2025 FY Audited Financial Statements (Consolidated)

Index

December 31, 2025 and 2024

Page(s) Independent Auditors' Report ……………………………………………………………………… 1 - 4

Consolidated Financial Statements

Consolidated Statements of Financial Position……….…………….…………….…………….… 5 - 6

Consolidated Statements of Comprehensive Income.…………….…………….……………..... 7

Consolidated Statements of Changes in Equity.…………….…………….…………….….…… 8

Consolidated Statements of Cash Flows……………….…………….…………….……………. 9

Notes to the Consolidated Financial Statements ………………….…………….…………….. 10 - 92

Independent Auditors' Report on Internal Control over Financial Reporting for Consolidation Purposes ……………………………………………………………………………… Management's Report on the Effectiveness of Internal Control over Financial Reporting for Consolidation Purposes …………………………………………………………………………

93 - 94

95 - 98

152, Teheran-ro, Gangnam-gu, Seoul 06236

(Yeoksam-dong, Gangnam Finance Center 27th Floor) Republic of Korea

Independent Auditors' Report

Based on a report originally issued in Korean

To the Shareholders and Board of Directors of Samsung Biologics Co., Ltd

Opinion

We have audited the consolidated financial statements of Samsung Biologics Co., Ltd and its subsidiaries ("the Group"), which comprise the consolidated statement of financial position as of December 31, 2025 and the consolidated statements of comprehensive income, changes in equity and cash flows for the year then ended, and notes, including material accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2025, and its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with Korean International Financial Reporting Standards ("K-IFRS").

We also have audited, in accordance with Korean Standards on Auditing (KSAs), the Group's Internal Control over Financial Reporting for Consolidation Purposes ("ICFR") as of December 31, 2025 based on the criteria established in Conceptual Framework for Designing and Operating Internal Control over Financial Reporting issued by the Operating Committee of Internal Control over Financial Reporting in the Republic of Korea, and our report dated February 25, 2026 expressed an unmodified opinion on the effectiveness of the Group's internal control over financial reporting.

Basis for Opinion

We conducted our audit in accordance with KSAs. Our responsibilities under those standards are further described in the Auditors' Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the consolidated financial statements in Republic of Korea, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Emphasis of Matters

Without qualifying our opinion, we draw attention to the following:

Administrative lawsuit against a ruling of the Securities and Futures Commissions

As described in Note 35 to the consolidated financial statements, the Securities and Futures Commission (the "SFC") resolved to impose measures on the Group in relation to alleged errors in accounting treatment for the Group's investment in Samsung Bioepis Co., Ltd. in the Group's financial statements for the period from 2012 to the first half of 2018.

The Group filed an application with the Seoul Administrative Court (the "Court") to suspend the measures imposed by the SFC and subsequently received a Court decision granting the suspension. In relation to this, the appeal and re-appeal filed by SFC were dismissed by the Seoul High Court and the Supreme Court, respectively. The Group submitted claims for cancellation of the measures and related administrative lawsuit is in progress. It is not possible to predict the outcome.

Disclosure of Discontinued Operations Resulting from a Spin-off

As described in Notes 1 and 34 to the consolidated financial statements, pursuant to the approval of the shareholders at the general shareholders' meeting held on October 17, 2025, the Group completed a spin-off of its biopharmaceutical development and commercialization business with November 1, 2025 as the effective date of the spin-off, establishing a newly incorporated entity, Samsung Epis Holdings Co., Ltd.

Accordingly, the consolidated entity has classified the results of operations arising from the business of the newly established entity as discontinued operations and has restated the prior-year consolidated statement of comprehensive income and the related notes.

Key Audit Matter

Key audit matter is a matter that, in our professional judgment, was of most significance in our audit of the consolidated financial statements as of and for the year ended December 31, 2025. This matter was addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on this matter.

Revenue recognition of CMO batch sales

The Group is principally engaged in the contract manufacturing organization ("CMO") business, which involves the contract manufacturing of biopharmaceutical products. The CMO business consists of technology transfer procedures, regulatory approval processes, and commercial manufacturing processes. The Group recognizes revenue over the period during which control of the manufactured biopharmaceutical products is transferred to customers (see Note 2).

The timing of transfer of control for CMO batch sales may vary depending on the contractual terms agreed between the parties. Accordingly, we identified the appropriateness of the cut-off of revenue recognition for CMO batch sales as a significant risk. Given that the related amounts are material to the consolidated financial statements, we identified this matter as a key audit matter.

In relation to the Group's accounting for revenue recognition, our primary audit procedures included the following:

• Obtaining an understanding of the Group's processes related to CMO batch sales

• Evaluating the design and operating effectiveness of internal controls over the cut-off of CMO batch sales recognition

• Inspecting key project-specific contracts to assess the appropriateness of the timing of revenue recognition

• Testing, on a sample basis, the appropriateness of the timing of revenue recognition for individual projects

Other Matters

The consolidated financial statements of the Group for the year ended 2024 were audited by another auditor who expressed an unmodified opinion on those statements on February 25, 2025.

The procedures and practices utilized in the Republic of Korea to audit such consolidated financial statements may differ from those generally accepted and applied in other countries.

Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with K-IFRS, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Group's financial reporting process.

Auditors' Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors' report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with KSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with KSAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances.

• Evaluate the appropriateness of accounting policies used in the preparation of the consolidated financial statements and the reasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors' report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors' report. However, future events or conditions may cause the Group to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors' report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partner on the audit resulting in this independent auditors' report is Jae-Kwang Ra.

Seoul, Korea February 25, 2026

Consolidated Statements of Financial Position

December 31, 2025 and 2024

Consolidated Statements of Financial Position, Continued

December 31, 2025 and 2024

The above consolidated statements of financial position should be read in conjunction with the accompanying notes.

The above consolidated statements of comprehensive income should be read in conjunction with the accompanying notes.

Samsung Biologics Co., Ltd. and Subsidiaries

Consolidated Statements of Changes in Equity Years Ended December 31, 2025 and 2024

(in Korean won)

Notes

Share capital

Share premium

Capital Adjustments

Accumulated other comprehensive income (loss)

Retained earnings

Non-controlling interests

Total

Balance at January 1, 2024 Total comprehensive income

Profit for the year

Other comprehensive income

Remeasurements of net defined benefit liabilities (assets) Foreign currency translation gain

Total comprehensive income for the year Balance at December 31, 2024

Balance at January 1, 2025 Total comprehensive income Profit for the year

Other comprehensive income

Remeasurements of net defined benefit liabilities (assets) Foreign currency translation gain

Total comprehensive income for the year

Transactions with owners recognized directly in equity

Spin-off

Acquisition of treasury shares

Balance at December 31, 2025

The above consolidated statements of changes in equity should be read in conjunction with the accompanying notes.

8

The above consolidated statements of cash flows should be read in conjunction with the accompanying notes.

1. General Information

   Samsung Biologics Co., Ltd. (the "Company" or the "Parent Company") was established on April 22, 2011 under the commercial law of the Republic of Korea and is engaged in biopharmaceutical manufacturing. The Company's head office is located in 300, Songdobio-daero, Yeonsu-gu, Incheon-si, Republic of Korea. The Company was listed on the securities market on November 10, 2016. As at 31 December 2025, following a demerger in the form of a spin-off on 1 November 2025, the Parent company's capital stock amounts to W 115,727 million.

