Survey
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
O P E R AT I O N R E V I E W > CHALL ENGE Life Science is an industry that seeks to promote human health and improve the quality of life. This field offers unlimited possibilities and growth potential. LG Life Sciences is an R&Ddriven pharmaceutical company focused on discovering, developing, manufacturing and marketing products for unmet medical needs. Key therapeutic areas include infectious, metabolic and cardiovascular diseases. 2004 ANNUAL REPORT 10 LG LIFE SCIENCES 2004 ANNUAL REPORT 11 LG LIFE SCIENCES OPERATION REVIEW 1 Human Health > The Challenge of Ensuring People’s Future Health The LGLS pharmaceutical business commenced in 1984, when LG Chem formed a Pharmaceutical Division that started Korea’s first research on genetic engineering and pioneered the nation’s pharmaceutical industry. In 1993, the human growth hormone EUTROPINTM was put on the market, and the company’s pharmaceutical plant at Iksan, Korea was completed in 1995. At this point, the life science business was apparently in full stride. LG Life Sciences developed the next-generation quinolone antibiotic FACTIVE Ⓡ, the first new drug from Korea with FDA approval in the US. With high technology of genetic engineering, LGLS leading the development of pharmaceutical industry has developed and produced recombinant interferon, recombinant hepatitis B vaccine, human growth hormone and other various commercialized medicines. The LGLS Pharmaceutical Division is hard at work developing new drugs that can help keep people in the best of health. To this end, the new drug development program is focused particularly on the early and mid development stages for anti-infective compounds, anti-coagulants, diabetes medication, obesity treatments and other drugs for better quality of life. The Division will continue to strengthen its alliances in these areas with global pharmaceutical companies. [ Strategic Alliances ] A contract was concluded with Anadys Pharmaceuticals of the US for the joint development of hepatitis B medication. LGLS signed exclusive license agreements to market diabetes medication from DepoMed (US) and psoriasis treatment from Biogen Idec (US) in Korea. [ Production ] The hepatitis B production processes passed WHO inspections. Also LGLS developed a unique, low- cost sterilized filter process for sodium hyaluronate. Moreover, production costs have been reduced from improved yields for hepatitis B vaccine, and anemia treatment. [ Marketing ] LGLS’ marketing partner Oscient Pharmaceuticals initiated selling FACTIVE Ⓡ quinolone antibiotic in the US in September, and companies have been selected for licensing in Turkey, Russia and Taiwan. Sales revenue increased and profitability improved, thanks to ₩42 billion in domestic sales of the high blood pressure treatment ZANIDIPTM and solid performances by other major products such as EUTROPINTM. >Bio Drugs Hyruan lnj. Euvax B lnj. Espogen Pre-Filled Intermax Alpha lnj. Intermax Gamma lnj. Leucogen lnj. HCD 2004 Operations in Review A sluggish domestic market and appreciating Won currency created a difficult business environment, but the company achieved strong results across the board including R&D, marketing and production. [ R&D ] A diabetes treatment disposable, single-use arthritis formulation and sustained release interferon alpha formulation have been selected as candidates for clinical trials. If they become commercial successes, LGLS will be able to expand its lineup significantly. 2004 ANNUAL REPORT 12 LG LIFE SCIENCES PRODUCT NAME Eutropin >Chemical Drugs PRODUCT NAME Zanidip tab. Calvan tab. IVF-C Inj. Follimon Inj. Factive APPLICATIONS infant dwarfism by lack of growth hormone and turner syndrome, adult growth hormone deficiency Degenerative arthritis Hepatitis B Anemia found in patients suffering from chronic renal failure Hepatitis B&C, leukemia and kidney cancer Rheumatic arthritis and myeloid leukemia Leukopenia Hepatitis C Diagnosis FEATURES The very first development of Korea [development of the world's first subject type I, progress of the clinical trial] Excellent safety High level of safety Recombinant product Excellent efficacy for hepatitis treatment The first in Korea to be developed with proprietary technology