SERACH RESULTS FOR" Manufacturing "
CEO IR NEWSLETTER Driven. For Life. SAMSUNG BIOLOGICS 2023. 07 IR Newsletter Dear investors, This is John Rim from Samsung Biologics. First of all, thank you for your continuous interest and support in Samsung Biologics. Key Highlights Financial Performance (Quarterly Semi-annual) • Continued strong growth momentum: Rev. +41%, OP +46% * Q2 CAGR over three years ('20~23), consolidated • 2Q Consolidated: Rev. KRW 866B, OP KRW 253B (OPM: 29.3%) (+33% YoY) (+49% YoY) • 2Q Separate: Rev. KRW 637B, OP KRW 254B (OPM: 39.9%) (+27% YoY) (+48% YoY) • 1H Consolidated: Rev. KRW 1,587B, OP KRW 445B (OPM 28.0%) (+36% YOY) (+29% YoY) CDMO • Full operation of P4 240KL with Phase II initiation (Jun) *Blo Campus 1:604KL • Continued orders from Global Pharmas *Pfizer $1,080M, Novartis $391M, US Pharma $113M, EU Pharma $81M • 13 out of top 20 Big Pharmas as clients *Count Before COVID-19:3→ After COVID-19:13 • Cumulative contracts amount of USD 11.3B by Jul. **20: $6.1B → '21:$7.5B '22: $9.58 → 23 2Q: 10.5B Business Expansion • NJ sales office launched: Client support in closer proximity (Mar) • ADC investment, commercial operation to begin in '24 • Early operation of P5: Sep '25 → Apr 25 (reduced by 5 months) • Further technology improvement in S-DUAL and mRNA platform Bioepis • Lucentis Biosimilar (SB11): Geographic expansion of product launch • Soliris Biosimilar (SB12): EMA approved and launched in EU in Jul. • Humira Biosimilar (SB5): Launched in US in Jul. Samsung Biologics today announced second-quarter 2023 consolidated revenue of KRW 866B and consolidated operating profit of KRW 253B, representing a 33% and 49% increase respectively from the second quarter of 2022. On a separated basis, Samsung Biologics recorded KRW 637B (+ 27% YoY) in revenue and KRW 254B (+48% YoY) in operating profit. We continued to achieve solid YoY revenue growth over 14 consecutive quarters since the COVID outbreak in 2020 and are proud to announce that our business is progressing well in line with the annual revenue guidance of 15-20% growth for 2023, demonstrating our top-notch management execution, successful business performance, and our competitive advantage as a world class CDMO. I am also pleased to share that thanks to our robust sales activities, 13 of the top 20 global pharmas are now Samsung Biologics' clients, resulting in Plants 1, 2, and 3 all running at full capacity and Plant 4's 240kL capacity being fully operational since June 1. Our total cumulative CMO contracts now surpass USD 10B, and we continue to expand partnerships with global pharmas leveraging our CDO capabilities and platforms. Also, our subsidiary Samsung Bioepis has been contributing to top-line growth with the launch of EPYSQLITM (SB12), a biosimilar of Soliris, in the EU market after obtaining the final approval from European Commission, and a biosimilar of Humira named HADLIMATM (SB5), in the US in July. Full operation of Plant 4 dubbed the 'SUPER PLANT', and acceleration of Plant 5's construction timeline by 5 months We began operation of the 60KL portion of Plant 4 last October and unlocked the remaining 180KL portion this June (240KL in total). Our total capacity of 604kL across Bio Campus I is now fully available to support clients at multiple scales and on schedule as we had planned from the very beginning. Our sales activities targeted for P4 have led us to the execution of supply contracts for 16 products with 10 clients, and on-going contract negotiations with 30 clients for 46 products. Based on robust demand from clients, we announced in March the construction of Plant 5 which will be operationally ready by April 2025, about 24 months from groundbreaking and 5 months earlier than the original plan. Succe
manufacturing facilities announced (Jan.) • Strategic investment in Araris Biotech via Life Science Fund Bioepis • Launching of Lucentis biosimilar (SB11) in GER, UK, CA (Mar.) • Positive CHMP Opinion received for Soliris biosimilar (SB12) • Upcoming US launching of Humira Biosimilar (SB5) (Compertitive edge gained by high & low-concentration, prefilled syringe and auto-injector, etc.) Samsung Biologics announced our first quarter financial results, and we are pleased to report quarterly financial performance with consolidated revenue of 720.9 billion won up by 41% YoY and an operating profit of 191.7 billion won up by 9% YoY. Since the beginning of the COVID19 pandemic, sales have increased year on year for 13 consecutive quarters, spurred by significant growth in the CMO business. Based on these solid financial results, we are revising our guidance for our annual revenue growth rate from 10-15%, which we announced this January, to 15%-20% for year 2023. Samsung Biologics has been operating its existing Plants 1 through 3 at full capacity while maximizing operational efficiency and maintaining steady and stable manufacturing output. As a result, we secured CMO contracts with global big pharmas including GSK, Pfizer, and