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South Korea’s factories stretched to limit churning out virus tests

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South Korea’s factories stretched to limit churning out virus tests

April 6, 2020
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South Korea’s factories stretched to limit churning out virus tests
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For the past month Noh Hyun-jung has worked 12 hour days deep inside a science park in Daejeon, South Korea, spending most of her time gluing labels on to plastic containers for chemical reagents used in testing for Covid-19.

It is not what the 35-year-old trained for. She is a highly educated specialist in systems management, but one of many technical experts at biotech group Solgent who have been redeployed to jobs on the assembly line as virus test kit makers struggle to satisfy a torrent of orders from abroad.

“This isn’t my job,” said Ms Noh, “but labour is in such short supply so I’ve been helping out production workers all day long.”

South Korea has rapidly become one of the world’s biggest producers of test kits for coronavirus after its testing of nearly half a million people helped bring under control what was for a time the worst outbreak outside China.

Five Korean biotech groups have won government approval for the domestic sale of kits that detect current infection with Covid-19, known as PCR tests. They are already producing enough kits to test about 135,000 people a day, according to the presidential office.

In total South Korea has 22 companies producing commercialised Covid-19 test kits, a number exceeded only by the US and China, according to the Foundation for Innovative New Diagnostics (Find), a non-profit group that tracks product development.

However, despite planning for rapid growth and the esprit de corps among workers, there are clear signs of strain at the heart of the test kit supply chain.

Global demand for tests was estimated to be about 700,000 a day in late March, according to analysts in Seoul. But it is forecast to rise as much as seven-fold as the outbreak spreads and countries including the UK see the wisdom of South Korea’s strategy of extending testing from just patients with severe respiratory problems to people who have mild symptoms or none at all.

Seegene, a molecular diagnostics company in Seoul, has cut back production of kits for 60 other diseases to focus on Covid-19 and is hiring 100 part-time workers to ease the pressure on its employees. It is building a new factory to make the kits, but for now has converted meeting rooms and office space into production lines.

“Demand from all over the world is far outstripping our supply,” said Noh Si-won, Seegene’s strategy director. Executives expect the company’s annual sales will increase nearly tenfold to Won1tn ($809m) this year.

So far more than 110 countries have sought South Korean testing kits. Inquiries have come from all quarters: governments, foreign health authorities, hospitals, laboratories, as well as multinational companies seeking kits for employees. Donald Trump, the US president, last month made a direct appeal to his counterpart in Seoul, President Moon Jae-in. 

Pandemic-sensitive regulations are a key reason why South Korea has been able to boost its domestic capacity. After the 2015 Mers epidemic the country changed the law to expedite regulatory approvals during infectious disease outbreaks, enabling its biotech sector to quickly switch focus on Covid-19 after reports of the first outbreak in Wuhan in January. 

Highlighting the speed at which the Korean groups moved, Kogene Biotech began to develop coronavirus test kits before South Korea had its first confirmed infection in January, using the Covid-19 genetic test code released by China. In February, the company won approval for sale of its test kits within a week of applying and it now produces 10,000 test kits a week, each used to test 25 people. It plans to triple its output.

But tight supplies of chemicals required in testing kits is a growing concern at the companies, with problems emerging in sourcing key ingredients, including from the US, according to several of the Korean groups and an industry association.

“We are running low on raw materials due to temporary delay of imports from abroad,” said Kim Kwang-chul, an official at BioSewoom, a group exporting kits to Indonesia and the Philippines. 

Solgent — which saw 12 months’ worth of sales in March alone — is using an intermediary to export its kits to other parts of Asia, Europe and the US, but many would-be buyers from around the world are also contacting the company directly with desperate pleas.

“We are getting more than 200 calls a day asking about kits . . . it is hard to handle,” said Park Sang-jin, a director at Solgent. 

On the company’s production line, where she is packing kits into boxes, Lee Mi-hyun, 30, says: “We are working overtime for three hours almost every day and coming to work on weekends because we have to produce more . . . It is tiring, but I am happy that our exports are growing so much.”

The post South Korea’s factories stretched to limit churning out virus tests appeared first on Financial Times.

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