Samsung Biologics Co. has clinched a 1.8 trillion won ($1.3 billion) contract from a US pharmaceutical company, its second-biggest deal since inception, underscoring South Korea’s largest contract drugmaker’s resilience even as the Donald Trump administration’s tariff threats cloud the outlook for foreign medicines.
The deal, running through 2029, pushes the company’s order tally this year to 5.2 trillion won, nearly matching all of 2024’s total within just eight months, the Incheon-based contract drug manufacturing giant said in a filing Tuesday.
Cumulative orders since its founding in 2011 have now exceeded $20 billion.
Under the new contract’s confidentiality terms, the name of the client and the product remain undisclosed.
The agreement follows the company’s largest-ever $1.4 billion contract manufacturing organization (CMO) deal signed with an unidentified European pharmaceutical company in January, marking a second mega-win in less than a year.
The latest victory comes despite industry concerns about potential hefty US tariffs on pharmaceutical imports.
Although the Trump administration recently agreed to cap tariffs at about 15% for imports from South Korea, Japan, the UK and the EU under new trade pacts, Seoul and Washington have yet to finalize a formal deal.
That leaves South Korea’s pharmaceutical and biotech companies, including Samsung Biologics, facing lingering uncertainty over potentially high US duties.
NO SLOWDOWN IN GLOBAL PUSH
Samsung Biologics, a unit of Samsung Group, is the world’s largest contract development and manufacturing organization (CDMO), with a total output capacity of 784,000 liters after its fifth plant came fully operational earlier this year.
It plans to ramp up its production capacity to 964,000 liters by 2027 as part of its aggressive expansion push to meet the rising global CMO demand.
It currently offers CDMO services to nearly all of the world’s top 20 pharmaceutical companies, including US companies like Pfizer Inc., Merck & Co. Inc., Roche Holding AG and Novartis AG.
The company will accelerate its customer base diversification by securing orders from the world’s top 40 pharmaceutical companies, it said.
As part of the expansion drive, Samsung Biologics has moved into antibody-drug conjugates (ADCs) and in June launched a contract research service, Samsung Organoids, aimed at offering clients a broader range of innovative solutions.
The CDMO player also announced in May a plan to spin off its wholly-owned biosimilar arm, Samsung Bioepis Co., in a move investors see as unlocking value and clarifying the group’s structure.
The shake-up is aimed at sharpening Samsung Biologics’ profile as a pure-play CDMO, a positioning that analysts say could help attract bigger global manufacturing contracts and rerate the stock.
By eliminating potential conflicts with Bioepis, which is moving deeper into novel drug development, Samsung Biologics can also concentrate resources on expanding its manufacturing pipeline and securing more high-margin outsourcing deals.
By Sookyung Seo
skseo@hankyung.com
Jennifer Nicholson-Breen edited this article.
