Financial, August 29SK is making its next bet on bioscience, after energy, chemical and information and telecommunication, which have been serving as its growth engine so far. The company envisions transformation into a biotechnology company from an oil refinery in about 10 years. R&D roadmap = SK plans to invest more than 100 billion won in the biotechnology business this year, and make the year the starting point to lay the foundation for growth in the field. To this end, the company has decided to develop Chinese medicine, a traditional popular medicine, and has started massive investment. The company opened a bioscience research institute in Shanghai, China, in order to set up a network of three research pillars encompassing bioscience research institutes in the U.S. and Korea. Through scientific study and understanding of the traditional Chinese medicine, it seeks to develop new products and market them not only in China but also Korea and elsewhere. SK has increased investments by a bio fund, which the company raised jointly with Shanghai City government late 2001, starting this year, and is now working on 14 projects for product development. Also, the company plans to continue to invest in bioscience ventures. Accordingly, it is set to invest more than 20 billion won a year to support venture firms. SK is focusing more on sales than on product development. The company is planning to forge partnerships with major drug-makers, including Janssen and Johnson & Johnson, to launch a global marketing strategy. ?If we sell products through partnerships with foreign companies, we get less profit margin. But this strategy is helpful in expanding the sales, because we can take advantage of their name value,? said an official with SK Pharma. Achievements so far = The two locomotives that pull the bioscience sector at the SK Group are SK Corp. and SK chemicals. SK chemicals invests about 200 billion won in research and development every year, and is actively engaged in the development of new products in traditional medicine, encompassing natural materials, and synthetic drugs. On the other hand, SK Corp. is focusing on research and development of drugs to treat diseases in central nerve system, and cancers. The hubs that will determine the future of SK?s life science are Daedeok research institute in Daejeon, and Life Science Institute. Also, its research center and pharmaceutical development center in New Jersey are playing key roles. SK has already made fruition in the life science area. An anti-depressant drug, and an epilepsy treatment, which are new drugs developed by SK Corp.?s research institute in the U.S. in 1996 and 1998, respectively, win approval for clinical trials from the U.S. Food and Drug Administration. At present, the two drugs are undergoing second phase clinical trials. In a move to push for a global marketing drive, the company handed over the rights for the drugs to Johnson & Johnson of the U.S. for tens of millions of dollars in technology fees and loyalty in 1999 and 2000, respectively. SK Corp. and Johnson & Johnson will proceed with the complete development of the new drugs in a close collaboration, including joint research, and will start to sell them in 2006 and 2007 in earnest. Meanwhile, the sales revenue of SK Pharma, and Dong Shin Pharma, which SK chemicals established with an intention to proactively move into the bioscience, surged last year, with their combined sales surpassing 100 billion won. Reporter - Soon Jea Hong