■ Looking Back on 2025

To Our Shareholders and Employees of Boryung,

I have always believed that an annual letter is not a place simply to list a year’s results. It is a place to speak candidly about the standards by which we made decisions, what we learned from those decisions, and where we intend to go next.

In past letters, I have tried to speak not only about what went well, but also about the judgments that fell short and the areas where we must improve. I believe that is part of a manager’s duty and part of the respect we owe those who have entrusted us with their capital, their careers, and their confidence.

For that reason, I want to look back on 2025 with even greater candor and transparency, and to share clearly the direction in which we intend to take Boryung.

Boryung’s business performance in 2025 is not something that can be reduced to a single sentence.

On a consolidated basis, revenue reached KRW 1.0174 trillion and operating profit came to KRW 65.1 billion. Those figures show that the Company maintained the foundation for top-line scale. At the same time, they also underscore the work we must do to redesign our future growth structure with greater clarity and discipline.

The principal backdrop was the first-instance litigation related to the price reduction of Kanarb following patent expiry. Separate from the outcome, we will continue to make every effort to ensure that the validity of the patents we hold is properly recognized. But financial statements must be written in the language of responsibility, not hope. Accordingly, the Company made the judgment to reflect the relevant impact conservatively. As a result, revenue and operating profit for 2025 finished at KRW 1.0174 trillion and KRW 65.1 billion, compared with KRW 1.0360 trillion and KRW 85.5 billion before conservatively reflecting the first-instance ruling.

I believe this decision means more than a simple accounting adjustment.

For the past fifteen years, the growth of Kanarb and the growth of Boryung have, in many respects, meant the same thing. Kanarb is a proud part of Boryung’s history, and it remains an important asset. But the time has now come when Boryung’s future can no longer be explained by a single product. Our next phase of growth must be defined by new pillars, and I believe 2025 was the year in which that new chapter began.

Going forward, Boryung will grow beyond a business structure concentrated in Korea and expand to the global stage. At the same time, we will not limit our ambitions to the ground alone. Over the long term, we intend to extend our reach into a new research environment: space. This is not a departure from our core business. It is an extension of the pharmaceutical and life-science capabilities we know best into a broader and more consequential domain.

■ A New Chapter: Three Growth Pillars for Boryung

Boryung’s future growth will be built around three pillars.

1. Strengthening Our Competitive Position in the Korean Pharmaceutical Market

The first pillar is to deepen our competitiveness in the Korean pharmaceutical market. Boryung intends to strengthen further the chronic disease areas and the oncology business where we already possess meaningful advantages, with the aim of becoming the clear leading player in Korea.

In 2025, our chronic disease business, led by the Kanarb family, grew 6.7% despite a market that was nearly stagnant. We do not intend merely to defend our existing strengths, including Kanarb. We intend to widen our position in the hypertension, dyslipidemia, and diabetes markets through every strategic tool available to us, including new combination products, in-licensing of novel medicines, and mergers and acquisitions. The important point is that we will not be satisfied with defending past success. We will build a stronger portfolio for the future.

Oncology will become an even more important engine of Boryung’s growth. In 2025, Boryung’s oncology revenue was approximately KRW 250 billion, and its five-year CAGR was 23.5%. We intend to build from that base. In Korea alone, the market for major biologics scheduled to lose patent protection by 2030 is expected to approach KRW 2 trillion. In anticipation of those expiries, Boryung will move actively to secure biosimilar pipelines, including in immuno-oncology. At the same time, we will continue introducing new technologies and conducting research and development aimed at improving patient convenience based on the original brands we have already acquired. Our objective is straightforward: to become the most trusted player in oncology in Korea.

2. Becoming a Provider of Essential Medicines

The second pillar is to strengthen Boryung’s role as a provider of essential medicines. I believe this pillar will become increasingly important in explaining Boryung’s intrinsic value. The capability to supply medicines that are essential to a nation and to society is not merely meaningful work. It is an increasingly strategic business as the years go by.

A. Cytotoxic Oncology Medicines

In 2025, Boryung completed the largest acquisition in its history by acquiring the Taxotere business from Sanofi. It was also the first global acquisition ever undertaken by Boryung. The transaction value was EUR 161 million, covering 19 countries, and we expect it to generate more than KRW 90 billion in annual revenue beginning in 2027.

