[Edaily Reporter KIM SAE-MI ] With the submission of this semi-annual report, pressure is expected to intensify for struggling listed companies in the biotech and healthcare sectors to be delisted.

Bio and Healthcare: 10 Companies Rece

ived

Disclaimer of Opinion in First Half

According to the Financial Supervisory Service’s electronic disclosure system on the 21st

,

a wave of non-conforming audit opinions was issued for listed biotech and healthcare companies following the June 14 deadline for submitting interim reports.

KAINOS MEDICINE, INC.(284620)Ten companies— CELLUMED CO., LTD.(049180), SyntekaBio,Inc.(226330), ENZYCHEM LIFESCIENCES CORPORATION(183490), MiCo BioMed Co., Ltd.(214610)(formerly The Biomed), Eutilex Co., Ltd.(263050), Clinomics Inc.(352770)(formerly Clinomics), EOFlow Co., Ltd.(294090), OLIPASS Corporation(244460), and UNION KOREA PHARM CO.,Ltd(080720) —received a disclaimer of opinion on their interim financial statements.

CELLUMED CO., LTD., ENZYCHEM LIFESCIENCES CORPORATION, and RollingStone are among the companies that had already received a disclaimer of opinion for their fiscal year 2025 audits, which constituted grounds for delisting. SyntekaBio,Inc. received unqualified opinions for both its consolidated and separate financial statements for fiscal year 2025 but received its first disclaimer of opinion in the first half of this year.

A disclaimer of opinion does not mean that a company posted a loss; rather, it means that the auditor was unable to obtain sufficient and appropriate audit or review evidence to form an opinion on the financial statements, or that there is significant uncertainty regarding the company’s ability to continue as a going concern.

For CELLUMED CO., LTD., RollingStone, and ENZYCHEM LIFESCIENCES CORPORATION, the core issue was a limitation on the scope of review regarding the basic financial statements or major accounts, while for SyntekaBio,Inc., the problem was identified as the failure to obtain sufficient review evidence to verify the legitimacy of loan transactions and the use of funds. Eutilex Co., Ltd. and UNION KOREA PHARM CO.,Ltd. are cases where uncertainties regarding going concern and limitations on the scope of the audit persisted even though the previous reasons for the qualified audit opinion had not been resolved.

For Eoflow Co., Ltd., a combination of limitations on the scope of the review of the basic financial statements, constraints on key review procedures, and uncertainty regarding going concern status came into play; Celestra, OLIPASS Corporation, and KAINOS MEDICINE, INC. also saw their interim review opinions rejected as their existing accounting and financial issues remained unresolved.

Falling Short of Revenue Thresholds, Capital

Erosion, and More…

Compounding Listing Risks

Some companies faced not only audit opinion issues but also simultaneous challenges such as

failing to meet revenue

requirements or facing financial crises. KAINOS MEDICINE, INC., in addition to receiving a refusal of opinion for its interim financial statements, recorded equity of less than 1 billion won and was in a state of complete capital erosion; Celestra also saw a refusal of opinion, failure to meet interim revenue targets, and complete capital erosion confirmed simultaneously. EOFlow Co., Ltd.’s first-half revenue on a standalone basis remained in the 200-million-won range, failing to meet both quarterly and interim revenue thresholds, and the company is in a state of complete capital impairment. OLIPASS Corporation also faced an additional reason for a substantive review of its listing eligibility due to complete capital impairment at the end of the interim period.

Most of these companies share the commonality that the issues did not first arise with these interim reports; rather, they were already undergoing related procedures, such as delisting or a substantive review of listing eligibility. EOFlow Co., Ltd. was also subject to a substantive review of listing eligibility, and on the 19th, the Korea Exchange’s Corporate Review Committee voted to delist the company.

A number of biotech and healthcare companies listed on KOSDAQ also failed to meet the revenue thresholds of 300 million won for the quarter and 700 million won for the half-year. EOFlow Co., Ltd., ABION Inc.(203400), and Celestra were among them. If a KOSDAQ-listed company fails to meet the revenue requirements based on its separate financial statements, its primary business operations are deemed to have effectively ceased, and the company is subject to a review to determine whether it qualifies for a substantive review of its listing eligibility.

