Samsung Biologics signs record CMO deal with Pfizer

John Rim, Samsung Biologics CEO, speaks during a press conference held in Boston on Monday. [YONHAP]

Samsung Biologics inked a $411 million contract manufacturing organization (CMO) letter of intent with Pfizer Ireland Pharmaceuticals, the biggest single deal the Korean company ever signed.

The amount accounted for 17.83 percent of the company's total sales in 2022, the Korean company said in a regulatory filing.

Under the deal, Samsung Biologics will manufacture Pfizer's biosimilars including tumor and inflammation treatment at its fourth plant in Songdo, Incheon. CMOs are companies that provide drug manufacturing services on a contract basis.

The second deal with Pfizer is the largest CMO deal Samsung Biologics has signed since its establishment in 2011, surpassing a $351 million deal with AstraZeneca in 2020.

Samsung Biologics also inked a $183 million CMO deal with Pfizer Ireland Pharmaceuticals in March.

"The latest deal was possible as Samsung Biologics successfully completed the construction of the fourth plant earlier in the month," Samsung Biologics CEO John Rim said. "We are exerting all efforts to expand the second complex to offer more flexible and improved services to clients."

Samsung Biologics recently started partial operation of its fourth plant, in Songdo, Incheon, which will have a capacity of 240,000 liters (63,401 gallons) when fully operational in June. It is the world’s largest single pharmaceutical manufacturing facility.

The latest plant will likely bring the company's annual production capacity to 604,000 liters, which Samsung Biologics says is equivalent to nearly 30 percent of the global contract manufacturing market for biopharmaceuticals.

It also announced that it will invest 7.5 trillion won ($5.7 billion) in the construction of four new factories in a new manufacturing complex, dubbed Bio Campus II, next to its existing plants, which will boost its capacity to 720,000 liters.

BY SARAH CHEA [chea.sarah@joongang.co.kr]