Hair-loss treatment stocks emerge as Korea's latest market theme
gettyimagesbank
Hair-loss treatment stocks have emerged as the latest theme in Korea's equity market, drawing investors searching for the next big pharmaceutical trade after the boom in obesity drugs, market watchers said Monday.
Shares of JW Shinyak and Samik Pharm jumped 55.7 percent and 62.89 percent over the past week, respectively, as enthusiasm spread across Korean companies seen as having exposure to the hair-loss market. Hyundai Pharmaceutical also gained 32 percent.
JW Shinyak, a pharmaceutical affiliate of JW Group, sells prescription drugs through hospitals, clinics and pharmacies. Its hair-loss portfolio includes oral and topical treatments, and the company is expanding into hair care cosmetics.
Hyundai Pharmaceutical is a longtime player in Korea's hair-loss drug market, with a 39-year presence.
Samik Pharm is positioning itself as a next-generation player. In January, it secured a patent for a platform technology aimed at converting once-daily oral hair-loss drugs into long-acting injections administered once a month.
The gains extended beyond drugmakers. Bioneer, which develops hair-loss cosmetics, rose 20.1 percent over the past week, while MetaLabs, a provider of hair-transplant services, climbed 9.8 percent.
The rally comes as hair-loss treatments draw growing attention from global investors looking for a potential successor to the obesity-drug trade. Bloomberg has recently focused on the sector as Wall Street's "next gold mine," highlighting investor interest in a market that has gone decades without a major new treatment.
Veradermics, a U.S. biopharmaceutical company that went public in February, has already surged about 500 percent since its initial public offering. Absci, which is using artificial intelligence to develop treatments for hair loss, has more than doubled this year.
For Korean investors, the theme is not new.
JW Shinyak, Hyundai Pharmaceutical and Samik Pharm all hit their daily upper limits in June as speculation mounted that national health insurance coverage for hair-loss treatments could be expanded after President Lee Jae Myung called for a review.
That proposal has since lost momentum amid concerns that broader coverage could divert resources from patients with severe and rare diseases and add pressure to Korea's already strained national health insurance system.
The sector remains at an early stage, analysts say, with the biggest uncertainty being which companies can turn investor enthusiasm into viable products.
The obesity-drug market offers a cautionary precedent. Before Wegovy and Mounjaro emerged as blockbuster treatments, numerous would-be contenders failed to gain traction, and some of the companies behind them went bankrupt.