GemVax & KAEL is one of Korea’s top bio businesses in developing new drugs. In 2013, it tested candidate drug GV1001 on a sample size of pancreatic cancer patients, encountering frustrations when the multinational clinical trial yielded statistically insignificant results. However, it has since proven effective on patients with high eotaxin levels and been introduced as Tertomotide (Korean name Riavax Inj) to the market. Tertomotide is Korea’s 21st new drug.
However, the new drug’s marketability has declined despite its original goals, and after setbacks in the drug development process, GemVax & KAEL is making new leaps. Spearheading its goals is President Song Hyoung-gon, who entered the company in 2015 and recently became the bio sector’s president in July 2016.
Song hasn’t followed a conventional career path. An ER specialist, he has seen the ins and outs of Korea’s medical system, working in various public and private medical institutions including Samsung Medical Center and Gyeonggi-do Medical Center Icheon Hospital. Further, as spokesperson of the Korean Medical Association, he has experienced firsthand changes in the country’s health policies. With such experiences in his back pocket, Song has remained resolute in his honest mission to “play by the rules” whilst developing new drugs at GemVax & KAEL.
|Song Hyoung-gon, president of GemVax & KAEL’s bio sector|
You’ve had a wide range of experiences throughout your career. Has this been helpful in running the business?
Of course. Public medical institutions and organizations like Samsung function in very different ways. At the Korean Medical Association, I learned a lot about health policy and press through my encounters with spokesperson, things that are hard to learn at private hospitals. Meeting other doctors about matters like clinical trials sometimes facilitates communication, because I have same backgrounds with them.
The biopharmaceutical industry is one that requires the participation of various professionals in nursing, chemistry, biology, genetics and more. Some things are particularly easier when you’re a doctor. No matter public opinion, it’s hard to kill your worth as a doctor who simply wants to be of help to your patients. This is the same with medicine. I want to ethically develop drugs that can be of use to patients, all the while bringing reasonable profit to my company. I think following the rules is very important. That’s what I decided to do. It’s ultimately the best path to take, even if it may make things more difficult in the short run for your venture or capital.
There are criticisms that GemVax & KAEL’s bio sector hasn’t performed as well as expected.
As a biopharmaceutical business, we need time to recover trust with the market. People don’t trust you right away just because you want them to; rather, you have to slowly but surely prove your success. We plan to really keep an eye on our stocks until the end of 2017. Regardless of ups and downs in the process, I hope to build a company that is always consistently growing. It is only by following through on your plans that you can recover trust with the market.
Some people argue that though investment seems promising, the bio sector has already become too over-invested.
A long-term investment requires a minimum of two years, and there are definitely some areas that still require more investment. Unfortunately, however, some investments go wrong with companies that I think function like parasites, trying to superficially increase their stock value by hyping up big issues. They’re taking advantage of investors and the fact that this is such a specialized, technical field, and this is definitely something that exacerbates the investing boom. I would say the best way to judge a biotechnology company would be to by their infrastructures, and how well they are following the fundamentals.
What’s your current status on development?
We’re conducting a two-phase clinical trial with GV1001, primarily on patients with benign prostatic hyperplasia(BPH). The final drug administration was last October, and we plan to release the final report sometime around February or March. Though I can’t say for sure what the results are going to be, I’m expecting them to be positive. We also received approval for the phase II clinical trial on Alzheimer’s patients from the Ministry of Food and Drug Safety in December.
GV1001 is a patented antineoplastic. Were there any difficulties in expanding its number of targeted diseases?
There’s a stigma that antineoplastic drugs are too strong, so there were challenges persuading stockholders and investors. At first, Our CEO Sangjae Kim asked a neurology professor Gyuyong Lee, at Hanyang University Guri Hospital about whether there is neurotoxicity in GV1001. But he discovered that there wasn't toxicity, but GV1001 repaired damaged nerve cells .
For Alzheimer’s Disease, GV1001 inhibited the synthesis of beta-amyloid protein, reduced tau protein and improved the oxidative stress and inflammation that occurs during the process. It caused different effects in these cells than when it was used as an anti-cancer drug.
Also, we realized its potential to combat BPH. The 2013 U.K. report for the Phase III Clinical Trials of Pancreatic Cancer showed that bathroom usage became less frequent for male subjects upon GV1001 use. We also concluded from pre-clinical trials that the medicine and BPH may be associated. We plan on continuing research for its anti-cancer properties, specifically for breast cancer and prostate cancer.
