[Edaily Reporter YU JIN-HEE ] D-Cigen, a company specializing in precision medicine and genetic diagnostics, is set to begin full-scale distribution in South Korea of “OncoFREE,” a next-generation sequencing (NGS)-based multi-gene test for predicting breast cancer prognosis that it developed in-house. The company plans to rapidly reshape the market landscape, which has been dominated by expensive imported diagnostic kits.

Notification of Deferral of New Medical Technology Evaluation Completed… Non-Insured Prescriptions to Begin November 1

According to recent industry reports, OncoFREE was recently selected as a candidate for the New Medical Technology Evaluation Deferral Program by the National Evidence-based Healthcare Research Institute (NECA), an agency under the Ministry of Health and Welfare, and has completed the relevant administrative procedures. Consequently, non-insured prescriptions will be available at major domestic medical institutions starting November 1.

The New Medical Technology Evaluation Deferral System is a mechanism designed to facilitate the early clinical adoption of technologies with proven safety. Technologies granted a deferral may be prescribed to patients on a non-covered basis for two years. This also provides an opportunity to accumulate additional clinical evidence regarding safety and efficacy in real-world medical settings.

With the completion of this official notice, patients will be eligible for benefits under out-of-pocket medical expense insurance. This is a decisive factor that dramatically lowers the barrier for medical professionals to prescribe the treatment. The process for introducing the treatment into major medical institutions, such as university hospitals and general hospitals, is also gaining momentum. The company plans to proceed with the necessary steps to secure designation as a “selective reimbursement” item and formal inclusion in the National Health Insurance reimbursement list.

Kim Hong-seop, CEO of Digen, explained, “With the Ministry of Health and Welfare’s notice confirming the selection for the New Medical Technology Evaluation moratorium, clinical application will begin in earnest starting next month,” adding, “Prescription accessibility by breast cancer specialists at major domestic hospitals will improve significantly.”

The biotech and medical device industries view OncoFree’s approval for the new medical technology evaluation deferral as a signal for a full-scale “quantum leap” in performance. This is because there are clear success stories in the domestic healthcare market where companies secured non-covered prescription codes through the early-entry track and subsequently achieved explosive sales growth.

The most prominent example is #VUNO, Inc., a company specializing in medical artificial intelligence (AI). VUNO, Inc.’s AI-based cardiac arrest prediction solution, “VunoMed DeepCARS,” was designated as an “early-entry medical technology” in 2022—the first AI-based medical device in Korea to receive this designation—paving the way for non-insured prescriptions at tertiary general hospitals.

VUNO, Inc.’s annual revenue, which stood at approximately 2.2 billion won in 2021—just before the designation—skyrocketed by more than 270% to 8.3 billion won in 2022, the first year of the “early entry” designation. Following this, the company recorded 13.3 billion won in 2023 and, in 2024—after being adopted by approximately 80 major hospitals—surpassed 25 billion won in revenue and achieved a quarterly profit. This was the result of a daily per-bed billing structure—combined with the non-reimbursed prescription environment—generating stable annual recurring revenue (ARR).

Jeisys Medical(287410), a company specializing in medical devices for dermatological aesthetics and treatment, also used the New Medical Technology system as a springboard for growth. Its tissue coagulation and treatment technology using radiofrequency (RF) underwent evaluation under the New Medical Technology system and became established as a non-insured service at local hospitals and clinics, leading to rapid revenue growth.

Annual revenue, which stood at 36.8 billion won in 2019, surged nearly fourfold over four years—reaching 81.3 billion won in 2021, 116.5 billion won in 2022, and 143.0 billion won in 2023—driven by growing domestic demand for non-insured procedures. Beyond equipment sales, the company has established a high operating profit margin in the 20–30% range, driven by the continuous repurchase of disposable tips used for each non-covered procedure.

Dicigen’s OncoFree is also expected to follow the same growth trajectory. Given the nature of prognostic testing—which breast cancer patients must undergo after surgery—the lowering of entry barriers due to non-covered status and coverage under indemnity health insurance is highly likely to lead to an immediate increase in the number of in-hospital prescriptions. The fact that this is a high-margin business model—generating recurring diagnostic revenue with each patient specimen submission, rather than relying solely on one-time sales—further enhances confidence in the company’s performance.

Half the Cost of Foreign Tests… Maximizing Patient Benefits with Rapid TAT

OncoFree’s greatest strengths are its outstanding price competitiveness and fast turnaround time. The first-generation U.S.-made tests currently used in most domestic clinical settings cost approximately 4.2 million won per test, which has placed a significant financial burden on patients.

Dicigen has set the supply price of OncoFree at about half that of imported U.S. tests. When combined with domestic out-of-pocket medical insurance benefits, the patient’s actual out-of-pocket cost is further reduced. This alleviates patients’ hesitation about undergoing prognostic testing due to high costs.

