Exactly a week after the year’s biggest global investor relations event JP Morgan Healthcare Conference wrapped up on Jan. 14, Korean biotech firms were still more than eager to pitch their businesses to the US investors in a spin-off event, held virtually on Thursday.
There were several key takeaways from the event’s panel talk comprising members from US law firm Sidley Austin, US venture capital firm Novatio and a couple of Korean biotech firms who have made exemplary forays into the US. They answered questions probably on the top of the mind for every emerging Korean biotech: What changes will the Biden administration bring? Is it advantageous to establish a US subsidiary? How should one patent their intellectual property in the US?
Rebecca Wood, a partner at US law firm Sidley Austin who previously worked at the US Food and Drug Administration, said that “seismic political shifts are underway in Washington, DC,” as America swore in Joe Biden as its new president.
However, at least at the FDA -- the state agency that oversees authorizations for drug products in the US -- continuity is expected because the agency is a very science-based organization, not to mention that it regulates about 25 percent of the US economy including biopharmaceuticals and medical technology, Wood said.
Coincidentally, the COVID-19 pandemic has acted as a catalyst for the FDA to enforce accelerations. It remains to be seen if improved regulatory flexibility for COVID-19-related products could go on to affect non-COVID-19 therapeutics, Wood said, as authorities are now more comfortable around the use of real-world evidence, enhanced flexibility for clinical trials and digital health.
For Korean biotech firms wishing to find their footing in the US, Wood said she would encourage them to equip themselves with IP patent lawyers, in addition to hiring regulatory consultants.
Christopher Kim from Novatio said setting up a US subsidiary would indeed increase exposure with US venture capital firms, but it is also important to have a rationale for the expansion.
“The disadvantage of being in Korea and wanting to raise money from US VCs is that your exposure, your visibility in the US, is inevitably low. That’s something to overcome. Some biotechs come to the US to build relationships. But what’s even more important is there has to be more practical, operational, substantial and rationalized reason why you’re doing that. You’re doing that to ultimately accomplish your strategic R&D long-term goal,” he said.
Kim portrayed US venture capital firms as being hands-on, with a high level of expertise in science and with big appetites for risk-taking in early-stage innovations.
Winning funding from US VCs is considered a badge of recognition, according to Kim, in that it “provides a positive signal to validation for the company’s underlying technology.”
For small-sized Korean biotech companies who have true innovations to showcase, pairing up with US venture firms would give them a reliable team of allies in the same boat, who will share their know-how for the common goal of successful business.
Kim noted that while the domestic venture investment in Korean biotech has increased fivefold over the last five years, the investment from US VCs has dwindled. He sees this downward trend as a potential opportunity, as there could be potential for it to grow back.
Another strategy of entering the eyes of the US investors, as spoken by BG Rhee, the CEO of SCM LifeScience, is by strategic acquisitions of local enterprises.
SCM LifeScience has expanded in to the US and Europe through acquisitions of US’ Argos Therapeutics -- renamed Colmmune -- and Italy’s Formula Pharmaceuticals.
“The reason why we acquired these companies is (because the Korean biotech industry still) has a need for cGMP (current good manufacturing practice) clinical trials at a global level. By acquiring companies, we can obtain all kinds of know-how that we can bring back to Korea to bring the local industry up to global standards,” Rhee said. “This kind of thing, we could easily get by acquiring companies.”
Rhee added that in the Biden era, biosimilars may play a bigger part, for which South Korea may have a role. Samsung Biologics and Celltrion both have world-scale manufacturing facilities.
Korea also has an edge in regenerative medicine such as cell therapy and gene therapy, as well as an increasing R&D drive for microbiome and exozomes.
Co-organized by KoreaBio, BioCentury and Sidley Austin, and sponsored by Korea’s Ministry of Trade, Industry and Energy, the two-hour event was run entirely in English on YouTube.
KoreaBio is the organization representing the biologics companies here, while BioCentury is a US publication dedicated to international biotech industry analysis. Sidley Austin is a US law firm highly motivated to offer legal advice to Korean biotechs wanting to make entry to the US market and with the FDA.
Those who presented in the event were: AbTis’ Chief Business Officer Justin Oh, Cellatoz Therapeutics’ Senior Executive Vice President Joon Lee, GBiologics’ Vice President Lee Hyo-sil, IMB Dx’s CEO and founder Peter Moon, Kanzen’s BT Manager Park Hyun-sun, Oncocross’ Chief Financial Officer Daniel Kim, Onegene Biotechnology’s CEO Park Sung-jin and WellsCare’s Global Sales Director Joony Suh.
By Lim Jeong-yeo (firstname.lastname@example.org