Easy to use, available in a pre-filled syringe Highly accurate third-generation diagnostic reagent APPLICATIONS Essential hypertension Hypertension Anovulatory, trouble in sexual gland, habitual abortion, azoospermia, etc. Ovulation accelerator Chronic bronchitis, pneumonia, and sinusitis FEATURES Excellent efficacy for lowering blood pressure with few side effects A primary selection for hypertension Excellent efficacy for treating sterility due to difficulty in ovulation and in vitro fertilization (IVF) Acceleration of follicle ripening in an infertile woman Rapid anti-microbial effects 2004 ANNUAL REPORT 13 LG LIFE SCIENCES HUMAN HEALTH Factive� HUMAN HEALTH Euvax B WONDER DRUG RESULTING FROM 12 YEARS OF R&D EUVAX B RECOMBINANT HEPATITIS B VACCINE FACTIVEⓇ was developed exclusively with homegrown technology in an R&D project that required 12 years to complete and is the first third-generation quinolone antibiotic to be approved by the FDA. The drug has proved to be highly effective in treating bronchitis, pneumonia, and sinusitis. Excellent success was achieved against chronic bronchitis in five days and pneumonia in seven days while administering a single dose orally per day. FACTIVEⓇ has outperformed other antibiotics currently available, killing a broad spectrum of pathogens that infect respiratory organs, including drug resistant or atypical bacteria strains. Moreover, fewer side effects were experienced with FACTIVEⓇ than with other quinolone preparations. EUVAX B is a second-generation vaccine for hepatitis B developed in 1991 after ten years of research. In 1996, the product was the first in its class from Korea to be certified compliant to WHO standards for pharmaceutical production and quality control. The vaccine is now being distributed to third world countries through Sanofi Pasteur, a vaccine specialist, as well as UNICEF and the Pan America Health Organization. EUVAX B has already been registered in 63 countries and an aggregate of more than 400 million pediatric’s doses have been supplied worldwide as of the end of 2004. Superb Efficacy and Safety at the Same Time For elderly patients with chronic respiratory problems, FACTIVE Ⓡ proved to be effective while being as well tolerated as other marketed antibiotics. Metabolism in the liver or kidney is limited, and the unchanged compound is evacuated through dual routes of excretion. Therefore, dosage normally does not have to be adjusted for patients with abnormal liver function or moderate renal insufficiency. FACTIVEⓇ does not affect blood sugar, making it safe with diabetes patients. Recognized for Excellence by the UN Growing recognition of EUVAX B’s superior quality resulted in the signing of contracts totaling $26 million with UN agencies in January 2004. The United Nations Children's Fund (UNICEF) will purchase $21 million worth of EUVAX B� over three years, while Pan American Health Organization (PAHO) will be supplied with $5 million in vaccine during one year. The amount represents about half of all the hepatitis B vaccine distributed throughout the world by the UN. LGLS officials expect the UN contracts will generated additional exports of at least US$20 million worth of hepatitis B vaccine to some 60 countries a year. From the US Market to the World Oscient Pharmaceuticals began marketing FACTIVEⓇ in the US in September 2004. LGLS is now awaiting approval of the drug in and making strategic alliances with partners for over 40 countries, including Russia, Turkey, Taiwan and Brazil. Vaccines Currently under Development 1) DTaP-hepatitis B : diphtheria, tetanus, acellular pertussis, hepatitis B 2) DTwP-hepatitis B : diphtheria, tetanus, whole-cell pertussis, hepatitis B 3) DTwP-hepatitis B/Hib : diphtheria, tetanus, whole-cell pertussis, hepatitis B, Haemophilus influenza type B >> Marketing Network for Factive >> Countries Using EUVAX B Holling Pharm (Taiwan) 2004 ANNUAL REPORT 14 LG LIFE SCIENCES 2004 ANNUAL REPORT 15 LG LIFE SCIENCES HUMAN HEALTH ZanidipTM HUMAN HEALTH EutropinTM ZANIDIPTM TREATMENT FOR HIGH BLOOD PRESSURE WORLD’S FIRST HUMAN GROWTH HORMONE FROM YEAST ZANIDIPTM(lercanidipine hydrochloride) is one of the calcium channel blockers, which act on the heart and blood vessels to reduce blood pressure. The globally