[Edaily Reporter Kim Seung-kwon] On the 15th, the domestic pharmaceutical and biotech sector was in turmoil following news that the government is considering covering hair loss treatments under the national health insurance system. While the KOSPI and KOSDAQ indices as a whole showed limited fluctuations, buying interest concentrated on stocks with hair loss treatments and related platforms, leading to a rally that hit the daily price limit early in the trading session.

In particular, #JWPharma, #HyundaiPharma, and #SamikPharma drew market attention as their shares surged by about 30% in unison. JWPharma and HyundaiPharma garnered attention as leading companies with “hair loss treatments,” while SamikPharma was highlighted for its long-acting platform.

JW New Drug Expected to Benefit Directly from Hair Loss Treatment Portfolio… Soars to Daily Limit

According to KG Zeroin, JW New Drug closed at 1,775 won on the 15th—up 29.94% from the previous trading day’s close (1,366 won)—hitting the daily price limit. The stock surged to the price limit early in the session and remained there until the close, emerging as a leading beneficiary of the national health insurance-covered hair loss treatment theme. In addition, #WithusPharma, #PromBio, #ShinshinPharma, and #AlikoPharma also rose in tandem.

The direct trigger for this sharp rise was the government’s statement regarding its review of expanding health insurance coverage for hair loss treatments. Analysts note that since many treatments—primarily for hereditary hair loss—are currently prescribed as non-covered services, the market has already factored in expectations that a shift to coverage would simultaneously alleviate the financial burden on patients, increase prescription volumes, and expand the market base.

Earlier, President Lee Jae-myung stated at a Cabinet meeting, “It seems [young people] view hair loss as a matter of survival,” and directed officials to review the application of health insurance coverage for hair loss treatments. This comes after he made health insurance coverage for hair loss treatments a key campaign platform during the last presidential election and has now issued specific instructions.

In response, Health and Welfare Minister Jeong Eun-kyung announced at a press conference held on the 11th to mark the first anniversary of the launch of the “People’s Sovereignty Government” that the ministry would push to expand health insurance coverage for hair loss treatments in the second half of this year by soliciting public opinion. The Ministry of the Interior and Safety and the Ministry of Health and Welfare have designated “Health Insurance Coverage for Hair Loss Treatments” as the topic for the first session of the “Everyone’s Forum”—a public participation initiative—and plan to hold an in-person forum in Seoul on the 4th of next month.

JW Pharmaceutical maintains a lineup of specialized hair loss treatments, including the finasteride-based “Monad Tablets” and “Monasta Tablets,” as well as the dutasteride-based “Dutamoa Tablets.” In addition, the company has expanded its portfolio to cover the full spectrum of hair loss and scalp care by introducing and selling minoxidil formulations and hair care products (such as “Ducray Neo-Peptide”).

“JW0061,” a hair loss treatment candidate considered a key pipeline asset, is also generating high expectations as a topical agent with a GFRA1 agonist mechanism—distinct from existing hair loss treatments that primarily focus on inhibiting male hormones. It received approval for a Phase 1 clinical trial from the Ministry of Food and Drug Safety in February of this year.

A JW Pharmaceutical official stated, “While best-in-class new drugs may offer better efficacy, safety, or convenience of use than existing treatments, we are also focusing on developing first-in-class new drugs to provide patients with new treatment options.”

A securities industry analyst also commented, “JW Pharmaceutical’s earnings are highly sensitive to reimbursement decisions, as oral finasteride and dutasteride-based drugs already account for a significant portion of its sales,” adding, “If the policy is finalized, it could be one of the first stocks to show visible improvements in earnings.”

Hyundai Pharmaceutical: ‘Minoxil’ Regains Prominence… Strength in OTC Channels

Hyundai Pharmaceutical also closed at 7,440 won on the same day, surging 1,710 won (29.84%) from the previous day. During the trading session, it ranked among the top in trading volume, cited alongside JW Pharmaceutical and TS Trillion as part of the “big three” in the national health insurance-covered hair loss treatment theme.

Hyundai Pharmaceutical’s strong performance stemmed from expectations of a reevaluation of “Minoxil,” its flagship minoxidil-based hair loss treatment. Minoxil is an over-the-counter (OTC) hair loss treatment brand readily available at pharmacies, with its strengths lying in its long-established brand recognition and stable pharmacy distribution network. Market observers suggest that if health insurance coverage for hair loss treatments is expanded, not only prescription drugs (ETC) but also the OTC market could benefit indirectly.

An industry insider analyzed, “Discussions on coverage are a signal that hair loss will be incorporated into the institutional framework as a ‘therapeutic area’ rather than a mere cosmetic issue, and this is highly likely to expand the overall market size.” They added, “In this scenario, the barrier to entry for existing OTC brands would lower, potentially benefiting companies with strong marketing and distribution capabilities.”

Samik Pharmaceutical also closed trading at around 7,700 won, up approximately 30%. This is interpreted as a result of the company’s long-acting injectable platform technology being re-evaluated in the hair loss treatment sector following news that the government is reviewing the inclusion of hair loss treatments under national health insurance.

Samik Pharmaceutical had previously secured a patent for “technology for manufacturing polymer microparticles using cyclodextrin inclusion compounds” to overcome formulation limitations of poorly soluble drugs. This technology serves as a platform capable of converting a JAK inhibitor-based alopecia areata treatment—specifically, one using baricitinib—from an oral formulation into a long-acting injectable that can be administered once a month; it is also known to be applicable to chronic diseases such as rheumatoid arthritis. The polymer microparticle technology, which increases drug loading and controls release rates, is considered to have high market potential as it aligns with global formulation trends.

Chong Kun Dang is also conducting a Phase 3 clinical trial for “CKD-843,” a long-acting hair loss treatment based on dutasteride. The industry expects that long-acting injectables will be able to overcome the limitations of medication adherence associated with existing oral formulations.

However, some in the pharmaceutical and biotech industries, as well as the securities sector, advise caution when investing, noting that this recent upward trend is largely a preemptive reflection of policy expectations.

According to industry sources, even if a decision is made to expand National Health Insurance coverage for these hair loss treatments, it may take time for the changes to take effect. Furthermore, the hair loss treatments currently under development by companies are still in the clinical trial phase, and their success remains uncertain. Since most stocks related to hair loss treatments are small-cap stocks, they are prone to being used for thematic investing or targeted by speculative groups, necessitating caution when investing.

A biotech analyst at a securities firm stated, “Given that the second half of this year will involve public consultation and other stages of social discussion, and considering the financial burden on the national health insurance system, it may take a considerable amount of time before the policy is actually implemented and the scope of coverage is finalized,” adding, "Rather than chasing after stocks with small market capitalizations and high volatility based on vague expectations, investors should carefully distinguish between the good and the bad, focusing on companies that have effectively established production infrastructure or are making progress with clinical data for a solid pipeline," the analyst advised.