In particular, starting this year, “total capital erosion”—where total capital falls into negative territory at the end of a half-year period—is also considered grounds for a substantive review of listing eligibility. In accordance with the listing regulations revised by the Financial Services Commission, reviews regarding this requirement began with the interim reports for the first half of 2026. Four biotech and healthcare companies—KAINOS MEDICINE, INC., Celestra, EOFlow Co., Ltd., and OLIPASS Corporation—recorded total capital erosion at the end of the first half of the year.

The problem is that some companies are simultaneously experiencing these issues of accounting reliability, a sharp decline in revenue, and capital erosion. In other words, companies are emerging where problems related to business continuity, financial soundness, and accounting reliability are overlapping—going beyond the level of simply sustaining losses during the research and development phase.

There have also been cases where companies failed to submit their periodic reports by the deadline. PCL. Inc(241820)failed to file its semi-annual report by the 14th, adding another ground for delisting due to the failure to submit a periodic report. PCL. Inc had already received a delisting decision from the Korea Exchange’s KOSDAQ Market Committee on September 5 of last year. Although the relevant procedures were put on hold after the company filed for a provisional injunction to suspend the delisting decision, the reasons for non-submission have accumulated, including the failure to file its annual report, first-quarter report, and now its semi-annual report.

Most of the companies facing issues this time are quite different from general listed companies whose shares are traded normally. A significant number of them have been designated as “monitored stocks” or “stocks requiring investor caution,” or have had trading suspended due to issues such as audit opinions or substantive reviews.

Companies such as KAINOS MEDICINE, INC., Celestra, OLIPASS Corporation, Eutilex Co., Ltd., UNION KOREA PHARM CO.,Ltd., and PCL. Inc. are already undergoing legal proceedings, including applications for provisional injunctions, after delisting decisions have been issued. CELLUMED CO., LTD., ENZYCHEM LIFESCIENCES CORPORATION, and RollingStone have been granted a grace period after grounds for delisting arose due to a qualified audit opinion for the 2025 fiscal year.

The Process of Separating the Wheat from the Chaff in the Biotech Sector

Begins in

Earnest… Pressure Mounts to Remove Struggling Companies

Observers predict that the process of testing the viability of

struggling biotech and healthcare companies

among listed firms will now begin in earnest. In particular, biotech companies that have failed to generate meaningful revenue for an extended period and have relied on external funding—such as rights offerings or convertible bonds (CBs)—to continue R&D are expected to face

increasing

pressure to maintain their listings.

In the capital markets as well, a clear polarization between companies is emerging.LigaChem Biosciences(141080)While investment capital is pouring into companies that have demonstrated success in technology transfers or have proven robust pipelines—such as Alteogen Inc.(196170), AprilBio Co.,Ltd.(397030), and —companies that have failed to deliver clear results are struggling to secure new investors. Biotech companies can continue R&D even with a weak revenue base as long as they can smoothly secure external funding; however, if their funding streams dry up, accumulated losses can rapidly escalate into capital erosion and a liquidity crisis.

The fact that financial authorities are stepping up efforts to delist underperforming listed companies is another factor increasing the pressure. The Financial Services Commission and the Korea Exchange are operating an “Intensive Delisting Management Period” from this past February through June of next year to promote the swift and rigorous delisting of underperforming companies.

In the same vein, the requirement for a substantive review of listing eligibility—which now includes total capital impairment at the end of each half-year—was introduced this year. As it becomes more difficult to raise funds in the capital markets and the bar for maintaining a listing rises, the space for biotech companies that have yet to demonstrate results is shrinking even further.

A biotech industry official stated, “I believe the financial authorities’ policy to accelerate the removal of underperforming companies from the market is a positive step toward ensuring market soundness in the long term,” but added, “If the KOSDAQ market is operated with an excessive focus on safety, it could hinder the entry of innovative technology companies. Improvements are clearly needed to revitalize technology-driven ventures.”