As countries around the world move in earnest to replace animal testing in new drug development, Organoid Science, which listed on KOSDAQ in May, is drawing attention.
Organoid Science is a corporations that has Organoid technology, known as "mini organs." Organoids are three-dimensional structures cultured from stem cells that can differentiate into all human cells and resemble organs, and can be used to verify the efficacy and toxicity of new drugs in place of animal testing or to treat damaged organs.
Until now, the new drug development process has evaluated effects by repeatedly administering drugs to animals' eyes or skin. In this process, various animals such as mice, pigs, and monkeys have been used for experiments, and the number of animals sacrificed each year worldwide is estimated at about 200 million. Because animals have different physiological structures from people, there have been many cases where success in animal tests still led to failure in clinical trials on people.
To overcome these limits, countries around the world are gradually reducing animal testing and adopting Organoid technology as an alternative. According to market research firm Insight Partners, the global Organoid market is projected to grow from $2.8 billion (4.05 trillion won) in 2023 to $10 billion (14.05 trillion won) by 2030.
◇Verifying new drug effects with Organoids
Organoid Science is a corporations founded in 2018 by Chief Executive Yu Jong-man, a former physician. Yu graduated from Korea University's Department of Life Sciences, earned a master's and doctorate at CHA University's medical school, and is serving as a professor at the same graduate school. The company listed on KOSDAQ in May under the super-gap technology special listing based on its Organoid technology. A super-gap technology special listing means a listing granted to a corporations recognized as possessing national strategic advanced technology.
The company has an Organoid platform called "Odyssey" that can evaluate the effects of drug candidates. It combines more than 20 types of Organoids—such as intestine, tumor, and skin—with technology that recreates the microenvironment. Organoids are more accurate than animal testing and can reduce the development period and expense of new drugs. The company expects Odyssey to help raise the success rate of clinical trials for new drugs. It can verify not only new drugs but also cosmetics and health supplements.
The company is also developing regenerative therapies based on Organoids. Atom-C, which targets treatment for inflammatory bowel disease, is representative. It is a regenerative therapy cultured into Organoids after collecting a patient's intestinal cells.
Inflammatory bowel disease occurs due to damage in which tissue becomes perforated or adheres because the inflammatory response in the intestine becomes excessively severe. While drugs that ease inflammation exist, there is no method to restore tissue damage. In such cases, the idea is to enable recovery of damaged areas with regenerative therapy. The company is targeting commercialization at domestic hospitals in 2027.
◇Widening losses, task of improving financial structure
However, Organoid Science faces the task of improving profitability. On a consolidation basis, Organoid Science's cumulative operating loss in the third quarter this year is about 12.4 billion won. The loss widened from 10.1 billion won in the same period last year. Cumulative gross profit for the third quarter doubled to 1.2 billion won.
An Organoid Science official said, "Regenerative therapies require time to obtain clinical approval," and noted, "Initial investment costs such as research and labor expenses led to operating losses."
The official said, "We plan to reduce operating losses with revenue from the Odyssey business that evaluates drugs," adding, "As the (Organoid) market grows, we are targeting 10 billion won in revenue from Odyssey in 2027."
The securities industry also sees a need to improve the financial structure. Kim Seung-jun, a researcher at the Korea IR Association's Corporate Research Center, said, "They have innovative Organoid technology, but given the business structure, there are risk factors on the financial side such as clinical trials, approvals, and commercialization."
He added, "Making Atom revenue visible for (regenerative therapy), achieving results in technology transfer, and expanding overseas customers for (the Organoid platform) Odyssey will be key to mitigating risks and enhancing corporate value."
As of the end of the third quarter, Chief Executive Yu holds 25.48% equity in Organoid Science. The equity of the largest shareholder and related parties, including registered executives, is 27.47%. The company will convene a shareholders meeting in early Jan. next year to put forward an agenda to appoint former CHA Biotech CEO Oh Sang-hoon as an inside director and former GI Innovation CEO Lee Byung-gun as an outside nonexecutive director. The former CEO previously served as the head of Chong Kun Dang Holdings and GC Holdings.