UNTIL EARLY 2020 Seegene was a medium-sized South Korean purveyor of medical diagnostics with round $110m in annual gross sales. On January twenty seventh that yr Chun Jong-yoon, Seegene’s boss, and his counterparts at different biotechnology corporations have been summoned to an emergency assembly by the federal government. Officers requested if they might produce exams for a novel coronavirus which had been spreading quickly in Wuhan, China. Seegene’s check equipment was given the go-ahead by regulators. When instances started spiking quickly afterwards in Daegu, in South Korea’s south-east, the corporate went into emergency mode. “We stopped all different actions and simply threw every part we had at covid-19,” says Mr Chun.
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Seegene’s staff labored across the clock, snatching a number of hours of sleep in inns close to the workplace. Dozens extra have been employed in a single day. Inside weeks the agency was exporting thousands and thousands of check kits to dozens of nations across the globe. It ended the yr with $1bn in gross sales and $440m in web revenue. Different South Korean biotech corporations have had a equally good pandemic. 5 of the ten most respected firms within the KOSDAQ index of medium-sized corporations now come from the biotech sector, up from two on the finish of 2019. So do two out of the ten greatest firms within the benchmark KOSPI index.
In addition to exams, they’ve been producing therapies and vaccines for covid-19. SK Bioscience began making the AstraZeneca jab this yr and in February signed a deal to make the Novavax one. The following month it raised $1.3bn in an preliminary public providing; its share value shot up by 30% on the primary day of buying and selling, which it ended with a market capitalisation of almost $12bn. In Might Samsung Biologics, a listed subsidiary of South Korea’s greatest conglomerate, signed a deal to assist distribute a whole lot of thousands and thousands of Moderna pictures from subsequent month. It’s constructing a brand new manufacturing facility in Incheon which, the corporate claims, will depart it with a 3rd of the world’s contract-manufacturing capability for “biosimilars”, generic variations of biotech medication.
Even earlier than enlisting biotech corporations to battle covid-19, successive administrations have used tax incentives, partnerships and grants for analysis and improvement to foster the trade. Partly because of such largesse it had been rising at almost 7% a yr earlier than the pandemic, twice as quick as South Korea’s GDP. However that was from a low base, and concentrated on the much less profitable me-too finish of the market. South Korean corporations have but to provide you with a blockbuster therapy licensed around the globe. As such, they account for lower than 2% of the worldwide biotech market, says Lee Seong-kyou of Korea Biotechnology Business Organisation, a commerce group.
The trade’s boosters consider that, within the phrases of Kwon Oh-sung of the Korea Institute for Industrial Economics and Commerce, a authorities think-tank, “the pandemic has been a turning level”. Firms have in all probability “realized extra and collected extra expertise over the previous yr than within the ten years earlier than that”, thinks Mr Lee.
Some fortunate ones, reminiscent of Seegene, have additionally collected income which they will put to make use of. Mr Chun had lengthy hoped to excellent diagnostic kits that may check for extra ailments with much less advanced tools. This is able to permit him to widen his buyer base from governments and large hospitals to smaller clinics and even particular person practices. “Now we have at all times had the plan however we by no means had the money to work on it,” he says. “Now we do.”
Can the money maintain flowing? Some traders could also be getting chilly toes. After hovering in 2020, South Korean biotech’s share costs have pale considerably (see chart). Earlier this yr six of KOSDAQ’s high ten corporations have been in biotech: one has joined them since however two have dropped out. Seegene’s shares are price half as a lot as at their peak final August. The market worth of SK Bioscience has dipped beneath what it was after its glowing debut. Shares of Samsung Biologics and Celltrion, the trade’s two giants, are buying and selling beneath their latest peaks.
Given the comparatively easy expertise concerned in merchandise reminiscent of check kits, firms like Seegene now discover themselves uncovered to intense competitors, together with from trade behemoths reminiscent of Roche of Switzerland. Startups gripe that financing is tough to come back by. Everybody grumbles a few scarcity of expert employees. The pandemic has given the trade a shot within the arm. For a booster, the businesses should look to themselves. ■
All our tales regarding the pandemic and the vaccines could be discovered on our coronavirus hub. You may also hearken to The Jab, our podcast on the race between injections and infections, and discover trackers displaying the worldwide roll-out of vaccines, extra deaths by nation and the virus’s unfold throughout Europe and America.
This text appeared within the Enterprise part of the print version beneath the headline “Booster shot”