Exclusive: Declared 'Inadequate' Two Months After Approval... Ministry of Health and Welfare Denied Support

[Anchor]

It has been revealed that the founder of a new drug development company linked to Justice Minister nominee Kim Seung-won applied for 32 billion won in government subsidies across five instances following approval from the Ministry of Food and Drug Safety (MFDS). However, unlike the MFDS, the Ministry of Health and Welfare (MOHW) denied all the funding requests, citing inadequate documentation.

Here is a report by reporter Son Hyeong-an.

[Reporter]

Kang Se-chan, the founder of Genencell, a COVID-19 therapeutics developer, applied five times starting December 6, 2021, for a government-funded subsidy project through which the Ministry of Health and Welfare provided clinical trial cost support to COVID-19 treatment developers.

This followed a request made through businessman Yang to Justice Minister nominee Kim Seung-won for a "fast-track" handling of the MFDS's clinical trial plan approval for the new drug, and began 41 days after the MFDS granted approval on October 26 of the same year.

The total amount of subsidies applied for across the five instances was 32 billion won.

This is the reason-for-rejection statement issued by the New Drug Development Project Group of the Ministry of Health and Welfare regarding Genencell's clinical subsidy applications, obtained by SBS.

The first application was rejected because "the basis for the mechanism of action and non-clinical efficacy was inadequate." From the second application up to the fifth application in September 2022, all requests were denied based on reasons such as "insufficient basis for efficacy in animal testing" and "no meaningful non-clinical efficacy data."

The Ministry of Health and Welfare concluded that Genencell's COVID-19 treatment had a "low likelihood of development," which starkly contrasts with the decision of the MFDS, which had approved the clinical trial plan.

Considering that Kang's subsidy applications were based on false reports, prosecutors indicted him on attempted fraud charges in 2024. When met with SBS, Kang protested as follows:

[Kang Se-chan / Founder of Genencell: Is it considered fraud if you apply for a national project and get rejected because the data was insufficient? If so, wouldn't all professors in our country be fraudsters?]

However, the court of first instance ruled him guilty, stating that it was a case of attempting to receive government funds through a "research and development plan containing false information and omitting side effects," which ended in an attempt.

[Han Ji-a / Member of the People Power Party: The Ministry of Health and Welfare must provide a clear explanation as to why the Ministry of Food and Drug Safety reached a different conclusion on matters determined to lack drug efficacy.]

Questions are mounting over on what grounds the MFDS granted approval, unlike the Ministry of Health and Welfare.

(Photo: Yonhap News)
(Video reporting: Kim Yong-woo, Seol Chi-hwan | Video editing: Seunghee | Design: Lim Chan-hyeok | Data courtesy of the office of Representative Han Ji-a of the People Power Party)
※ Please note: This article was translated by AI and may contain errors.