Millions of patients, medical professionals and researchers around the world are every day fighting stubborn illnesses from various types of cancer to Alzheimer’s disease to arthritis. A more efficient weapon in this war against diseases may be biopharmaceuticals – medical drugs derived from life forms using biotechnology – which have come a long way since the first of their kind, Humulin, was approved in 1982.
In May 2010, Samsung identified biopharmaceutical as one of five new strategic businesses that would lead the group’s future. We have already announced a far-reaching plan to invest 23 trillion won (US$20.4 billion) through 2020 in the new businesses, with 2.1 trillion won earmarked for biopharmaceuticals.
Today, we marked the first major step to expand in the sector by announcing plans to form a 300 billion won joint venture that will build a biopharmaceutical production plant. Three Samsung companies -- Samsung Electronics Co. Ltd., Samsung Everland, Samsung C&T Corp. – will partner with Quintiles Transnational Corp. of the United States, a global leader in integrated pharmaceutical services, to set up the JV.
This represents Samsung’s entry into contract manufacturing (contract manufacturing organization or CMO) of biopharmaceuticals. The CMO business will be accompanied by efforts to develop biosimilar products, which we expect to begin production in 2016.
And by combining the expertise gained from contract manufacturing and biosimilar production, we will aim to eventually develop new biopharmaceutical products of our own.
Our long-term expansion will be also supported by the synergy from different Samsung businesses. The experience and research capability of Samsung Medical Center, a leading hospital and research chain, and the medical equipment business based on the Samsung Electronics’ technology, will be combined with the biopharmaceutical business, enabling us to provide integrated medical services.
"One of the big challenges in biopharmaceuticals is quality control. The business also requires a talented pool of R&D personnel and competitive production facility … Samsung’s strength in manufacturing and focus on quality will be assets in this industry," said Tae-han Kim, Executive Vice President in charge of Samsung’s new business development, during today’s announcement.
The Samsung-Quintiles JV will initially invest 330 billion won and set up a biopharmaceutical production plant in the free economic zone at the port city of Incheon, west of Seoul, which offers a favorable location for biopharmaceutical production and export. The new plant is expected to produce biopharmaceutical drugs for the treatment of cancer and arthritis patients starting in the first half of 2013.
The joint venture is also expected to create more than 300 new positions that will be recruited from abroad and from Samsung affiliates.
According to forecasts by market intelligence provider IMARC, global biopharmaceutical sales are expected to reach more than US$ 167 billion by 2015, driven by biopharmaceuticals’ high potency and a strong ability to attack targets.