KUALA LUMPUR (Oct 25): CCM Duopharma Biotech Bhd has acquired a 5.8% stake in South Korean research-based biopharmaceutical company SCM Lifescience Co Ltd, which is developing cell therapeutics for autoimmune diseases, for 5.5 billion won or RM20.24 million.

In a filing with the stock exchange today, CCM Duopharma said it has entered into a share subscription agreement with SCM Lifescience and interested persons Sun U Song and Byung Geon Rhee for the subscription of 164,016 shares and 109,344 redeemable convertible preference shares.

The agreement marks its first foray into regenerative medicine, specifically in allogeneic stem cells.

The deal will allow CCM Duopharma to gain early access to the technology and the rights to market products by SCM Lifescience in Malaysia, Singapore, Brunei and Philippines, with the first right of refusal for all other ASEAN countries excluding Indonesia.

SCM Lifescience specialises in stem cell therapeutics with proprietary platform technology in the field of high-purity isolation and cultivation of mesenchymal stem cells. It is focused on developing next-generation stem cell therapeutics for difficult-to-treat autoimmune diseases.

“CCM Duopharma has been looking very closely at potential strategic investments in regenerative medicines as well as stem cells and today’s agreement has laid the groundwork to penetrate the South East Asian market and could provide a driving force for global expansion of both entities,” group managing director Leonard Ariff Abdul Shatar said, adding the investment is in line with the group’s strategy to enter niche areas as it allows it to expand its product portfolio into high-value therapeutics.

The products are expected to be ready to be commercialised in the next few years and will contribute to future earnings.

The acquisition will be financed through a combination of internally-generated funds and bank borrowings.

CCM Duopharma closed six sen or 5.36% down at RM1.06 today, valuing the group at RM701.59 million.