The South Korean government will launch a program next year to develop a "Korean-style CRDMO" sector that covers everything from early research to development and production of biopharmaceuticals, going beyond contract manufacturing.
The Ministry of Health and Welfare will begin a new research and development program next year to strengthen CRDMO capabilities, according to biotech industry sources on the 8th. Two projects will be selected, each receiving a total of 49.4 billion won over five years. The government's 2027 budget proposal includes 7.8 billion won for the program's first year.
CRDMO, or contract research, development and manufacturing organization, adds a research function to the existing CDMO model. While a typical CDMO handles process development and the production of clinical samples and commercial drugs for candidate compounds discovered by clients, a CRDMO supports the entire process from earlier research stages, including candidate development, process optimization and manufacturing. As global pharmaceutical and biotech companies outsource a wider range of drug discovery work, CDMO firms are expanding into the research stage.
The two projects are likely to focus on antibody-drug conjugates (ADC) and cell and gene therapy (CGT). ADCs link potent drugs to antibodies that recognize cancer cells, delivering the payload selectively to tumors. CGTs are advanced biopharmaceuticals that treat disease by regulating or modifying a patient's cells or genes. Both fields require a high level of expertise in process development, analysis and clinical drug production tailored to the characteristics of each candidate compound, driving demand for CRDMO services.
In ADCs, ST Pharm (237690.KQ) is among the companies expanding in the field and is seen as a potential recipient of support. ST Pharm develops manufacturing processes for and produces linkers, which connect the antibody and the drug in an ADC.
In CGT, the companies mentioned include ENCell (456070.KQ), GC Cell (144510.KQ) and Matica Biotechnology, a subsidiary of CHA Biotech (085660.KQ). ENCell provides process and quality analysis development for cell and gene therapies as well as GMP production for clinical use, while GC Cell is expanding from cell therapy research and development into manufacturing and commercialization. Matica Biotechnology also runs a CDMO business centered on process development and GMP production for cell and gene therapies.
"Small and mid-sized companies with the relevant technology and production capabilities, rather than large conglomerates, will be the main targets of support," a Health Ministry official said. "Whether the projects will be run by single companies or consortiums will be determined later."
