The South Korean government plans to invest 60 billion won over three years to support competitive pharmaceutical and bio venture companies, aiding them from drug candidate discovery to commercialization and international expansion.
On October 29, the Ministry of SMEs and Startups and the Ministry of Health and Welfare announced the 'K-Pharma and Bio Frontier Company Development Plan' during a national policy coordination meeting.
The domestic pharmaceutical and bio market has grown from 23.2 trillion won in 2020 to 31.7 trillion won in 2024. However, due to the significant funding required for commercialization, the number of bio venture startups has decreased from 581 in 2020 to 288 in 2023. The competitive landscape in the global market is also rapidly changing due to advancements in next-generation technologies.
In response, the government aims to identify promising small and medium-sized pharmaceutical and bio companies with growth potential and technological capabilities. The plan includes comprehensive support for drug candidate discovery, preclinical and clinical trials, commercialization, investment, and entry into global markets.
The government will select 50 promising companies in the pharmaceutical and bio sectors each year, aiming to nurture a total of 200 companies by 2030.
The selected areas include: new drug development (20 companies), digital health and medical devices (20 companies), and bio materials and production technologies (10 companies), with joint selection by the Ministry of Health and Welfare and the Ministry of SMEs and Startups. Each selected company will be paired with a 'Growth Director' to establish tailored growth strategies and receive customized support for two years. Following a performance evaluation, outstanding companies will receive additional support for global expansion over three years.
Investment and guarantees will also be expanded to alleviate funding gaps for these companies. A dedicated bank for research and development (R&D) will facilitate annual investments of 20 billion won, totaling 60 billion won over three years, along with 90 billion won in commercialization guarantees over the same period.
The government will also support the verification and commercialization of artificial intelligence (AI) drug development models and promote R&D for animal alternative testing technologies and advanced medical AI to respond to global regulatory and technological changes.
To reform regulations, a joint consultative body between the Ministry of Health and Welfare and the Ministry of SMEs and Startups will be established to identify on-site challenges and pursue institutional improvements. Additionally, efforts will be made to facilitate the commercialization of excellent research outcomes from hospitals and universities by expanding the foundation for hospital researcher startups and utilizing technology transfer organizations.
Investment through regional growth funds will be increased, and support for these companies' international expansion will be enhanced. A network of biotech firms, global pharmaceutical companies, investment institutions, and local experts will be established by country, and strategies for international expansion will be developed for each company. A demand-based international joint R&D program will also be launched to match domestic small and venture companies with the technology needs of foreign pharmaceutical firms.
Minister of Health and Welfare Jeong Eun-kyeong emphasized, "The pharmaceutical and bio industry requires systematic support across all processes, from technology development to clinical trials, approvals, and commercialization, to ensure that excellent research outcomes lead to clinical applications and products. We will leverage the expertise of the Ministry of Health and Welfare in the pharmaceutical and bio sectors and the growth support capabilities of the Ministry of SMEs and Startups to assist our companies."
On the same day, the Ministry of SMEs and Startups announced plans to increase the number of digital transformation companies from 18,000 to 30,000 and AI-adopting companies from 600 to 6,000 by 2030. The initiative aims to promote AI transformation in new growth sectors such as new security, pharmaceuticals and bio, climate tech, and K-consumer goods.
Minister of SMEs and Startups Lee So-young stated, "In the era of AI transformation, the innovation of manufacturing AI in small and medium-sized enterprises, which are the backbone of our economy and industry, is key to South Korea becoming a leading nation in physical AI. We will support small and medium-sized enterprises in innovating their production methods and enhancing their technological capabilities by integrating and converging data, AI, and robotics, enabling them to grow as a core part of national strategic projects."
* This article has been translated by AI.
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