Samsung BioLogics Co., a six-year-old contract manufacturer of biologic drugs groomed as a new growth engine for Korea’s biggest conglomerate Samsung Group, delivered its first humble yet meaningful profit of 3.4 billion won ($3.01 million) in the first three months of 2017 as it suggests the company has begun to reap fruits from early-stage investment.

The firm in a regulatory filing Tuesday reported an operating profit of 3.4 billion won, sharply improving from an operating loss of 70 million in the fourth quarter owing largely to the expenses for the initial public offering in November.

Sales rose 1.9 percent on quarter and 21.3 percent on year to 107.6 billion won on increased orders from multinational drug-makers and capacity following opening of the second plant.

In net terms, it reported a loss of 33.1 billion won because of investment and clinical costs at its biosimilar-developing subsidiary Samsung Bioepis.

On Wednesday, shares of Samsung BioLogics closed down 1.63 percent to 181,000 won from the previous session.

Market watchers are betting the company could record its first full-year profit, given the robust demand for the replica biologic drugs Benepali and Flixabi it supplies to Europe and the feat of Samsung Bioepis whose copy version of John & Johnson’s Remicade, Renflexis, has won a nod from the U.S. Food and Drug Administration to start sale from the latter half.

“Sales could increase 50 percent to 440.7 billion won and generate a profit of 37.5 billion won for full 2017," said Kwak Jin-hee, an analyst at Eugene Investment & Securities Co.

The company is working hard to win orders for antibody drugs to treat Alzheimer’s disease, which could boost sales.

Upon completing its third plant next year, Samsung BioLogics would become the world’s biggest contract drug maker with combined capacity of 360,000 liters. Its first plant of 30,000 liters is running at full capacity and the second that begun operation last year at 40 percent of its capacity.

By Shin Chan-ok and Lee Yong-gun

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