2024-01-15 10:24:34
Orion panoramic view. Screenshot of company website.
Orion, which has been seeking to enter the bio industry, is attracting attention by becoming the largest shareholder of LegoChem Bioscience (hereinfollowing referred to as LegoChem Bio), which is developing new antibody-drug conjugate (ADC) drugs.
LegoChemBio announced on the 15th that the largest shareholder will change from founder Kim Yong-joo to Pan Orion Corp. Limited through a stock transfer agreement. Pan Orion is a Chinese subsidiary in which Orion holds a 95.15% stake.
Pan Orion will acquire 7.96 million new shares through a paid-in capital increase through third-party allocation, and purchase an additional 1.4 million shares of old shares from the existing largest shareholders, CEO Kim Yong-joo and President Park Se-jin. According to this contract, Pan Orion will invest a total of 548.7 billion won and own a 25.73% stake in LegoChemBio.
According to the agreement between the two companies, LegoChemBio will maintain its existing management and operating system, and CEO Yongju Kim will continue to lead the company. Pan Orion plans to participate in management by appointing directors and auditors at future general shareholders’ meetings. The stock transfer price is scheduled to be paid in a lump sum on March 29th.
LegoChem Bio announced its mid- to long-term growth strategy, VISION 2030, in 2021, and to achieve this, it has set a goal of discovering more than 5 candidate substances every year and securing at least 5 additional clinical stage pipelines within 5 years.
Recently, it received attention by signing a technology transfer agreement with Janssen Biotech, a subsidiary of Johnson & Johnson, for the development and commercialization of Trop2-ADC ‘LCB84’. LegoChemBio expected to reap profits of up to $1.7 billion (approximately KRW 2.2449 trillion), including advance payments, exclusive development rights exercise proceeds, milestones, and royalties.
After the announcement that day, LegoChemBio CEO Kim Yong-joo explained the background of the change in the largest shareholder through a letter to shareholders.
Yongju Kim, CEO of LegoChem Bioscience.
CEO Kim said, “We prepared a strategy to achieve VISION 2030 early at the end of last year, discovered 4 to 5 candidate substances per year, which is twice the goal of the existing plan, secured 10 clinical pipelines within 5 years, and lead new future ADCs, including immuno-oncology drugs. “I have established an ambitious plan to become a runner,” he said.
He continued, “To achieve these goals, approximately 1 trillion won in research and development funds are needed over the next five years. “In addition to the 220 billion won in funds currently held by the company and the hundreds of billions of won in technology transfer profits expected within the next few years, we needed to secure an additional 500 billion won in funding, and we are seeking to secure this funding through this strategic partnership with Orion.” did.
In addition, CEO Kim said, “We have respected LegoChem Bio’s independent management for several years, understand the high-risk, high-return nature of new drug research and development, and are looking for a long-term, friendly company with a stake of more than 20%. “We have been making efforts to find a strategic partner.”
CEO Kim said, “Through the past negotiation process, we became convinced that Orion was the optimal strategic partner we were looking for. “Orion Group, which has achieved stable growth through strategies such as rapid entry into the global market with the confectionery business as its main business, had the goal of finding a new growth engine through entry into the biotechnology industry, and chose our company as the target,” he emphasized. .
CEO Kim said, “Orion has shown deep trust in the path that LegoChem Bio has taken over the past 18 years, and has made a firm commitment to support and work together as one family as the management, including myself, pursues more active research and development.” “They showed their will,” he added.
Meanwhile, Orion selected the bio business as one of its top three new businesses. Orion Holdings, the holding company of Orion Group, established a joint venture ‘Orion Biologics’ with Hisense Bio, a dental disease treatment development company, in 2022, and Orion pursued the acquisition of management rights to domestic bio company Alteogen last year, but the attempt was limited.
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