popular drug, produced by LGLS under technical license from Recordati in Switzerland, was introduced to the Korean market in April 2000 and is currently sold in 67 countries. It is also one of the most popular antihypertensive drug in Korea; monthly sales rose to over ₩4 billion in record time. In 2004, ZANIDIPTM ranked fourth on the list of Korea’s top-selling prescription drugs, and sales have been increasing by at least 30% a year. EutropinTM is a human growth hormone (hGH) commercialized with recombinant DNA technology in Korea. Contrary to the existing imported hGHs, Eutropin is cultured in yeast, not in E. coli. Eutropin is the first in the world have applied in yeast as a host culture cell. The result shows that Eutropin is a hGH product with excellent stability, high concentration and high purity. The clinical tests were implemented at several prominent hospitals with children of age from 5 to 15 year-old, who showed a slow growth rate less than 3 cm per year due to lack of endogenous growth hormone. An extended treatment of Eutropin demonstrated an enhanced growth level as much as 10 cm per year. After 3 year treatment of Eutropin, a sample group showed a remarkable growth of 21 cm. Eutropin also proved to be effective to the patients with Turner Syndrome. In addition, it noticeably improved QOL (Quality of Life) of the elderly. After Eutropin treatment, elderly patients showed a decreased fat content and increased physical strength respectively. Safe with Outstanding Blood Pressure Control ZANIDIPTM, a third-generation calcium channel blocker, enters the arterial wall structure, blocking the calcium channel from the inner side of the membrane for longer action duration. The action is mainly in the blood vessels, so side effects such as tachycardia, edema, and flushing are much less pronounced with ZANIDIPTM than with first- and second-generation medicines for high blood pressure. In clinical trials, the drug was 98% effective in lowering blood pressure, while only 7.4% of the patients showed adverse events. The vascular selectivity of ZANIDIPTM was shown to be ten to one hundred times greater that that for other calcium channel blockers. Dedicated Website for High Blood Pressure: www.htnclinic.co.kr LGLS is applying know-how and experience gained from research, clinical testing, production and sale of medicines for high blood pressure to operate an online “Hypertension Clinic.” The Hypertension Clinic offers access to a much broader range of information than can be found on most health-related websites. Site visitors can access the latest research trends, news reports on academic societies and the medical community, reviews of domestic and foreign papers on high blood pressure, a search engine for relevant overseas papers, over 60 types of educational materials for patients, and a database covering more than 20,000 medicinal substances. Professional information is also available covering clinical tests and prescriptions for circulatory system treatments. 422 334 >>Domestic ZANIDIP Sales over 5 Years TM (Unit : hundred million KRW) 207 106 30 00 2004 ANNUAL REPORT 01 16 02 03 Launched after 3 years of research LGLS initiated to develop hGH early in 1987 and the original aim was to develop a cost-effective hGH and supply to Korean market. There were only 1 in 10,000 cases of children with GHD (Growth Hormone Deficiency) in Korea and all hGH products had been imported at that time. In 1985, the U.S. company Genentech, Co,. Ltd. had developed hGH and finally had it approved by FDA. Since then, Sweden, Denmark and Italy all developed their own hGHs but none used other than E.coli to culture hGH. LGLS had set out using Yeast as a host culture medium, a totally innovative approach in the world. A total of 3 billion KRW was invested in R&D and after a series of devoted efforts, in 1989 Eutropin finally came to birth. Initially since it was the first time ever in Korea, Eutropin stirred up some confusion for the Ministry of Heath and Welfare. The authorization for the clinical tests took very long time and after the authorization the clinical trials had been organized at the most well-recognized hospitals in Korea such as Seoul National University, Yonsei University, Catholic University and etc. The results