Eli Lilly, to name a few, totaling roughly KRW 500 billion, bringing the total accumulated CMO contract amount to approximately USD 9.9 billion (KRW 13 trillion). We have also been able to enter into a partnership with a large pharmaceutical company in our CDO business and continued to build on our solid track record. Samsung Bioepis, a wholly owned subsidiary of ours since April 2022, has also contributed to our swift top-line growth by broadening revenue streams from the expansion of Lucentis biosimilar (SB11) sales in the United States, and other newly launched markets such as Germany, UK and Canada. Simultaneously, in line with the company's three-dimensional growth strategy, Samsung Biologics continues to augment our differentiated "Super Gap" CDMO competitive edge through expansions in our capacity, geographic presence, and business portfolio. Capacity Expansion | Announcement of investment in Bio Campus II, with the construction of Plant 5 Plant 4 construction has been fully on track, with its 60,000L portion going operational in October last year, and the remaining 180,000L to go live in June of this year. We have already sealed a number of large-scale manufacturing contracts with Plant 4, signing 9 clients on 12 products, and are actively negotiating with 29 additional clients on 44 products. The robust demand seen for outsourced biopharmaceutical manufacturing convinced us that the time has come to proac- tively make this investment as part of our expansion strategy in order to further expand our global CMO market leadership. In this regard, we have decided to invest 1.98 trillion won ($1.51 billion) in the construction of our fifth facility in Bio Campus II, which will be located on a 96,000-square-meter plot. This new Plant 5, with a capacity of 180,000L, will break ground in the first half of this year and expected to complete construction and commence operations in September 2025. Plant 5 will maximize Samsung Biologics' operational efficiency by adopting the company's standardized facility design, allowing the company to leverage existing capabilities, expertise, and know-how acquired through experience at Plants 1 through 4, while introducing advanced digitalization and automation technologies. With Plant 5 construction, Samsung Biologics will further accelerate our capacity growth and leadership with Bio Campus II. Geographic Expansion | Regional sales office opening in New Jersey, USA In keeping with the company's ambitions for global expansion, Samsung Biologics has been strengthening our footprint in the United States by establishing a presence in major cit
manufacturing facilities at 604KL. With all three plants operating at full capacity, Samsung Biologics recognized the need for additional capacity development and proactively purchased a plot of land 30% larger than the existing Bio Campus I to lay the groundwork for a large-scale bio complex for future growth. Plant 4 began partial operations in Oct. 2022, and we have secured 11 large-scale manufacturing contracts with 8 global biopharmaceutical companies and are actively negotiating an additional 34 contracts with 26 global major pharmaceutical companies. Based on such strong demand on the horizon, we decided to build our fifth facility even before Plant 4 was fully operational in order to meet our clients' needs in a timely manner. Plant 5 will be the first plant to be housed in Bio Campus II, with a capacity of 180KL, identical to Plant 4's phase 2 large scale design. Bio Campus II - conceptual rendering Plant 5 Construction Plan • Location: Bio Campus II in Songdo, Incheon (Approx. 35.7 million square meters) • Capacity: 180KL (Approx. 9.5 million square meters) • Construction Period (Target): Groundbreaking in Mar. 2023; CGMP ready by Sep. 2025 Expected CAPEX: Approx. KRW 1.98 trillion (incl. production support and utility facilities) With Plant 5, we will integrate simplified and standardized design and processes of our existing plants to save construction time and cost, in addition to optimizing operations. Simultaneously, we aim to introduce even greater competitive advantage and service perfection by incorporating cutting-edge technologies including automated equipment and systems and energy efficiency, while leveraging our deep expertise and know-how gained from the operation of our Bio Campus I plants 1, 2, 3, and 4. Using Plant 5 as a starting point, Samsung Biologics will invest approximately KRW 7 trillion in the development of Bio Campus II, which will include the construction of three additional large-scale mAb manufacturing facilities as well as an Open Innovation center to promote and foster innovative biotechnologies. Furthermore, we will continue to implement various inorganic strategies and pursue portfolio and geographic expansion in order to keep our commitment to being a top-tier biopharmaceutical company. As always, your continuous faith and support in us is greatly appreciated. Sincerely, March 17, 2023 President & CEO John Rim
