Bristol-Myers extends manufacturing pact with Samsung

Bristol-Myers Squibb ($BMY) hooked up with South Korea's Samsung last year when it wanted someone to handle manufacturing overseas for its hot-selling melanoma drug Yervoy. But with more promising biologics in its pipeline, the New York-based drugmaker has decided to deepen its commitment.

The companies said Tuesday that Samsung will manufacture "commercial drug substances and drug product" for several BMS biologics at its manufacturing site in Incheon, South Korea.

BMS has its own biologics plants in Syracuse, NY, and Devens, MA. It started an expansion at the Devens facility last year to add two buildings and 200,000 square feet of space to the campus, where it already has 6 buildings and 400,000 square feet of space. Work on the $250 million project is expected to be completed in 2015.

BMS spokesman Ken Dominski said in an email Wednesday that the agreement is part of the company's global biologics manufacturing strategy. He said that bulk products are manufactured either at Bristol-Myers' U.S. plants or by contractors like Samsung, and then finished and packaged in Manatí, Puerto Rico, and Anagni, Italy: "This agreement increases our biologic manufacturing capacity to help ensure sufficient, long-term supply of our commercial products and is intended to complement capacity already in place."

Samsung plant in Incheon, South Korea

And Samsung has a lot of capacity. Last year, the company completed its 740,000-square-foot plant in Songdo Incheon. It has 6 5,000-liter stainless mammalian cell culture bioreactors which can produce up to 600 kilograms (1,300 pounds) of biopharmaceutical products a year.

The company also has audacity. It turned heads in 2012 when one of its top execs boasted that Samsung would be able to produce biosimilars at half the cost of what Western drugmakers would have to charge. "It is in Samsung's DNA to produce products at low prices while meeting legal and industry requirements," Tae-Han Kim, president and CEO of Samsung BioLogics, said at the time. Other drugmakers, like Roche ($RHHBY) and Merck ($MRK), have also signed on with Samsung.

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