SK Pharmteco again seeks $382 mn in pre-IPO funding

The CDMO unit under SK aims for a valuation of more than $3.8 billion; it will attract investment from Korea's large PE firms

SK Pharmteco headquarters in Rancho Cordova, California, the US (Courtesy of SK Pharmteco)
SK Pharmteco headquarters in Rancho Cordova, California, the US (Courtesy of SK Pharmteco)
Chae-Yeon Kim 1
2023-03-21 16:33:29 why29@hankyung.com
Pre-IPOs

SK Pharmteco Co., a contract development and manufacturing organization (CDMO), is eyeing pre-initial public offering funding again after it dropped the plan last year.

The drugmaker, wholly owned by South Korean conglomerate SK Group’s holding firm SK Inc., is set to raise 500 billion won ($381.7 million) with a valuation of more than 5 trillion won, according to investment banking sources on Tuesday.

The CDMO is slated to send investment teasers to Korean private equity firms by this month. Credit Suisse and Morgan Stanley are the lead managers of the pre-IPO, sources said.

Headquartered in California, SK Pharmteco is specializing in active pharmaceutical ingredients (APIs) and cell and gene therapy. It owns SK Biotek Ireland Ltd., a CDMO that SK Inc. established in 2017 after buying Bristol-Myers Squibb Co.’s small molecule active pharmaceutical ingredients facility in Swords, Ireland.

SK Pharmteco also runs AMPAC Fine Chemicals, a California-based API manufacturer, and Yposkesi, a French CDMO for cell and gene therapy viral vector production. The SK's biotech injected $350 billion in US-based cell therapy developer CBM last year, marking a combined 2 trillion won in M&As since 2017.

The SK’s biotech sought pre-IPO funding in early 2022 but postponed the plan amid interest rate hikes and economic uncertainties.

The company is aiming to raise funds from some major Korean private equity firms such as IMM Private Equity, Premier Partners, STIC Investments, Skylake Equity Partners and Glenwood Private Equity, all of which manage large-sized blind pool funds.

SK Pharmteco is garnering attention from investors as it expands beyond growth hormone and antibody treatment to cell and gene therapy, which is expected to cure cancer and genetic disorders.  

If the company goes public, it will mark the third public offering among SK’s bio affiliates. SK Biopharmaceuticals Co., a new drug developer focusing on the central nervous system, and SK Bioscience Co., specializing in vaccine research and production; the two firms debuted on the main bourse Kospi in 2020 and 2021, respectively. 

Write to Chae-Yeon Kim at why29@hankyung.com

Jihyun Kim edited this article.
#SK Pharmteco Korea #SK Group Korea #Korean biotechs #SK Biopharmaceuticals #SK Bioscience #Korean CDMO #Korean drugmaker #Korean IPO market #bio M&As

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