manufacturing site with a capacity of 240,000 liters, within 23 months after the groundbreaking, which was 6 months faster than the original 29-month timeline. It will be fully operational by the first half of this year, and presales activities have successfully locked in capacity. Prior to the plant's full ramp-up, we signed large-scale manufacturing contract agreements for 11 products with 8 global biopharmaceutical companies, and we are actively communicating with 26 other major clients on approximately 34 products. Based on our key competitive advantages of "speed" and "execution," we will strive to complete Plant 4 construction without a hitch and demonstrate our commitment to meeting client needs in a timely manner in order to solidify our trust-based partnership with our clients. [Taking the leap to become a fully integrated global biopharmaceutical company through active investments and portfolio diversification] In response to rising biopharmaceutical CMO demand, Samsung Biologics acquired an additional parcel of land for Bio Campus II in July, which is designed to support Samsung Biologics' further expansion of large-scale manufacturing capacity as well as house an open innovation facility to aid in the development of bio industry infrastructure. We will continue to invest in innovative venture firms both domestically and globally in order to promote and nurture promising core biotechnologies for a brighter long-term future and growth of the biopharmaceutical industry. Since entering the CDO market in 2018, Samsung Biologics has been steadily laying the groundwork for its CDO business by establishing an independent bio research lab for next generation technology and launching proprietary technology platforms including 'S-DUALTMM (bispecific antibody platform)' and 'DEVELOPICKTM (developability assessment platform).' Samsung Biologics has expanded its business beyond monoclonal antibodies to meet a variety of industry needs. For example, in August, we successfully completed our first commercial scale engineering run for mRNA vaccine drug substance, and we are now fully equipped to provide one- stop, end-to-end services for mRNA vaccines in addition to our flagship CMO services for antibody drugs. Also, we recently announced our plan to kick off antibody-drug conjugate manufacturing. We will construct ADC conjugation facilities this year, with the goal of starting production in the first quarter of 2024. In addition, we made our first investment in Jaguar Gene Therapy, a US biotech, in March of last year through the Samsung Life Science Fund, a joint venture established with Samsung C&T, followed in August by a $15M investment in Senda Biosciences, a US therapeutics platform company that specializes in leveraging nanoparticles to deliver protein and peptide therapies. Furthermore, Samsung Biologics purchased Biogen's shares in Samsung Bioepis last April in order to achieve its long-term vision of becoming a global top-tier biopharma. The purchase was paid for with a portion of a KRW 3.2 trillion paid-in capital increase raised by issuing new shares, the proceeds of which will be used to fund the company's strategic growth plans. We believe that this acquisition provides Samsung Bioepis with greater autonomy and agility in business operations, accelerating sales growth, improving operating margins, and leveraging manufacturing excellence to drive top-line growth for both Samsung Biologics and Bioepis. Also, with the FDA's approval of the high-concentration version of Hadlima (SB5), the biosimilar referencing Humira that is set to launch in July, we have become the only company to have both low- and high-concentration versions of Humira biosimilar. This, we believe, is a critical step toward gaining a competitive advantage in the Humira biosimilar market. [Leading ESG CDMO committed to biopharma industry's sustainable growth] Samsung Biologics also established industry leadership in E
manufacturing and R&D expertise [cumulative revenue of 2 trillion won on a consolidated basis] Today, Samsung Biologics announced our third-quarter financial results. Our operational excellence not only enabled our stable manufacturing capabilities by renning all three plants at full capacity, but it also mximized revenue by maintaining industry-leading batch success rates and minimizing product changeover(PCO). We are pleased to report quarterly revenue of 675 billion won(operating profit of 311 billion won) with consolidate quarterly revenue of 873 billion won and operating profit of 325 billion won. [Plant 4's rapid initial phase of 60,000 liters coming on line in Oct. '22, only 23 months from groundbreaking to GMP-ready, demonstrated our competitive edge in speed as the leading CMO with the highest manufacturing capacity in the world'] Since the third dquarter of 2020, when we began construction on Plant 4, the world's largest bio manufacturing site with 240,000 liters of capacity (approx. 