[IPO Spotlight] Voronoi Pursues Listing for Continuous Research and Development

Relisting Attempt After 2 Months... Expecting Success by Reducing IPO Size

[Asia Economy Reporter Park Hyungsoo] Drug design company Voronoi is pushing for a KOSDAQ market listing again just two months after submitting a withdrawal report for its initial public offering (IPO).

According to the Financial Supervisory Service on the 18th, Voronoi plans to raise at least 52 billion KRW by issuing 1.3 million new shares through the IPO. The proposed price range is set between 40,000 and 46,000 KRW per share. Demand forecasting will be conducted over two days from the 8th to the 9th of next month targeting institutional investors, after which the final offering price will be determined. The company aims to enter the KOSDAQ market by the end of next month following the subscription process. Korea Investment & Securities and Mirae Asset Securities are jointly serving as lead underwriters.

Previously, Voronoi halted its listing procedures after conducting demand forecasting over two days starting March 14, citing difficulties in accurately evaluating the company’s value.

Voronoi explained that it decided to retry the IPO after considering investor protection, company growth strategies, and market conditions from multiple perspectives. The offering volume was reduced, and the price range was lowered, shrinking the total offering size from 100 billion KRW to 52 billion KRW.

Voronoi is independently developing targeted therapeutics that selectively bind only to disease-causing kinases among over 550 kinases responsible for intracellular signal transduction. Through its core technology called 'Kinase Profiling,' Voronoi has been recognized for its technological prowess by addressing the issue where existing inhibitors fail to precisely target only the mutant proteins causing cancer and also affect proteins responsible for normal functions, leading to side effects.

Since its establishment, Voronoi has raised external funds due to the high growth potential and technological capabilities of various pipelines, including 'VRN07,' which is under development as a precision targeted anticancer drug. Despite continuous capital increases and technology transfers, losses have accumulated due to expenses such as personnel and research and development costs. As of the end of Q1 this year, accumulated deficits reached 104.7 billion KRW. Expenses recorded were 31.5 billion KRW in 2019, 13.4 billion KRW in 2020, and 12.5 billion KRW in 2021. The research and development expenses planned for the next three years amount to a total of 44.8 billion KRW, with 14.5 billion KRW, 19.9 billion KRW, and 10.4 billion KRW allocated respectively.

Voronoi has signed technology transfer agreements for four pipelines. It can receive milestone payments at each clinical development stage and royalties from sales after product commercialization. The pharmaceutical company that acquired the technology is preparing for Phase 1 clinical trials of the new drug candidates. As of the end of Q1, Voronoi holds 12.3 billion KRW in cash and cash equivalents. Until milestone payments from successful Phase 1 trials are received, it must externally fund research and development costs.

Of the IPO proceeds, 22.1 billion KRW will be invested as trial expenses for non-clinical and clinical tests and other outsourced research costs through 2024. 6.3 billion KRW will be used to purchase research reagents and consumables. The remaining 10.5 billion KRW will be allocated as operating expenses, including employee salaries, rent and management fees, commission fees, and other general administrative costs.

After the setback, Voronoi’s management lowered the offering price range by increasing the discount rate to 44.8% compared to the per-share valuation. Existing shareholders voluntarily agreed to lock-up their shares. Post-listing, the locked-up shares account for 74.4% of the total. Excluding the offering shares, the circulating shares within one month after listing are estimated at 15.31%.