The South Korean government is joining forces to tackle the significant challenge of funding in drug development, often referred to as the 'valley of death' that occurs after clinical trials begin.
The Ministry of Health and Welfare and the Ministry of Small and Medium Enterprises and Startups are launching the 'K-Pharmaceutical and Bio Frontier Company Development Plan,' which aims to support the entire process from drug candidate discovery to clinical trials, regulatory approval, and global market entry. This initiative seeks to provide a comprehensive growth ladder for promising bio ventures to evolve into global unicorns, moving beyond fragmented research and development (R&D) support.
On September 17, the two ministries held a roundtable at the headquarters of medical AI company Lunit in Gangnam, Seoul, with representatives from small and medium-sized pharmaceutical and bio ventures. Attendees included Lee Hyung-hoon, the Second Vice Minister of Health, and Noh Yong-seok, the First Vice Minister of Small and Medium Enterprises and Startups, along with eight representatives from various sectors such as new drug development, digital healthcare, medical devices, and bio materials, totaling around 20 participants.
“Entering Clinical Trials Requires Significant Funding and Talent”
During the meeting, representatives from bio ventures expressed their concerns about the structural limitations they face when transitioning from initial technology development to clinical trials and commercialization.
Typically, new drug development takes over a decade and involves astronomical costs, from candidate discovery to non-clinical studies, clinical phases 1 to 3, regulatory approval, and commercialization. Companies emphasized the necessity of support for technology development and testing during the candidate discovery and non-clinical stages, while highlighting that securing large-scale investments, specialized personnel, and organic connections with major hospitals and clinical institutions become critical as they enter the clinical phase.
Moreover, they conveyed the need for continuous government support throughout the commercialization phase, including global technology transfer, follow-up investments, and overseas regulatory approvals.
Combining Health Ministry's Clinical Infrastructure with Small Business Ministry's Investment Capabilities
In response to these industry demands, the two ministries agreed to break away from the existing framework of 'single R&D project support.' They plan to establish a collaborative system that packages support for the entire growth cycle of companies, from technology development to clinical trials, commercialization, investment guarantees, and global expansion.
This initiative will merge the Health Ministry's expertise in the pharmaceutical and bio sectors and clinical trial support infrastructure with the Small Business Ministry's strengths in discovering promising ventures and linking them with startup and fund investment guarantees. This is expected to provide a practical breakthrough for small bio companies that have faced setbacks due to the burden of clinical costs and lack of commercialization capabilities.
Lee Hyung-hoon and Noh Yong-seok: “Breaking Down Ministry Silos to Fully Support Global Advancement”
The government plans to actively incorporate the feedback gathered from companies into the 'K-Pharmaceutical and Bio Frontier Company Development Plan,' which is currently being jointly formulated.
Lee Hyung-hoon, the Second Vice Minister of Health, stated, “The pharmaceutical and bio industry requires systematic support tailored to the growth process of companies, from candidate development to non-clinical and clinical trials, regulatory approval, and commercialization. We will closely collaborate with the Small Business Ministry to establish an effective support system that addresses the challenges faced by promising companies based on their feedback.”
Noh Yong-seok, the First Vice Minister of Small and Medium Enterprises and Startups, also emphasized, “Even with excellent candidates and technologies, the pharmaceutical and bio sector requires significant time and funding to enter the market through clinical trials and commercialization. We will actively support promising companies in their growth from technology development to clinical trials, commercialization, and global market entry by combining the Small Business Ministry's R&D, investment, and commercialization capabilities with the Health Ministry's expertise in pharmaceuticals and bio.”
* This article has been translated by AI.
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