238,000m2 of land), we have signed large-scale manufacturing contract agreements for seven products with five global biopharmaceutical companies prior to the plant's full ramp-up. We are also actively communicating with other major global corporations regarding more than 25 products. As a demonstration of our commitment to meet the needs of clients in a timely manner, we began partial operations of Plant 4 this October as originally announced at ground breaking 23 months ago. Based on our key competitive advantages of 'speed' and 'technology,' Samsung Biologics continues to make history in the biopharmaceutical CMO industry with unprecedented achievements and solidifying our position as a global leading CMO. [Expanding and diversifying our path to become the world's best CDMO] In response to the increasing biopharmaceutical CMO demand, Samsung Biologics signed a purchase agreement with Incheon Metropolitan City in July to acquire an additional parcel of land (357,000m2) approximately 30% larger than our current campus (238,000m2). In addition, we have been expanding our CMO production facilities beyond monoclonal antibodies to accommodate a wide range of industry needs. For example, after 7 months of technology transfer and scale-up, we successfully completed our first commercial scale engineering run of an mRNA vaccine drug substance at our newly-built mRNA manufacturing suite at our Songdo headquarters. With this, we are now fully equipped to provide one-stop, end-to-end services for mRNA vaccines in addition to our flagship CMO services for antibody drugs. Furthermore, Samsung Biologics has been steadily introducing a number of proprietary technology platforms, laying a solid foundation for our CDO business. Since entering the CDO market in 2018, we have launched a proprietary cell line expression technology called 'S-CHOice' in 2020. We also demonstrated our steady efforts this year by introducing two new platforms: a rapid developability assessment platform called 'DEVELOPICKTM,' which helps identify candidates with the best potential for IND and BLA at an early development stage, and a bispecific antibody platform called 'S-DUALTM,' which ensures optimized manufacturability of bispecific antibodies. In addition to our solid track record and various self-developed platforms, including 'S-DUAL,' we plan to expand our partnership with R&D-based pharmaceutical companies to improve our capability in the CDO business and become a fully integrated, leading end-to-end CDMO. Samsung Biologics' interests and efforts go beyond investments in existing businesses. In fact, we made our first investment in Jaguar Gene Therapy, a US biotech, through the Samsung Life Science Fund, a joint venture established with Samsung C&T, in March this year, followed in August by a $15M investment into a US therapeutics platform company named Senda Biosciences, which specializes in leveraging nanoparticl
manufacturing expertise and R&D capabilities : Fully-integrated CDMO=Integrated Bio-pharmaceutical Company Company Reputation Continuously improved Reputation Release of "2022 ESG Report*, (Jul 11th) Corporate Rating Upgraded by one-grade (A+ → AA-) CMO Leadership award for 9 consecutive years 삼성바이오로직스는 반기 별도 기준 최초로 매출 1조원을 달성했습니다. 오늘 삼성바이오로직스는 2분기 실적을 발표했습니다. 지난 1분기에는 2공장 Slowdown이 있었지만, 2분기에는 전 공장이 안정적으로 가동됨에 따라 생산 및 매출증가로 이어져 상반기 매출 1조원이라는 성과를 이뤄낼 수 있었습니다. 당사는 지난 4월, 유상증자를 성공적으로 마무리한 데 이어 삼성바이오에피스 지분을 인수해 100% 자회사로 편입한 바 있습니다. 이번 실적 발표에는 바이오에피스의 실적도 반영되었으며, 2분기 연결기준 매출 6,514억원, 영업이익 1,697억원을 기록했습니다. 삼성바이오에피스는 우수한 바이오 제약 개발 역량을 기반으로, 더욱 신속하고 유연한 성장 전략을 추진해 포트폴리오 리더십을 지속적으로 확대해나갈 계획입니다. 바이오로직스의 제조 역량과 바이오에피스의 개발 역량이 더해져 더욱 시너지를 낼 수 있을 것으로 기대하고 있습니다. I am very proud to announce that Samsung Biologics, independent of Bioepis, achieved revenues exceeding 1 trillion won for the first time on a half-year basis. This is mainly attributable to the stable manufacturing operations of all plants leading to increased revenue in spite of the scheduled slow-down for regular maintenance in Plant 2 in the 1st quarter. Furthermore, as a result of the acquisition of remaining stakes in Samsung Bioepis completed in April, Samsung Biologics benefitted from the effect from the consolidation of Samsung Bioepis' P/L as a wholly owned subsidiary. Accordingly, we posted a record 2nd quarter revenue of 651.4 billion won and operating profit of 169.7 billion won on a consolidated basis. Driven by our operational excellence and flawless quality and regulatory track record, we have been maintaining solid sales momentum with a robust cumulative backlog. We had already secured contract agreements for 7 products with 5 global biopharmaceutical companies for Plant 4, which is currently under construction and will come on line in October (to be fully GMP ready by mid-2023). At the same time, we are continuously negotiating with global big-pharmaceutical companies for additional pre-sales. Moreover, we signed a land purchase agreement with the Incheon Free Economic Zone (IFEZ) on July 