This was not simply the acquisition of a single brand. It was Boryung’s third acquisition of an original cytotoxic oncology business and the starting point for a much broader expansion of our manufacturing and development capabilities in the global market.

Over time, Boryung has accumulated world-class manufacturing capabilities by receiving technology transfer from global pharmaceutical companies such as Lilly and Sanofi. We have also demonstrated formulation capabilities that improve patient convenience, including liquid formulations of Gemzar and Alimta and the development of an alcohol-free docetaxel formulation.

The market environment also presents a meaningful opportunity. Cytotoxic oncology medicines are not being displaced by immuno-oncology or targeted therapies. On the contrary, their role remains essential as combination regimens expand. At the same time, persistent shortages of production capacity around the world are creating share-gain opportunities for companies that can provide stable, high-quality, and trusted supply.

We intend to use both our capabilities and this market backdrop to continue expanding our share in the global cytotoxic oncology market. We will go beyond product sales and pursue CDMO opportunities in cytotoxic oncology as well. Moreover, expertise in cytotoxic manufacturing is essential in the fast-growing ADC field, where many new drugs are now being developed worldwide. By deepening our specialization in cytotoxic oncology, we also intend to explore expansion into those newly emerging markets.

B. Penicillin and Other Essential Medicines

The second branch of our essential medicines strategy is basic medicines such as penicillin. Boryung will strengthen its competitiveness so that the supply of penicillin in Korea remains stable and reliable. This is not simply about producing more of a single item. It is an investment with real significance from the standpoint of national health security. At the same time, through new facility investment and research and development, we will also examine the possibility of expansion into overseas markets.

A business does not become unimportant merely because its price is low. In fact, the lower the price and the more unstable the supply, the greater the value of the company that can reliably shoulder that responsibility. Boryung will deepen its role as a provider of essential medicines that the nation and society truly need.

3. Life Science Research Infrastructure in Space

The third pillar is the securing of life science research infrastructure in space. I view this not as an entirely new business, but as an extension of the research infrastructure we have been building in our core pharmaceutical and life science operations. It is a process of building the foundation to test in low-Earth orbit and advance the pharmaceutical assets and research capabilities we have secured on Earth.

In life science research, controllable infrastructure and controllable data matter enormously. Any company that intends to build durable competitiveness over time must secure both. We will continue to strengthen our manufacturing and research capabilities on Earth while preparing the foundation that will allow us to conduct research in low-Earth orbit and, eventually, in broader environments beyond it.

Many countries and corporations are already working to realize existing technologies in space and, at the same time, to create technologies that cannot be made on Earth by using the space environment itself. Life science is no exception. We believe that securing experimental infrastructure for this field will become essential as the space market matures.

For that reason, Boryung is reviewing, together with various partners, the possibility of next-generation biotechnology research infrastructure that includes the space environment. We are working diligently to develop and formalize partnerships and business models. At this stage, our efforts are appropriately focused on planning, evaluation, and negotiation rather than on publicly committing to specific asset-level transactions. But our direction is clear: we intend to prepare now for infrastructures that we believe will matter greatly in the coming future.

■ This Is a Period for Sustained Investment in Growth

Boryung strongly believes that concentrated investments are required across all three of the business pillars described above.

Success of each pillar will greatly depend on which player in the game secures assets and capabilities necessary to build structural advantages. That is why we believe the next five years should be a period in which Boryung concentrates on investment for growth.

I regard capital allocation as one of management’s most important responsibilities. A good company is not built merely by generating profits. A company’s future is determined by how well management decides where to invest, what to forgo, what to build, and how to convert today’s cash into tomorrow’s competitiveness.

Earlier, I discussed the decline in reported revenue and operating profit resulting from the Kanarb litigation. That decision affected accounting earnings because we chose to reflect the most conservative view of the eventual legal outcome through a provision. It does not, however, affect the Company’s cash flow.

