CHA Health Systems Poised for Accelerated Growth in Overseas Network and Research Development

CHA Health Systems (CHS), a global leader in bio-technology and healthcare, is poised for growth and expansion of the company’s overseas network and research development, under the guidance of its global research and innovation leader, Dr. Kwang-yul Cha. Headquartered in Pan-gyo Korea, CHS consists of 25 hospitals and clinics, 30 research and 14 education institutions, and 30 bio/pharmaceutical/healthcare companies. CHA Hollywood Presbyterian Medical Center is also a member of CHA Health Systems, which delivers world-class care in all facets of medicine — famous particularly for its research and clinical work in creating cutting edge therapies using cord blood stem cells and immune cells. The group is renowned for its women’s health services, offering a comprehensive suite of medical services to women of all age groups.

In a recent interview with leading Korean newspaper, JoongAng Daily, Dr. Cha shared his strategic vision for the group and the future of bio industry. Below are edited excerpts from the interview.

Tell us about your role.

I entrusted the president of CHA University Medical Center and the CEO of CHA Biotech with the task of managing the medical sector and business side of our group. I instead handle the overseas network and research development.

I focus on mapping out the group’s future growth engines and designing them. I concentrate on expanding the global networks [between our group and] other Pacific rim countries including the United States, Southeast Asian countries and Australia, as well as developing new drugs and medical technologies.

If the coronavirus pandemic hadn’t happened, I would’ve spent half the year overseas.

Any results?

In 2018, we acquired a 65 percent stake in an Australian company focused on women’s health services… We also acquired a 24-percent stake in Singapore-based Singapore Medical Group, which owns around 40 medical clinics in three Southeast Asian countries, and have become the major stakeholder of the group. We anticipate these movements will result in an increase in exports and create new business models in the health bio industry.

Shares of bio companies are on a roller coaster. Some say there are bubbles in the industry.

In the bio sector, there are a lot more failures than successes. As safety has been the most important issue in clinical trials, careful approaches are needed for investments in bio.

CHA Medical & Bio Group has two listed companies and I know that some investors are complaining about shares that have not been showing extreme changes. But I’m optimistic. I believe that the time will soon come when people realize the true value [of our companies].

What is the key factor in accelerating the growth of bio sector?

There are a lot of factors that we should take into consideration. To become a powerhouse in the bio sector, we need people. Korea should come up with national-level mid- and long-term plans to cultivate talent. Beyond Korea, they should be sent overseas and learn about advanced technology.

Scouting outstanding talent from foreign countries could be another option. CHA Biotech is currently building a facility that produces cell and gene therapies such as viral vectors through its U.S. subsidiary Matica Biotechnology, and has hired experts from related biotech companies, including Switzerland’s Lonza and Germany’s Boehringer Ingelheim, because we had no specialized manpower in Korea.

Any other strategies?

Building an ecosystem in the bio sector is important.

We should consider building a system where medical centers, research institutes and companies can work together and create synergy effects. Like Yul-gok Yi I’s argument of nurturing 100,000 soldiers [against possible foreign enemies], we should do the same with the bio sector. I think a solution is forming a bio city, a new city where 100,000 people can actually reside.

A research-focused hospital could be placed in the middle of the city, and hospitals specializing in each sector such as cancer or maternity clinics, bio research institutes and related biotech companies could be located around the hospital. Building facilities to produce high-technology biopharmaceuticals will maximize the synergy effects. It’s a bio cluster that includes hospitals, medical schools, biotech companies and research facilities altogether.

It’s impressive that CHA Medical & Bio Group has been showing active movements toward acquiring and establishing new hospitals and research centers.

They are our efforts to create a bio ecosystem. CHA University Bundang Medical Center, which was selected as one of the Korea Research-driven hospitals by the government in 2013, has been conducting research on incurable diseases using stem cell treatments. It also has the Global Stem Cell Clinical Trials Center, which is an essential center to raise abilities to develop new drugs.

At the CHA Bio Complex in Pangyo, many companies, research centers and CHA University School of Medicine are located. A contract development and manufacturing organization [CDMO] facility for gene and cell therapy will also be completed by 2024 in the second Pangyo Techno Valley in Gyeonggi.

Maybe the group is putting too much focus on expansion?

Not at all. We are working toward an open innovation system in the pharmaceutical sector and a bio ecosystem.

I suggest that the doctors at our hospitals lecture in our group-affiliated research centers or companies at least one or two times a year. These exchanges between industry and academia are important.

There’s no need for professors to constantly write mediocre papers [unless they are] very influential research that they can vie for Nobel Prizes or contribute to the industry. There should be a virtuous cycle that can lead the basic research conducted in universities or research centers to commercialization and the gains from commercialization back into the research centers again.

CHA Biotech is an important link in that virtuous cycle. CHA Vaccine Institute is currently preparing for a technology-based special listing on the Kosdaq market with its patent technologies in immune enhancement programs. Hospitals are platform businesses, and the bio companies harvest the fruit.

Are you currently developing any treatment using stem cells?

We have developed treatment for degenerative disk herniation utilizing umbilical cord-derived stem cells, and this has currently been undergoing Phase 2a clinical trials.

We have also achieved notable results in research about glioblastoma, one of the malignant tumors. The survival duration of patients with relapsed glioblastoma is generally six to eight months, but it has turned out that more than 40 percent of patients who used our new treatment lived for over two years.

We’ve also been conducting research into a few more things, such as restoring the function of ovaries and treatment for Parkinson’s disease using brain stem cells.

There are concerns that Korea’s regulations prevent the bio industry from further growth.

I hope [the government] eases some regulations for developing cell therapeutics using their own cells, just like Japan.

Autologous cell therapeutics are relatively safe as they have no immune rejection. Due to the tightened regulations, research and development for cell therapeutics in Korea are still showing slow progress.

I also hope the government starts offering enough research grants to pharmaceutical companies, at least for cost prices for the pharmaceuticals that are being used for clinical trials. The enormous cost needed for clinical trials has been an obstacle for future development in the country’s bio industry.
 
 
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