As financial authorities move faster to delist underperforming corporations from KOSDAQ, tension is rising in the pharmaceutical and biotech industry. With a dedicated unit for delisting reviews newly created and listing maintenance standards being strengthened in stages, more than 20 biotech corporations that fall short of the market capitalization threshold are expected to become potential review targets.
Earlier, financial authorities tightened delisting requirements early last year. As a result, starting this year, KOSDAQ-listed companies must maintain a market capitalization of at least 15 billion won. The threshold is scheduled to be raised sequentially to 20 billion won in 2027 and 30 billion won in 2028. With a dedicated delisting review unit also set up, restructuring efforts are gaining momentum.
According to the industry on the 13th, applying the current standards, there are about 20 pharmaceutical and biotech corporations on the KOSDAQ market with a market cap below 30 billion won. PCL, UNION KOREA PHARM, PeopleBio, and Dongsung Bio Pharm fall into this range.
Among them, PCL's market cap is about 16.8 billion won, below 20 billion won. Although delisting was finalized in Sept. last year, the process has been put on hold due to an injunction request to suspend the effect.
PCL, a corporation specializing in in vitro diagnostics, had its item approval revoked by the Ministery of Food and Drug Safety for manipulating clinical trial data for a COVID-19 self-test kit, and while 2024 sales were 1.2 billion won, operating loss reached 27.1 billion won. In July last year, it resolved a 90% capital reduction without consideration to improve its financial structure, but failed to complete the change-listing application within the deadline, resulting in an additional violation of regulations.
Many corporations are also clustered in the 20 billion–30 billion won range, including UNION KOREA PHARM (21.6 billion won), PeopleBio (22.1 billion won), and Dongsung Bio Pharm (25.9 billion won). As listing maintenance requirements are raised sequentially to 20 billion won in 2027 and 30 billion won in 2028, they are classified as a potential risk group that could face a heavier burden from designation as issues to be managed or from maintaining their listing.
In practice, delistings or substantive reviews have been occurring one after another in the market. So far this year, four companies—Kainos Medicine, PharmAbcine, Cheil Bio, and NKMAX—have been decided for delisting. These corporations went public through a technology track but failed to deliver clear results thereafter, leading to accumulated losses. Currently, NKMAX and Kainos Medicine have had processes put on hold due to injunction requests to suspend the effect, and Cheil Bio is proceeding with the delisting process.
Some corporations are also under review due to audit opinion issues. GenNBio is undergoing a listing eligibility review after receiving a disclaimer of opinion for two consecutive years. Trading in Cellivery and CanariaBio has been suspended due to the occurrence of delisting grounds. Eutilex has become subject to a substantive review due to inaccurate disclosures.
In addition, many biotech and medical device corporations, including Sejong Medical, ICURE Pharmaceutical, MEDICOX, and SD Biotechnologies, underwent substantive reviews due to delisting grounds and are currently in an improvement period.
This stance became even clearer with remarks from the head of the financial authorities. Lee Eog-weon, chair of the Financial Services Commission (FSC), said at a regional meeting the previous day, "About 150 companies are estimated to be delisted this year," and added, "We plan to announce this week an improvement plan for delisting standards, including market cap and sales thresholds."
This is interpreted as effectively moving up the existing policy to gradually remove corporations with a market cap of 30 billion won and sales under 10 billion won by 2029. It is being viewed as a remark suggesting that authorities are considering not just keeping the standards as is, but shortening the application timeline or further raising the thresholds.
The move is also seen as part of restructuring aimed at resolving the so-called "Korea discount." Financial authorities believe that while new listings were active on KOSDAQ, corporations with weak earnings and business performance remained for a long time, causing index stagnation and damaging market trust. The plan is to encourage the early exit of corporations that fail to deliver performance after listing, creating a market environment investors can trust.
While the pharmaceutical and biotech industry agrees on the need to restore market trust by clearing out underperforming corporations, it notes that an approach that takes into account the industry's characteristics—such as research and development (R&D) for new drug development taking a long time to yield visible results—is necessary.
An industry official said, "We agree that the system is intended to tidy up the market," but added, "Because the biotech industry is structured for research and development results to emerge over the long term, deciding listing maintenance based only on short-term market cap or sales could shrink even corporations with technological competitiveness."