[Edaily Reporter Hong Ju-yeon ] “We expect to complete the formation of the fund during the fourth quarter and make our first investment by the end of the year. We’ve been receiving inquiries from various sources ever since the asset manager was selected.”

Hwang Man-soon, CEO of Korea Investment Partners, made this forecast regarding the timing of investment execution for the Phase 3 clinical trial-specialized fund in an interview with Pharm eDaily, E-Daily’s premium pharmaceutical and biotech content platform. On the 27th, the Ministry of Health and Welfare selected Korea Investment Partners as the lead manager for the Phase 3 clinical trial-specialized fund, with CEO Hwang serving as the lead manager. This is the first large-scale policy fund in Korea dedicated to late-stage clinical trials. CEO Hwang revealed that the fund’s official name is the “Korea Investment Biohealth Phase 3 Clinical Trial Fund.”

Up to 200 billion won in size… Growing interest in rare disease companies

According to the investment banking (IB) industry, Korea Investment Partners secured the status of general partner (GP) in a capital contribution project under the Ministry of Health and Welfare account of the master fund managed by Korea Venture Investment. Korea Investment Partners plans to establish a sub-fund of approximately 170 to 200 billion won based on a 70 billion won contribution to the master fund. This exceeds the minimum formation target of 150 billion won set by the master fund.

Korea Investment Partners is demonstrating its commitment to responsible management by committing 20 billion won as a general partner (GP) commitment. Under this structure, the firm will directly bear 10% of the total capital, based on the maximum fund size of 200 billion won. The plan is to launch the fund in a single phase without separate multi-closings. The Ministry of Health and Welfare has permitted a “priority formation method,” which allows for early investment once at least 120 billion won—80% of the target amount—is secured, further facilitating swift execution.

The fund must invest at least 60% of its total committed capital in companies that have completed Phase 2 clinical trials and are proceeding to Phase 3, or those entering global Phase 3 trials following domestic approval. The fund is expected to invest in approximately 10 companies, and industry observers anticipate that each investment will exceed 10 billion won.

The screening criteria presented by CEO Hwang are clear. “The most important criteria are reaching a consensus on the company’s approach to Phase 3 clinical trials, its current level of preparation, and its strategy to minimize future risks,” he said. “We cannot—and must not—invest in companies or management teams that rely solely on vague expectations.”

The scope of investment has been kept broad. CEO Hwang said, “We are reviewing all companies and pipelines advancing toward Phase 3 clinical trials, and companies conducting Phase 2 trials based on conditional approval are also major investment targets,” adding, “Unlisted companies are expected to have greater potential for value enhancement and growth.” He went on to emphasize, “We are particularly interested in companies with pipelines for rare diseases.”

“Early-stage technology transfers are undervalued… Just one or two successful cases of completing the full development process would change the landscape”

CEO Hwang pointed to the structural limitations of the domestic biotech industry as the reason for the need for a fund specializing in late-stage clinical trials. He said, “While domestic companies are achieving many technology transfer successes, the reality is that they receive relatively low valuations due to early technology transfers, driven by the burden of advancing to later stages,” adding, “The very movement to provide policy support for late-stage clinical trials could serve as a starting point for maximizing the global growth and commercial success of domestic companies.”

He continued, “Even if just one or two cases emerge where results are maximized by conducting late-stage clinical trials directly, the overall atmosphere will change,” explaining, “The first step toward the global growth of the biotech industry is a fund that supports the late-stage clinical trial phase.”

He also expressed his views on the role of venture capital. CEO Hwang said, “Within companies, it is common for decision-making to be distorted or delayed due to the owner’s will or the resources invested thus far,” adding, “We will not merely act as investors or evaluators, but will play a role in maximizing the success potential of the pipeline and actively participating in enhancing the company’s value.”
A Leading

Name in Bio Investment… Also Manages the National Growth Fund

Korea Investment Partners has built up its experience in bio investment by managing funds such as the 135 billion won “Korea Investment Global Pharmaceutical Industry Development Private Equity Fund (PEF).” Major portfolio companies include TiumBio Co., Ltd.(321550), LigaChem Biosciences(141080), Genome&Company(314130), ABL Bio Inc.(298380), and Australia’s Elastagen.

CEO Hwang announced plans to expand biotech investments. “Korea Investment Partners was recently selected as a manager for the National Growth Fund, and we plan to make biotech investments through that fund as well,” Hwang said. “Unlike funds specialized in Phase 3 clinical trials, we will invest in companies with pipelines at earlier stages.” He added, “We view 30% of our venture capital assets as the appropriate allocation for the biotech sector and plan to maintain this level,” and stated, “Our goal is to help domestic companies grow into global enterprises, increase the likelihood of clinical success, and achieve active value creation.”