What’s the expected market size once clinical trials succeed?
|Song Hyoung-gon, president of GemVax & KAEL’s bio sector|
We see the Alzheimer’s disease market as the single largest market amongst the pancreatic cancer, Alzheimer’s disease and benign prostatic hyperplasia (BPH) markets. Analysis predicted its standard international market to exceed 13 trillion won (11.4 billion USD) by 2023. The market size will keep expanding as Alzheimer’s continues to be a socially important topic, and the U.S. will make up 60 to 70 percent of that. What I’m saying is, we need to move to the U.S. If we want GV1001 licensed in the States, we need the FDA’s approval for a Phase II clinical trial. We’re aiming to be licensed by the beginning of 2018.
It’s already been found that a patient’s decrease in beta amyloids is not necessarily correlated with an improvement in Alzheimer’s symptoms. This means that beta-amyloid doesn’t account for 100 percent of the mechanism of Alzheimer’s. But GV1001 not only decreases beta-amyloid or eliminates tau protein, but also performs three or four mechanisms, including inflammation suppression. Therefore it is expected to be effective even in Alzheimer’s middle or late stages. On the other hand, the most commonly used Donepezil merely slows the onset of symptoms in the disease’s early stages.
As for BPH, there is a report that over 40 percent of those 50 and older suffer from BPH which demonstrates there’s another large market here.
Are there any difficulties in conducting research domestically?
GemVax & KAEL is a peptide-based drug development company. Regardless of whether or not the drugs are effective, extracting peptides from our bodies yields very few side-effects. Unfortunately, though we do have many good candidate drugs in this field, there is a shortage of professionals in Korea who can conduct the research.
Even the government has started to become more interested in cultivating more bio professionals.
Many ministries and associations have become involved with human resource development, but the MFDS is still the most knowledgeable when it comes to clinical testing. As such, I think the MFDS should serve as the foundation of education, instead of leaving these tasks up to individual groups.
Do you think government investment for R&D has been successful?
The government’s investments and solutions are limited by its “proper” perspectives. The nature of biotechnology means you have to admit failures. You have to work under the premise that if only one out of every 10 R&D projects succeeds, you will be able to cover all of their initial costs while still making a profit. The government, however, funds research for pharmaceutical development expecting every project to be successful. In this industry, you must consider the cost effectiveness of investments on an industry level, not individually.
The same goes for hospitals’ international expansions. Samsung Medical Center closed just two years after opening a clinic in Dubai. In fact, there have been no successful cases, which is a lot easier to understand if you have real life experience. The most important element of a doctor-patient interaction is communication-- now add a language barrier. This is true even within Korea. There are times where communication is unclear on medical volunteer trips to Chungcheong Province or Jeju Island, because of the regional idioms. A CT or MRI doesn’t tell the whole story, and there are aspects a human doctor must understand. If an excellent Korean doctor goes abroad expecting automatic success without considering how to approach these nuances, they will surely face troubles.
So how can we create added value for Korea’s medical export industry?
Most higher-tier general hospitals sponsor staff on yearlong training exchanges to the U.S. It’s extremely important that they support their employees to study in their country of choice. Fostering a relationship with an accomplished senior in your area of specialty creates a lifelong mentor-mentee relationship. The mentee can continue their mentor’s techniques and eventually conduct research together. You’re forming a network.
On the other hand, let’s consider bringing Chinese doctors into Korea. It’s difficult for doctors in China to enter the U.S., where it’s more difficult to obtain a visa and geographically farther. But suppose the government creates a foundation, with an investment concept, to sponsor some Chinese doctors who wish to come to Korea for training.
If three Chinese doctors received training under Professor John Doe at digestive internal medicine specialist Samsung Medical Center, what medical equipment would they use upon returning to China? They will take the same equipment Professor Doe used, and prescribe the same drugs Professor Doe prescribed. This is why the education element is necessary. Doctors control a significant portion of the pharmaceutical industry. Patients who are medical consumers normally cannot request specific equipment or prescriptions. The system is designed so the consumer follows the doctor’s plan. Therefore, the government must reform its perspective on medical industrialization.
GemVax & KAEL seems like your most intense job yet.
I’ve been and am still studying a lot since I first entered as a Korean Medical Association spokesperson without even knowing what fee negotiation was. I’m still not at 100%, but I see the path. I’m enjoying my work more now than my time in the union discussing things like fee agreements that we couldn’t achieve alone. My first few months as the head of the emergency medical center at a non-Seoul medical center were easy, but I was itching to do more after a while. I don’t think I’m yet at an age to relax. I believe I have potential to make things happen here.
What are some things you emphasize for your employees?
I ask experiment development partners to work creatively and everyone else to work amiably. At the same time, I try to avoid holding an authoritative manner. I always ask my employees to call me out if my head gets too big. Even if it’s difficult, I’m not going to cut corners. This business isn’t a short-term deal, and I’m sure outsiders will find some points for improvement. We’re continuing to make improvements and progress. If the company grows, I as a pharmaceutical company CEO will maintain a doctor’s integrity to make good drugs.
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