   The shareholders of the Company as of December 31, 2025, are as follows:

   Shareholder Number of shares (in shares) Percentage of ownership (%)

   19,932,350		43.06
   14,449,944		31.22
   11,908,657		25.72
   46,290,951		100.00

   Samsung C&T Corporation Samsung Electronics Co., Ltd.

   Others

   Samsung Biologics Co., Ltd. (the "Company", a controlling company in accordance with International Financial Reporting Standards as adopted by the Republic of Korea ("K-IFRS") No. 1110 'Consolidated Financial Statements') and subsidiaries (collectively referred to as the "Group") prepared the consolidated financial statements accounting for the investments in associates using the equity method.

   On 22 May 2025, the Board of Directors resolved to establish a newly formed company through a spin-off, whose main business will be the management of subsidiaries including Samsung Bioepis Co., Ltd. and others, and new investments. Following the approval of the agenda at the shareholders' meeting on 17 October 2025, the company carried out a spin-off of the relevant business segment on November 1, 2025.

   1. Consolidated Subsidiaries

      Details of the consolidated subsidiaries as of December 31, 2025 and 2024 are as follows:

      Location	2025	2024	Main business	Closing months
      USA	100.00	100.00	Other services	December

      Percentage ownership (%)

      SAMSUNG BIOLOGICS AMERICA Inc.

      SAMSUNG BIOEPIS

      Co., Ltd.

      SAMSUNG BIOEPIS UK LIMITED SAMSUNG BIOEPIS CH GMBH SAMSUNG BIOEPIS AU PTY LTD

      SAMSUNG BIOEPIS BR

      PHARMACEUTICAL LTDA SAMSUNG BIOEPIS

      NZ LIMITED

      SAMSUNG BIOEPIS IL LTD SAMSUNG BIOEPIS NL B.V. SAMSUNG BIOEPIS

      TW Limited

      SAMSUNG BIOEPIS

      PL Sp z o.o SAMSUNG BIOEPIS

      HK Limited SAMSUNG BIOEPIS

      United States Inc.

      SVIC No.63 New Technology Business Investment L.L.P.

      Republic of Korea UK	- -	100.00 100.00	Biopharmaceutical development and commercialization Other services	December December
      Switzerland	-	100.00	Other services	December
      Australia	-	100.00	Other services	December
      Brazil	-	100.00	Other services	December
      New Zealand	-	100.00	Other services	December
      Israel	-	100.00	Other services	December
      Netherlands	-	100.00	Other services	December
      Taiwan	-	100.00	Other services	December
      Poland	-	100.00	Other services	December
      Hong Kong	-	100.00	Other services	December
      USA	-	100.00	Other services	December

      Republic of Korea

      - 99.00 Investment association

      December

      Summarized financial information for consolidated subsidiary as of and for the years ended December 31, 2025 and 2024 is as follows:

      (in Korean won) 2025

      Assets Liabilities Equity Sales

      Profit for the year

      Total comprehensive income

      Samsung Biologics America, Inc.

      SAMSUNG BIOEPIS

      W 18,361,304,615 W 3,044,015,112 W 15,317,289,503 W 13,667,584,631 W 695,990,849 W 344,856,357

      Co., Ltd.₁,₂ - - - 1,419,693,194,628 359,749,764,347 357,061,495,663

      1 Consolidated financial information of SAMSUNG BIOEPIS Co., Ltd., and its subsidiaries.

      2 The consolidated company carried out a spin-off of subsidiaries including Samsung Bioepis Co., Ltd. with 1 November 2025 as the effective date. The profit or loss financial information for the current period includes only ten months of profit or loss prior to the spin-off.

      (in Korean won) 2024

      Assets Liabilities Equity Sales

      Profit (loss) for the year

      Total comprehensive income

      W 19,448,387,959	W	4,475,954,813	W	14,972,433,146	W	15,049,759,180	W	(943,314,961)	W	947,154,371
      3,292,370,282,950		1,570,888,375,687		1,721,481,907,263		1,537,700,053,729		371,949,356,446		368,841,094,148

      Samsung Biologics America, Inc.

      SAMSUNG BIOEPIS

      Co., Ltd. ₁

      1 Consolidated financial information of SAMSUNG BIOEPIS Co., Ltd., and its subsidiaries.

   2. Changes in Scope for Consolidation

      Entities excluded from consolidation during the current period

      Reason

      SAMSUNG BIOEPIS Co., Ltd. Spin-off

      SAMSUNG BIOEPIS UK LIMITED Spin-off

      SAMSUNG BIOEPIS CH GMBH Spin-off

      SAMSUNG BIOEPIS AU PTY LTD Spin-off

      SAMSUNG BIOEPIS BR PHARMACEUTICAL LTDA Spin-off

      SAMSUNG BIOEPIS NZ LIMITED Spin-off

      SAMSUNG BIOEPIS IL LTD Spin-off

      SAMSUNG BIOEPIS NL B.V. Spin-off

      SAMSUNG BIOEPIS TW Limited Spin-off

      SAMSUNG BIOEPIS PL Sp z o.o Spin-off

      SAMSUNG BIOEPIS HK Limited Spin-off

      SAMSUNG BIOEPIS United States Inc. Spin-off

      SVIC No.63 New Technology Business Investment L.L.P. Spin-off

2. Material Accounting Policies

   The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

   1. Basis of Preparation

      The Group maintains its accounting records in Korean won and prepares statutory financial statements in the Korean language (Hangul) in accordance with International Financial Reporting Standards as adopted by the Republic of Korea (K-IFRS). The accompanying consolidated financial statements have been restructured and translated into English from the Korean language financial statements.

      Certain information attached to the Korean language financial statements, but not required for a fair presentation of the Group's financial position, financial performance or cash flows, is not presented in the accompanying financial statements.

      The consolidated financial statements of the Group have been prepared in accordance with Korean IFRS. These are the standards, subsequent amendments and related interpretations issued by the International Accounting Standards Board (IASB) that have been adopted by the Republic of Korea. The financial statements have been prepared on a historical cost basis, except for the following:

      • Certain financial assets and liabilities (including derivative instruments), and

      • Defined benefit pension plans - plan assets measured at fair value, and

      • Assets held for sale measured at fair value less costs to sell.

      The preparation of financial statements requires the use of significant accounting estimates. Management also needs to exercise judgement in applying the Group's accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in Note 3.

   2. Changes in Accounting Policies and Disclosures

      1. New and amended standards adopted by the Group

         The Group has applied the following standards and amendments for the first time for their annual reporting period commencing January 1, 2025

         Amendments to Korean IFRS 1021 The Effects of Changes in Foreign Exchange Rates- Lack of Exchangeability

         The amendments add criteria for assessing the exchangeability between two currencies in order to clarify the requirements for translating a functional currency into a presentation currency. In addition, when a company judges that exchangeability is lacking, the amendments add requirements for estimating the spot exchange rate to be applied and require disclosure of related information.

         These amendments to the Standard do not have a material effect on the financial statements.

