Samsung Biologics maintains hot streak with latest biomanufacturing contract

Samsung Biologics signed a $390.9 million biomanufacturing deal with Novartis Pharma, the Incheon-based pharma manufacturer said Monday.

Samsung Biologics’ third plant in Songdo, Incheon [SAMSUNG BIOLOGICS]

Samsung Biologics signed a $390.9 million biomanufacturing deal with Novartis Pharma, the Incheon-based pharma manufacturer said Monday.

With this latest contract manufacturing organization (CMO) deal, Samsung Biologics’ contract value so far this year reached 2.34 trillion won ($1.79 billion), surpassing its previous record of $1.66 billion won in 2020.

CMOs refer to companies that provide drug manufacturing services on a contract basis. The five-year deal with Novartis, a Swiss pharmaceutical company, followed a letter of intent signed in June last year, according to Samsung Biologics’ regulatory filing on Monday.

The contract amount, expanded from the previously announced $81 million to $390.9 million, is equivalent to 17 percent of Samsung Biologics’ revenue last year.

The latest contract with Novartis came after Samsung Biologics announced a massive $897-million worth of CMO deals with Pfizer Ireland Pharmaceuticals on July 4, which marked the largest for the company since its establishment in 2011.

Samsung Biologics recently started full operation of its fourth plant in Songdo, Incheon, which has a production capacity of 240,000 liters (63,401 gallons). It is the world’s largest single pharmaceutical manufacturing facility.

The latest plant brought the company's annual production capacity to 604,000 liters, which Samsung Biologics said is equivalent to nearly 30 percent of the global contract manufacturing market for biopharmaceuticals.

Moreover, Samsung Biologics announced in March that it will invest 1.98 trillion won to build its fifth production plant, which started construction in April.

Analysts expect the added production from the fourth plant will be reflected in the earnings performance starting in the latter half of this year.

Meanwhile, Samsung Bioepis, wholly owned by Samsung Biologics, recently began selling Hadlima, a biosimilar of the blockbuster autoimmune diseases drug Humira, in the United States.

BY SHIN HA-NEE [shin.hanee@joongang.co.kr]