[Edaily Reporter Kim Jinsoo ] “There have been changes to the distribution agreement with a global company that we have been pursuing. While discussions regarding a distribution agreement in the U.S. have been suspended due to a strategic shift by the company involved, talks for Europe and Asia are still ongoing. We are also simultaneously discussing an agreement with another global company as a contingency plan.”

Kang Guk-nam, Head of the General Headquarters at #L&K BIOMED CO., LTD., stated in a recent interview with Pharm Daily, “Discussions regarding distribution in Asia—which were the first to begin—are continuing. Although the regional distribution agreements have changed from the original plans, we are still receiving inquiries from many companies, and our competitive edge of offering a full lineup of spinal implants on the global stage remains unchanged.”

L&K BIOMED CO., LTD. had been pursuing distribution agreements for its spinal implant products in the U.S., Europe, and Asia with global companies. However, the negotiations hit a snag when the counterpart, with whom discussions were underway, acquired another spinal implant company.

General Manager Kang explained, “Just two weeks ago, I met with the counterpart we were negotiating with, and they said there were no issues with proceeding with the contract. However, they suddenly announced that they had acquired another company and that their strategy had changed; subsequently, that company unilaterally notified us that they would ‘terminate the distribution contract for the U.S. region.’”

He continued, “Discussions for the European and Asian regions, excluding the U.S., are proceeding as originally planned. In Asia, we are continuing discussions to expand our business in each region, and we are also continuing talks regarding Europe. Our plan is to focus on finalizing the contracts currently underway in these two regions to secure tangible results first.”

In particular, there is a possibility that the contractual partner in Europe itself may change. This is a strategy to minimize risks that could arise in Europe, given that contract discussions in the U.S. were unilaterally suspended.

General Manager Kang emphasized, “In Europe, in addition to the global company with which we were already pursuing a contract, we have made significant progress in negotiations with several other European companies. These companies possess stronger local distribution networks in Europe and are competitive players in the European market.”

He added, “Distribution agreements in Asia are positive in terms of enhancing brand awareness and symbolic value. However, as negotiations are still ongoing, it is difficult to provide specific estimates regarding sales volume or contribution to earnings at this time. It is certain that expanding our supply regions will secure a stable foundation for overseas sales and serve as an opportunity to increase the proportion of global sales in the mid- to long-term.”

In addition, General Manager Kang emphasized, “This change is limited to a specific partnership within the U.S. market; there is no change to L&K BIOMED CO., LTD.’s global business expansion strategy itself.” He added, “Going forward, we will continue to expand our global distribution network by identifying and diversifying our optimal partners in accordance with regional market conditions, without relying on any single company.”

Failed U.S. Distribution Deal:

L&K BIOMED CO., LTD.

Considers Utilizing Direct Sales and Strategic Partnerships

Although the contract in the U.S

. market

has been terminated, L&K BIOMED CO., LTD. plans to actively leverage the

direct sales

system it has already established to some extent in the U.S.

General Manager Kang stated, “We are exploring ways to utilize direct sales channels and strategic partnerships in a complementary manner. We plan to select the most efficient distribution method based on market conditions and product characteristics to strengthen our sales coverage.”

L&K BIOMED CO., LTD. currently operates local U.S. subsidiaries, such as EGIS Co., Ltd. and L&K Spine, to continue product distribution and sales, and is already seeing concrete results. Following the announcement of the first successful surgery using the “BluEX-C” cervical spine implant, product registrations and surgery schedules are being confirmed one after another at major ambulatory surgery centers (ASCs) and large spinal specialty hospital networks, primarily in the western and southern United States.

He stated, “We plan to leverage the sales capabilities and medical professional network we have built through our direct sales system to expand market penetration for our existing products and quickly establish new products upon their future launch, thereby continuously increasing our market share in the U.S.”

L&K BIOMED CO., LTD. expressed confidence in its competitive advantage on the global stage, noting that, including L&K BIOMED CO., LTD., there are still only two companies worldwide that offer a full lineup of spinal implant products.

General Manager Kang stated, “Until now, most spinal implant products have focused solely on the lower back (lumbar spine). However, in the case of cervical (neck) discs, it is common for a single patient to have discs at various stages of degeneration, making expandable implant products essential.”

Finally, he added, “We also plan to complete the development of a stand-alone type expandable cage product line next year, which enables stable fixation without the need for separate posterior fixation devices (pedicle screws).” “Once development is complete, we will have a full lineup of height-expandable cages covering Chonbang, posterior, and lateral approaches, as well as the stand-alone type,” he said.