Samsung Biologics, the Samsung Group’s biopharmaceutical unit in South Korea, is looking to build its first factories in the US and Europe as it rebalances its global supply chains after the pandemic.

The world’s largest contract drug maker, producing for other global pharmaceutical companies, is cash-rich two years after the pandemic, posting a 35 percent increase in 2021 revenue. Production order backlog has risen 25 percent to $7.5 billion due to rising demand for coronavirus treatments offered by US drugmaker Eli Lilly and UK’s GSK and AstraZeneca.

John Lim, the company’s CEO, told the Financial Times that the company wants to build factories overseas to be closer to its key customers and meet the rising demand for contract manufacturing.

“The Covid situation has placed greater emphasis on the need for diversification and risk management, especially around supply chain management. It has also emphasized the need to do things quickly,” said Lim, who has headed the company since December 2020.

He said demand for Covid antibody treatments has outpaced supply due to growing orders from US customers, although demand for Covid vaccines has declined recently due to the Omicron variant. The company added that it has not yet experienced a significant supply disruption due to the war in Ukraine.

The company signed a fill and finish agreement with Moderna last May and began manufacturing vials of Moderna’s mRNA vaccines in September. From April, it will also begin production of GreenLight Bioscience’s mRNA vaccine candidate, which is in its third phase of clinical trials.

The pandemic has helped the company rapidly expand its product portfolio. It has diversified from its focus on monoclonal antibodies — molecules designed to fight cancer and autoimmune diseases — to offer products, including next-generation cell and gene therapies and vaccines using mRNA, against its Swiss rival Lonza Group and the German Boehringer Ingelheim.

Column Chart of By Product Type ($tn) with Global Pharmaceutical Revenue

Lim said biosimilars, which are priced lower than branded products, are penetrating Europe faster than in the US, citing more complicated patent and pricing issues in the US.

“But the US will also start to pick up as all health systems worldwide are under more pressure to cut costs and lower costs. [treatments] more available to patients,” he said.

Samsung Biologics expects to double its market share for large-scale monochrome antibody production to 40 percent next year once its fourth $1.4 billion plant in Songdo comes online in October.

Global sales of biologics are estimated to be $419 billion this year, still smaller than their chemical counterparts at $542 billion, but the market is expected to grow 35 percent to $564 billion by 2026, according to research firm Evaluate Pharma.

But contract manufacturing of biologics requires greater investment and a demanding manufacturing process that, according to Lin, is comparable to semiconductors in that it cannot be contaminated by bacteria.

Samsung Biologics has also been on a takeover hunt. It recently agreed to buy Biogen’s 49.9 percent stake in their joint venture Bioepis for $2.3 billion to bolster its biosimilar business, seen as a stepping stone towards its long-term goal of making its own new drugs.

This post Samsung Biologics Capitalizes on Pandemic Boom to Expand in US and Europe

was original published at “”