18th to build out our second biocampus, dubbed “Bio Campus II”, to preemptively respond to the changes and needs of the market. Bio Campus II is designed to support Samsung Biologics' plans to establish a foundation for our future growth engine with large-scale manufacturing capacity for monoclonal antibodies, portfolio expansion, and an open innovation facility. We are also pleased to inform you that we successfully completed the purchase of Biogen's stake in Samsung Bioepis and the rights issue in April. With excellence in biosimilars development capabilities, we expect to have our portfolio leadership expanded continuously by pursuing a more flexible and accelerated growth strategy. As an extension of our efforts for sustainable management that began in earnest in 2021, we published our second annual ESG report on July 11th to address a wide range of environmental, social, and governance (ESG) activities that had been carried out in the past year in addition to outlining our plans for the upcoming year. Under our mission of ‘Driven. For a Sustainable Life.', we are continuously improving and committing our resources to create a more sustainable environment, build a healthier society, and implement responsible business activities. We will be steadfastly committed to a wide range of socially and environmentally equitable practices to contribute to society with sustainable growth and development. With our pre-emptive and bold investments backed by solid business execution, Samsung Biologics will continue our path forward from the world's best contract development and manufacturing organization (CDMO) to a fully integrated global bio-pharmaceutical company. I would like to express my deepest gr
manufacturing efficiency across all plants while preparing for the pre-sales and partial operation of Plant 4 in October. In January, to secure future growth engines we announced a capital raise by issuing new shares to existing shareholders and employees. Thanks to our shareholders' strong support, we successfully raised 3.2 trillion won (USD 2.6B), at 639,000 won per share, with a subscription rate of more than 100%. Once again, we would like to sincerely thank our shareholders for supporting us in investing in our sustainable growth. Of the capital raised, we will invest 1.2 trillion won in purchasing Biogen's (50%-1 share) stake in the Samsung Bioepis joint venture, and the remainder will be spent on expanding additi CDMO capabilities, including Plant 4 construction and securing additional land for Bio Campus II, etc. As a wholly owned subsidiary, Samsung Bioepis will have improved agility and autonomy in decision making to accelerate its biosimilar development capabilities and its future growth plans, including novel drug development, etc. SUC CE Thanks to the strong support and interest from shareholders and investors, Samsung Biologics successfully completed the rights offering. In return, we will continue our efforts to take a great leap forward to diversify our business portfolio for sustainable growth and ultimately become a global biopharmaceutical company with great responsibilities to better serve our clients, shareholders, and ultimately society. We greatly appreciate your continued support and interest in Samsung Biologics. Thank you Sincerely, John Rim President and CEO, Samsung Biologics
manufacturing capacity since 2019 and is advancing forward through active investment with unparalleled innovation. We are currently building Plant 4 and will begin construction of Plant 5 this year, which will offer multi-modal product services, venturing into expanding business portfolio for cell and gene therapies and next-gen vaccines utilizing mRNA, PDNA and viral vectors, all at a single site, in addition to mRNA DP and DS manufacturing. We are also in the process of securing additional land of 350,000m2 for Bio Campus II, which will be 30% larger than the size of the current site. At a time of great momentum for change and advancement, your continued support is indispensable. We ask for your continued trust and support for the success of Samsung Biologics. Thank you. Sincerely, 2022.1.28 CEO and President of Samsung Biologics John Rim
manufacturing efficiency, operating profit margin increased by +9%p year-on-year to 34%. Proactive Investments into Future Growth Engines for Sustainable Growth Taking the pandemic crisis as an opportunity for growth, Samsung Biologics made a bold investment decision last year to expand our business portfolio, while ensuring internal stability by improving manufacturing operation efficiency of all plants. As a result, the cumulative backlog reached $7.5 billion thanks to additional contracts with Merck, Roche, and other multinational companies. Significantly, we signed five contracts as early lock-ins for Plant 4, our Super Plant with the world's largest capacity, which will be partially operational from October this year. Furthermore, we acquired land for Plant 5, a Multi Modal Plant for