Korean bio firms flock to US as SV Invest eyes $100 million bio fund

SV Investment, a South Korean venture capital and private equity firm, is looking to launch a $100 million bio fund in the US as a growing number of Korean biotechnology companies are seeking business opportunities in the world’s largest novel therapeutics market.

The venture capital firm is starting the fund to help promising Korean companies develop new drugs, identify licensing opportunities and transfer biotechnology to global pharmaceutical firms, according to industry sources.

SV Investment plans to establish a new US affiliate, which will eventually be listed on the US stock market or seek an M&A with a multinational bio company operating in the US, they said.

Founded in 2006, the investment company runs offices in Boston, Shanghai, Shenzhen and Jakarta, providing financial support to Korean startups in the life science, technology and consumer goods sectors.

Korea Investment Partners, one of the country’s largest venture capital firms, is also said to be preparing to jointly establish a fund in the US to invest in bio and information technology startups operating in Korea or the US.

The company is currently looking for a US partner with strong networks in the biopharmaceutical and bio venture businesses, according to the sources.

BOSTON, THE PLACE TO BE FOR BIO STARTUPS

The latest move by venture capitalists to launch bio-focused funds in the US comes as smaller Korean biotech companies are actively seeking business opportunities in the North American market by establishing research centers and offices in Boston, known as the hotspot for biotechnology startups.

Last month, LegoChem Biosciences Inc. established its US subsidiary, AntibodyChem Biosciences (ACB), in Boston to develop medicines based on its antibody-drug conjugate (ADC) platform. The company is also seeking to transfer its technology to a US biotech company.

Bridge Biotherapeutics Inc., a clinical-stage biotech company focused on developing novel drugs for cancer, fibrosis and inflammation, runs a research center in Boston. TiumBio Co., another Korean biotech firm, also set up an affiliate there in 2020.

“In Boston, it’s much easier to hire excellent R&D people with years of work experience at global pharmaceutical firms,” said TiumBio Chief Executive Kim Hun-taek.

SyntekaBio Inc., a drug developer utilizing a genomic database and artificial intelligence, launched its US subsidiary in New York last August, while OliX Pharmaceuticals Inc., a leading developer of RNAi therapeutics, is operating a research center in San Diego.

NASDAQ LISTING VIA SPAC

Some Korean entrepreneurs are even moving their headquarters from Korea to the US or starting their businesses in the US.

Genome Insight Inc., which specializes in analyzing big data to provide accurate diagnosis and customized treatment for cancer and rare diseases caused by genetic mutations, moved its headquarters to San Diego in March.

“Having a significant presence in the US is critical to getting ahead of others in the value chain of the bio ecosystem,” said Lee Jeong-seok, Genome Insight’s chief medical officer.

The company is known to be seeking an initial public offering on the Nasdaq market.

EOFlow Co., a provider of wearable drug devices such as patches, is currently working to transfer much of its development projects to its affiliate in Silicon Valley.

RosVivo Therapeutics, a biotech company that develops microRNA-based therapeutics for type 2 diabetes, obesity and fatty liver disease, was established in Nevada in March of last year, while GenEdit started its business in Silicon Valley.

Some Korean companies have chosen the US for the availability of ample liquidity on the Nasdaq market.

Healthcare product maker pH Pharma Co. is seeking a backdoor listing on the Nasdaq through a merger with a special purpose acquisition company (SPAC) listed on the US tech-heavy stock exchange after withdrawing its plan to go public on Korea’s junior stock market.

Crystal Genomics Inc. recently went public on the Nasdaq via a merger with a SPAC.

Write to Jae-young Han and Sun A Lee at jyhan@hankyung.com
In-Soo Nam edited this article.