April 26, 2024

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[THE INVESTOR] Samsung Bioepis is likely to delay its initial public offering on NASDAQ as it may get capital infusion from existing shareholders, according to industry sources on Nov. 24.

Initially, the subsidiary of Samsung BioLogics had pushed for a listing this year, but it pushed it back to next year due to the volatile US stock market.

Now, industry watchers speculate that the company -- a joint venture between Samsung BioLogics and Biogen -- may put on hold its NASDAQ listing again as the firm seeks to raise funds privately.

Samsung BioLogics, which holds a 91.2 percent stake in the firm, said on Nov. 22 it would invest some 400 billion won (US$338.29 million) in its subsidiary by participating in its capital increase planned for December and June 2017.

As BioLogics successfully raised 2.25 trillion won through what is the world’s largest health care sector IPO in two years in October, it has become a strong funding source for its subsidiary.

Going public for additional capital may not be the top priority for Bioepis any more, sources said.

“As the company has a capital hike plan for next year, its IPO could be postponed to 2018,” an official at a local brokerage firm said.

Bioepis said it will use the money to reduce debt and develop copies of biotech blockbusters such as Enbrel, Remicade, Humira, Herceptin and Lantus.

The firm, however, refuted speculations, saying there isn’t a direct correlation between the planned fundraising by issuing new shares and the US stock market debut timeline.

“We are monitoring the US market conditions to find the right time for a listing,” an official at Bioepis told The Investor.

Analysts here forecast that Bioepis could benefit from US president-elect Donald Trump’s favorable stance on prescription drug prices compared to his Democratic opponent Hilary Clinton.

Trump’s free-market approach to the sector could have a positive impact on biosimilar firms including Bioepis due to their price competitiveness, as they produce less costly imitations of original drugs, they said.

This also means that Bioepis could attract more interest by investors from 2017.

“Trump’s election victory is a favorable factor for Bioepis because he is expected to inject vitality into the biosimilar sector,” Kim Tae-hee, an analyst at Hyundai Securities told The Investor.

By Park Han-na (hnpark@heraldcorp.com)