Parent stocks of SK Bioscience hit ceiling on deal to produce COVID-19 vaccine

2020.07.22 12:21:38 | 2020.07.22 15:37:05

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SK Chemical shares rose by their daily limit upon the news that its unit SK Bioscience landed a deal to manufacture investigational coronavirus vaccine AZD1222h for British pharmaceutical company AstraZeneca as a part of global vaccine supply program.

AstraZeneca has signed agreements with governments around the world for its COVID-19 vaccine supply should it prove effective and gain regulatory approval.

SK Bioscience said Tuesday a letter of intent signed between the two companies and the Ministry of Health and Welfare calls for its stable production of undiluted solutions of the vaccine for AstraZeneca’s global supply, as well as capacity expansion for future demand growth and cooperation in domestic supply.

The signing ceremony held on Tuesday was attended by Health and Welfare Minister Park Neung-hoo, U.K. Ambassador to South Korea Simon Smith, AstraZeneca`s Country President Juno Kim, SK Discovery’s Vice Chairman Chey Chang-won, SK Bioscience CEO Ahn Jae-yong and AstraZeneca CEO Pascal Soriot.

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Shares of SK Chemical which own 98 percent of SK Bioscience rose by the permissible high of 30 percent to 232,000 won ($194.4) Wednesday, and shares of SK Discovery with 33.5 percent stake in SK Chemical also finished Wednesday at their daily ceiling of 46,250 won.

AZD1222 developed by Oxford University and licensed to AstraZeneca is one of the world’s experimental vaccines closest to commercial viability with a phase 3 trial.

Data showed that the vaccine produced an immune response in early-stage clinical trials, showing promise against COVID-19.

The Korean health ministry plans to support AZD1222 vaccine production and export procedures in the future, while seeking cooperation between AstraZeneca and the Ministry of Food and Drug Safety for domestic supply of the vaccine in Korea.

The manufacturing contract between SK Bioscience and AstraZeneca goes into effect this month and will last until early next year. It could be extended depending on AstraZeneca’s success in vaccine development, according to SK Bioscience.

By Kim Byung-ho and Minu Kim

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