Brokerage : Shinhan Securities
Analyst : Minyong Eom, Seokhyeon Yoon
Investment Rating : BUY (Maintained)
Target Price : KRW 620,000 (Upgraded)
Core Momentum : Major patent overhangs materially eased following US PTAB’s invalidation of Halozyme’s core patent, addressing triple valuation discounts across patents, royalty clarity, and rapid Keytruda SC conversion.
📊 1. [Valuation & Key Financial Metrics]
- Rating & Target Price: BUY (Maintained) / Target Price KRW 620,000 (Upgraded) (Upside potential of 75.1% based on the May 13, 2026 closing price of KRW 354,000)
- Valuation Methodology: Re-rating ALT-B4 platform value based on the analyst’s expectation that patent protection will remain intact through 2043 post-Halozyme patent invalidation. Removed the previously applied 20% discount rate on estimated commercialization values for Merck’s 5 follow-on pipeline assets.
- Market Data: Market Cap KRW 18.95 Trillion / Shares Outstanding 53.6 Million (Floating Shares 79.6%) / 52-Week High KRW 559,000, Low KRW 317,500 / 60-Day Average Trading Value KRW 136.0 Billion / Foreign Ownership 14.5% / Major Shareholders: Soonjae Park and 4 affiliates 20.4%, Inwoo Hyung and 2 affiliates 5.1%
- Annual Financial Forecast (Shinhan Securities Estimates):
- 2026F: Revenue KRW 477.9 Billion, Operating Profit KRW 316.6 Billion (OPM 66.2%), Net Profit (Controlling) KRW 329.9 Billion, PER 57.9x, PBR 25.4x, ROE 55.2%, EV/EBITDA 56.9x, Dividend Yield 0.1%
- 2027F: Revenue KRW 854.9 Billion, Operating Profit KRW 565.3 Billion (OPM 66.1%), Net Profit (Controlling) KRW 525.0 Billion, PER 36.4x, PBR 15.3x, ROE 52.6%, EV/EBITDA 31.5x, Dividend Yield 0.2%
- 2028F: Revenue KRW 1.34 Trillion, Operating Profit KRW 918.3 Billion (OPM 68.4%), Net Profit (Controlling) KRW 781.5 Billion, PER 24.4x, PBR 9.6x, ROE 48.3%, EV/EBITDA 18.7x, Dividend Yield 0.2%
🚀 2. [Market Opportunities & Business Outlook]
- Halozyme’s Core Patent Invalidated & Dismissal Expected:
- On May 12, 2026, the US Patent Trial and Appeal Board (PTAB) issued a final written decision invalidating Halozyme’s MDASE patent following a Post-Grant Review (PGR) petition filed by Merck in November 2024.
- US Patent No. 11,952,600 (‘600 patent), the core dispute among 15 PGRs and 3 IPRs, was invalidated. Because related PGR patents stem from the ‘600 patent, the analyst expects related US civil infringement claims and European/German preliminary injunctions to be dismissed.
- Simultaneous Easing of Three Valuation Discounts:
- Patent Overhang Materially Eased: Markedly reduces market risks of royalty sharing with Halozyme over alleged patent infringement.
- Royalty Rates Clarified: Biogen disclosure confirmed mid-single digit royalty structures.
- Prescription Conversion Momentum: Annualized April run-rate following J-code assignment represents 3.4% of full-year 2025 Keytruda sales; outpacing consensus conversion (8.8%) will further accelerate cash-flow realization.
- Accelerating Out-Licensing Catalysts:
- Easing of PGR uncertainties is anticipated to trigger deal signings with multiple global partners who had postponed final agreements pending legal clarity.
📝 Editor’s Comment (Perspective)
The analyst views Alteogen as an elite drug delivery platform enterprise that has materially eased the three major valuation discounts—patent disputes, royalty ambiguity, and conversion uncertainties—following PTAB’s invalidation of Halozyme’s core patent. The overarching perspective prioritizes the removal of the 20% discount on Merck’s five follow-on pipeline candidates and the expectation that ALT-B4 patent protection will remain intact through 2043 (driving a target price upgrade to KRW 620,000) over temporary supply-demand swings in the biotech sector.
To verify whether this investment thesis progresses as expected, investors should primarily monitor formal dismissals of related US and European civil patent lawsuits, Keytruda SC prescription conversion tracking above the 8.8% consensus rate post-J-code implementation, and the execution of new global pharma out-licensing deals following the easing of patent overhangs. These developments can be verified through upcoming quarterly earnings releases, official company IR presentations, and regulatory filings on DART/KRX.
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