HEM Pharma Secures $40.4M Series Investment Led by GVA Asset Management

Microbiome healthcare company HEM Pharma announced completion of its second private convertible bond (CB) issuance totaling 54 billion won ($40.4 million) led by GVA Asset Management.

The round included 5 billion won ($3.7 million) from the Korean Growth Fund through a Mirae Asset Management sub-fund, 5.5 billion won ($4.1 million) from Timefolio Asset Management, and 5 billion won ($3.7 million) each from Korea Investment & Securities and A1 Asset Management.

HEM Pharma will allocate 27 billion won ($20.2 million) of the proceeds to construct Sejong Plant 2, following Plant 1 completed in 2023. The expansion responds to increased orders from global partner Amway. The company’s secured orders this year for its microbiome analysis service MyLab and new probiotic products have already reached approximately 13.9 billion won ($10.4 million), surpassing the entire 2025 revenue of about 13 billion won ($9.7 million).

“The broad participation of institutional investors plus the Korean Growth Fund demonstrates that both private and public sectors trust our fundamentals and global growth trajectory,” said Yosep Ji, CEO of HEM Pharma. “We will break ground on Sejong Plant 2 this year on our secured site, targeting commercial operation in the second half of 2027, to achieve solid results in major global markets including the United States.”

In June, HEM Pharma received a formal purchase order for a co-developed probiotic product from Access Business Group, Amway’s global supply chain affiliate. The approximately 4.6 billion won ($3.4 million) order covers initial supply for the Korean market, with the product set to launch domestically through Amway Korea in September. Mass production is now underway.

The company accelerated the plant construction to prevent bottlenecks as it enters the U.S. health supplement market, which is projected to grow at a compound annual rate of 5.8 percent through 2031. After roughly three years of technical due diligence and quality verification, production volumes previously handled in Amway’s existing global supply chain have been transferred to HEM Pharma’s GMP-certified Sejong plant.

“We confirmed through the Japanese pre-order that demand for personalized probiotics grows in markets with higher income levels and greater willingness to pay for health services,” Ji said. “The contract structure scales supply with each regional expansion, so geographic growth directly converts to revenue growth. We are discussing launch expansion to major markets including the U.S. and Japan from 2027 and are coordinating additional orders this year.”

The proceeds are designated for 27 billion won ($20.2 million) in Sejong plant capital expenditure, 7.5 billion won ($5.6 million) for analysis capacity expansion and automation, 15.5 billion won ($11.6 million) in operating capital, and 4 billion won ($3 million) in other funds reserved for call-option exercise on the first CB. No funds are earmarked for debt repayment. The other-funds category will be fully allocated to exercising the first-round CB call option to stabilize management control.

All participating institutions accepted a fixed conversion price of 43,912 won per share without the downward repricing clause typically required in mezzanine investments, finalizing the issuance of 1,229,732 shares (14.55 percent). Conversion may be exercised one year after payment, and early-redemption rights become available after two years, minimizing short-term overhang and repayment pressure. The repricing clause in the first-round CB was also removed by unanimous consent in June, fully eliminating derivative valuation profit-and-loss risk from the financial statements.

The 7.5 billion won ($5.6 million) allocated to analysis will fund full-process automation equipment for gut microbiome analysis. MyLab Plus, the analysis service launched in Japan in May, recorded a cumulative 90,000 contracts worth approximately 9.3 billion won ($7 million) in its first year. A February pre-order of 70,000 tests (about 7.2 billion won, or $5.4 million) was followed by an additional 20,000 tests (about 2.1 billion won, or $1.6 million) in May, proving strong demand and expansion potential in the Japanese market.

With Japan’s demand handled by the domestic Gwanggyo research center, the company plans to expand analysis throughput progressively through automation. The target is to at least double current capacity by the end of 2027 and to secure more than five times current capacity by the end of 2028 for global expansion including the United States. This is expected to continuously lower per-test analysis costs and maximize operating leverage as revenue grows.

Of the operating capital, 7.5 billion won ($5.6 million) will be used to advance BiGNAL, an AI-based autonomous health-management platform. The toilet-mounted device analyzes biosignals via AI and provides personalized solutions; HEM Pharma recently signed a pilot contract with Celltrion to conduct a demonstration for employees.