      2. New standards and interpretations not yet adopted by the Group

         The following new accounting standards and interpretations have been published that are not mandatory for December 31, 2025 reporting periods and have not been early adopted by the Group.

         1. Amendments to K-IFRS No. 1109 'Financial Instruments' and K-IFRS No. 1107 'Financial Instruments: Disclosures'

            The Group is reviewing the effect of these amendments on its consolidated financial statements. The amendments are effective for fiscal years beginning on or after 1 January 2026, with earlier application permitted. The main amendments are as follows:

            • Permit an entity, when certain baseline are met, to deem a financial liability to have been settled (derecognized) via an electronic payment system before the settlement date.

            • Clarify further guidance for assessing whether a financial asset meet criteria for consisting solely of payments of principal and interest.

            • Require disclosures in the financial statement, for each class of financial instrument, of the effect on the entity and the exposure to which the entity is subject from contractual terms that change the timing or amount of contractual cash flows.

            • Require additional disclosures for equity instruments measured at fair value through other comprehensive income.

         2. Annual Improvements to K-IFRS Volume 11

            Annual Improvements to K-IFRS Volume 11 are effective for fiscal years beginning on or after 1 January 2026, with earlier application permitted. The Group expects that the amendments will not have a material effect on its consolidated financial statements.

            • K-IFRS No. 1101 'First-time Adoption of Korean International Financial Reporting Standards': application of hedge accounting on first-time adoption of K-IFRS.

            • K-IFRS No. 1107 'Financial Instruments: Disclosures': gains or losses on derecognition, implementation guidance.

            • K-IFRS No. 1109 'Financial Instruments': accounting for derecognition of lease liabilities and definition of transaction price.

            • K-IFRS No. 1110 'Consolidated Financial Statements': determination of a de facto agent.

            • K-IFRS No. 1007 'Statement of Cash Flows': cost method.

         3. Amendments to K-IFRS No. 1107 'Financial Instruments: Disclosures' and K-IFRS No. 1109 'Financial Instruments'

            These standards are effective for fiscal years beginning on or after 1 January 2026, with earlier application permitted. The Group does not expect the amendments to have a material impact on the consolidated financial statements. The main amendments are as follows:

            • Expansion of the application of hedge accounting to virtual power purchase agreements (Virtual PPAs)

            • Introduction of disclosure requirements for nature-dependent power contracts that meet specified characteristics

         4. K-IFRS No. 1118 'Presentation and Disclosures in Financial Statements', promulgation

         The Group is currently assessing the impact of this promulgation on the consolidated financial statements. This standard is effective for fiscal years beginning on or after 1 January 2027, with earlier application permitted. The main provisions are as follows:

         • Presentation of specified categories and defined subtotals in the statement of profit or loss

         • Provision of disclosures related to management-defined performance measures (MPMs) in the notes to the financial statements

         • Improvements to aggregation and disaggregation

   3. Consolidation

      The Group has prepared the consolidated financial statements in accordance with Korean IFRS 1110

      Consolidated Financial Statements.

      1. Subsidiaries

         Subsidiaries are all entities over which the Parent company has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases.

         The acquisition method of accounting is used to account for business combinations by the Group. The consideration transferred is measured at the fair values of the assets transferred, and identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. The Group recognizes any non-controlling interest in the acquired entity that is provided a proportionate share in the case of liquidation on an acquisition-by-acquisition basis either at fair value or at the non-controlling interest's proportionate share of the acquired entity's net identifiable assets. All other non-controlling interests are measured at fair values, unless otherwise required by other standards. Acquisition-related costs are expensed as incurred.

         The excess of consideration transferred, amount of any non-controlling interest in the acquired entity and acquisition-date fair value of any previous equity interest in the acquired entity over the fair value of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than the fair value of the net identifiable assets of the business acquired, the difference is recognized directly in the profit or loss as a bargain purchase.

         Intercompany transactions, balances and unrealized gains on transactions between group companies are eliminated. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

         The Group treats transactions with non-controlling interests that do not result in a loss of control as transactions with equity owners of the Parent Company. Any difference between the amount of the adjustment to non-controlling interest and any consideration paid or received is recognized in a separate reserve within equity attributable to owners of the Parent Company.

         When the Group ceases to consolidate for a subsidiary because of a loss of control, any retained interest in the subsidiary is remeasured to its fair value with the change in carrying amount recognized in profit or loss.

         Meanwhile, although they are not combinations between businesses, the specific methodology of the book value method applied to spin-off transactions of the group that occurred in the current and prior periods, which satisfied the criteria for transactions under common control, is as follows:

         - Spin-off

         The cumulative amount of other comprehensive income related to the assets to be spun off is reclassified to an equity component upon the spin-off.

      2. Associates and joint ventures

      Investments in associates and joint ventures are accounted for using the equity method of accounting, after initially being recognized at cost. Unrealized gains on transactions between the Group and its associates and joint ventures are eliminated to the extent of the Group's interest in the associates and joint ventures. If the Group's share of losses of an associate and joint venture equals or exceeds its interest in the associate and joint venture (including long-term interests that, in substance, form part of the Group's net investment in the associate and joint venture), the Group discontinues recognizing its share of further losses. After the Group's interest is reduced to zero, additional losses are provided for, and a liability is recognized, only to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the associate.

      If there is an objective evidence of impairment for the investment in the associate and joint venture, the Group recognizes the difference between the recoverable amount of the associate and joint venture and its book amount as impairment loss. If an associate and joint venture uses accounting policies other than those of the Group for like transactions and events in similar circumstances, if necessary, adjustments shall be made to make the accounting policies of the associate and joint venture conform to those of the Group when the financial statements of the associate and joint venture are used by the Group in applying the equity method.

   4. Cash and Cash Equivalents

      Cash and cash equivalents include cash on hand, deposits held at call with banks, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

   5. Foreign Currency Translation

      1. Functional and presentation currency

         Items included in the financial statements of the Group are measured using the currency of the primary economic environment in which each entity operates (the "functional currency"). The consolidated financial statements are presented in Korean won, which is the Group's functional and presentation currency.

      2. Transactions and balances

      Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the transactions, or the exchange rates at the dates of valuation for items that are remeasured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at year end exchange rates are generally recognized in profit or loss. They are deferred in other comprehensive income if they relate to qualifying cash flow hedges and qualifying effective portion of net investment hedges, or are attributable to monetary part of the net investment in a foreign operation.

      Translation differences on assets and liabilities carried at fair value are reported as part of the fair value gain or loss. For example, translation differences on non-monetary assets and liabilities such as equities held at fair value through profit or loss are recognized in profit or loss as part of the fair value gain or loss and translation differences on non-monetary assets such as equities held at fair value through other comprehensive income are recognized in other comprehensive income.

      If the functional currency of a foreign operation is not the currency of a hyperinflationary economy, the assets and liabilities for each statement of financial position presented are translated at the closing rate at the date of that statement of financial position. Income and expenses for each statement of comprehensive income presented are translated at exchange rates at the dates of the transactions. All resulting exchange differences are recognized in other comprehensive income.

