As the world's No. 1 beauty corporation L'Oréal joins a 110 billion won paid-in capital increase for OliX Pharmaceuticals, a Korea-based RNA technology corporation, together with a U.S. asset management firm, attention is focusing on the background.
The investment size itself is not large, but following last year's joint research agreement, L'Oréal has moved to make a direct equity investment, which the industry interprets as reflecting its strategic commitment to next-generation hair loss and hair care technology.
According to the Financial Supervisory Service on the 4th, OliX Pharmaceuticals will raise about 110 billion won through a third-party allotment paid-in capital increase for strategic investors. Of that, L'Oréal Group's venture investment fund BOLD will invest about 10.5 billion won to receive allocation of more than 70,000 new shares, and U.S. asset management firm Weiss Asset Management plans to invest about 100.2 billion won through the Brookdale Global Opportunity Fund and Brookdale International Partners.
L'Oréal's equity investment follows on from the joint research signed in Jun. last year. At the time, the two sides began joint research in the skin and hair fields using OliX Pharmaceuticals' small interfering RNA (siRNA) technology. OliX Pharmaceuticals is leading research and development, while L'Oréal is providing advice on product development and commercialization.
The industry is taking note that L'Oréal has joined as a direct investor following the joint research. It is seen as a move that shows confidence in OliX Pharmaceuticals' research outcomes and commercialization potential, going beyond a simple technology review. The investment is also expected to further strengthen the two companies' strategic partnership.
siRNA is a technology that suppresses gene expression by selectively removing messenger RNA (mRNA), which serves as the blueprint for making specific proteins. Because it can block the production of proteins that cause disease, aging, or hair loss, it is regarded as a next-generation gene therapy platform.
In particular, in the hair loss field, its strength is seen in the ability to regulate, at the gene level, signals related to the androgen receptor (AR) and dihydrotestosterone (DHT), the main causes of androgenetic alopecia. While existing hair loss treatments work by suppressing hormone production or action, siRNA is an approach that blocks the gene signals that cause hair loss itself.
Most siRNA-based hair loss treatments remain in clinical trial stages, but some studies have confirmed reduced DHT production and promoted hair growth, drawing attention as a next-generation hair loss treatment technology.
L'Oréal is known to have reviewed biotech ventures worldwide for years to commercialize new products in the hair loss and hair fields. In the industry, the view is that L'Oréal ultimately chose OliX Pharmaceuticals because of the company's proprietary siRNA platform technology.
OliX Pharmaceuticals' competitiveness lies in its proprietary "asymmetric siRNA" platform. Based on RNA interference technology, the company has asymmetric siRNA technology that improves gene-suppression efficiency, and to overcome the intracellular delivery issues often cited as a limitation of existing siRNA Therapeutic, it also developed the "self-delivering asymmetric siRNA" platform for locally administered therapeutics.
The androgenetic alopecia drug candidate OLX104C, now in Phase 1b/2a trials in Australia, was also developed on this platform. Administered once a month, OLX104C reduces androgen receptor expression to block the hormonal signals that cause hair loss. The company expects it can minimize hormone-related side effects such as decreased sexual function or depressed mood that may occur with existing DHT inhibitors.
Given L'Oréal's business characteristics as a beauty corporation, the industry sees a greater likelihood that OliX Pharmaceuticals' technology will be used in functional hair care products rather than new drug development. The analysis is that RNA technology could be applied to functional hair cosmetics such as topical creams, shampoos, and scalp essences.
Whereas conventional cosmetics focused on caring for skin and hair, RNA technology is differentiated by its ability to regulate the causes of hair loss and aging at the gene level. In the long run, some expect new markets to form for hair loss-relief cosmetics and scalp care products that incorporate RNA technology.
Guive Balooch, L'Oréal's global head of Open Innovation and Augmented Beauty, said, "This strategic collaboration combines OliX Pharmaceuticals' siRNA platform technology with L'Oréal's innovation capabilities built over more than 100 years in biology, technology, and formulation," adding, "We will deliver a new level of performance to consumers and accelerate innovation in the future beauty industry based on advanced biology and robust scientific evidence."
Meanwhile, OliX Pharmaceuticals is seen as having its technological prowess recognized in the global market, following a technology collaboration agreement last year with Eli Lilly and Company and now securing joint research and investment from L'Oréal.