This is the fifth in a series of articles analyzing the top 10 companies by market capitalization traded on the tech-heavy KOSDAQ market. --Ed.

With a growing population seeking noninvasive cosmetic procedures, dermal filler and Botulinum toxin-maker Medytox has been bolstering its presence in Korea and abroad. 



The biopharmaceutical company, which manufactures and distributes an injectable neurotoxin for cosmetic use, posted a whopping 60.9 percent surge in annual operating profits last year, outperforming the sector’s 9.8 percent gain on KOSDAQ.

Medytox has been developing Botulinum toxin type A -- better known as Botox -- since it was established in 2000, when Korean consumers were not familiar with the wrinkle smoother that works by temporarily paralyzing facial muscles.

“The firm has a solid domestic market position as it is ranked the No.1 Botox manufacturer and No. 4 with its dermal filler products,” said Noh Kyung-chul, an analyst at SK Securities.

Medytox has been expanding its global foothold, with half of its sales coming from overseas markets.

As a part of such moves, Medytox entered into an exclusive license agreement with Allergan, an Ireland-based Botox maker, to transfer its technology of liquid botulinum toxin under the brand name “Innotox” for $360 million in 2013.

The antiwrinkle treatment is currently on sale here and Allergan is expected to conduct the phase 3 clinical trials on its own product with the same technology in the U.S and Europe this year.

The key importer markets of Medytox products include Japan, Brazil, Thailand, China and Taiwan.

“Given its surging exports of toxin and filler products as well as Innotox’s global trials, which will soon go into its third phase, Medytox is an attractive stock to invest in,” Park Jae-chul, an analyst at Mirae Asset Securities said in his report.

With its rapid growth in earnings surging to 51.7 billion won ($44.3 million) in operating profit in 2015 from 16.8 billion won in 2013, the firm’s stock price shot up nearly fivefold from 114,500 won to 512,800 won during the period.

But shares in the company are struggling to rebound since they sank a record 13 percent on Feb. 12 this year when trading of smaller stocks on KOSDAQ was temporarily halted after the benchmark gauge plunged more than 8 percent.

Analysts attributed the setback of the pharmaceutical stocks to investors’ concerns that valuations were excessive relative to earnings prospects.

“Investors are selling small-cap biopharmaceutical stocks due to high valuations amid the global market turmoil,” an analyst declined to be named said.

Medytox, whose price-earnings ratio is 56.7, closed at 418,700 won on Monday, down 17.9 percent from two months earlier.

Noh said he wouldn’t rule out a rebound in the stock price if Medytox sees further development in its products like Coretox that have less likelihood of patients building resistance against it.

“If the third phase clinical trial on the Allgeran version of Innotox kicks off and Coretox obtains approval for domestic sales, the share price may move up,” Noh said.

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