Notice from Samsung BioLogics in relations to
preliminary notification from FSS
On the Wednesday May 2nd, Samsung BioLogics has received preliminary notification regarding the implementation of audit from the Financial Supervisory Service (FSS).
Any details on the notification is not permitted to reveal without prior consultation of FSS.
However, Samsung BioLogics informs you that we changed Samsung Bioepis from consolidated to equity-method subsidiary in its 2015 financial records based on IFRS corporate accounting standards 1110 B23(3).
Furthermore, external auditors also determined that the accounting treatment was correct in 2016.
The reason for removing Samsung Bioepis as a consolidated subsidiary was as follows. For Biogen, a joint shareholder of Samsung Bioepis, the value of the holding shares subject to the call option became greater than the price of exercising the call option (in-the-money) as development results of biosimilars became more visible and substantial.
In fact, Biogen officially disclosed its willingness of exercising the call option to the public, announcing “In the coming months, we plan to exercise our option to increase our equity stake in the Samsung Bioepis JV" last April during an earnings conference call.
Samsung BioLogics will fully cooperate with every process including the review of board of supervisors and the decision of Securities & Futures Commission in the future.
※ Please refer the bulletin on company’s website posted last February.