InterviewDaegu sets its sights on becoming Korea’s Boston

Park Gu-sun, chairman of the Daegu Gyeongbuk Medical Innovation Foundation, also known as K-MEDI Hub, speaks during an interview with The Korea Times at his office in Daegu, Sept. 9. Korea Times photo by Shim Hyun-chul

DAEGU — The southeastern metropolitan city of Daegu shares a similarity with Boston, the global hub of life sciences.

Like Boston, which boasts world-renowned universities, nearly 1,000 biotech companies and the headquarters of major pharmaceutical giants, Daegu is home to several high-end medical centers and a growing pool of biomedical talent. This strong infrastructure was a key reason why the landlocked city was chosen to host the Daegu Gyeongbuk Medical Innovation Foundation, better known as K-MEDI Hub.

Established in 2010 under the Ministry of Health and Welfare, K-MEDI Hub supports pharmaceutical and biotech startups with the goal of nurturing unicorn companies and positioning Daegu as Korea’s life sciences capital.

“In Korea, Daegu ranks third in the number of professionals in the medical field — including doctors, nurses and veterinarians — following Seoul and Gyeonggi Province,” said Park Gu-sun, chairman of K-MEDI Hub, in an interview at his office with The Korea Times on Sept. 9.

The foundation traces its origins to former President Roh Moo-hyun’s vision to transform Korea into a global leader in pharmaceuticals and life sciences.

Roh foresaw the biomedical industry as Korea’s next growth engine at a time when many were satisfied with the success of semiconductors and automobiles. He had a keen sense of which industries would rise or fade in the coming decades and was convinced that biomedical innovation could one day outpace even the then-booming tech and auto sectors.

During his presidency from 2003 to 2008, Roh established the Osong Bio Valley in North Chungcheong Province and laid the legal groundwork for K-MEDI Hub, which launched two years after he left office.

“Roh was right. The biomedical industry has great potential,” Park said. “It’s a $1.7 trillion market — nearly three times the size of the semiconductor industry.”

As an example, he noted that local pharmaceutical company AbbVie earns more revenue from its antirheumatic drug Humira than Hyundai Motor does from its popular Sonata model.

“You can imagine how much the nation stands to gain if we build a thriving biomedical sector,” Park added.

Because of the enormous financial rewards, developing a blockbuster drug is a dream for every pharmaceutical company. But it is also a high-stakes gamble — one that can make investors fabulously wealthy if successful or drive them to bankruptcy if it fails.

Park said this all-or-nothing nature explains why blockbuster drugs are so rare.

“When you look at Big Pharma, you’ll see that a large portion of their revenue comes from a very small number of blockbuster drugs,” Park noted.

The financial risks are not the only obstacle. The entire process of drug development is long, complex and fraught with challenges.

The journey begins with identifying potential candidate components — a phase the industry calls “discovery.” According to Park, the odds are daunting.

“Out of 10,000 compounds screened, scientists may find only 10 candidates worth further study,” he explained. “This is why the first stage of discovery is nicknamed the ‘Devil’s Swamp’ — once researchers are stuck in experiments, it is extremely difficult to escape.”

Even if scientists overcome this stage, another challenge awaits — the so-called “Death Valley.” This stage involves proving that a discovered component can actually become a viable drug target, a process as demanding as the first phase.

Only after years of hard work do successful candidates proceed to preclinical research, clinical trials and postmarket safety monitoring, before being released as new drugs.

Because of the high failure rates and enormous costs, few startups or smaller companies dare to pursue new drug development alone. This is where K-MEDI Hub comes in.

Established to support innovative but financially constrained pharmaceutical startups and biotech firms, the hub has seen tangible progress over the past 15 years.

Park cited Celltrion’s emergence as a global leader in the biosimilars market and Yuhan Corporation’s breakthrough in lung cancer therapy as some of its biggest sucess stories.

“Celltrion has opened the global market for biosimilars, which is highly significant,” he said.

K-MEDI Hub also played a role in the development of Yuhan’s lung cancer drug Leclaza in its early development process, collaborating with the company in molecular design.

“We will continue to foster innovation and partner with startups so they can grow into unicorns like Celltrion,” Park said.

The idea of creating a state-run think tank to support the biomedical industry originated with former president Roh.

During his presidency, Roh pushed for massive investment in infrastructure for the biomedical sector. Ambitious in vision, he vowed in October 2003 to make Korea the world’s seventh largest player in the biomedical industry. At the time, Korea accounted for just 1.3 percent of the global market. Roh declared the nation would continue investing so its share could rise to 12 percent by 2012.

His dream, however, remains unfulfilled. Today, Korea ranks as the world’s 13th-largest pharmaceutical player, though the industry is expanding rapidly.

Investment in biomedical innovation has since become a bipartisan priority. During his term, former President Yoon Suk Yeol pledged to create a bio cluster to help Korea become the world’s sixth largest player in the field. On Sept. 9, President Lee Jae Myung vowed to make the biomedical sector one of six strategic industries to power Korea’s future growth, alongside artificial intelligence (AI), culture, defense, energy and manufacturing.

According to the Korea Biotechnology Industry Organization, the sector grew at an annual rate of 13.2 percent between 2019 and 2023, driven largely by biosimilars and contract manufacturing organizations.

President Lee Jae Myung speaks at a seminar to boost the biomedical industry held in Songdo Convensia, Incheon, on Sept. 5. From left are Trade Minister Kim Jung-kwan, Deputy Prime Minister and Minister of Economy and Finance Koo Yoon-cheol, President Lee, Science Minister Bae Kyung-hoon and Health Minister Jung Eun-kyung. Yonhap

Like in other industries, AI is set to be a game changer in life sciences. Park noted that AI could dramatically reduce the time and cost of drug development while enabling breakthroughs in early disease detection.

“The AI-driven revolution in life sciences has already begun,” Park said, citing the example of VUNO, a biotech startup that released Korea’s first AI-powered medical equipment for disease detection.

Traditional imaging technologies such as X-rays, CT scans and MRIs typically yield diagnostic accuracy rates of around 50 percent, meaning about half of radiologists’ cancer diagnoses, for example, may be inaccurate. “But VUNO’s AI-based equipment has boosted accuracy to 70 percent,” Park said.

To keep pace with these changes, K-MEDI Hub recently underwent a major reshuffle to better support startups in the AI-driven life sciences era.