Korean biohealth industry's profitability recovers in Q1: KHIDI data

The results of the first quarter of this year's pharmaceutical industry business management analysis showed that profitability has recovered and stability has been maintained.

The Korea Health Industry Development Institute (KHIDI) announced on Monday the results of its business management analysis of 320 manufacturers in the biohealth industry, including pharmaceuticals, medical devices, and cosmetics, for the first quarter of 2025.

Key findings include a sales increase for biohealth manufacturing companies, but the sales growth rate dropped to 7.9 percent from 11.3 percent in the fourth quarter of last year. The total asset growth rate also slightly decreased to 2.2 percent from 2.9 percent a year earlier.

Medical devices’ sales increased by 2.8 percent, up 1.6 percentage points from the 1.2 percent recorded in the fourth quarter of last year, while pharmaceutical sales grew by 8.8 percent, down from 14.0 percent in the fourth quarter of last year. The total asset growth rate also increased for medical devices by 5.1 percent, up from 4.6 percent in the same period last year, while the comparable rate for pharmaceuticals stood at 0.7 percent, down from 2.1 percent in the same period last year.

The operating profit rate of biohealth manufacturers rose to 10.7 percent from 8.8 percent in the same period last year, and the pretax net profit rate against sales also rose to 12.3 percent from 11.3 percent a year earlier.

By industry, the operating profit rate for pharmaceuticals rose to 10.8 percent from 7.3 percent in the same period last year, while that for medical devices fell to 9.4 percent from 13.6 percent a year ago. The net profit rate before tax also increased for pharmaceuticals, to 11.6 percent from 7.9 percent, but declined sharply for medical devices, from 21.6 percent a year ago to 6.8 percent.

The debt-to-equity ratio of biohealth manufacturing companies was 38.6 percent, a slight increase from 37.8 percent in the fourth quarter of the previous year. However, the ratio of total borrowings to total assets remained at 10.2 percent, similar to the 10.4 percent in the fourth quarter of the previous year, indicating a stable financial condition.

By industry, the debt ratio for pharmaceuticals was 41.4 percent in the first quarter, similar to the 41.5 percent recorded in the preceding quarter. Meanwhile, the debt ratio for medical devices increased slightly to 37.7 percent from 36.2 percent.

The total borrowings-to-total assets ratio for the pharmaceutical industry decreased slightly to 11.8 percent in the first quarter, from 12.0 percent in the fourth quarter of last year. Similarly, the ratio for the medical device industry also decreased, from 9.3 percent to 8.7 percent.