Cell and Gene Therapy, etc., and we will start its construction this year. In our CDO business, Samsung Biologics successfully launched a CDO development Platform 'S-Cellerate TM' to offer clients an integrated and seamless drug development solution resulting in accelerated timelines, improving both economics and convenience. We opened our U.S. R&D Lab in San Francisco in 2020, and are planning to add more labs covering the US East Coast and Europe, etc. We have accumulated 87 CDO contracts since 2018, and have been strengthening our seamless one-stop services to clients with high quality and end-to-end capabilities. Pursue Sustainable Growth to a Top-tier Global Bio Pharma CDMOs in the biopharmaceutical industry are projected to grow rapidly at 10% every year, between 2020 and 2026, as a result of increased outsourcing by global pharmaceutical companies, expanded indications and modalities for drugs, and an increase in the number of biotech companies. To seize the opportunity of increased demand for CDMOS, Samsung Biologics' upmost priority this year is to accelerate Plant 4 operation and lock-in pre-sales. Also, within the first of half of this year, we are planning to operate our mRNA drug substance (DS) manufacturing facility, start the construction of Plant 5 (multi modal services), and purchase additional land for Bio Campus II to prepare for Plant 6, open innovation and beyond. Enhancing ESG (Environmental, Social, Governance) Performance As a global biopharmaceutical company, we have enhanced our efforts on ESG management and made progress in various areas. We established an ESG committee within our Board of Directors, published our first Sustainability Report last June, and earned five ISO certificates in BCMS (Business Continuity Management Systems), Safety, Environment, Energy, and Quality. In recognition of our achievements, we received "A" ESG rating from the Korea Corporate Governance Services (KCGS) and were added to the Dow Jones Sustainability World Index, a first for a Korean pharmaceutical company. Last but not least, we have disclosed our mid-term dividend policy and are committed to continuously improve responsible management to enhance shareholder value. We greatly appreciate your continued support and interest in Samsung Biologics. Thank you Sincerely, John Rim President and CEO, Samsung Biologics
Manufacturing Contract GSK/VIR, Lilly, AZ Antibody MFG Contracts Multi Modal Plant Expansion Songdo Section 5 (10,279m²) Land Acquisition mRNA DS Expansion May 21 Announced 1 Half 22 GMP-Ready Partnership with "Greenlight Biosciences S-CellerateTM Launch Accelerated platform for cell line development We have also bolstered our efforts on ESG (Environmental, Social and Governance) management and accomplished the following: 5 Global ISO Certifications ISO 22301, ISO 45001, ISO 14001, ISO 50001, ISO 9001 First Sustainability Report Issued Frontier-1.5D Participation ESG Rating 'A Grade' from KCGS Dow Jones Sustainability World Index Inclusion SMI Health Systems Supply Chains Working Group Champion *Sustainable Market Initiative As everyone struggled together to return to normal, Samsung Biologics was proud to serve our part by not only providing high quality, end-to-end CDMO services crucial to our global clients, but also as a responsible member of society for greater sustainability. In 2022, we will continue to put forth our best efforts to pursue a better life for humanity in addition to our continuous growth. In our journey to a brighter future, we will continue to actively communicate with investors to update on our progress and results. This winter feels colder than ever with the pandemic, and we wish you an abundance of joy, health, and a happy year-end and New Year's holidays. Thank you. Sincerely, John Rim President and CEO, Samsung Biologics
manufacturing contract of their COVID-19 vaccine. Subsequently we also announced our plan to add an mRNA vaccine drug substance facility by 2022 in order to provide a full end-toend service for mRNA vaccine production from drug substance manufacturing to aseptic fill and finish with labeling, packaging, and cold storage. We hope that with this expansion of our services portfolio, Samsung Biologics will provide an even greater contribution to the rapid supply of high-quality vaccines worldwide. We will also continue to study new technologies such as cell and gene therapies in addition to mRNA to secure new platforms for growth and business momentum. Plant 4 Expansion Currently Plant 4 is on track to begin partial GMP operations by the end of 2022. As global biopharmaceutical companies broaden and diversify their SCM strategy with new antibody drugs continuously under development, the demand for CDMOs is steadily increasing. This need for additional capacity is not only reflected in our Plant 4 pre-sales activity, but is also driving us to closely review the investment and construction of a second bio-campus in Songdo, Incheon. 3-Dimensional Expansion : Capacity / Geography / Portfolio Earlier this yera, we shared our '3-Dimensional Expansion' strategy to becoming a fully integrated global top-tier biopharmaceutical company, and I am proud to confirm we are keeping that promise even at this moment. In addition, Samsung Biologics will be proactive in fulfilling our commitment and responsibility to a better planet and social environment as signaled by the issuance of our first annual sustainability report during this past quarter. We will also continue to stay ahead of and respond to evolving market dynamics and client needs to maximize corporate and shareholder value. Thank you for your continued support. Sincerely, John Rim President and CEO, Samsung Biologics
