[Reporter’s view] Yuhan's CEO Lee made a big decision

Jung Hee Lee, Yuhan CEO, is due until March next year.

 

This is due to the company's policy of having two consecutive terms in three years.

 

It will end in March next year.

 

since he started working in March 2015.

 

Most CEOs make their performances within their tenure.

 

This is because 'maximum performance since its founding' can be a 'decoration' for their career.

 

However, CEO Jung Hee Lee does not care about performance.

 

Last year's (0.84%) and the first quarter's (0.35%) operating margin were the lowest, but the technology fee, which is a positive factor in earnings, is divided as conservatively as possible.

 

The recent business report confirms this trend.

 

Yuhan extended the expiry date of LO’s upfront fee for three cases.

 

This is different from the report of the third quarter of last year.

 

LO’s upfront fee for Lazertinib (anti-cancer drugs) exported to Janssen ($30 million) has extended from 2020 to 2021.

 

The upfront fee for non-alcoholic steatohepatitis treatment, (NASH) YH2574 ($38 million), licensed out to Beringer, was extended from 2020 to 2022.

 

the upfront fee for NASH treatment, sold to Gilead was set to be until 2021.

 

Previously, only the principle of split recognition was disclosed, and the end date was not disclosed.

 

In short, Yuhan delayed the completion of unfront fee accounting until 2022.

 

The intention is to secure a fixed profit by dividing the down payment by 2022.

 

This is a big decision for CEO Lee.

 

If all of the LO’s upfront fee were reflected within the term, better results were possible in terms of sales and operating profit.

 

The LO’s upfront fee left by Lee can strengthen the next CEO.

 

This is because fixed profits are the driving force for maintaining R&D continuity without compromising earnings.

 

Yuhan has a tradition of competing for two vice presidents and choosing a president.

 

Either Wook-je Jo, Vice President (Management Division) or Jong-hyun Park, Vice President (Pharmaceutical Business Division) is a strong candidate.

 

For one of them, CEO Lee's management to prepare for the future can be a valuable asset.