Eli Lilly bets big on South Korea as Asia's core R&D hub

Eli Lilly, the global pharmaceutical giant that dominates the obesity and metabolic disease treatment market, has designated South Korea as its primary research and development hub in Asia, unleashing a wave of major investments and landmark deals in the country.

The company's sweeping partnership drive — spanning the government, established pharmaceutical firms, biotech ventures and contract development and manufacturing organizations — signals that South Korea's biotech industry has fully arrived on the global stage of drug development.

Lilly closed a series of deals with South Korean companies in the first half of this year, including multibillion-dollar technology licensing agreements, equity acquisitions and open-innovation co-development arrangements, according to pharmaceutical and biotech industry sources.

The push began with a strategic commitment to the government. On March 9, Lilly signed a memorandum of understanding with South Korea's Ministry of Health and Welfare, pledging $500 million (about 740 billion won) in investment in the country's biotech ecosystem over the next five years. The roadmap centers on expanding clinical trial activity, corporate social responsibility initiatives and transplanting Lilly's advanced bioventure incubation platform to Korea.

The investment took concrete shape through a landmark partnership with Samsung Biologics. In March, Lilly announced it would collaborate with Samsung Biologics to establish Lilly Gateway Labs (LGL) within the second bio campus in Incheon's Songdo, targeting completion in July 2027. South Korea marks the first time Lilly has partnered with a local company abroad to build an incubation hub anywhere in the world.

The Korean LGL site will be Lilly's second location outside the United States — after China — and will accommodate up to 30 early-stage biotech startups, from seed to Series A, providing direct research and development support. Lilly will supply its R&D infrastructure and mentorship, while Samsung Biologics will back resident companies with its world-class CDMO capabilities. Samsung Biologics will also separately establish an industry development fund worth 25 billion won.

Lilly's partnership offensive has translated directly into securing key pipeline assets from South Korean drug developers. Hanmi Pharmaceutical signed a technology licensing deal with Lilly on June 1 for sonepeglutatide, a candidate treatment for short bowel syndrome, a rare disease. The agreement carries a confirmed upfront payment of $75 million (about 112.9 billion won), with total deal value reaching up to $1.26 billion (about 1.9 trillion won) upon achievement of milestone targets.

In May, Lilly agreed to acquire Curevo, the US affiliate of GC Biopharma, for up to $1.5 billion (about 2.25 trillion won), securing global rights to a next-generation shingles vaccine candidate. GC Biopharma received approximately 459.9 billion won from the transfer of its equity stake in the transaction.

In December last year, Lilly entered an open-innovation agreement with bioventure Medigen to co-develop an obesity treatment candidate through clinical trials. The company's collaboration with OliX Pharmaceuticals — which completed a technology licensing deal worth roughly 911.7 billion won in February last year — on treatments for metabolic dysfunction-associated steatohepatitis and obesity has also continued into this year.

ABL Bio signed a technology licensing and joint research and development agreement with Lilly in November last year for its IGF1R-based blood-brain barrier platform, Grabody-B. The total deal value stands at $2.602 billion (about 3.8072 trillion won), with ABL Bio receiving approximately 80.5 billion won, including a $40 million upfront payment and a $15 million equity investment.

Industry observers attribute Lilly's aggressive spending in South Korea to the country's growing technological maturity. Where Korea once served merely as a contract manufacturing base for cell lines, analysts say it has reinvented itself as a core R&D hub capable of independently supplying differentiated first-in-class drug candidates and platforms in obesity, metabolic disease and rare disease — fields poised to lead global markets.

"The fact that Lilly has activated a dense investment network connecting the Korean government, large conglomerates and ventures is proof that Korean biotech's R&D credibility has reached the highest level in the world," an industry official said. "The startups that emerge from Lilly Gateway Labs in Songdo will drive subsequent major deals with global pharmaceutical companies, completing a virtuous cycle ecosystem."