Korean biotech L&C Bio issues convertible bonds worth $46 mn

South Korean biotech company L&C Bio, which specializes in tissue regeneration treatment, is poised to ramp up its expansion into the Chinese market.

The Kosdaq-listed company recently issued 60 billion won ($46 million) worth of convertible bonds with the aim of investing in the maker of surgical robots for artificial joints called CUREXO, Inc., according to industry insiders.

L&C Bio plans to use 40 billion out of the 60 billion for acquiring a 14% stake in CUREXO, making it the second-largest shareholder.

The biotech firm is investing in CUREXO with the Chinese market in mind. L&C Bio views its two main businesses of skin and knee cartilage grafting materials would provide a synergy effect with CUREXO’s surgical robots for artificial joints.

“The goal is to provide a package solution in the orthopedics sector,” an L&C Bio employee told The Korea Economic Daily. 

China’s Hainan province issued a permit for emergency use of L&C Bio’s human skin allograft MegaDerm Plus in 2020, which led the company to begin exporting the product to that region last year.

The largest skin and soft tissue bank in Asia will apply for an export permit from the Chinese central government this year. 

L&C has submitted a permit for its other main product MegaCarti, a cartilage treatment, to the South Korean authorities. Once approved in South Korea, it will apply for a sales permit from the Chinese authorities as early as next year.

The company is also working on mass producing its products in China. 

L&C Bio has built a joint venture with China International Capital Corp. (CICC) called L&C China, for local production, regulatory work, and sales.

L&C China is currently building a plant in Kunshan City, Jiangsu Province, which spans 23,140 square meters. 

The company will use the joint venture to assist CUREXO’s entry into the Chinese market. 

Ascent Private Equity, which invested in L&C Bio’s convertible bonds, has an existing relationship with Beijing’s CICC. 

With the 20 billion won left from the 60 billion in new liquidity, L&C Bio will use the 10 billion as operating costs and the rest 100 billion to invest in other medical equipment makers that plan to enter the Chinese market. 

Write to Jae-Young Han at jyhan@hankyung.com
Jee Abbey Lee edited this article.