[Edaily Reporter Kim Seung-kwon ] "We are preparing to sign a contract with a global company. We are now focusing more on how to sell our products rather than how to make good ones."

Jeon Seong-woo, CEO of #Finemedix Co., Ltd., made these remarks in an interview with Pharm e-Daily on the 30th of last month. He explained that the company is pursuing a partnership agreement with a global healthcare firm to target the U.S. market. The contract is expected to be signed this month. However, as negotiations are still ongoing, he did not disclose the details of the agreement or the size of the deal.

Agreement with U.S. Global Company Imminent… “Worth Trying with Boston Scientific Products”

Finemedix Co., Ltd. manufactures surgical instruments used to excise lesions or collect tissue samples via endoscopy. The company was founded in 2009 by CEO Jeon, who was then a professor in the Department of Gastroenterology at Chilgok Kyungpook National University Hospital. Its flagship product is an endoscopic submucosal dissection (ESD) knife. ESD is a procedure that removes early-stage gastric or colorectal cancer lesions endoscopically without surgery. Former CEO Jeon estimates the company’s market share for ESD knives in South Korea to be 20–30%.

The contract currently being negotiated is structured so that a partner company purchases the products and supplies them to the U.S. and Central and South America. Discussions are underway to determine annual purchase volumes. CEO Jeon explained, “The contract specifies quantities such as ‘X amount for one year’ or ‘Y amount for two years.’”

The reason the company does not insist solely on its own brand but also engages in original equipment manufacturing (OEM) and original design manufacturing (ODM) is its distribution network. He said, “We are still a latecomer in the global market, so there are many areas to address regarding branding and distribution,” adding, “Growing our OEM and ODM businesses with a focus on high-value-added products is the path to becoming a global company.”

The U.S. market is dominated by domestic companies such as Boston Scientific. As of August, Finemedix Co., Ltd. had secured approval from the U.S. Food and Drug Administration (FDA) for 13 products. However, approval does not necessarily lead to sales. CEO Jeon said, “In the U.S., they meticulously evaluate how a new product is superior to existing ones.”

CEO Jeon also noted that competitors have not yet completely dominated the market. “Boston Scientific’s endoscopic knife doesn’t sell very well in the market,” he said, adding, “There isn’t a clear market leader in tissue sampling devices either.” He went on to emphasize, “If we effectively communicate the ease of use and tissue sampling performance of our products, we have a good chance of success.”

Results are already emerging. “ClearTip,” a tissue-sampling device for bronchoscopy, is expanding its supply following testing at local hospitals. Regarding the knife product, the company is in discussions with major U.S. firms through key local medical professionals.

The key differentiator is development speed. The company incorporates the inconveniences doctors experience firsthand into the design. CEO Jeon remarked, “There aren’t many companies that can launch a product, receive feedback, and make rapid improvements,” adding, “Our deep, long-standing expertise in this field acts as a significant barrier to entry.”

Return to Profitability and Full-Scale Sales Launch in Japan… “Revenue of Around 15 Billion Won This Year”

In South Korea, the company received manufacturing approval last July for its new ESD knives, the “DuoJet Knife” and the “Swing Knife.” The DuoJet combines a drug-injection needle and an incision tip into a single unit, reducing the number of times instruments need to be changed during a procedure. The Swing allows the direction of the incision tip to be adjusted by manipulating the handle, making it ideal for lesions that are difficult to access.

CEO Jeon described the two products as “designed to target niche markets.” He stated, “The type of knife required varies depending on the location and characteristics of the lesion, as well as the operator’s preference,” adding, “The technological capability to produce a variety of products is crucial.” Additional regulatory approvals and insurance procedures are expected to be finalized around the second half of next year.

The company’s financial performance is also reaching a turning point. The company’s consolidated revenue for the first half of this year was 6.263 billion won, a 43.7% increase from the same period last year. Operating profit stood at 39 million won. The company returned to profitability after posting a loss of 1.375 billion won in the first half of last year. This is the result of a combination of strengthened direct sales in the domestic market, sales of endoscopic equipment, and increased exports.

CEO Jeon projected this year’s annual revenue to be “around 15 billion won.” He stated, “Returning to profitability is a turning point,” and expressed confidence, saying, “Our performance will not deteriorate from current levels.”

The next key market is Japan. In February, the ClearCut Knife became the first domestically produced ESD instrument to receive product approval from Japan’s Ministry of Health, Labor and Welfare. The company’s strategy is to secure market share by offering prices 15–20% lower than existing products. Negotiations on local supply prices are also underway.

The company is currently in the process of fine-tuning its products based on feedback from local medical professionals. CEO Jeon expects sample evaluations to be completed in the second half of the year, with sales set to ramp up in earnest starting next year. The company plans to first establish a representative office as a base of operations and then consider setting up a legal entity depending on performance.

“Unlike in the past, Japan has also seen a generational shift, reducing resistance to imported products,” he said. “We can’t claim to have entered the market just by selling one or two units. It’s important to continue expanding our market share, just as we have in Korea.”

Overseas sales in the first half of the year rose 51% to 1.601 billion won, accounting for about 25% of total revenue. CEO Jeon set a goal to increase this share to more than half next year and to 70–80% in the long term. The company believes that if exports of high-value-added products, such as Knife and Clear Tip, increase, an operating profit margin of over 20% is achievable.

CEO Jeon emphasized to shareholders that he would restore their trust through improved performance. “It wasn’t that we failed to keep our promises,” he explained, “but rather that the timing of fulfillment was delayed due to factors such as regulatory approvals.” He added, “Since we’ve turned a profit this year, as reflected in the numbers, we will deliver even better results next year.” He continued, “We are focusing our efforts on selling high-quality products,” and added, “We are also proceeding with a share buyback program, driven by our commitment to enhancing shareholder value alongside qualitative growth.”