   6. Financial Assets

      1. Measure

         Equity instruments

         The Group subsequently measures all investments in equity instruments at fair value. For equity instruments held for long-term investment purposes or strategic investment purposes for which the Group has elected to present fair value changes in other comprehensive income, amounts recognized in other comprehensive income are not reclassified to profit or loss even when the related equity instruments are derecognized.

      2. Impairment

         The Group assesses expected credit losses on debt instruments measured at amortized cost or at fair value through other comprehensive income based on forward-looking information. The impairment approach is determined depending on whether there has been a significant increase in credit risk. However, for trade receivables, other receivables and contract assets, the Group applies the simplified approach and recognizes lifetime expected credit losses from the time the receivables are initially recognized (see Note 33).

      3. Offsetting of financial instruments

      Financial assets and liabilities are offset and the net amount is presented in the balance sheet when the Group currently has a legally enforceable right to offset the recognized assets and liabilities and intends either to settle on a net basis or to realize the asset and settle the liability simultaneously. A legally enforceable right of offset is not contingent on a future event and is enforceable in the normal course of business, in the event of default, and in the event of insolvency or bankruptcy.

   7. Trade Receivables

      Trade receivables are amounts due from customers for merchandise sold or services performed in the ordinary course of business. Trade receivables are recognized initially at the amount of consideration that is unconditional, unless they contain significant financing components and are recognized at fair value. Trade receivables are subsequently measured at amortized cost using the effective interest method, deducting allowance for credit losses.

   8. Inventories

      Inventories are presented at the lower of cost and net realizable value, and the cost of inventories is determined using the specific identification method and the moving-average method. The cost of inventories includes costs of purchase, costs of conversion and other costs necessary to bring the inventories to a state in which they are available for use, and fixed production overheads included in the cost of finished goods and work in progress are allocated based on allocation criteria for each production process.

   9. Property, Plant and Equipment

      Historical cost includes expenditures that are directly attributable to the acquisition of an asset. Subsequent costs are included in the carrying amount of the asset, or, where appropriate, recognized as a separate asset, only when it is probable that future economic benefits arising from the asset will flow to the group and the costs can be measured reliably. The carrying amount of the replaced part is derecognized. All other repair and maintenance costs are recognized as expenses in the period in which they are incurred. Except for land, assets are depreciated on a straight-line basis over the following estimated economic useful lives, after deducting residual value from acquisition cost.

      Useful lives

      Buildings and Structures 40 years

      Machinery 5~15 years

      Vehicles 4 years

      Others 4 years

   10. Government Grants

       Government grants are recognized at fair value when there is reasonable assurance regarding receipt of the grant and compliance with the conditions attached to the government grant. Grants related to assets are presented by deducting them in calculating the carrying amount of the asset, and grants related to income are deferred and presented as a deduction from the expenses related to the purpose for which the government grant is awarded. In connection with the use of certain land, the Group is fully exempt from rent by satisfying the rent reduction requirements under the Incheon Metropolitan City public property management ordinance in the process of entering into a lease contract with Incheon Metropolitan City. The Group recognizes the fair value of the rent exempted by Incheon Metropolitan City as an intangible asset, and recognizes the same amount as a deduction from the asset under the account of government grants.

   11. Intangible Assets

       Intangible assets acquired in a business combination are amortized on a straight-line basis over the useful lives set out below from the acquisition date, and other intangible assets are amortized on a straight-line basis over the useful lives set out below from the date they are available for use, assuming a residual value of zero. However, as the period during which certain intangible assets are expected to be available for use is not subject to predictability, the useful lives of such intangible assets are assessed as being indefinite and they are not amortized.

       Useful lives

       Development costs 5 ~ 12 years

       Software 5 years

       Other intangible assets 5 years

       Land use rights 50 years

       Trademarks and patent rights 10 years

       Memberships indefinite

       Subsequent expenditures

       The judgement made by the Group's management regarding the recognition of intangible assets is as follows:

       A biosimilar product development process starts with extracting proteins after developing a cell line and then formulating them into a pharmaceutical product; once it passes the equivalence test against the originator drug, clinical procedures are initiated, and based on a comprehensive assessment of the resulting clinical outcomes and commercial-scale manufacturing capability, final approval for sale is obtained.

       The Group determined that the intangible assets are individually identifiable and technically feasible at the time of approval for the application of the first clinical trial, when the regulatory body has confirmed the similarity verification data with the original biologic medicine. In addition, only expenses directly related to clinical trials should be capitalized as development expenses, and other expenses are recognized as expenses. Other expenses incurred in relation to the development of Biobetter and new medicines are recognized as expenses for the current period as they do not meet the requirements for capitalization.

   12. Trade and Other Payables

       These amounts represent liabilities for goods and services provided to the Group prior to the end of reporting period which are unpaid. Trade and other payables are presented as current liabilities, unless payment is not due within 12 months after the reporting period. They are recognized initially at their fair value and subsequently measured at amortized cost using the effective interest method.

   13. Financial Liabilities

       Classification and measurement

       The Group's financial liabilities at fair value through profit or loss are financial instruments held for trading. A financial liability is held for trading if it is incurred principally for the purpose of repurchasing in the near term. A derivative that is not designated as a hedging instrument and an embedded derivative that is separated are also classified as held for trading.

       The Group classifies non-derivative financial liabilities, except for financial liabilities at fair value through profit or loss, financial guarantee contracts and financial liabilities that arise when a transfer of financial assets does not qualify for derecognition, as financial liabilities carried at amortized cost and present as 'trade and other payables' and 'debentures and borrowings' in the statement of financial position.

       Borrowings are initially recognized at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortized cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognized in profit or loss over the period of the borrowings using the effective interest method.

       Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the reporting period.

       Covenants that the Group is required to comply with, on or before the end of the reporting period, are considered in classifying loan arrangements with covenants as current or non-current. Covenants that the Group is required to comply with after the reporting period do not affect the classification at the reporting date.

   14. Greenhouse Gas Emission Permits

       With enforcement of The Act on the Allocation and Trading of Greenhouse Gas Emission Permits, the allocation received from the government for free of charge are measured at zero while purchased emission permits are measured at acquisition cost and presented net of accumulated impairment loss. Emissions obligations are measured as the best estimate of expenditure required to settle the obligation at the end of the reporting period for the gas emissions in excess of the emission permits. Emission permits and emission obligations are classified as intangible assets and emission liability, respectively, in the statement of financial position.

   15. Revenue Recognition

       1. Identification of performance obligation

          • CMO (Contract Manufacturing Organization) business

            The Group manufactures and supplies made-to-order biomedicine. Services mandatorily rendered prior to a production of biomedicine do not form a part of a performance obligation since they are considered as a set-up process. Only the sales of biomedicine are recognized as performance obligations.

          • CDO (Contract Development Organization) business

            The Group provides cell line and upstream/downstream process development services. The Group recognizes cell line and upstream/downstream process development services as distinct performance obligations.

          • Development and commercialization of biosimilar products

            The Group recognizes the development of biosimilar products and the sale of commercialized products to the end customers as performance obligations.

       2. Satisfaction of performance obligations

          • CMO business

            Goods manufactured by the Group do not have an alternative use to the Group, and it has an enforceable right to payment for performance completed to date. This is because that the Group produces biomedicine at a quality that a customer requires and is entitled to reimbursement of the costs incurred to date, including a reasonable margin if a customer terminates a contract. Therefore, the Group recognizes revenue and the associated costs over time as it satisfies its performance obligation over a contract period.

