseas expansion via the Amway partnership and the company's accumulated microbiome data assets, rather than current earnings power.

Earnings-based valuation metrics cannot be calculated because the company has yet to post an annual profit, and with no dividends paid, shareholder-return comparisons via yield are not applicable.

Recent quarterly trends show signs of a shift in the profit-and-loss structure—operating losses persisted even as net income attributable to owners turned positive in one quarter—but because that swing may stem from non-operating factors, it is premature to call it a sustained improvement.

Whether future overseas revenue growth actually translates into improved profitability will likely be the key variable determining whether this premium is warranted.

PER, EPS, PBR and BPS are all calculated in-house (the same method as Naver and Toss) · Dividend yield = cash dividend per share from DART filings (supplemented by KRX) ÷ current price · As of 2026-09-04

Bull factors

Deepening Partnership With the World's Leading Direct-Selling Company

HEM Pharma holds a 20-year exclusive contract with Amway Korea for the myLAB service, and in June 2026 received a formal purchase order for a new probiotics product from Access Business Group, Amway's global supply chain entity.

That product officially launched in Korea in September 2026 and is scheduled for global expansion into markets including the U.S. and Japan from 2027. The company expects additional orders to follow within the year after the Korea launch, leaving room for its Amway-channel revenue base to diversify and expand.

Japan Expansion and Emerging Signs of a Shift in Profit Structure

Japan's myLAB PLUS pre-orders grew by KRW 7.2 billion in February and KRW 2.1 billion in May, reaching a cumulative roughly 90,000 cases worth about KRW 9.3 billion, and the Japan subsidiary has reportedly swung to an operating profit.

In Q2 2026, despite continued operating losses at the consolidated level, net income attributable to owners turned positive for the first time, suggesting overseas performance is beginning to show up in some financial metrics—though the possibility that this profit stems from non-operating factors cannot be ruled out and warrants further confirmation.

Production and R&D Infrastructure Secured Through Large-Scale Financing

In August 2026, a KRW 54 billion second-round convertible bond with participation from major domestic institutional investors including the National Growth Fund was fully paid in, with KRW 27 billion allocated to building Sejong Plant No. 2, KRW 7.5 billion to analysis automation equipment, and KRW 7.5 billion to upgrading the BiGNAL AI platform.

The conversion price was fixed at KRW 43,912 with no downward refixing clause, providing structural stability to the financing. Through this, the company is preemptively preparing for potential production bottlenecks tied to its planned U.S. market entry.

Bear factors

Structural Losses and Sharply Deteriorated Financial Health

The 2025 net loss attributable to owners reached KRW 23.8 billion, sharply up from KRW 7.6 billion the prior year, while total equity plunged from KRW 26.1 billion to KRW 5.2 billion. Over the same period, total liabilities rose from KRW 10.7 billion to KRW 46.6 billion, pushing the debt ratio from 41.1% to 894.0%.

Operating cash flow was negative for four consecutive years from 2022 through 2025, reflecting a structure that would struggle to continue operating without external financing.

High Revenue Dependence on a Single Partner

Most revenue from both the myLAB service and the new probiotics products flows through the Amway channel, meaning changes in the partner's ordering policy or market strategy could directly affect results.

According to a Eugene Investment & Securities report dated January 26, 2026, the myLAB and Phytobiome businesses together account for most of revenue, indicating the business portfolio has not yet been sufficiently diversified.

Potential Equity Dilution From Convertible Bond Conversion

The second-round convertible bond issued in August 2026 could result in the issuance of roughly 1.23 million new shares upon conversion at the fixed conversion price of KRW 43,912.

This represents a meaningful proportion of shares currently outstanding, and existing shareholders could face dilution if conversion requests are exercised in the future.

Given the company's repeated use of mezzanine financing such as CBs in the past, the possibility of additional future fundraising cannot be ruled out.

Risk factors

Financial and Funding Risk

Operating cash flow was negative every year from 2022 through 2025, and the debt ratio surged to 894.0% in 2025. The company has repeatedly relied on external financing through convertible bond issuances and may need similar funding again in the future. If financing conditions deteriorate or funding costs rise, execution of business plans could be disrupted.

Regulatory and Clinical Development Risk

The LBP drug pipeline candidates HEMP-001 (depression) and HEMP-002 (LARS syndrome) remain at an early clinical stage, having received Phase 2a IND approvals from the U.S. FDA and Australian HREC respectively, meaning commercialization would require considerable additional time and further clinical success.

Entry into overseas dietary supplement markets could also see timelines slip depending on country-specific regulatory and approval procedures.

Partner Dependency and Execution Risk

With a significant share of revenue concentrated in the Amway channel, changes in the partner's strategy represent a direct risk factor.

The AI platform BiGNAL, presented as a new growth driver, is at an early stage, having just begun an employee pilot with Celltrion, and will take time before its commercial viability is proven.

If multiple planned milestones—such as the Sejong Plant No. 2 groundbreaking and the 2027 overseas product launches—do not proceed as scheduled, earnings estimates could be subject to change.

What to watch next

November 2026
The Q3 report filing should confirm whether the Q2 swing to positive net income attributable to owners persists, along with revenue growth trends and any narrowing of the operating loss.
Q4 2026
It should be confirmed whether groundbreaking for Sejong Plant No. 2 actually occurs within the year as the company has targeted.
First half of 2027
Progress on the global rollout of Nutrilite Probiotics into markets such as the U.S. and Japan, and any additional orders through the Amway channel, should be monitored.
Second half of 2027
Whether Sejong Plant No. 2 begins operation as targeted, and whether the expanded production capacity translates into actual supply and revenue, should be checked.

Overall view

HEM Pharma is simultaneously pursuing two growth pillars—expansion of its Japan myLAB business and supply of new probiotics products—anchored by its strong global partner Amway, and Q2 2026 showed early signs of a shift in profit structure with net income attributable to owners turning positive for the first time.

However, since this profit emerged even as operating losses persisted, non-operating factors cannot be ruled out, making it premature to call this a sustained improvement.

Financially, the capital structure weakened considerably, with the 2025 debt ratio surging to 894.0% and equity shrinking sharply, and the company's repeated reliance on external financing such as convertible bond issuances to sustain operations remains a burden.

Whether the planned construction of Sejong Plant No. 2, global product launches in markets like the U.S. and Japan, and clinical progress on the LBP pipeline proceed as scheduled will be key variables determining whether the company's mid-to-long-term growth narrative materializes.

Investors should continue monitoring upcoming quarterly results and the concrete progress of overseas business expansion.

Sources

Korea Exchange (KRX) — Prices · Market Cap · Volume
FSS electronic disclosure system (DART) — Financial statements · Dividend filings

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Report written 2026-09-05 · Data as of 2026-09-04

This content is AI analysis of market data and web search results, provided for information only. It is not a solicitation or recommendation to invest. Investment decisions and their consequences are the investor's own responsibility. Data may be delayed or contain errors.