manufacturing services according to our strict COVID-19 controls and management systems. Our supply chain management war room monitored and managed availability of critical materials around the clock, while our preemptive development of our Live Virtual Tour platform ensured our ability ot perform client due diligence and regulatory inspections amid worldwide travel restrictions, enabling us to sign additional CMO contracts for a total of 47 cumulative by the end of 2020. Our achievements in 2020 not only demonstrated innovation in the CDMO market but also strengthened our business competitiveness despite the COVID-19 pandemic. Samsung Biologics, I ask for your continued warm attention and support. Sincerely, also established a stable growth foundation by securing full contracts in Plants 1, 2, John Rim President and CEO, Samsung Biologicsand near-full contracts in plant 3. We also made a decisive investment to expand Plant 4 to respond to the accelerated supply/demand situation within the industry. Plant 4 will be the word's most productive facility, with a total of 256,000L, which is 76,000L larger than plant 3. in the CDO (contract Development) business, we successfully launched our proprietary cell line, "S-CHOice" in August. In october, we announced the opening of our R&D center in San Francisco, US. We will continue to evaluate expanding DP (fill finish) facilities to ensure client satisfaction by providing competitive end-to-end services. 2021 - The beginning of a new decade for Samsung Biologics, I ask for your continued warm attention and support. Sincerely, John Rim President and CEO, Samsung Biologics As announced at this year's JP Mogan conference, we are planning to expand our business in 3 aspects : capacity expansion, geography expansion, and scope expansion over the next 10 years: Capacity Expansion By acquiring Bio-campus Ⅱ and plant 4 expansion in Songdo play as game changer beyond CDMO champion Geography Expansion Expansion of CMO and CDO capacity oustide of Korea to maximize customer satisfaction and expand prospects. Scope Expansion Study from mAb based biologics to new potential growth momentum(eg. Cell/gene therapy, vaccine etc.) For the Next Decade 3-Dimensional Expansion - Business Expansion & Portfolio Diversification Source : JP Morgan Healthcare Conference 2021 Samsung Biologics will always advance forward and deliver on ever challenging goals as a CDMO Champion. As we celebrate our 10 year anniversary this year, we will not be complacent with our achievements, but instead commit ourselves even more to continuously innovating our process for superior client satisfaction. Through this, we will strive to increase both customer value while maximizing shareholder value. And we will continue to actively communicate with investors to inform on our business performance. In this new decade of Samsung Biologics, I ask for your continued warm attention and support. Sincerely, John Rim President and CEO, Samsung Biologics
manufacturing, offering fully integrated, one-stop services. for additional information regarding Plant 4, please visit our newly opened "Plant 4 Virtual Showroom", where you can also track its ongoing construction progress. Bio CMO/CDO/CRO Champing 2030 As a CDMO service provider, Samsung Biologics attained the largest total capacity within the shortest amount of time while ensuring top-notch quality services. We will continue to strengthen our competitive edge through technological innovation and new business development. We will also strive to ensure maximum client satisfaction, optimize shareholder value, and most importantly advance the industry in improving assessibility to healthcare and quality of life. We ask for your continued encouragement and support in buliding a better future with Samsung Biologics. Thank you, Tae Han Kim President & CEO, Samsung Biologics December 3rd, 2020