            Under the practical expedient of Korean IFRS 1115, the transaction price allocated to these unsatisfied contracts is not disclosed.

          • CDO business

            Revenue is recognized over time during the research period of each service as a customer simultaneously receives and consumes the benefits provided by the Group as the Group performs research and development services.

          • Development of biosimilar products and sales of biosimilar commercialized products

            The Group's revenue is generated from commissions related to the development of biosimilar products and external sales of commercialized products. The Group recognizes revenue by identifying performance obligations from product development and manufacturing in the contract. The timing of revenue recognition by the Group varies depending on whether each performance obligation is satisfied at a point in time or over time. The Group's revenue is recognized depending on whether a performance obligation is satisfied at a point in time or over time.

            Among contracts that covering the development and commercialization of biosimilar products, the Group reviewed whether the definition of customer mentioned in the contracts align with the meaning of customer referred in paragraph 6 of Korean IFRS 1115.

            Contracts in which the counterparties meet the definition of a customer, revenue is measured based on the consideration promised in the contract with the customer, and the Group recognizes revenue when control of the goods or services is transferred to the customer.

            Contracts in which the counterparties do not meet the definition of a customer are not subject to Korean IFRS 1115, and there is no provision in Korean IFRS that specifically stipulates a series of transactions pursuant to such a collaboration agreement. The Group developed and applied accounting policies in accordance with paragraphs 10 to 12 of Korean IFRS 1008. As a result, the Group recognizes revenue from the transfer of control of license and revenue from the sale of commercialized products separately as follows:

            • Revenue recognition timing for fees related to the development of biosimilar products:

              The Group recognizes considerations received from customers through the development of biosimilar products (including Upfront and Milestone fees) as revenue when control of the intellectual property rights acquired through the research and development are transferred to the customers (e.g., when regulatory approval is obtained).

            • Transactions with counterparties that do not meet the definition of a customer:

              In accordance with contractual agreements, the Group participates in the production and sale of products with partners to generate revenue. The total profit or loss generated from these products and within specific regions over a certain period is settled according to an agreed-upon ratio. The profit and loss settlement between the Group and its partners includes all sales, cost of sales, and marketing expenses incurred during the revenue-generating process from product production to sales to end customers.

              The Group has reviewed whether the partner in this transaction meets the definition of a customer as prescribed in paragraph 6 of Standard No. 1115. It has been determined that the partner does not meet the definition of a customer because it does not acquire the output of the company's ordinary activities. Instead, the partner participates with the Group in the production and sale of products to generate revenue and shares in the risks and benefits arising from those activities.

            • Transactions with counterparties that meet the definition of a customer:

            The Group recognizes revenue at the point in time when a commercialized product is sold to the customer and control of the goods is transferred to the customer.

       3. Costs to fulfil a contract

          If the costs incurred in fulfilling a contract with a customer are related directly to a contract or to an anticipated contract that the entity can specifically identify, generate or enhance resources of the entity that will be used in satisfying performance obligations in the future, and the costs are expected to be recovered, the costs are recognized as assets. And the costs to fulfil a contract are recognized as cost of revenue based on the percentage of completion.

       4. Contract assets and contract liabilities

          • CMO business

            The Group recognizes the amount of the advance consideration by customers related to the transfer of technology or engineering batch production as contract liabilities and related costs as costs to fulfil a contract. Such activities are required in advance for the production of goods ordered but do not transfer goods or services to a customer. Accordingly, they are not included in a performance obligation.

          • CDO business

            In a CDO business, a contract asset is an entity's right to receive consideration in exchange for goods or services that the entity has transferred to a customer, and a contract liability is the entity's obligation to transfer goods or services to a customer for which the entity has received consideration (or the amount is due) from the customer.

          • Development of biosimilar products and sales of commercialized products

            The Group recognizes unbilled amounts for R&D services for which performance obligations have been completed as contract assets. Commissions received from customers through the development of biosimilar products (including Upfront and Milestone fees) are recognized as contract liabilities.

       5. Variable consideration

          If the consideration promised in a contract includes a variable amount, the Group estimates the amount of consideration to which the Group will be entitled to in exchange for transferring the promised goods or services to a customer. An amount of consideration can vary because of discounts, refunds, credits, price concessions, penalties or other similar items. The promised consideration can also vary if an entity's entitlement to the consideration is contingent on the occurrence or non-occurrence of a future event.

       6. Recognition of receivable

       A receivable is recognized when the control of bio-medicine has been transferred as this is the point in time that the consideration is unconditional because only the passage of time is required before the payment is due.

   16. Leases

       1. Lessor

          Lease income from operating leases where the Group is a lessor is recognized in income on a straight-line basis over the lease term. Initial direct costs incurred in obtaining an operating lease are added to the carrying amount of the underlying asset and recognized as expense over the lease term on the same basis as lease income. The respective leased assets are included in the statement of financial position based on their nature.

       2. Lessee

       The Group leases various offices, equipment and vehicles. Lease contracts are typically made for a fixed periods of 2 to 3 years, but may have extension options. Contracts may contain both lease and non-lease components. However, for leases of real estate for which the Group is lessee, the Group applies the practical expedient which has elected not to separate lease and non-lease components and instead accounts for these as a single lease component. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements do not impose any covenants, but leased assets may not be used as security for borrowing purposes.

       Some of lease contracts of the group include extension and termination options. These terms are used to maximize operational flexibility in terms of contract management. Most of the extension and termination options can be exercised by the group and not by the relevant lessor.

       The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be determined, the lessee's incremental borrowing rate is used, being the rate that the lessee would have to pay to borrow the funds necessary to obtain an asset of similar value in a similar economic environment with similar terms and conditions.

       The Group elected not to apply that revaluation model to buildings held by the Group that are presented in the right-of-use assets.

       Short-term leases are leases with a lease term of 12 months or less. Low-value assets are comprised of IT-equipment and small items of office furniture. Payments associated with short-term leases and leases of low-value assets are recognized as an expense in profit or loss.

   17. Approval of Issuance of the Financial Statements

       The consolidated financial statements 2025 were approved for issue by the Board of Directors on January 21, 2026 and are subject to change with the approval of shareholders at their Annual General Meeting.

3. Significant Accounting Estimates and Assumptions

   The preparation of consolidated financial statements requires the Group to make estimates and assumptions concerning the future. Management also needs to exercise judgement in applying the Group's accounting policies. Estimates and assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. As the resulting accounting estimates will, by definition, seldom equal the related actual results, it may contain a significant risk of causing a material adjustment.

   The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below. Additional information of significant judgement and assumptions of certain items are included in the relevant notes.

   1. Development costs

      The Group uses management's best judgment, such as expected future cash flow and discount rate when reviewing capitalization requirements and useful lives of development costs. In addition, impairment tests for development costs are performed at the end of each reporting period, and there is uncertainty in estimating the recoverable amount including recoverability.

   2. Income taxes

      The Group's taxable income generated from these operations are subject to income taxes based on tax laws and interpretations of tax authorities in numerous jurisdictions. There are many transactions and calculations for which the ultimate tax determination is uncertain (Note 28).

