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CDMO Samsung Biologics Invests $347 Million to Acquire Land in the Incheon Free Economic Zone for Bio Campus II

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Samsung Biologics, a leading contract development and manufacturing organization (CDMO), continues to grow. Already a world leader in capacity, operating three plants at its headquarters in Songdo, South Korea, the CDMO recently announced that its fourth plant will be completed ahead of schedule. Now, Samsung Biologics is acquiring land near Songdo for the construction of its Bio Campus II facility, which will feature large-scale antibody manufacturing capabilities and an open innovation center to foster biotech startups.

In a recent regulatory filing, Samsung agreed to pay $347 million for land in the Incheon Free Economic Zone (IFEZ) to house the new facilities, building on its role as a foundation of South Korea’s emerging biopharma hub.

A New Biopharma Hub

Samsung Biologics has experienced rapid growth since its establishment in 2011, quickly rising to become a leading CDMO. For Samsung Biologics CEO John Rim, this growth has been partly due to the Korean government’s support of the biopharma industry.

“The government was very supportive in terms of IFEZ and enabled us to really start the business here [in Songdo],” said Rim in an interview with The Korea Society. “And over the last several years, we’ve grown to be the No. 1 CDMO company, in terms of capacity, in the world.”

In choosing to build Bio Campus II in IFEZ, Samsung Biologics displays a continued commitment to developing the biopharma industry in South Korea, particularly with the new facility’s focus on growing biotech startups.

And as Samsung Biologics has grown, it’s added thousands of jobs in the region. The CDMO increased its employment rate by 37% in 2021 and has maintained an average annual employment increase rate of 43% since 2013. The addition of Bio Campus II stands to build on this job creation in a growing industry.

In his interview with The Korea Society, Rim explained that in choosing to expand in South Korea, the goal is “not only to foster the industry but also employment. If you look at our company, we’ve gone from less than 100 people to almost 4,000 people. And we anticipate growing to 10,000 within several years.”

Building on Success

The decision to invest in additional land comes amid continued revenue growth for Samsung Biologics. In 2021, the CDMO recorded a 35% increase in revenue, and in the first quarter of 2022 it reported a record-high revenue of 511.3 billion Korean won (KRW) for 96% year-over-year growth.

“Samsung Biologics’ strong start to the 2022 fiscal year was driven by building momentum around our long-term growth strategy and expanding capacity,” said Rim in a statement on the first-quarter earnings report. “Our first-quarter financial performance demonstrates a significant and sustained level of customer demand in our services and capabilities.”

Investing in Bio Campus II is a key driver of that momentum, as it will provide Samsung Biologics with additional capabilities and space to accommodate growth. Bio Campus II will encompass 350,000 square meters of land, making it 30% larger than the size of the CDMO’s current Bio Campus I facility.

Building Sustainably

As Samsung Biologics builds new facilities, it’s emphasizing its commitment to sustainable methods.

“Turning to the present and future, Samsung Biologics has also committed to making sustainability a key component of the way we work and engage with our partners and communities,” said Rim in his statement on the earnings report. “In our mission to build a healthier future for all while creating enduring and sustainable value, we are investing in initiatives to mitigate the risks of climate change in the greater areas we impact.”

In 2021, Samsung Biologics was recognized by the nonprofit Carbon Disclosure Project (CDP) for its commitment to sustainability, receiving an Honor Award in the pharmaceutical sector at the CDP Korea Awards. Samsung Biologics received the award for its effort to implement decarbonization methods and eco-friendly management systems. The CDMO has also obtained two global International Organization of Standardization (ISO) certifications for Environmental Management and Energy Management.

What’s Next for Samsung Biologics?

The acquisition of land for Bio Campus II is part of a larger growth plan based around what Rim calls “core pillars.” These include increasing capacity, expanding the company’s portfolio, and developing a global footprint. 2022 looks to be an active year for Samsung Biologics on all these fronts.

In its first-quarter earnings report, Samsung Biologics announced that plans to open Plant 4 for partial operation have been accelerated to October 2022, with the plant fully operational by mid-2023, as many as six months ahead of schedule. Samsung Biologics is also exploring the potential development of facilities in the U.S. and Europe.

The CDMO expanded its mRNA vaccine production capabilities following the success of its fill/finish manufacturing services for Moderna’s COVID-19 mRNA vaccine. Samsung Biologics added drug substance capabilities to its drug product services, making the CDMO capable of providing end-to-end services for mRNA vaccine production.

In April 2022, Samsung Biologics announced the completion of its acquisition of Samsung Bioepis, a biosimilars company founded by Samsung Biologics and Biogen as a joint venture in 2012. Biosimilars offer cost-effective alternatives to biologic reference medicines, and the CDMO’s full acquisition of Samsung Bioepis signals its commitment to providing affordable, lifesaving medicines.

“By acquiring the full ownership of Samsung Bioepis, as announced in January this year, Samsung Biologics will leap forward as a global biopharmaceutical company with three business areas: CDMO, biosimilar, and new drugs,” said Rim in a statement on the acquisition.

With the acquisition of land for Bio Campus II, Samsung Biologics looks to fuel its leap forward as a global biopharmaceutical company while continuing to support the growth of Songdo as a major biopharma hub.

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