Korea Investment Partners Selected as Manager for Korea's First 'Phase 3 Clinical Trial Specialized Fund'

Ministry of Health and Welfare to Raise 170 Billion Won and Focus Investment in Late-Stage Clinical Trials for Around 10 Companies
Targeting Creation of 1 Trillion Won K-Bio Mega Fund by Next Year

The Ministry of Health and Welfare announced on July 27 that it has selected Korea Investment Partners as the lead management company for the “Phase 3 Clinical Trial Specialized Fund” to support late-stage clinical trials for pharmaceutical and biotech companies.

Through this initiative, the ministry aims to provide focused support for Phase 3, the final stage in new drug development, and accelerate the creation of the “K-Bio Mega Fund” totaling 1 trillion won by next year.

Previously, the Ministry conducted a call for management companies via Korea Venture Investment from May 11 to June 5, and after document reviews, on-site due diligence, and presentation evaluations among four applicant firms, the final manager was chosen.

Korea Investment Partners, which has been selected this time, was highly rated for its specialized investment professionals and track record in pharmaceutical and biotech sectors, as well as its ability to attract private capital. In particular, the company proposed to establish a fund amounting to 170 billion won, exceeding the initial target of 150 billion won.

The Phase 3 Clinical Trial Specialized Fund is a policy fund established to address the investment gap at the late-stage clinical phase, which requires the largest amount of capital in new drug development. The management company must invest at least 60% of the fund’s total commitments in pharmaceutical or biotech companies that both possess an innovative drug or biobetter pipeline and are actually conducting Phase 3 trials. Approximately 10 companies are expected to receive support.

To accelerate the timing of capital allocation, the Ministry has also introduced a “priority formation method.” If at least 120 billion won, equal to 80% of the original target of 150 billion won, is secured, the fund can be launched in advance and early investments can begin, thereby ensuring that companies urgently in need of funding are not forced to halt their R&D activities.

If the fund is established as planned, a total of 949.6 billion won will be pooled for biotech investment when combined with the K-Bio and vaccine funds already in progress since June. The government expects this will bring it significantly closer to its goal of creating a 1 trillion won K-Bio Mega Fund by 2027.

Sung Changhyeon, Director General for Health Industry Policy at the Ministry of Health and Welfare, stated, “This fund will serve as a turning point for companies with outstanding new drug pipelines that have hesitated to proceed with late-stage clinical trials due to lack of funding.” He added, “The Ministry will spare no policy and financial support to enable domestic pharmaceutical and biotech companies to complete Phase 3 trials successfully and yield global blockbuster new drugs.”

Noh Yeonhong, Chairman of the Korea Pharmaceutical and Bio-Pharma Manufacturers Association, said, “New drug development is not only about R&D capability, but above all requires a stable investment base that supports the entire process to the end.” He added, “The Phase 3 Clinical Trial Specialized Fund, the government’s first of its kind, will prevent the interruption of innovative new drug R&D due to financial constraints and serve as a turning point for the domestic pharmaceutical and biotech investment ecosystem to take a major step forward.”

This content was produced with the assistance of AI translation services.