      If certain portion of the taxable income is not used for investments or increase in wages, etc.,, the Group is liable to pay additional income tax calculated based on the tax laws. Accordingly, the measurement of current and deferred income tax is affected by the tax effects accordingly. As the Group's income tax is dependent on the investments, increase in wages, etc., there is an uncertainty in measuring the final tax effects.

   3. Impairment of costs to fulfill a contract

      The Group reviews whether there are any impairment indicators of costs to fulfil a contract at the end of each reporting period. The Group recognizes the impairment by comparing the revenue expected to receive for goods or service related to the costs to fulfil a contract with expected cost that are directly attributable. These calculations require estimates.

   4. Net defined benefit liability (asset)

      The present value of net defined benefit liability (asset) depends on a number of factors that are determined on an actuarial basis using a number of assumptions including the discount rate (Note 21).

   5. Impairment of goodwill

   The Group tests whether goodwill has suffered any impairment by the recoverable amount of a cash generating unit (CGU) which is determined based on fair value method.

4. Operating Segments

   The group discloses segment-related information in the consolidated financial statements in accordance with K-IFRS No. 1108, and the group's operating segment is a single CDMO (Contract Development and Manufacturing Organization) segment. Management responsible for the group's strategic decision-making determines the group's operating segment.

   Segment information by operating segment for the current and prior periods has been prepared after allocation of the internal transaction adjustments to operating profit.

   Information on profit for each segment for the years ended December 31, 2025 and 2024 is as follows:

   (in Korean won) 2025 2024

   Total sales	W	4,570,639,279,811	W	3,512,195,434,962
   Intercompany sales		(13,667,584,631)		(15,049,759,180)
   Net sales		4,556,971,695,180		3,497,145,675,782
   Depreciations		(344,186,763,860)		(277,373,372,234)
   Amortization of intangible assets		(15,538,810,945)		(12,947,652,434)
   Operating profit		2,069,221,266,630		1,321,366,380,588

   Information on segment assets and liabilities for each segment as of December 31, 2025 and 2024 is as follows:

   (in Korean won) 2025

   Biopharmaceutical development and

   CDMO

   commercialization₂ Total

   Reportable segment asset	W	11,060,741,976,837	W	- W	11,060,741,976,837
   Investments in associates		78,098,117,569		-	78,098,117,569
   Reportable segment Liability		3,609,631,328,852		-	3,609,631,328,852
   Additions to non-current assets1		983,297,436,633		-	983,297,436,633

   1 The amount excludes financial instruments, and investment in associates and joint ventures.

   ₂ The consolidated company carried out a spin-off in the form of a demerger of its subsidiaries, including Samsung Bioepis Co., Ltd., with November 1, 2025 as the effective date.

   (in Korean won) 2024

   Biopharmaceutical development and

   CDMO

   commercialization₂ Total

   Reportable segment asset	W	10,267,790,929,968	W	7,068,505,419,543	W	17,336,296,349,511
   Investments in associates		52,501,095,426		-		52,501,095,426
   Reportable segment Liability		4,440,987,358,723		1,990,632,928,770		6,431,620,287,493
   Additions to non-current assets1		1,890,625,655,743		126,714,996,751		2,017,340,652,494

   1 The amount excludes financial instruments, and investment in associates and joint ventures.

   ₂ The consolidated company carried out a spin-off in the form of a demerger of its subsidiaries, including Samsung Bioepis Co., Ltd., with November 1, 2025 as the effective date.

   Details of customers, who contribute over 10% of the Group's total revenue for the years ended December 31, 2025 and 2024 are as follows:

   (in Korean won)	2025		2024
   Client A	W	969,660,442,839	W	306,012,091,890
   Client B		493,757,336,968		86,130,744,391
   Client C		478,468,863,363		358,915,729,494
   Client D		277,382,226,790		487,523,553,090
   Client E		166,979,764,908		410,144,688,023

   Revenue by regions for the years ended December 31, 2025 and 2024 are as follows:

   (in Korean won) 2025 2024

   Domestic	W	371,876,479,018	W	558,086,309,485
   Europe		2,367,746,716,504		2,035,771,049,122
   USA		1,733,921,542,433		822,631,938,995
   Other	83,426,957,225		80,656,378,180

   W 4,556,971,695,180 W 3,497,145,675,782

   The amount of non-current assets by region as of December 31, 2025 and 2024 are as follows:

   (in Korean won) 2025 2024

   Domestic1 W 6,406,271,022,280 W 11,690,923,200,205

   Overseas1 1,019,572,500 3,086,124,791

   W 6,407,290,594,780 W 11,694,009,324,996

   1 The amount excludes financial instruments, and investment in associates and joint ventures and others.

5. Financial Instruments

   1. Financial assets

      Categories of financial assets as of December 31, 2025 and 2024 are as follows:

      (in Korean won) 2025

      Financial assets at fair value through

      profit or loss

      Financial assets measured at

      amortized cost Total

      Current assets Cash and cash equivalents	W	- W	148,851,266,520		W	148,851,266,520
      Short-term financial instruments		-	1,307,174,500,000			1,307,174,500,000
      Trade and other receivables1		-	667,411,901,892			667,411,901,892
      Deposits provided		-	29,057,433,784			29,057,433,784
      		-	2,152,495,102,196			2,152,495,102,196
      Non-current assets Long-term financial instruments		-	226,947,395			226,947,395

      Financial assets at fair value through profit or loss

      - - -

      Trade and other receivables		-	-			-
      Loan		-	30,563,370			30,563,370
      Deposits provided		-	10,596,804,423			10,596,804,423
      		-	10,854,315,188			10,854,315,188
      	W	- W	2,163,349,417,384		W	2,163,349,417,384

      1 The amounts exclude the tax-related receivables and receivables due from employees.

      (in Korean won) 2024

      Financial assets at fair value through

      profit or loss

      Financial assets measured at

      amortized cost Total

      Current assets Cash and cash equivalents	W	- W			391,221,617,203		W	391,221,617,203
      Short-term financial instruments		-			907,350,000,000			907,350,000,000
      Trade and other receivables1		-			1,074,364,663,233			1,074,364,663,233
      Deposits provided		-			32,717,174,901			32,717,174,901
      		-			2,405,653,455,337			2,405,653,455,337
      Non-current assets Long-term financial instruments		-			385,357,612			385,357,612
      Financial assets at fair value through profit or loss		6,718,968,273			-			6,718,968,273
      Trade and other receivables		-			23,887,946,322			23,887,946,322
      Loan		-			31,311,000			31,311,000
      Deposits provided		-			29,259,715,010			29,259,715,010
      		6,718,968,273			53,564,329,944			60,283,298,217
      	W	6,718,968,273		W	2,459,217,785,281		W	2,465,936,753,554

      1 The amounts exclude the tax-related receivables and receivables due from employees.

   2. Financial liabilities

      Categories of financial liabilities as of December 31, 2025 and 2024 are as follows:

      (in Korean won) 2025

      Financial liabilities at fair value through profit or loss

      Financial liabilities measured at

      amortized cost Other liabilities Total

      Current liabilities
      Trade and other payables1	W	- W	271,638,078,349	W		- W			271,638,078,349
      Debentures Short-term borrowings		- -	319,712,704,765 -			- -			319,712,704,765 -
      Current portion of long-term borrowings		-	-			-			-
      Lease liabilities		-	-			7,257,974,993			7,257,974,993
      		-	591,350,783,114			7,257,974,993			598,608,758,107
      Non-current liabilities Trade and other payables1		-	-			-			-
      Debentures Long-term borrowings Derivative liabilities Lease liabilities		- - - -	599,011,716,516 - - -			- - -1,112,062,611			599,011,716,516 - -1,112,062,611
      		-	599,011,716,516			1,112,062,611			600,123,779,127
      	W	- W	1,190,362,499,630		W	8,370,037,604		W	1,198,732,537,234

      1 The amounts exclude the tax-related payables and accrued compensation for annual leaves, performance bonuses, and others payable to employees.