had been outstanding. The trials were done to 100 microsomia children of age from 7 to 13 who suffered from a slow growth rate of just 3 cm per year. After the treatment of 6 injections per week, the growth rate increased to 12 cm per year. LGLS’s take-off into the world. In 1993, “Eutropin” had ranked No. 1 market share surpassing all other hGHs in Korea. Eventually it had brought down the overblown price of all hGHs by half, making them more affordable to many patients. In June 2004, LGLS has filed to EMEA (European Medicines Agency) for marketing authorization of hGH (brand name: ValtropinTM) and our other FOBs (Follow-on Biologics). We expect to win Valtropin approval within 2005 from EMEA and once it’s approved, we plan to take active steps to promote their sales in the U.K, Germany, France, and other countries of EU. In April 1998, we renovate our plant in Iksan, Jeonbuk Province with state-of-the-art facilities worthy of 20 billion KRW. The plant capacity has a power to produce 3 million doses of Eutropin per year. 04 LG LIFE SCIENCES 2004 ANNUAL REPORT 17 LG LIFE SCIENCES OPERATION REVIEW 2 Animal Health > Synergy from Veterinarian Medicine and Pharmaceuticals Outstanding R&D Results, including BOOSTIN�, MastaVac Veterinarian medicine represents an export industry for Korean companies, and the scale of this business is being expanded by diversifying export markets and launching new products. In addition, LGLS is applying R&D expertise to develop new substances and is securing a foothold in advanced markets to help stabilize overall sales and profitability. World-class genetic engineering and drug synthesis technologies are being leveraged to develop veterinary medicines that can be recognized worldwide. In the process, the stature of Korea’s life science industry will rise and domestic technology in the life science will continue to improve. In 1993, LG launched BOOSTIN� (recombinant bovine somatotropin), a formulation that increases milk production in lactating dairy cows, and the company has achieved significant market share in many countries. Now steps are underway to register the product with the FDA in the US, the world’s largest market. The company also is scheduled to launch its new mastitis vaccine MastaVac in 2006. The vaccine, which incorporates a treatment concept, was developed in technical cooperation with University of Idaho in the US. The product has proven to prevent as well as relieve inflammation of the bovine mammary gland, a condition that incurs major losses for dairy farmers. Farmers who have tested the MastaVac are very excited about the results. LGLS continues to focus R&D on high-tech veterinary medicines such as next-generation animal vaccines and bioconversion products. Steady Advancement since the 1980s The research and development of new veterinary medicines is one of the untapped areas in Korea that must be advanced to help promote human health and improve human welfare. Genetic engineering can be used to prevent diseases in and promote growth of animals that are used as an important human protein source. The need for these drugs is vast as is their potential effect on the livestock industry. LG began researching veterinarian medicines in the 1980s and has continued to advance this industry in Korea. The company has focused on exports and leads in the overseas sale of Korean-made products. The scale of this business continues to expand through overseas market diversification and new product introduction. LGLS is also leveraging R&D capabilities to develop new substances that can provide a solid foundation for sales and revenue as well as promote the industry as a whole. At Least 20% of Sales Reinvested in R&D Annually The veterinary medicine plant, located inside Iksan Industrial Complex 2 in North Jeolla Province, boasts Korea’s largest and most advance facilities for producing genetically engineered medicines. The plant was completed on an 80,000m2 site in 2001 and operates in full compliance with the government Good Manufacturing Practices (GMP) guidelines for veterinary medicine. All production systems, buildings and machinery have been built according to the stipulations in the current Good Manufacturing Practices in order to become registered with the FDA. Since 