[Top 5 Pharma News in 2022 ①] ‘Ice Age’ hits Korean pharma’s stock market – KBR

In 2022, the Korean healthcare industry seemed to be out of the Covid-19 shock. However, the industry had a rough year amid the economic downturn, jittery investor sentiment, and higher costs of imported raw materials. Nevertheless, the local healthcare industry showed a glimpse of future growth as conglomerates such as GS and Lotte entered the industry and digital healthcare companies achieved rapid growth. Korea Biomedical Review has compiled the five biggest healthcare news stories in 2022. –Ed. 
Winter has arrived in the pharmaceutical and biotech sector, which used to draw heated attention from investors in the stock market. In marked contrast to 2020 and 2021 when liquidity was ample, the year 2022 was checkered with inflation in the wake of the Covid-19 pandemic, increased uncertainty coming from the Russia-Ukraina war, and the local bond market crunch sparked by a missed bond payment of the developer of Lego Land Korea. 
The weakening investor sentiment hit initial public offerings (IPOs) of biotech firms hard. In the old days, an IPO of a biotech company meant the initial offering price going double on the day of listing. However, such bullish sentiment has gone.  
Many pharmaceutical and biotech companies that went public this year —  such as Voronoi, April Bio, Lunit, Noul, Shaperon, Inventage Lab, and Bionote — accepted disastrous results. This is because the public offering price was confirmed at an amount below the lower end of the desired public offering price. This is the reason why companies attach the label of “market-friendly” to the confirmed public offering price.
Investors began to demand specific earnings results from pharmaceutical and biotech firms that have to take risks in developing drugs. Voronoi clinched a deal to license out a new drug candidate worth 2 trillion won ($1.56 billion) but the company had to lower the initial offering price when it went public on the Kosdaq market. 
In particular, Bionote’s offering price fell short of the desired public offering price even though it lowered the offering price once in the process of preparing for an IPO in November. 
Some people had predicted that its market capitalization would reach 2 trillion won. However, in reality, it entered Kospi with an amount of less than 1 trillion won. 
Exceptionally, RP Bio, which debuted on the stock market in September, secured a price higher than the desired offering price. RP Bio is an OEM/ODM specialized manufacturer of soft capsules. It had been a subsidiary of Daewoong Pharmaceutical but it became an independent firm later.  
Industry watchers said the “ice age” of the pharmaceutical and biotech stock market could continue throughout the first half of 2023. The grim outlook has made IPO-eyeing companies take a wait-and-see approach. Coreline Soft, a medical AI company, initially wanted to go public in 2022 but put off the plan until 2023. Idience, a new drug developer under Ildong Pharmaceutical, said it would conduct IPO in 2024, not in 2023. 
For those pressured to go public after attracting series C or pre-IPO funding, the year 2023 will be a cruel one, observers said.
 
tweet

source