      (in Korean won) 2024

      Financial liabilities at fair value through profit or loss

      Financial liabilities measured at

      amortized cost Other liabilities Total

      Current liabilities
      Trade and other payables1	W	- W			1,270,884,788,474	W		- W			1,270,884,788,474
      Short-term borrowings		-			207,000,000,000			-			207,000,000,000
      Current portion of long-term borrowings		-			120,000,000,000			-			120,000,000,000
      Lease liabilities		-			-			138,594,047,222			138,594,047,222
      		-			1,597,884,788,474			138,594,047,222			1,736,478,835,696
      Non-current liabilities Trade and other payables1		-			2,906,368,948			-			2,906,368,948
      Debentures		-			917,756,707,992			-			917,756,707,992
      Long-term borrowings		-			95,000,000,000			-			95,000,000,000
      Derivative liabilities		5,134,918,626			-			-			5,134,918,626
      Lease liabilities		-			-			7,888,720,135			7,888,720,135
      		5,134,918,626			1,015,663,076,940			7,888,720,135			1,028,686,715,701
      	W	5,134,918,626		W	2,613,547,865,414		W	146,482,767,357		W	2,765,165,551,397

      1 The amounts exclude the tax-related payables and accrued compensation for annual leaves, performance bonuses, and others payable to employees.

   3. The fair values of financial instruments

      The fair values of financial instruments, together with the carrying amounts shown in the statements of financial position as of December 31, 2025 and 2024 are as follows:

      (in Korean won) 2025 2024

      Carrying amount1 Fair value Carrying amount1 Fair value

      Assets measured at fair value

      Financial assets at fair value through profit or loss	W -			W	-		W	6,718,968,273		W	6,718,968,273
      Assets measured
      at amortized cost
      Cash and cash equivalents	148,851,266,520		148,851,266,520			391,221,617,203			391,221,617,203
      Short-term financial instruments	1,307,174,500,000		1,307,174,500,000			907,350,000,000			907,350,000,000
      Long-term financial instruments	226,947,395		226,947,395			385,357,612			385,357,612
      Trade and other receivables		667,411,901,892			667,411,901,892			1,098,252,609,555			1,098,252,609,555
      Loan		30,563,370			30,563,370			31,311,000			31,311,000
      Deposits provided		39,654,238,207			39,654,238,207			61,976,889,911			61,976,889,911
      		2,163,349,417,384			2,163,349,417,384			2,459,217,785,281			2,459,217,785,281
      	W	2,163,349,417,384		W	2,163,349,417,384		W	2,465,936,753,554		W	2,465,936,753,554
      Liabilities carried
      at fair value
      Derivative liabilities	W	-		W	-		W	5,134,918,626		W	5,134,918,626
      Liabilities carried
      at amortized cost
      Trade and other payables		271,638,078,349			271,638,078,349			1,273,791,157,422			1,273,791,157,422
      Debentures		918,724,421,281			918,724,421,281			917,756,707,992			917,756,707,992
      Borrowings		-			-			422,000,000,000			422,000,000,000
      		1,190,362,499,630			1,190,362,499,630			2,613,547,865,414			2,613,547,865,414
      	W	1,190,362,499,630		W	1,190,362,499,630		W	2,618,682,784,040		W	2,618,682,784,040

      1 The Group used the carrying amount as a proxy for fair value because it is a reasonable approximation of fair value.

   4. Fair value hierarchy

      The following presents financial instruments measured and recognized at fair value as of December 31, 2025 and 2024:

      (in Korean won) 2025

      Level 1 Level 2 Level 3 Total

      Financial assets

      Financial assets at fair value through profit or loss Financial liabilities

      W - W - W - W -

      Derivative liabilities - - - -

      (in Korean won) 2024

      Level 1 Level 2 Level 3 Total

      Financial assets

      W	- W	1,151,653,488	W	5,567,314,785	W	6,718,968,273
      	-	-		5,134,918,626		5,134,918,626

      Financial assets at fair value through profit or loss Financial liabilities

      Derivative liabilities

   5. Valuation techniques and inputs

      Valuation techniques and significant inputs used in measuring the fair value of financial instruments classified as level 2 and level 3 as of December 31, 2025 and 2024 are as follows:

      (in Korean won) Fair value

      2025 2024 Level

      Valuation

      techniques inputs

      Financial assets at fair value through profit or loss

      Financial assets at fair value

      Market

      W - W 1,151,653,488 2

      approach

      Third party transaction price

      through profit or loss1 - 5,567,314,785 3 - -

      Derivative liabilities (contingent considerations in the stock purchase)

      - 5,134,918,626 3 Option model

      Discount rate and others

      1 The Group measures certain non-listed shares among financial assets at fair value at cost, of which the fair value cannot be measured reliably, and believes that these amortized cost or acquisition cost is similar to fair value.

   6. Valuation Processes for Fair Value Measurements Categorized as Level 3

      The finance department of each division of the Group is responsible for the fair value measurements required for financial reporting purposes, including level 3 fair values. The department responsible for fair value measurements periodically reports on the valuation process and its results in line with the reporting schedule at the end of each reporting period.

   7. Net gains or losses by category of financial instruments

   Net gains or losses on each category of financial instruments for the years ended December 31, 2025 and 2024 are as follows:

   (in Korean won) 2025

   Interest income (expenses)

   Gain (loss) on valuation

   Other income

   (expenses)1 Net income (loss)

   W	46,033,670,092 -		W	- W -	(2,983,763,919) -		W	43,049,906,173 -
   	(27,374,057,529)			-	(3,651,493,257)			(31,025,550,786)
   	(1,797,223,399)			-	-			(1,797,223,399)
   W	16,862,389,164		W	- W	(6,635,257,176)		W	10,227,131,988

   Financial assets at amortized cost

   Derivative assets Financial liabilities at amortized cost

   Other liabilities

   1 Other gains and losses include foreign currency translation gains and losses, foreign exchange gains and losses, and bad debt expenses on receivables.

