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Photo: Daewon Pharmaceutical |
[Alpha Biz= Paul Lee] Daewon Pharmaceutical, best known for its antitussive and expectorant medicine Codawon, reported a cumulative operating loss for the third quarter, reflecting weak performance at its subsidiary. Market attention now turns to whether the company can rebound in Q4 and achieve an annual profit.
According to filings with the Financial Supervisory Service on Jan. 12, Daewon’s cumulative revenue for the first three quarters of 2025 was KRW 445.6 billion, with an operating loss of KRW 2.4 billion. This compares to KRW 453.1 billion in revenue and KRW 25 billion in operating profit during the same period in 2024, showing a slight drop in sales and a swing to an operating loss.
Codawon, the company’s flagship product, helps relieve coughs and facilitate phlegm discharge. Revenue from Codawon rose steadily from KRW 56.6 billion in 2022 to KRW 93.2 billion in 2024, accounting for roughly 15.6% of total sales. However, Q3 2025 sales of KRW 16.2 billion fell 25% from KRW 21.6 billion in the same quarter last year and 18% from KRW 19.8 billion in Q2, reflecting seasonal demand fluctuations.
To reduce seasonal dependence, Daewon is expanding into treatments for metabolic conditions. Sales of osteoarthritis drug Sinbaro rose 32.3% year-on-year to KRW 5.6 billion, while dyslipidemia treatment Tabarojet increased 30.9% to KRW 4.9 billion.
The overall operating loss, however, is largely attributed to SD Biotech, a Daewon subsidiary engaged in health supplements and cosmetics, which posted KRW 23.7 billion in cumulative revenue and a KRW 4.8 billion operating loss for Q3. Excluding subsidiaries, Daewon’s standalone revenue reached KRW 397.9 billion with an operating profit of KRW 4.5 billion.
In a move to strengthen management, Daewon appointed third-generation family member Baek In-young, former head of the Healthcare Division, as CEO of SD Biotech. The subsidiary’s performance is expected to be a key factor in determining Daewon’s annual results.
Market projections are mixed. SK Securities estimates 2025 annual revenue of KRW 598.6 billion and operating profit of KRW 0.6 billion, implying a margin of just 0.1%. Daol Investment Securities forecasts KRW 614.8 billion in revenue and KRW 5.1 billion in operating profit. SK Securities analyst Lee Sun-kyung noted, “Respiratory product growth and diversified sales channels in the health supplement segment are driving revenue. Losses at SD Biotech are narrowing, suggesting a possible Q4 recovery.”
Conversely, Heungkuk Securities projects annual revenue of KRW 594 billion with an operating loss of KRW 5.3 billion, highlighting the risk that Daewon’s yearly operating results could remain in the red.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
