The stagnant bio investment market is expected to see a warming trend. The Ministry of Health and Welfare (Minister Cho Kyuhong) announced on February 28 that Daily Partners and NH Investment & Securities have been selected as the final operators for the K-Bio and Vaccine Fund 3, which was initially planned to be worth 1 trillion KRW. The fund has promptly secured 400 billion KRW from public contributions, including those from the government, and 320 billion KRW from private capital, leading to an early formation of 720 billion KRW.
The K-Bio and Vaccine Fund is a project focused on investing in domestic companies in the biohealth sector, covering areas like clinical phases 2-3 of innovative new drugs, pharmaceutical technology platforms, global expansion, and M&A. The 3rd fund will also invest over 60% in domestic biohealth companies and more than 10% in vaccine-related technology companies to support new drug development and strengthen vaccine self-reliance.
Since December last year, the Ministry of Health and Welfare has selected the operating firms through an open competition, including document screening, on-site inspections, and presentations. The fund plans to raise an additional 1 trillion KRW from private sectors by May before officially commencing investment.
To date, the K-Bio and Vaccine Fund has amassed a total of 3.786 trillion KRW, following the 1st fund (Yuanta Investment, 1.5 trillion KRW) and the 2nd fund (Premier Partners, 1.566 trillion KRW). The 4th fund (Solidus Investment & IBK Capital co-management) is being formed at a scale of 1 trillion KRW, with the government aiming to raise a total of 6 trillion KRW, including the 5th fund by the end of the year.
Jung Eun-young, head of the Health Industry Policy Bureau, commented, “Although investment in the biohealth sector, including pharmaceuticals and medical devices, has been dwindling, the selection of the 3rd fund operators and its early formation is expected to serve as a positive signal in the market.” She further stated, “We hope that the fund, upon its successful final formation, will serve as a springboard for domestic bio companies pursuing global expansion and new drug development.”
The government plans to continue supplying stable capital to innovative pharmaceutical and biohealth companies through the K-Bio and Vaccine Fund, focusing on national vaccine autonomy and enhancing the competitiveness of the bioindustry.