The turnaround time (TAT) for analysis has also been significantly reduced. With imported tests, the patient’s cancer tissue sample must be sent to the manufacturer’s laboratory in the U.S., which typically takes 2–3 weeks to receive the results. Patients previously had to endure an anxious waiting period before deciding whether to undergo chemotherapy after surgery.

In contrast, OncoFree performs testing in domestic laboratories using its proprietary NGS platform. Final analysis results can be delivered to medical staff within about one week of receiving the tissue sample. Thanks to this rapid diagnosis, medical staff can establish personalized treatment plans for patients without delay. This is advantageous for securing the “golden time” for patient treatment.

OncoFree is also a second-generation precision diagnostic device that surpasses first-generation tests in terms of technological capability. Existing first-generation products, primarily from the U.S., measured 21 genes individually using the quantitative reverse transcription polymerase chain reaction (qRT-PCR) method. In contrast, OncoFree performs a batch quantitative analysis of the RNA expression levels of 179 genes within cancer tissue. This data is analyzed using a proprietary machine learning algorithm to calculate a “Decision Index (DI)” score. The DI quantifies the risk of distant metastasis to other organs within 10 years after surgery. Because it analyzes a significantly larger number of genes, it offers a higher degree of precision in prognostic prediction.

Its performance has also been validated in long-term follow-up studies. Clinical results from a 10-year follow-up showed that the 10-year metastasis-free survival rate for the low-risk group identified by OncoFree was 96.1%. In contrast, the rate for the high-risk group was 79.3%. The hazard ratio (HR) between the two groups was 5.86. This means that patients in the high-risk group have approximately six times the risk of recurrence compared to those in the low-risk group. This represents top-tier discriminatory power among diagnostic kits worldwide. It has also received marketing authorization from the Ministry of Food and Drug Safety as a multiplex genetic test for predicting the prognosis of early-stage invasive breast cancer.

A database optimized for Asian patients is another key competitive advantage. Western tests are skewed toward data from older, postmenopausal patients and do not fully reflect the clinical characteristics of Asians, among whom the incidence is high among young, premenopausal women. In a comparative clinical trial of early-stage breast cancer patients aged 50 or younger, OncoFree demonstrated an area under the curve (AUC) of 0.71. This significantly outperformed the 0.62 achieved by a global competitor. The closer the AUC is to 1, the higher the diagnostic accuracy.

Dicigen is using its success in entering the domestic regulatory market as a springboard to further accelerate its global business expansion. The company has recorded annual sales of around 4 billion won, dispelling concerns about the earnings gaps typical of biotech ventures. This year, it expects to generate over 5 billion won in sales, driven by the launch of domestic supply and exports to Asia. Next year, as prescriptions for new medical technologies gain momentum, the company has set a target of surpassing 10 billion won in sales.

Taiwan serves as the outpost for its overseas market expansion. Through a partnership with TSH Biopharm, a Taiwanese publicly listed pharmaceutical company, the company has conducted marketing campaigns targeting major local hospitals. As a result, prescriptions for OncoFree are now becoming increasingly common in Taiwanese clinical settings. With the growing number of voluntary clinical evaluations by medical professionals, the scale of prescriptions is expected to expand further. The company is also strengthening its commercialization network in about 10 Southeast Asian countries, including Thailand, the Philippines, and Malaysia. The company has also laid the groundwork for entering the European market through India’s largest testing institution, Dr. Lal Path Labs, and its Hungarian partner, HANPASS CO.,Ltd.

These overseas sales achievements are expected to be a decisive asset in successfully completing the company’s upcoming KOSDAQ listing. During the previous technology evaluation process, assessment agencies had emphasized the need for concrete results from overseas expansion and sales maturity. Digen’s strategy is to demonstrate prescription sales generated directly in Asian markets to ensure its corporate value is properly assessed.

The company is also proceeding in stages with its entry into the U.S., the largest market in the Western world. It plans to complete efficacy validation for Western populations using cohort data from the Austrian Clinical Trials Collaboration Group (ABCSG). Subsequently, it aims to secure inclusion in the National Comprehensive Cancer Network (NCCN) guidelines to gain access to both public and private insurance markets.

Dicigen is expanding its prognostic prediction pipeline beyond breast cancer to include various other cancer types. The company aspires to establish a personalized diagnostic ecosystem that reduces unnecessary anticancer treatments for cancer patients and improves their quality of life. In fact, development of the “OncoFree-PC” prostate cancer prognostic prediction kit has been completed, and validation is underway using more than 900 clinical specimens. “SurgiFREE,” which helps reduce unnecessary thyroid surgeries, is continuing clinical trials with the goal of obtaining product approval within two years. “OncoDict-CF,” a liquid biopsy-based minimal residual disease (MRD) diagnostic solution that uses blood to monitor cancer recurrence early, is also progressing smoothly in development.

CEO Kim stated, “Through the notice on the suspension of the New Medical Technology Evaluation, we are now able to provide Korean breast cancer patients with access to affordable precision diagnostics,” adding, “We will leap forward to become a leading global precision medicine company by expanding prescriptions at domestic and international medical institutions and achieving solid growth in performance.”