South Korean electronics giant Samsung got into biologics production with the boast that its manufacturing expertise would allow it to produce products at half the cost of Western drugmakers. It is backing that up with plans for a new plant it says will make it the largest biologics contract manufacturer in the world.
Samsung BioLogics, which has an A-list of Western drugmakers as clients, will invest 850 billion Korean won ($740 million) to build its third biologics manufacturing plant in South Korea, The Wall Street Journal reports, citing a filing by the company. The 180,000-liter-capacity facility will be erected alongside two other biologics manufacturing plants in Songdo and is slated to be finished in September 2018.
That comes after laying out plans earlier this year for a 150,000-liter, $700 million plant. When those two are complete, it will have a combined 360,000 liters of capacity, which it claims will make it the global leader in biologics manufacturing, at least in terms of size.
Samsung Group got into biologics manufacturing in 2011 as a way to expand beyond its flagging mobile phone business. It pledged to invest $2 billion to become an expert in biologics manufacturing and started with a 30,000-liter production facility. It said its manufacturing knowhow would quickly catapult it into a top tier player, Tae Han Kim, president of Samsung Biologics, told the Financial Times a year into its endeavor.
"Biopharmaceutical companies are good for sales, and biotech companies for innovation, but neither is good for manufacturing," Kim said. "It is in Samsung's DNA to produce products at low prices while meeting legal and industry requirements."
Samsung already does biologics manufacturing for Big Pharma and biotech players like Bristol-Myers Squibb ($BMY) and Roche ($RHHBY).
On another front for Samsung, it and Biogen ($BIIB) created Samsung Bioepis, a joint venture to work on biosimilars, which Merck ($MRK) has since joined. Biogen and Samsung Bioepis's effort moved forward significantly this month with an EU recommendation for a copy of Pfizer's ($PFE) Enbrel. The joint venture is working on biosimilars of Roche's cancer blockbuster Herceptin and Avastin. Samsung Bioepis and Merck recently won approval in South Korea of their copycat version of Enbrel.