[THE INVESTOR] DAYLI Partners CEO Lee Seung-ho reckons a sea change in the local biotechnology industry and is gearing up to reap huge profits from the fast-growing segment.

“I haven’t seen this kind of momentum for over 50 years in the country’s biotech and pharmaceutical industry,” the venture capital firm’s CEO said in a recent interview with The Investor.

 

DAYLI Partners CEO Lee Seung-ho

“Conglomerates are making heavy investments which is driving professionals educated overseas to return home with fresh ideas to create a sound startup ecosystem coupled with the government’s policy support.”

Lee, who was arguably the most well known biotech analyst in the nation with 10 years of experience, took the helm in May when the company decided to shift its investment focus from fintech to life science sector.

Its overhaul came as Korean biotech companies are attracting interest as some of them are making tangible results here and overseas with a series of license-out deals and the development of biosimilars, gaining access to capital from VCs and the public.

“There are concerns that the valuation of biotech stocks got too frothy. But I expect unlisted firms will yield further growth with their innovative pipelines with access to huge VC funding,” Lee said.

He said the valuation of Korean biotech firms’ pipelines will boost as they match up with global research and development trends that are evolving into more complex and high-technology sectors such as cell gene therapies and tissue engineering.

Seeking to make bets on such companies, Lee has formed a team with six investment associates who worked as health care-focused fund managers and VCs. “Deep understanding about the sector enables us to make quick decisions while a strong network is giving us an upper hand in deal sourcing,” he said.

From a humble beginning of 9 billion won (US$7.96 million) in total assets under management, DAYLI Partners have raised 46 billion won through two fundraising rounds in four months.

The firm launched DAYLI Empowering Bio HealthcareⅠ in August, raising capital from high-net worth individuals such as owners of local pharma firms, to deploy some 30 billion won to 11 startups in diagnostics, medical devices and new drug developers from Series A funding to late-stage investments.

The portfolio firms include Tomocube, which developed holotomographic microscopy -- a new tool that enables label-free live cell imaging. “I was thrilled when Tomocube was pitching to us. You can say that the company made me become a VC,” Lee said.

The second fund was dedicated to Y-Biologics which he calls “a company that meets global trends,” as it focuses on antibody therapeutics in cancer, autoimmune diseases, and metabolic disease.

Lee and his team have named the fund after US biotech giant Genentech’s co-founder Robert Swanson in hopes of replicating what the American VC did to form a biotech business.

“We plan to play roles beyond a VC firm like being an accelerator and private equity fund,” he said.

By Park Han-na (hnpark@heraldcorp.com)