April 26, 2024

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[THE INVESTOR] FRANKFURT -- Samsung BioLogics, the contract drug development and manufacturing arm of Samsung Group, has ruled out the possibility of mergers and acquisitions at least for the next five years, its CEO said last week.

“Now is the time for us to prove our own ability to deliver industry-leading growth rather than relying on M&A deals,” Samsung BioLogics CEO Kim Tae-han told The Investor on the sidelines of the CPhI Worldwide Pre-Connect Congress in Frankfurt, Germany.

“We may consider M&A in five to 10 years but not now. We think M&A should be carried out when our business shows solid growth.”

 

Kim Tae-han

Samsung BioLogics is expected to secure the world’s largest production capacity of an annual 36,000 liters next year when its third plant is completed as planned. But due to the huge spending on facilities, the firm has not yet turned to a profit since its foundation in 2011.

The CEO’s remarks come as its global rivals are increasingly seeking to purchase smaller firms or acquire their technologies with aims to offer a more integrated service to their clients -- big pharmaceutical companies.

Swiss drug manufacturing giant Lonza last year acquired US-based contract capsule and drug producer Capsugel for US$5.5 billion, while lab equipment company Thermo Fisher Scientific in August this year agreed to buy drug-development technology company Patheon for US$7.2 billion.

In the meantime, Samsung BioLogics has been focusing on attracting more clients and diversifying its business portfolio. In June, the firm said it would jump into the contract development sector amid growing demand for outsourcing integrated services. Its current clients includes Roche, Bristol-Myers Squibb and Sun Pharma.

By Park Han-na (hnpark@heraldcorp.com)