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Celltrion founder aims to raise $1 bn for healthcare startup from global funds

Oct 07, 2020 (Gmt+09:00)

Seo Jung-jin, founder and chairman of South Korea’s biosimilar maker Celltrion Group, said on Oct. 6 that he is in talks with a number of global investment funds to raise about $1 billion for an overseas healthcare startup he plans to launch early next year.

The firm, set to join the emerging sector of medical technology known as ubiquitous healthcare, will be based in a foreign country. It will provide remote medical services whereby a patient can undergo medical checks sending in just one drop of blood. Seo expects the startup to evolve into a platform to be used for other businesses and eventually compete with online retail giant Amazon.com, he said in a speech during the Korea Investment Festival 2020, hosted by The Korea Economic Daily and Korea Investment & Securities Co.

“I will build a platform by which medical checkup results are transferred on a daily basis to a hospital, which then sends medicine to the patient. The platform will be used for various other businesses,” Seo said.

To launch the new startup, he will step down as the group chairman and chair of the Celltrion Group’s board at the end of this year.

He did not elaborate on the details of the negotiations with the global funds, nor identify them; neither a potential location for the startup.
Celltrion Group Chairman Seo Jung-jin speaks at the Korea Investment Festival 2020
CORONAVIRUS VACCINE DEVELOPMENT

Celltrion is developing a coronavirus vaccine candidate, for which second-phase clinical trials are expected to finish around the end of next month. Seo estimated the new vaccine development to cost between 150 billion and 300 billion won. Once approved by the Korean drug safety ministry, the vaccine candidate will likely be commercialized around the end of this year, Seo said.

“Now Celltrion has firm footing to grow over 70% in operating profit on average over the next 10 years,” he said.

The Celltrion Group’s operating profit is expected to reach 2 trillion won next year and exceed 8 trillion won in 2025, said the chairman during the speech. At such a pace, the Korean biopharmaceutical group may be able to overtake Roche Holding to become the world’s No.1 healthcare company in terms of operating profit, he added.

This year, the group's operating profit is forecast to rise above 1 trillion won, buoyed by strong sales of Remsima and other blockbuster biosimilar products, according to market tracker FnGuide on Sept. 15.

Remsima, the world’s first approved monoclonal antibody biosimilar, has continued to expand its presence over its reference drug, Janssen’s Remicade, commanding nearly 60% market share.

Meanwhile, JPMorgan forecast in a September report that Celltrion’s annual net profit growth rate will peak at 54% this year and fall to 21% in 2021.
Write to Woo-sub Kim at duter@hankyung.com

[Edited by Yeonhee Kim]

(Amended on Oct. 7, 2020 to remove an investment fund's name from the first and fifth paragraphs and delete other relevant paragraphs at the request of Celltrion.)

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