NovMetaPharma, a Korean biotech company, is prepping to scale up to the secondary Kosdaq market from the lower Konex, set to become to most prized stock to graduate from the startup-focused market.

The company’s board Tuesday okayed the shift designed to raise corporate value and get quicker and easier access to fundraising. The company is due to file a preliminary IPO review application to the Korea Exchange by the end of this month under a special procedure that lowers rigid financial requirements for promising tech companies.

NovMetaPharma founded in Nov. 2010 is developing a therapy to treat type 2 diabetes and obesity now in a phase 2 study in the United States. The company’s stock price already tripled this year, sending its market cap up to 770 billion won ($714 million).

Market watchers pay attention to whether NovMetaPharma could continue the success story of its predecessors despite growing warnings over bubbly biotech firms. ToolGen, the largest Konex company in terms of market cap, is also readying to move up to the Kosdaq. Enzychem Lifesciences successfully settled in the secondary stock exchange with a market cap of 709 billion won after leaving the Konex. Enzychem’s stock price gained more than 9 percent over the past three months after the stock’s transition in February.

NovMetaPharma remains in the red due to lack of stable cash flow. The company reported a 72.4 percent year-on-year decline in sales to 800 million won last year. Its operating loss widened from 4.3 billion won to 5.5 billion won.

By Park Yoon-gu and Minu Kim

[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]