[Hong Ju-yeon, Edaily Reporter] South Korea’s pharmaceutical and biotech sector posted broad gains on Tuesday despite heightened market volatility that triggered a sell-side sidecar on the benchmark stock market early in the session.

Lemon Healthcare, which closed below its initial public offering (IPO) price on its market debut the previous day, staged a dramatic turnaround by hitting the daily upper trading limit on its second trading day. Shares of D&D Pharmatech and PharmaResearch also finished sharply higher.

Lemon Healthcare rebounds to daily limit after first-day drop below IPO price

According to KG Zeroin MP Doctor, Lemon Healthcare closed at the daily upper limit of 12,220 won, up 2,820 won from the previous session. The closing price was 22.2% above its IPO price of 10,000 won. The stock remained highly volatile during the session, however, falling as much as 14.8% to 8,520 won at one point.

On its debut the previous day, Lemon Healthcare surged to as high as 20,300 won—more than double its IPO price—shortly after trading began. The stock later erased all of its gains and ended its first trading day at 9,400 won, down 6% from the offering price.

Market participants attributed Monday’s limit-up rally to bargain hunting following the previous day’s sharp decline.

Lemon Healthcare operates a two-way medical data brokerage platform that connects participants in the healthcare data ecosystem—including hospitals, patients, insurers, and pharmaceutical companies—in real time.

Based on its core Lemon Digital Bridge (LDB) technology, the company operates LDB-H, a smart hospital service used under contracts with 38 of South Korea’s 47 major tertiary hospitals, as well as LDB-E, a reimbursement claim service for private indemnity insurance.

The company plans to use the proceeds from its IPO to build infrastructure for the distribution and trading of medical data for artificial intelligence training and to further upgrade its existing services.

“Through our KOSDAQ listing, we will further strengthen the competitiveness of our medical data brokerage platform and accelerate the development of infrastructure for distributing and trading medical data for AI training, establishing ourselves as a company that connects the medical AI ecosystem,” said Chief Executive Hong Byung-jin.

D&D Pharmatech closes up 12.4% amid volatile trading

D&D Pharmatech closed at 85,300 won, up 9,400 won, or 12.38%, from the previous session. During the day, the stock traded between a high of 91,900 won and a low of 72,600 won, showing significant price swings. Regarding the share price increase, a company official said, “There is no specific reason. It appears to reflect expectations for a potential major deal in the future.”

The market anticipates that D&D Pharmatech will sign a license-out agreement for its metabolic dysfunction-associated steatohepatitis (MASH) treatment candidate, DD01, before the end of this year. DD01 is a dual agonist that targets both glucagon-like peptide-1 (GLP-1) and glucagon (GCG) receptors; its mechanism is designed to improve fatty liver disease through weight loss and blood glucose control. At the European Association for the Study of the Liver (EASL) conference in late May, D&D Pharmatech presented Phase 2 results showing that DD01 achieved statistical significance on key endpoints. The company expects to receive the clinical study report (CSR) for DD01 in the third quarter.

Brokerage firms also view DD01 as having strong bargaining power for a licensing deal. In a report published last month, Huh Hye-min, an analyst at Kiwoom Securities, said, “As the only late-stage MASH asset in the global market that has successfully completed a Phase 2 trial and is capable of being licensed to a major pharmaceutical company, DD01 is in a favorable negotiating position.” She added, “Compared to Boston Pharmaceuticals’ efimosfermin—which was licensed to GSK in a deal worth a total of $2 billion (3.03 trillion won) after completing Phase 2—DD01 demonstrates comparable or superior histological outcomes, including liver fat reduction (-68.2% vs. -49%), MASH resolution (57% vs. 39%), and improvement in fibrosis (34% vs. 24%)."

The company previously stated, “Our primary goal is to find a partner capable of developing and commercializing the product globally in the fastest and most efficient manner. Companies currently in discussions have gained a deeper understanding of the asset, and we are comprehensively evaluating both the partner best suited for product development and the terms most favorable to the company.”

PharmaResearch Rises 8.4% on Back-to-Back Positive Developments

PharmaResearch closed at 340,500 won, up 26,500 won, or 8.44%, from the previous session. The gain is seen as reflecting growing expectations for future earnings following a series of positive developments. A PharmaResearch official said, “Various factors, including recent market conditions and investor sentiment, appear to have contributed, but we cannot attribute the move to any single factor.”

Brokerages are also optimistic about the resumption of PharmaResearch’s earnings momentum. Domestic medical device sales in the first quarter reached 58.4 billion won, declining by only 2.2% from the previous quarter despite lower spending by foreign visitors in January and February, supported by increased domestic demand and an expansion in medical specialties. Kang Eun-ji, an analyst at Korea Investment & Securities, said, “PharmaResearch’s domestic medical device sales in the second quarter are expected to increase by more than double digits compared to the first quarter, driven by solid domestic demand and a recovery in demand from foreign visitors.” The cosmetics business, which posted solid growth in both domestic and overseas channels during the first quarter, is also expected to continue its strong performance, supported by the expansion of TikTok sales channels in Southeast Asia and entry into offline distribution channels in the United States beginning in the second quarter.

In line with this, PharmaResearch signed an agreement on June 30 to acquire CG USA, a cosmetics OEM and ODM company based in California. The acquisition secures a local production base in North America, enabling the company to respond more effectively to growing demand for Rejuran cosmetics through Sephora and Amazon. The company also plans to enter the Canadian market in the second half of the year, accelerating its expansion across North America.

Son Ji-hoon, CEO of PharmaResearch, said, “The acquisition of CG USA is a strategic decision aimed at strengthening supply stability and laying the groundwork for business expansion in the North American market. By leveraging local production capabilities and quality infrastructure, we plan to continue enhancing the competitiveness of our global derma cosmetics business.”