1994, LGLS has reinvested at least 20% of veterinary medicine sales revenue in R&D and new facilities. The company is also acquiring advanced technologies from and entering into strategic alliances with multinational enterprises as part of the new product development effort. > Key Products 2004 ANNUAL REPORT 18 LG LIFE SCIENCES PRODUCT NAME Boostin (Bovine Somatotropin) Eltosil (Bovine Somatotropin) Accent (Ceftiofur Sodium) Euvectin (Ivermectin) Sugaring (Powerful Sweetener) Medimin C, E (Pegulated Vitamin C,E) Enrobac (Enrofloxacin-Na) APPLICATIONS & FEATURES Recombinant bovine somatotropin Fish growth enhancer Antibiotics without withdrawal period Internal-external parasiticide Sweetener (500 times sweeter than sugar) World’s first functional Vitamin C & E Quinolone anti-microbial agent (for treatment of disease, etc.) 2004 ANNUAL REPORT 19 LG LIFE SCIENCES YEAR 1994 1997 1998 1998 1999 2001 2002 OPERATION REVIEW 3 P l a n t P ro t e c t i o n > Development and Marketing of New Generation Agrochemicals for Stable Growth Strategy and Vision LSLS’ involvement in crop protection spans nearly 20 years and is unique in that the company has always focused on research and technology. For example, the earliest product portfolio was pyrethroid insecticides, including cypermethrin, deltamethrin, and Lambda-cyhalothrin. These insecticides were manufactured because the manufacturing technology was one of the highlighted challenges in the early to mid-1980s. As soon as pyrethroid chemistry ceased to be such a global challenge, the company started discovery research from 1990. As the result, LGLS now has three new molecules developing globally, and maintains excellent R&D productivity and human resources. The structure of the LGLS crop protection business has changed significantly from technology towards business integration to achieve sustainable and healthy growth in the past two years. The company emphasizes strong global relations with multinationals through collaboration with LGLS’s proprietary molecules, while domestic operations are being strengthened with local formulators as well as the establishment of an independent sales network. As a consequence, LGLS’s agrochemical business has become more integrated and sustainable. Growth of proprietary products was particularly noticeable during the last two years and is expected to surge in the next 3-5 years. > Key Products New products PYANCHORⓇ is a post-emergence broad spectrum rice herbicide. As of 2004, registrations were completed and sales are under way in Korea, China, Thailand, Vietnam, Sri Lanka, Panama, Costa Rica, and Ecuador, while registrations are in progress about 10 other countries, particularly in Southeast Asia and Latin America. Ⓡ GUARDIAN is a new mode of action fungicide for Oomycetes diseases in vines, potatoes, various other vegetables and fruits. A global distribution alliance has been concluded with Sumitomo Corporation, and registrations are in progress in over 50 countries. COMMON NAME PRODUCT NAME PM Permethrin λ -CH Lamda-cyhalothrin MXL PSE Metalaxyl Pyrazosulfuron-ethyl DM Deltamethrin Pyanchor Veteran Guardian Fluxo DCZ Pyribenzoxim (PBX) Imidacloprid (ICP) Ethaboxam (EBX) Flucetosulfuron (FTS) Difenoconazole APPLICATIONS & FEATURES Orcharding and horticulture (plant parasitic insects, moths) and prevention of epidemics (flies, mosquitoes) Orcharding and horticulture (aphids, moths) and prevention of epidemics (flies, mosquitoes) Orcharding and horticulture (epidemics, downy mildews) Paddy fields (broad-spectrum herbicide) Orcharding and horticulture (plant parasitic insects, moths) and prevention of epidemics (flies, mosquitoes) Paddy fields (barnyard grass, spiderwort) Orcharding and horticulture (aphids, moths) Orcharding and horticulture (epidemics, downy mildews) Paddy fields (broad-spectrum herbicide) Orcharding and horticulture (leaf spot, powdery mildews) FLUXOⓇ is a pre-and post-emergence herbicide for rice, winter cereals, and turf. The product is currently being registered in Japan, China, and Europe, while the primary targets are the Far Eastern rice and European winter cereals markets. 2004 ANNUAL REPORT 20 LG LIFE SCIENCES 2004 ANNUAL REPORT 21 LG LIFE SCIENCES YEAR 1986 1989 1995 1995 1997 1997 1998 1999 2004 2005