[Edaily Reporter KIM SAE-MI ] LigaChem Biosciences has secured the first direct investment in a biotech company from the 5000억 won National Growth Fund.

National Growth Fund Selects LigaChem Biosciences as First Direct Investment Target in the Biotech Sector

LigaChem Biosciences(141080)announced on the 26th that it held a board meeting on the 25th and decided to issue 170 billion won worth of private convertible bonds (CBs) and conduct a 330 billion won third-party private placement. The private placement will take the form of voting convertible preferred shares (CPS), rather than common stock.

This investment is significant as it marks the National Growth Fund’s first direct investment in a biotech company. It is also the first instance of a listed company securing direct investment from the National Growth Fund.

The National Growth Fund is a government-led financial support program established with a total scale of 150 trillion won, comprising 75 trillion won from the Advanced Strategic Industries Fund and 75 trillion won in private funds, aimed at fostering advanced strategic industries.

New drug development is a field that requires massive, long-term capital investment as the process progresses from candidate discovery through Phase 2 and 3 clinical trials to approval, production, and commercialization. This investment can be viewed as an example of policy funds serving as a catalyst in the high-risk, long-term investment sector, which is difficult to sustain with private capital alone.

A representative from LigaChem Biosciences emphasized, “Our selection for the National Growth Fund is a result of LigaChem Biosciences’ core antibody-drug conjugate (ADC) technology and global new drug development capabilities being recognized as key strategic assets at the national level.”

5000억 Raised via CB and CPS…Majority Shareholder ORION Also Invests 1250억

By investor, the Korea Development Bank (KDB) will invest a total of 2500억 in its capacity as the manager and operator of the Advanced Strategic Industries Fund. Specifically, this consists of 850억 in convertible bonds (CB) and 1650억 in convertible preferred shares (CPS). The largest shareholder, PAN ORION Corp. Limited, will invest a total of 1250억, consisting of 425억 in CBs and 825억 in CPSs. The remaining 1250억 is scheduled to be allocated to third-party financial investors.

The conversion price for both the CB and CPS is 149,300 won per share. The company stated that no separate discount rate was applied. The CB has a coupon rate and maturity rate of 0% and matures on July 24, 2036. If held until maturity, 100% of the principal will be repaid in a lump sum. The conversion period runs from July 24, 2028, to June 23, 2036.

A total of 2,210,313 CPS shares will be issued. The issue price is 149,300 won per share, and each share carries one voting right. However, they will not be listed until they are converted into common stock. The conversion request period runs from July 25, 2028, to June 24, 2036.

These convertible preferred shares will be subject to a one-year lock-up period, and the conversion of the convertible bonds into shares will also be prohibited for one year. The company explains that this structure mitigates concerns about short-term overhang, as the conversion rights can only be exercised 24 months after issuance.

If both the CB and CPS are converted into common stock, the total number of shares that can be issued is 3,348,960. This represents 9.05% of the 37,019,418 common shares already issued as of the date of submission of the major matters report. The minimum adjustment price is capped at 119,500 won, which is 80% of the initial conversion price.

Proactive Fundraising Despite Cash Reserves… Boosting In-House Late-Stage Clinical Capabilities

LigaChem Biosciences plans to allocate these funds primarily to research and development (R&D) and clinical development. The company also clarified that the funds are not intended for mergers and acquisitions (M&A) or the acquisition of external management control.

According to the disclosure, the funds will be used entirely as working capital and allocated to R&D for new drugs, such as ADCs and immuno-oncology agents. On an annual basis, the company plans to allocate 90 billion won in 2026, 180 billion won in 2027, and 230 billion won starting in 2028.

Although LigaChem Biosciences already holds approximately 4500억 won in cash, it has decided to raise additional funds to ensure the normal operation of its existing business and ongoing pipeline. The company explained that this 5000억 won represents long-term strategic investment capital intended to support the company’s journey from late-stage clinical development through approval to global production and commercialization.

The funds will be allocated along two main axes.

First is the expansion of late-stage clinical development capabilities for its core pipeline. While the company’s previous strategy centered on recouping value through technology transfers (L/O) at certain stages, this new funding will enable it to independently advance high-priority pipeline candidates through Phase 2 and 3 clinical trials.

Second is investment in future growth engines through the acquisition of new modalities and platforms. In particular, the company plans to invest funds in proactively securing the technological foundation for the next generation of ADC platforms and other technologies that will succeed its current pipeline.

LigaChem Biosciences made it clear that this funding round does not signify a shift in focus from a technology transfer-centered strategy to one centered on in-house development. A LigaChem Biosciences official stated, “Please understand that this is not about scaling back or replacing our technology transfer strategy, but rather about maintaining and continuing our existing L/O strategy while securing the additional option of conducting late-stage clinical trials in-house.”