Boryung’s cash flow in 2025 increased by more than 50% from KRW 82.0 billion in the prior year to KRW 128.0 billion, and we expect that strength to continue throughout 2026. Using that cash flow as our foundation, we have already proceeded with decisions relating to CAPEX for essential medicine production infrastructure, including penicillin and cytotoxic oncology, as well as the acquisition of the Taxotere global business. We will continue to invest actively in the growth of all three businesses. At the same time, we will actively consider ways to share the benefits of that growth with our shareholders.

We will not behave recklessly in the name of optimism, nor will we stand still in the name of uncertainty. Where investment is necessary, we will act with conviction. But every decision will be made against a single standard: the long-term increase of Boryung’s core value.

■ Growing Together with Shareholders

Alongside corporate growth, the enhancement of shareholder value remains an important management principle for Boryung.

In 2025, the Company canceled 1 million treasury shares, equivalent to approximately 1.2% of total shares outstanding. It was the largest treasury-share cancellation in the Company’s history.

The treasury shares we continue to hold are intended for compensation of key executives and employees. I believe it is critically important for the people making the Company’s most consequential decisions to have long-term ownership and to grow alongside the value of the company. Going forward, we will continue to consider share repurchases when we judge that the market undervalues the Company relative to its opportunities and financial condition, while also taking into account the needs of employee ownership and compensation.

In the same spirit, we set this year’s dividend at KRW 160 per share, approximately 60% higher than the prior year. Over time, Boryung intends to expand shareholder returns progressively on the foundation of stable earnings power.

That said, I do not believe shareholder return should be judged solely by a single year’s dividend figure. True shareholder return begins with building a company that can generate higher earnings and stronger competitiveness over the long term. We will continue to weigh growth investment and shareholder return with care and discipline.

■ Growing Together with the Nation and Society

I do not believe Boryung’s growth should serve only itself.

Part of my responsibility is to communicate clearly to our shareholders that investing in Boryung is not merely a pursuit of financial return, but an alignment with the values of a company committed to contributing to the growth of our nation and society.

That is why we are strengthening our ability to supply essential medicines. It is also why we are preparing life science research infrastructure in space. Both efforts, in the end, serve the same purpose: to build a company that is truly needed by the nation and by society. When a company’s reason for being meets a genuine social need, its value can last.

Against that backdrop, HIS Youth carries special meaning for Boryung. In earlier letters, I described the program as a long-term effort to broaden opportunity for future generations through the idea of “children’s dreams to space.”

In 2025, for the first time since Dr. Yi So-yeon’s mission to the International Space Station in 2008, artwork created by Korean children was sent to the ISS through Axiom Space. We also held a live event from orbit to share those drawings.

In 2026, we plan to send a time capsule to the lunar surface. It is scheduled to travel to the Moon in the third quarter of this year aboard Intuitive Machines’ IM-3 mission, a company in which we have invested. Under the theme, “A time capsule I will return to as an astronaut in ten years,” we hope to widen the horizon of possibility for many children.

I regard Boryung’s Humans In Space efforts in 2025 and 2026 as more than acts of corporate social responsibility. They are investments in helping the next generation see life science and space not as separate domains, but as connected possibilities.

For 42 years, Boryung, together with the Korean Medical Association, has honored the spirit of the “Korean Schweitzer” through the Boryung Medical Service Award. Through the Boryung Cancer Academic Award, we have also grown alongside pioneers in cancer treatment. In the same spirit, we hope to become a company that helps open the way for the next generation of Koreans to study and protect human health not only on Earth, but in space as well.

■ Entering 2026

Kanarb is a proud part of Boryung’s history and an important foundation for its future.

But Boryung’s future will not rest on a single success.

In the years ahead, we intend for Boryung to become a stronger player in the Korean pharmaceutical market, a reliable supplier of essential medicines to the world, and, over time, a company that enables multi-planetary human life in space.

I take very seriously the capital you entrust to us. I will continue to speak plainly about where we allocate it, why we do so, and what we expect from it. I will not share only the good news. I will also share the difficult judgments and the uncertainties that come with building for the long term. I believe that is part of management’s duty and the basis on which lasting trust is built.

Boryung’s next chapter is already underway.

The path ahead will not always be easy. But we believe the direction is right, and we are committed to proving it through results.

Thank you very much.

2026.03.30

CEO & Chairman, Jay Kim