[Graphics by Song Ji-yoon]
Korean pharmaceutical companies are capitalizing on the drug momentum and spotlight on Korean vaccine consignment capacity under Covid-19 environment to raise funds to bolster R&D activity and novel drug pipeline.
According to sources on Monday, seven major pharmas - ChongKunDang, ChongKunDangHoldings, Green Cross, Kwangdong Pharmaceutical, Daewoong Pharmaceutical, Suheung, Samsung Biologics – issued bonds worth 1 trillion won ($842 million) this year.
Debt issuers from the industry stopped at three - Boryung Pharm, HK inno. N, and DongA Socio Holdings - last year.
ChongKunDang had been most active with its biggest-ever issue. The traditionally debt-averted company raised a total of 100 billion won in 3-year bonds worth 80 billion won and 5-year bonds worth 20 billion won. Its parent ChongKunDang Holdings also sold its first bond worth 50 billion won in June.
ChongKunDang said it will use the funds to boost its drug development platform that encompasses ongoing clinical trials of a Covid-19 cure and a dual target antibody against tumor cells.
The company’s investigational coronavirus drug Napabeltan (nafamostat mesylate) was approved for a Phase 3 clinical trial in Korea in April, and for additional clinical trials in eight countries last month.
Boryung Pharm which raised 78 billion won through debt issue last year was more eager in raising capital this year.
In July, the company raised 100 billion won through stock offering. The funds will go to development of modified drugs from off-parent legacy brands.
Green Cross raised its biggest record of 200 billion won this year, while Daewoong Pharmaceutical, Suheung, Kwangdong Pharmaceutical joined the debt market with respective issuance of 90 billion won, 43 billion won, and 22 billion won.
Samsung Biologics was a high-profile issuer. In its bond sale in August, the company attracted 1.57 trillion won offers from institutional investors for its 300 billion won offering, eventually leading to an increased sale of 500 billion won.
Market watchers see the financing drive will continue in the local biotech and pharmaceutical industry, given institutional heat. Bids totaled 3.2 trillion won, five times more than the planned offering.
By Kim Si-gyun and Minu Kim
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