ViroMed Co. Ltd., the Korean biotech, has seen companies miss out on approvals for novel therapies because the FDA had problems with their manufacturing processes. With its first treatment nearing the completion of Phase 3 trials, the company says it has taken steps to avoid that trap.
The Seoul-based biotech this week said that in a joint venture partnership with a private equity investment firm, it had acquired a GMP (good manufacturing practices) ready facility in San Diego, CA, from Vical Inc. Terms of the deal were not disclosed, says FiercePharma.
Until recently, the production site was used for clinical studies that included Phase 3 trials in the US of DNA-based investigational drugs, ViroMed said. The Korean company’s lead product VM202 (donaperminogene seltoplasmid) is a gene-therapy for the treatment of painful diabetic peripheral neuropathy (PDPN). The facility in San Diego has a 500 L fermenter, cell culture lab and quality control test lab, as well as space for expansion, ViroMed said in its announcement.
With plans for test runs within this year and GMP production in the first half of 2019, the company said it is hiring key personnel to operate the facility and expects to have 25 people on board in the next few months.
The company said a comparability test will be required by regulatory authorities for the facility since the production site is different from the ones that manufactured the drug used in past and current clinical studies. ViroMed CEO Sunyoung Kim said he does not expect that to be an issue.
ViroMed said it is currently the only company conducting Phase 3 trials in the US involving plasmid DNA. It acknowledged that manufacturing will be a key consideration for approval of plasmid DNA-based gene medicines since they have never been approved and commercialized. It also expects having a manufacturing site will “boost the company’s bargaining power for potential out-licensing and marketing partnership deals.” If approved, ViroMed’s treatment would be up against Pfizer Inc. (NYC) blockbuster Lycra and Neurontin (gabapentin).
Lots of news coverage has been devoted to the recent, rapid emergence of China’s presence on the global healthcare scene as it attempts to make basic clinical/hospital care and medicines available to all Chinese residents; something we’re still (unbelievably) debating again here in the US under the Trump administration after astronomical progress via Obamacare.
Little attention has been paid to tiny Korea’s commitment and movement into the commercial healthcare space and race, but who cares? China has a population of 1.415 billion versus South Korea’s 51.19 million; about 27 times as big. But don’t be fooled by these demographic numbers. Instead, think more like: Japan.
The fact is that more and more Korean pharmaceuticals are jumping into developing new drugs, raising the number of clinical trials done in Korea in the past five years.
More domestic pharmaceutical companies seem to be focusing on developing new drugs. The number of Phase 1 and 2 trials is also increasing because Korea has been raising its competency regarding clinical trials, said an official at Korea Research-based Pharma Industry Association (KRPIA).
Globally, new drug development projects have decreased in number, says MarketScreener.com. Despite the drop, Korea has maintained its level relatively well in the number of clinical trials, the official added. Against this backdrop, some Korean pharmaceuticals have launched phase 3 trials. The five conducting important Phase 3 trials include Viromed, Hanmi, SillaJen, Celltrion, and Tego Science.
My favorite: ViroMed
As pointed out above in the news recently, Viromed has been busy with Phase 3 trials for its plasmid DNA-based gene therapy, VM202. The drug contains hepatocyte growth factor (HGF) genes and has proven to be effective in regenerating peripheral nerves after neuronal injury as well as for diabetic neuropathy.Steve's Take: @ViroMedCo shows promise with its plasmid #DNA based #genetherapy and could account for a small portion of a high risk-tolerant portfolio Click To Tweet
When they injected VM202, it induced the production of various nerve regeneration factors and promoted Schwann cell division and migration, the company said. This ultimately increased the diameter of the nerve axon and the thickness of the myelin aqueduct.
ViroMed was able to carry on its studies for VM202 after winning a patent fight with Reyon Pharmaceutical. The company is now conducting Phase 3 trials in China with its Chinese partner Beijing Northland Biotech.
