BARCELONA -- Samsung Biologics Co., the world’s top contract manufacturing organization by capacity, is looking for acquisitions of new drugmakers to accelerate growth while planning to build an antibody-drug conjugate (ADC) factory in South Korea to diversify its business, President & CEO John Rim said.
The contract development and manufacturing organization (CDMO) of South Korea’s largest conglomerate Samsung Group is also expanding its business through cooperation on contract development organization (CDO) deals with 20 global maker drugmakers, Rim said on Wednesday.
“It is hard to escalate to the next level only with the existing CDMO and biosimilar businesses,” Rim told reporters on the sidelines of CPHI Worldwide 2023, a global bio and pharmaceutical conference, in Barcelona. “We need to grow to a company with (sales of) 40 trillion won-50 trillion won ($29.5 billion-$36.9 billion) by adding a new drug development business.”
The South Korean company reported sales of 3 trillion won last year.
“To take a leap to the next level, it is necessary to acquire new drugmakers,” he said, adding the company is considering acquisitions of companies at home and abroad.
“Stock prices did not rise as much as we had expected. That is a market signal that we need to work on new businesses.”
Shares in Samsung Biologics have lost 11.2% as of Thursday so far this year in the South Korean stock market where the main Kospi has gained 2.8%.
The company is looking to log an operating profit of 1 trillion won in 2023, up 1.7% on-year, Rim said. Its profit rose 13.9% to 763.7 billion won in the first three quarters of this year.
TO BUILD ADC FACTORYSamsung Biologics has decided to establish an ADC plant by the end of 2024 at its bio campus inside the free economic zone in Songdo, Incheon, west of Seoul, Rim said.
“The ADC market is not that big but its growth is faster than that of the biopharmaceutical sector,” he said.
ADCs are a class of drugs designed as a targeted therapy for treating various cancers. ADCs are in the spotlight as a next-generation treatment as they are intended to target and kill tumor cells while sparing healthy cells, unlike chemotherapy.
Switzerland’s Lonza, the world’s top CDMO, has been expanding its ADC production facilities.
Samsung Biologics may consider producing other products at two of its new factories to be completed rather than the existing antibody drugs, Rim said.
The company on Wednesday said it plans to invest 7.5 trillion won to build four plants by 2032 in Songdo.
EXPANDING TO CDO BUSINESSSamsung Biologics is currently manufacturing antibody drugs, biosimilars and other products for 14 global healthcare giants such as
Pfizer Inc.,
Bristol Myers Squibb and
Novartis.The contract drugmaker expanded its business to the CDO sector by developing processes for mass production and manufacturing materials for clinical trials for those major customers.
“It is easier to extend the businesses of existing clients than secure new customers,” Rim said.
Write to Dae-Kyu Ahn at
powerzanic@hankyung.com
Jongwoo Cheon edited this article.
