0
This image was generated by AI.

Domestic pharmaceutical and biotech industries achieved a technology export volume of approximately 12.85 trillion won in the first half of this year alone, drawing keen attention to their potential performance in the second half. As companies shift from early-stage transfers to diversifying strategies through securing late-stage clinical data and signing global exclusive deals, the industry is closely watching whether this technology export rally will maintain its momentum.

According to pharmaceutical and biotech industry sources on July 12, the cumulative technology export volume of domestic firms in the first half reached nearly 12.85 trillion won. Last month, Hanmi Pharmaceutical signed a contract worth approximately 1.89 trillion won ($1.26 billion) with Eli Lilly for its rare gastrointestinal disease treatment candidate, donepeglutide, marking the largest deal of the year.

Industry insiders attribute the H1 expansion of technology exports to advanced late-stage clinical development and enhanced competitiveness in platform technologies. Analysts note that a strategy to boost bargaining power by advancing the development stages of candidate molecules is becoming more widespread.

This trend is projected to continue into the second half of the year. Breaking away from the early-stage technology transfer model typical of domestic biotechs, LigaChem Biosciences is pushing a "big deal" strategy driven by its own late-stage clinical trials. Leveraging about 1 trillion won in recently secured cash, the company plans to invest directly in the late-stage clinical development of its core candidate molecules, based on the assessment that securing late-stage clinical data can significantly enhance their value.

"What matters more than the technology export itself is the clinical data," said Choi Jae-wook, Vice President of LigaChem Biosciences. "Our goal is to prove that Korea houses companies with world-class technologies and to continuously drive global deals." Global Phase 1 clinical data generated using LigaChem's technology will be disclosed at the San Antonio Breast Cancer Symposium (SABCS) and the American Society of Hematology (ASH) annual meeting later this year. The industry expects these clinical outcomes to heavily influence future technology export discussions.

Alteogen, which fired the opening shot for technology exports this year, is also strengthening its business strategy based on global exclusive contracts. Utilizing its ALT-B4 platform, which converts intravenous (IV) injections into subcutaneous (SC) injections, Alteogen secured deals worth roughly 6 trillion won with global pharmaceutical firms between 2019 and 2022. However, those deals were evaluated to have limits in actual cash inflow due to their non-exclusive structures.

Yet, since signing an exclusive agreement with MSD, the company established a foundation to secure additional upfront payments and sales royalties, which subsequently led to contracts early this year with GSK's subsidiary Tesaro (420 billion won / $285 million) and Biogen (860 billion won / $579 million). "We have already signed two contracts in the first half of this year alone, and a few more are highly possible," said Park Soon-jae, CEO of Alteogen, at the BIO International Convention (BIO USA) last month. "In terms of both the number of deals and gross volume, this year will be our largest ever."

Developments from companies holding metabolic disease candidate molecules are also expected to follow. D&D Pharmatech is scheduled to receive the clinical study report (CSR) for its proprietary metabolic dysfunction-associated steatohepatitis (MASH) treatment candidate, DD01, within the third quarter. "Based on successful Phase 2 clinical results, we will swiftly finalize technology transfer agreements with global pharmaceutical firms," stated Lee Seul-ki, CEO of D&D Pharmatech.

OliX Pharmaceuticals is awaiting the release of Phase 1 clinical results for OLX702A, a MASH treatment candidate it licensed to Eli Lilly last year. Upon entering Phase 2 clinical trials, the company will receive milestone payments from Eli Lilly. OliX is also seeking technology export opportunities with global pharmaceutical firms for its next-generation obesity treatment, OLX501A, leveraging the momentum from BIO USA. Meanwhile, HK inno.N is reportedly coordinating global contracts for its MASH treatment candidate alongside the announcement of U.S. Phase 3 clinical results for its gastroesophageal reflux disease drug, K-CAB.

Research milestones are also set to be presented at major upcoming conferences, including the World Conference on Lung Cancer (WCLC) and the European Society for Medical Oncology (ESMO). Starting this month with U.S. Phase 3 clinical data for Kolon TissueGene's osteoarthritis treatment, Invossa, clinical results from Voronoi (non-small cell lung cancer) and HanAll Biopharma (dry eye disease) will be disclosed. Furthermore, Lundbeck, a partner of AprilBio, is scheduled to announce Phase 1b clinical results for the thyroid eye disease treatment, APB-A1. The industry suggests that securing positive data could spark further technology export discussions.

"With technology exports and large-scale capital raising occurring simultaneously, the asset competitiveness and financing environment for domestic biotechs are improving," analyzed Kim Seung-min, a researcher at Mirae Asset Securities. "If clinical data and technology export achievements continue to accumulate, corporate valuations are highly likely to undergo a significant re-rating."

                                                                                                       Moon Jeong-woo