The latter completed producing 500 liters of NL003, the Chinese version of VM202 that uses the same raw material called pCK-HGF-X7. The Chinese company completed Phase 2 trial of NL003 and received approval from the China Food and Drug Administration to go ahead with the P3 trial in October last year.
Because plasmid DNA has yet to receive approval worldwide, establishing a mass production platform is mandatory for entering Phase 3 trials and commercialization. While Beijing Northland has been working to do so in China over the past several years, Viromed said it also made strides in the US, securing a DNA production plant in San Diego.
“We are very pleased that the problem of production which was the biggest variable has been solved through the acquisition of the production facility,” ViroMed CEO Kim Sun-young said.
Refresher course on why Korea–an economic powerhouse–will also likely contend in biotech space.
The Top 5 South Korean companies by profitability at August, 2017.
1. Samsung Electronics
Samsung Electronics is one of the largest companies in the world and is South Korea’s most profitable company generating revenues valued at $208.938 billion and profits totaling $ 27.245 billion. Samsung Electronics was founded on January 13th, 1969 as an electronics company and is synonymous with smartphones since the company began their production. Currently, Samsung Electronics is the largest producer of smartphones, televisions, and semiconductor chips in the world. The total assets held by Samsung Electronics are valued at $202.876 billion.
2. SK Holdings
SK Holdings is a conglomerate based in South Korea and is made up of 95 affiliate and subsidiary companies. Also known as the SK Group, SK Holdings is one of the largest conglomerates in the country with an annual revenue of $102.122 billion and a net profit of $258.2 million. SK Holdings, which was formerly known as the Sunkyoung Group was founded on April 8th, 1953 by the late Chey John-Hyun. The core business of SK Holdings is telecommunications as well as energy. The company has assets valued at $87,716 billion.
3. Hyundai Motor
Hyundai Motor Company is another top South Korean company based on profitability with the company’s annual revenues reaching $79.766 billion and profits amounting to $7.804 billion. Hyundai Motor Co. is the world’s third largest automobile manufacturer. The company’s Ulsan production facility is one of the largest of its kind in the world with an annual production capacity of up to 1.6 million units. Hyundai was founded on December 29th, 1967 by Chung Ju-Yung.
POSCO is a steel-manufacturing multinational company which is based in South Korea. Its total assets are valued at $80.037 billion and annual revenues are valued $56.520 billion. The company which has major operations in India and China was founded in April 1968 by the Korean Government.
5. LG Electronics
LG Electronics is a multinational electronics company popularly known for the production of home appliances, an industry which LG Electronics has a significant market share. By 2011, LG Electronics was the second-largest producer of televisions in the world behind Samsung Electronics and has assets valued at $33.669 billion. LG Electronics is among the most profitable companies in South Korea with annual revenues of $53.118 billion and net profits totaling $161.5 million.
Future of the South Korean Economy
The economy of South Korea is expected to continue growing with the country investing heavily in technological advancements to lure more IT-based companies to set up shop in the country. The only point of concern that worries economists is the ongoing friction between South Korea and North Korea which always has the potential to escalate to an armed conflict.
I like ViroMed as a small portion of only the highest risk-tolerant portfolio. It’s a rational bet rather than a pure crap shoot for the reasons mentioned above. Here’s the data for those interested in an investment.
ViroMed Co. Ltd.
Code: 084990S on the Kosdaq
Closing price of ₩221,000.00 on Aug. 28, 2018; up 200.00 (0.091%) from the previous day.
|52 Week Range||₩109,500.00 – ₩303,800.00|
|Ytd net Change||+35.3%|
|1 Yr net Change||+75.5%|
1 South Korean Won = 0.00090 US Dollar
How to Buy ViroMed:
Select a licensed broker/dealer, and then purchase the stock or exchange-traded fund through the broker. As a non-licensed individual, you will not be able to purchase the shares directly from either the Korean exchange or US exchanges.