Contract development and manufacturing organization Samsung Biologics was one of many companies to attend the 30th CITIC CLSA Investors’ Forum in Hong Kong in September, an event organized by CLSA and CITIC Securities to provide a platform for companies to share growth strategies with the global investment community. At the event, the CDMO shared its expansion plans, financial growth, and the state of its drug manufacturing and development portfolio.
“Investors met with Samsung Biologics’ executive members and asked mainly about Samsung Biologics’ business strategy, involving the company’s success in securing new contract manufacturing orders from global pharmaceutical firms, as well as in its ongoing expansion of manufacturing capacity,” an official from Samsung Biologics told the Korea Herald.
The CDMO is currently under contract with 14 of the top 20 global pharmaceutical firms as well as many other smaller concerns. It’s also been investing in its cell line development platform, antibody manufacturing capacity, and new technologies such as mRNA and antibody-drug conjugates.
Samsung Biologics’ 2023 Deals
After announcing an $897 million biosimilars contract with Pfizer and a $391 million contract with Novartis earlier this year, Samsung Biologics recently secured a $242 million contract manufacturing deal with Bristol Myers Squibb.
Its new orders for 2023, currently at eight, are now worth more than 100 billion South Korean won (approximately $74.9 million).
The CDMO’s earnings have increased year over year as a result. In the first half of 2023, it posted nearly 1.6 trillion won in sales and over 445 billion won in operating profits. Its operating profits are expected to exceed 1 trillion won by the end of the year. Samsung Biologics would be the first Korean pharmaceutical company to do so.
“Our consistent delivery of quality service and operational excellence, coupled with our expanded strategic partnerships with top global pharmaceutical companies, have been pivotal in driving stable revenue growth,” said John Rim, president and CEO of Samsung Biologics in the company’s earnings report.
Diversifying the CDMO Portfolio
In addition to its foundational business of securing manufacturing contracts, Samsung Biologics has ventured into diversifying its portfolio with several recent investments in early-stage biotechnology companies working in fast-developing areas.
Through the Samsung Life Science Fund, the CDMO recently invested in AimedBio, a Korean biotech firm specializing in antibody-drug conjugate technologies. The partnership is expected to include a research focus on co-developing ADC technologies, technologies that have the potential to be integral in targeted drug delivery for cancer therapy. Additionally, a contract development agreement was signed to progress AimedBio’s monoclonal antibody therapy for dementia and atopic dermatitis.
Previously, the Samsung Life Science Fund invested in Jaguar Gene Therapy, Senda Biosciences, and Araris Biotech AG, companies with expertise in ADCs and gene therapy technologies.
Rim has expressed the company’s enthusiasm for the growing ADC market, which some experts expect to grow by nearly 20% and reach 29.6 billion by 2030.
“Probably the quickest area of growth for us is ADC,” said Rim at the J.P. Morgan Healthcare Conference in January. “Our current clients are producing monoclonal antibodies which then get sent to a different CDMO for the linkage and conjugation components. So, we’re trying to vertically integrate.”
The Bigger Picture
Financially, Samsung Biologics reported a Q2 2023 revenue of 866.2 billion won, a 33% increase compared to the same quarter in the previous year, with an operating profit of 253.4 billion won, which was 49.4% higher than the prior year.
Revenue tied to Plant 4, which the CDMO completed in June, is anticipated to be reflected in its 2023 third quarter results.The Bristol Myers Squibb and Pfizer agreements will utilize Plant 4 for monoclonal antibody and biosimilars manufacturing.
Looking ahead, Samsung Biologics has already broken ground on a fifth plant, with plans to commence operations by April 2025. The company currently has the most manufacturing capacity at any one location in the world at its Songdo, South Korea, headquarters. It currently sits at 604,000 liters, and Plant 5 is expected to add 180,000 liters to its current capacity. Plant 5 is the first facility planned for construction at a new Bio Campus, which will be constructed over the next several years and add additional plants and an open innovation center for incubating new technologies.
In recognition of its track record, Samsung Biologics recently secured the No. 2 spot in the Health Care & Life Sciences category of Newsweek’s inaugural World’s Most Trustworthy Companies 2023 list. There were over 70,000 participants and 269,000 evaluations involved in determining the award’s recipients. The CDMO was one of 1,000 companies selected across 23 industries, with selections based on a holistic approach to evaluating corporate trust.