   (in Korean won) 2024

   Interest income (expenses)

   Gain (loss) on valuation

   Other income

   (expenses)1 Net income (loss)

   W 54,404,315,038	W		-	W		(20,279,755,594)	W		34,124,559,444
   -			1,086,047,835			(459,701,862)			626,345,973
   (31,677,527,625)			-			68,491,696,202			36,814,168,577
   (2,445,647,886)			-			-			(2,445,647,886)
   W 20,281,139,527		W	1,086,047,835		W	47,752,238,746		W	69,119,426,108

   Financial assets at amortized cost

   Derivative assets Financial liabilities at amortized cost

   Other liabilities

   1 Other gains and losses include foreign currency translation gains and losses, foreign exchange gains and losses, and bad debt expenses on receivables.

6. Cash and Cash Equivalents

   Cash and cash equivalents as of December 31, 2025 and 2024 are as follows:

   (in Korean won) 2025 2024

   Cash equivalents W 148,851,266,520 W 391,221,617,203

7. Restricted Financial Instruments

   Restriction of financial instruments as of December 31, 2025 and 2024 are as follows:

   (in Korean won) 2025 2024 Note

   Long-term

   financial instruments

   W 6,000,000 W 12,000,000 Deposits on checking accounts

   220,947,395 373,357,612 Establishment of a pledge right

   W 226,947,395 W 385,357,612

8. Trade and Other Receivables

   Details of trade and other receivables as of December 30, 2025 and 2024 are as follows:

   (in Korean won) 2025 Gross amount Bad debt allowances² Net amount

   Trade receivables	W	691,122,451,268 W	(36,394,223,818) W	654,728,227,450
   Other receivables		10,122,576,979	(338,842,608)	9,783,734,371
   Accrued income		11,954,957,155	-	11,954,957,155
   Total1	W	713,199,985,402 W	(36,733,066,426) W	676,466,918,976

   (in Korean won) 2024 Gross amount Bad debt allowances² Net amount

   Trade receivables	W	1,106,434,765,062 W	(36,461,519,034) W	1,069,973,246,028
   Other receivables		111,202,630,888	(692,058,437)	110,510,572,451
   Accrued income		8,832,261,348	-	8,832,261,348
   Total1	W	1,226,469,657,298 W	(37,153,577,471) W	1,189,316,079,827

   1 Trade and other receivables for related parties as of December 31, 2025 and 2024 are 30,399 million and

   3,379 million, respectively (Note 31).

   ² The Group recognized bad debt allowances by calculating the expected credit loss for lifetime expected collection period from the initial recognition of receivables (Note 33).

9. Contract Assets and Liabilities

   Changes in contract assets and liabilities arising from contracts with customers for years ended December 31, 2025 and 2024 are as follows:

   (in Korean won) 2025

   ²

   Beginning

   balance Increase Decrease Spin-off

   Ending

   balance

   Contract assets

   306,960,313,251 W	42,244,520,475 W	(20,570,939,601) W	61,579,143,530 W	390,213,037,655
   60,360,464,225	33,146,603,061	(67,635,175,842)	(4,485,563,484)	21,386,327,960
   576,853,212,107	256,028,431,068	(173,706,295,908)	(119,738,195,770)	539,437,151,497

   • costs to fulfil W a contract

     Contract assets

   • unbilled1 Contract liabilities

     1 The amount of increase or decrease includes bad debt expense (reversal) (Note 33).

     ²The consolidated entities completed a spin-off of its subsidiaries, including Samsung Bioepis Co., Ltd., effective November 1, 2025.

     Revenue recognized from continuing operations in the current period that was included in the beginning balance of contract liabilities was W 94,010 million.

     (in Korean won) 2024

     Beginning

     balance Increase Decrease Spin-off1

     Ending balance

     Contract assets

     282,957,591,652 W	86,987,018,289 W	(62,984,296,690) W	- W	306,960,313,251
     24,791,698,034	61,896,794,655	(26,328,028,464)	-	60,360,464,225
     502,568,138,620	376,929,597,211	(302,644,523,724)	-	576,853,212,107

   • costs to fulfil W a contract

     Contract assets

   • unbilled1 Contract liabilities

   1 The amount of increase or decrease includes bad debt expense (reversal) (Note 33).

   Costs incurred in fulfilling a contract include costs for technology transfer and production of trial batches in order to manufacture products that customers request. Such activities do not include transferring goods or services to a customer but are prerequisite for the production of goods ordered. Accordingly, they do not consist of a part of the performance obligation but are recognized as contract assets. Unbilled contract assets were recognized due to a difference between the extent of the Group's satisfaction of its performance obligation satisfied over time and the consideration billed to the customer. The Group recognizes the amounts received in advance from customers as contract liabilities as it satisfies its performance obligations over time.

   The amount of impairment loss on contract costs recognized in profit or loss from continuing operations during the current year was W 10,697 million, compared to W 885 million recognized in the prior year.

   Besides the above contract liabilities recognized, the Group classifies the amount received prior to transferring goods or services to the customer as 'advance receipts. Changes in advance receipts for the years ended December 31, 2025 and 2024 are as follows:

   (in Korean

   won) 2025

   Beginning

   balance Increase Decrease Spin-off1

   Ending balance

   Advance receipts

   W 1,048,552,665,805 W 1,527,302,433,489 W (1,342,346,252,790) W 31,978,417,708 W 1,265,487,264,212

   1The consolidated entities completed a spin-off of its subsidiaries, including Samsung Bioepis Co., Ltd., effective November 1, 2025.

   Revenue recognized from continuing operations in the current period that was included in the beginning balance of advance receipts was ₩ 382,513 million.

   (in Korean

   won) 2024

   Beginning

   balance Increase Decrease Spin-off

   Ending balance

   Advance receipts

   W 752,420,126,325 W 994,723,307,966 W (698,590,768,486) W - W 1,048,552,665,805

10. Inventories

    Details of inventories as of December 31, 2025 and 2024 are as follows:

    (in Korean won) 2025

    Provision for

    Acquisition cost loss on valuation Book amount

    Finished goods	W	730,367,526,210 W	(5,576,748,170) W	724,790,778,040
    Work-in-process		513,638,360,394	(5,778,381,504)	507,859,978,890
    Raw materials		765,337,196,132	(30,180,259,695)	735,156,936,437
    Supplies		198,929,649,771	(39,575,587,014)	159,354,062,757
    Goods in transit		1,002,406,598	-	1,002,406,598
    	W	2,209,275,139,105 W	(81,110,976,383) W	2,128,164,162,722

    (in Korean won) 2024

    Provision for

    Acquisition cost loss on valuation Book amount

    Finished goods	W	697,191,681,632 W	(1,963,390,002) W	695,228,291,630
    Work-in-process		1,080,989,625,039	(4,352,565,528)	1,076,637,059,511
    Raw materials		815,745,726,380	(11,595,640,440)	804,150,085,940
    Supplies		268,743,284,609	(43,913,904,110)	224,829,380,499
    Goods in transit		17,430,956,795	-	17,430,956,795
    	W	2,880,101,274,455 W	(61,825,500,080) W	2,818,275,774,375

    For the year ended December 31, 2025, the Group recognized 1,854,068 million (2024: 1,640,618 million) of inventories as an expense, and the amount includes inventory write-downs recognized for the year ended December 31, 2025, amounting to 19,800 million (2024: 56,337 million).

11. Other Financial Assets

Details of other financial assets as of December 31, 2025 and 2024 are as follows:

(in Korean won) 2025 2024 Current Non-current Current Non-current