NEW YORK – After having recently raised $32 million via an initial public offering in its home country, Korean molecular diagnostics provider NGeneBio intends to invest in human resources, R&D, and expansion to international markets, with the US a particular target.
"Our immediate goal is international expansion," said YoungJoon Moon, executive director of NGeneBio's global diagnostics business division. He said that the firm will seek to cultivate a client base of clinical laboratories that will offer its menu of next-generation sequencing-based tests, especially in the US.
According to Moon, NGeneBio is courting CLIA-certified labs for strategic partnerships that will offer its assays as laboratory-based tests. These activities will set the stage for eventual test submissions to the US Food and Drug Administration. "In the future, we hope to receive FDA approval and to develop companion diagnostics with biopharma companies," he said.
NGeneBio was established in 2015 as a spinout of Korea Telecom, South Korea's largest telecommunications company. Its founders had been developing NGeneBio within KT since 2011, with support from the telecom company. This allowed it to be quick to market with in vitro diagnostics, companion diagnostics, and complementary bioinformatics software.
Moon credited this foundation for the company's relatively fast journey from molecular diagnostics startup to IPO. "NGeneBio was able to combine IT and biotechnology to provide a precision diagnostics platform, which made our IPO go relatively quickly," he said. "The company’s preliminary work was accomplished [within] KT before the spinoff."
In the years following its launch, NGeneBio debuted a number of assays, garnering regulatory approval for them in South Korea and CE-IVD marks in Europe, which allowed it to serve clinical laboratories outside its home market.
These included the BRCAaccuTest, a BRCA1 and BRCA2 test that was approved by the Ministry of Food and Drug Safety in South Korea and also gained a CE-IVD mark; HemeaccuTest, a CE-IVD-marked assay for hematological malignancies; and SolidaccuTest, which looks for variants associated with various solid tumors and also carries a CE-IVD mark. NGeneBio has also released a comprehensive oncology kit for research called the OncoaccuPanel, which provides data on tumor mutation burden and microsatellite instability.
In addition, NGeneBio has a new offering for human leukocyte antigen testing, called the HLAaccuTest. The assay can be used for HLA typing for organ transplants and for screening for chronic infectious diseases and drug hypersensitivity reactions. Moon noted there are two versions of the product. One containing five loci was launched for the domestic market and received authorization for clinical use from the MFDS in South Korea this week. A second, expanded panel, covering 11 loci, should gain a CE-IVD mark and will be launched internationally in the second half of the year.
All of NGeneBio's next-generation sequencing assays are designed for use on Illumina instruments, including NextSeq, NextSeqDx, MiSeq, MiSeqDx, iSeq, and MiniSeq. The company also launched a test for SARS-CoV-2, the virus that causes COVID-19, last year. The quantitative PCR test, called NGenePlex nCoV, obtained both a CE-IVD mark and MFDS approval last year. Another qPCR test for SARS-CoV-2 and influenza is in development.
According to Moon, NGeneBio's tests have been adopted by more than 15 hospitals in South Korea. The company has client labs in Southeast Asia, Europe, and the Middle East. NGeneBio's oncology tests have also been used for developing companion diagnostics with some domestic biopharmaceutical companies, he said, and the firm would like to explore similar partnerships with partners outside Korea in the future.
The IPO and its proceeds
In December, NGeneBio went public in South Korea and began trading on KOSDAQ, the Korean stock market, on Dec. 10. The company priced its IPO at KRW 14,000 ($12.7) per share and announced a market capitalization of $155 million. Moon claimed that NGeneBio is the first South Korean firm with sequencing-based cancer diagnostics to go public in the country.
As of 2017, he added, South Korea's Health Insurance Review and Assessment Service, a public institution administered by the Ministry of Health and Welfare that oversees public health expenditures, has been covering next-generation sequencing-based tests. That decision allowed NGeneBio to expand its presence in South Korea.
NGeneBio previously raised private funds, closing an $11 million Series B round in 2018 and $1.9 million the year prior.
Since the start of 2021, the firm has been adding steadily to its headcount, growing from 83 to 111 employees, and plans to hire at least 10 more staffers this year. "We hired specialists for clinical NGS R&D for new products, tests, analysis, and software development," said Moon. The company also invested in its sales and marketing team for global expansion, plus its business development team to give it more muscle for pursuing clinical projects and CLIA lab partnerships.
Moon stated that NGeneBio would like to have a CLIA partnership in place in the US by the first half of 2022. The company aims to submit a test to the FDA sometime in 2023, though it has not yet decided on the assay.
"BRCAaccuTest could be the one, but we will consider solid tumor-related products also, depending on US market adoption and companion diagnostics projects," said Moon. NGeneBio is interested in the US market, he explained, as it is the "most advanced market" in the clinical next-generation sequencing field. It can also serve as a staging ground for entry into other markets, even those closer to home.
"The US is a very strong reference market for global business," Moon said, "especially for advanced markets, such as the EU and Japan."