More than a decade into its entry into the biopharmaceuticals space, Samsung Biologics has established itself as one of the larger contract development and manufacturing organization (CDMO) players. The company has been proactive in increasing its manufacturing capacity, which grew to an industry-leading 604,000 liters with the completion of its fourth plant in June. It followed this up by announcing plans to begin construction of a fifth plant in 2023, and by revealing an expanded alliance with Pfizer.
The Pfizer contract expansion totals $897 million in a, including a $704 million deal that’s Samsung Biologics’ most significant to date. Samsung Biologics will use its newly constructed fourth plant to produce biosimilars for Pfizer.
Collectively, the 2023 contracts between Pfizer and Samsung Biologics tally up to $1.08 billion. A portion of these contracts is expected to be dedicated to manufacturing a biosimilar counterpart to Humira, AbbVie’s widely used medication for various inflammatory and autoimmune conditions.
Samsung Biologics has also recently initiated another round of legal action against Lotte Biologics, a newcomer to the CDMO scene. Lotte, which began operations in 2022, is helmed by former Samsung Biologics head of drug product development Richard Lee. In a series of cases beginning last year, Samsung Biologics has alleged that Lotte is attempting to leverage proprietary trade secrets by poaching Samsung Biologics employees.
Samsung Biologics and the CDMO Industry Landscape
Samsung Biologics’ substantial Pfizer contract is indicative of the growing symbiosis between pharmaceutical companies and CDMOs. Big pharma companies are progressively outsourcing manufacturing and development. According to a recent Mckinsey & Company report, in 2020, roughly 45% of drugs in the pipelines of the 20 biopharmaceutical companies with the biggest research and development budgets were sourced externally. The same report found that in 2021, 66% of the entire industry’s pipeline revenues were generated from these externally sourced drugs.
And biosimilars are an area of increasing interest. Recognized as cost-effective substitutes for commonly used biologic drugs, biosimilars have been gaining momentum for years in areas such as oncology and immunology. The Wall Street Journal recently reported that the global market for biosimilars is expected to grow to $88 billion by 2030, an exponential increase from its $15.5 billion valuation in 2021. According to the report, these projections could be due to the fact that many top-selling medications are biologics that will be off-patent by 2033.
Samsung Biologics has invested in the technology with its new plants and a 2022 full acquisition of Samsung Bioepis, a biosimilars firm founded as a joint venture with Biogen in 2012. Its partnership with Pfizer is speculated to involve manufacturing a biosimilar for Humira, the world’s top-selling medication. Humira’s patent expired this year.
Artificial intelligence has also contributed to the growth of the industry, as it can be used to identify and design effective genetic-based therapeutics. The pivotal role of AI was particularly evident in the race against COVID-19, where the development and approval of mRNA vaccines, once a distant dream, became a reality in record time.
This future-forward combination of biotechnological innovations and AI has caught the eye of investors. The potential of innovative biopharmaceuticals for treating a spectrum of diseases, from autoimmune diseases and blood disorders to cancers and diabetes, combined with the prospects of more accessible treatments in the form of biosimilars, has piqued investor interest in the sector.
The Path Forward
As CDMOs like Samsung Biologics steer the health care industry toward an era defined by novel biotechnological therapies, their partnerships with prominent pharmaceutical corporations might become more commonplace. The health careindustry is increasingly turning toward biotechnology for solutions — and the CDMO sector, backed by continuous advancements and investments, appears poised for exponential growth. The hope is that this growth ultimately results in more accessible treatments for patients and breakthroughs in pharmaceutical technologies.
John Rim, Samsung Biologics’ president and CEO, expressed optimism in a June statement on the Pfizer deal.
“We are pleased to extend the strategic collaboration with Pfizer as we share and support their strong vision to bring innovative solutions for patients around the globe,” said Rim. “This new meaningful partnership comes just as our Plant 4 is fully completed early this month as we had previously committed and are on the move for future expansion into our second campus in order to provide our clients with even more flexible and advanced manufacturing technology.”
“Our collaboration with Samsung Biologics will have the potential to significantly improve the lives of patients globally,” added Dong-Wook Oh, Pfizer Korea country manager.
With companies like Samsung Biologics investing in innovation and exploring further expansion opportunities, we can expect the CDMO industry to continue pushing the boundaries of what’s possible in biopharmaceuticals. The sector’s future, it seems, is as exciting and dynamic as the life-changing treatments it promises.