Samsung Group biotech unit is now Kospi's fourth-biggest company, outpacing world's largest CDMO, Lonza, in market cap

Samsung Biologics' fourth plant in Songdo, Incheon (Samsung Biologics)
Samsung Biologics' fourth plant in Songdo, Incheon (Samsung Biologics)

Samsung Biologics has kicked off the start of 2025 with the largest single contract in the company's history, signing a record-breaking $1.41 billion deal, amounting to some 40 percent of the total orders received last year.

On Tuesday, the company disclosed that it had signed a large-scale contract manufacturing organization agreement with a European pharmaceutical company. The contract runs until Dec. 31, 2030. The client company and details of the signed drug product remain confidential.

The new agreement sets another milestone for the company, just three months after signing a $1.24 billion deal with an Asian pharmaceutical company in October last year.

Samsung Biologics has further solidified its global market presence, securing three major deals worth over 1 trillion won ($770 million) each in key markets such as the US, Europe and Asia last year. The company’s total annual orders for 2024 reached a historic high of 5.4 trillion won, representing a 1.5-fold increase from the previous year.

Currently, Samsung Biologics has 17 of the world’s top 20 pharmaceutical companies on its client list.

Leveraging its unparalleled production capacity, quality competitiveness and extensive track record, the company has accumulated a total order value exceeding $17.6 billion since its inception.

In anticipation of rising demand for biopharmaceuticals, Samsung Biologics is expanding its production capabilities.

Its fifth plant, incorporating best practices from its first four facilities, is under construction with a planned capacity of 180,000 liters and is set to commence operations in April. Upon completion, the company’s total production capacity will reach 784,000 liters.

On the quality front, Samsung Biologics has demonstrated exceptional performance, maintaining a 99 percent batch success rate and excelling across all stages of pharmaceutical manufacturing and management.

By the end of last year, the company had secured 340 manufacturing approvals from global regulatory agencies, including 41 from the US Food and Drug Administration and 36 from the EU’s European Medicines Agency. Furthermore, its regulatory inspection success rate remains among the highest in the industry, according to the company.

Meanwhile, Samsung Biologics is set to take the main stage on Tuesday at this year's JP Morgan Healthcare Conference in San Francisco, the largest global investment event in the pharmaceutical and biotech industries. The company is focused on promoting its competitive edge in global CDMO services while strengthening networking with investors and potential clients.

Samsung Biologics has been invited to speak at the conference for nine consecutive years since 2017. Since last year, the company has been assigned on the second day alongside other big pharma leaders such as GlaxoSmithKline, Eli Lilly and AstraZeneca.

On Tuesday (local time), CEO John Rim will deliver a presentation under the theme “4E,” which highlights the company’s focus on customer excellence, operational excellence, quality excellence and people excellence. Rim will outline its consistent growth since his appointment and discuss the business strategy for this year.

On the news of the mega deal, Samsung Biologic shares surged 4.94 percent in the morning trading before edging lower.

With its robust growth in the global biopharmaceutical scene, it has become the fourth-largest stock listed on the country’s benchmark Kospi with its market capitalization of 72.8 trillion won as of Monday. The market cap has grown over 18 trillion won from 54.9 trillion tallied the end of last year.

Market analyst expect that the Korean biopharmaceutical CDMO would generate sales growth this year nearly on par with its rival and the world's largest CDMO, Lonza.

"Samsung Biologics will have growth momentum this year with its sales projected to expand at 19 percent while Lonza Groups 2025 sales growth forecast is around 20 percent," said Han Seung-yeon, an analyst at NH Investment & Securities.

In terms of market cap, Samsung Biologics exceeded Lonza's 39.3 billion Swiss Franc (62.7 trillion won) as of Tuesday.

By Kim Hae-yeon (hykim@heraldcorp.com)