Manufacturing and Business Operations Samsung Biologics announced our 2020 Q3 Earnings today. Despite the ongoing COVID-19 pandemic, we maintained stable business operations including development and manufacturing according to our strict COVID-19 controls and management system. 2020 Q3 Revenue 2,746B KRW(QoQ 11% DOWN, YoY 49% UP) Operating Profit 565B KRW (QoQ 30% DOWN, YoY 139% UP) Profit Before Incom Tax 737B KRW (QoQ 9% UP, YoY 67% UP) Net Profit 561B KRW (QoQ 8% UP, YoY 27% UP) Manufacturing Contracts and Business Performance 4 additional contracts in Q3 11 cumulative contracts in 2020 thus far plant 4 Expansion(august) S-CHOiceTMLaunched(August) Continuing to Strengthen Business Competitiveness Towards Becoming a Super Value Company In August, we announced our Plant 4 expansion, which will have a capacity of 256,000L. With the Plant 4 expansion Samsung Biologics is proactively responding to changes in the global biopharmaceutical market and is strongly positioned as the global No.1 CMO based on production capacity. applying Super Value Company principles in the CDO(contract development)market, we continue to strengthen our competitive edge. Samsung Biologics successfully launched our own cell line, S-CHOiceTM, in August 2020. The S-CHOiceTM cell line results in shorter production times and price competitiveness for our clients. Additionally, to strengthen client satisfaction and bring our contract development services closer to global clients, we are launching a CDO R&D Center in San Francisco, California on October 29th(KST). I encourage you to attend the online grand opening ceremony of our CDO R&D Center. Please register through the link at the bottom of the letter. Samsung Biologics will contnue to innovate to provide qualiy services for clients to support them in their mission to advance life-saving therapies. Thank you, Tae Han Kim President & CEO, Samsung Biologics October 21, 2020 CEO IR Newsletter 2 뿐만 아니라 글로벌 거점과 고객사 확보 역량 강화를 위해 10월 29일 미국 San Francisco에 CDO R&D 센터를 오픈할 계획입니다. 온라인으로 진행되는 본 행사에 관심 있으신 투자자분들은 메일 하단의 '등록'을 통해 참석하실 수 있습니다. 삼성바이오로직스는 앞으로도 지속적인 혁신을 통해 빠른 속도로 양질의 서비스를 제공하며, 보다 높은 기업가치 창출을 위해 최선을 다하겠습니다. Super Value Company를 향한 삼성바이오로직스의 행보에 투자자 여러분들의 따뜻한 관심과 지속적인 성원을 부탁드립니다. 감사합니다. 2020년10월21일 삼성바이오로직스 대표이사 사장 김태한
manufacturing supply. At Samsung Biologics, innovation isn’t something we do in bursts or sporadically. It is a constant approach, and the biopharmaceutical industry has recognized this trait through our outstanding quality, cost competitiveness, and customer satisfaction over the years. Taking into consideration the market’s supply and demand and the trend of global pharmaceutical companies expanding their usage of CMPs, we see the Plant 4 expansion as our long-term strategy for resilience and growth not only for ourselves but for our clients as well. Plant 4 Super Pant Detail Capacity 256,000L CAPEX Amount 1.74 trillion Korean Won Targeted Construction Period Groundbreaking in September 2020 Mechanical completion by the end of 2022 Location & Size Songdo, Incheon (Next to Plant 3) Approximately 23.8 million square meters Plant 4 will have the world’s largest manufacturing capacity at a single site with top-notch quality and production efficiency – using Samsung Biologics’ cutting-edge plant design technology. Also in order to respond to our clients’ diverse requests with even more flexibility, we will leverage a variety of bioreactor sizes (2,000L, 10,000L, and 15,000L). Upon Plant 4’s completion, Samsung Biologics will have a total site capacity of 620,000 liters, setting us on track to be one of the world’s largest CDMO companies. We recognize that we’re entering into a new era for biomanufacturing that requires us to go beyond the standard: we need to innovate through technology and product construction to create this super gap between us and our competitors. In addition to our Plant 4 expansion, we are also reviewing the creation of a second bio complex in Songdo, Incheon. We’re investing in these advancements because our future and the future of healthcare depends on it. We promise to continue to deliver long-term growth and value for our shareholders, whose success and Samsung Biologics’ success are inextricably linked. Sincerely, Tae Han Kim President & CEO, Samsung Biologics August 11, 2020
manufacturing agreement with Vir Biotechnology -valued at 440 billion korean won-for a potential COVID-19 treatment. We also signed a 280 billion Korean won CMO contract with GSK in May to expand their innovative biopharmaceutical portfolio. This year to date, we have signed eight manufacturing contracts with clients, valued approximately at 1.8 trillion korean won. These achievements further articulate our continued commitment to continuous top line growth and client satisfaction through outstanding ution and innovation. As competition intensifies, several big pharmaceutical and CMO companies are increasing their manufacturing capacities as the demand for novel biologics continues to rise. Meanwhile, the number of pharma companies without in-house facilities is multiplying, and SCM strategies are moving towards increased dependence on CMOs amid COVID-19. Considering these dynamics in the supply and demand of biotherapeutics, we recognize an opportunity for expansion as our outstanding quality, cost competitiveness, and client satisfaction have laid the foundation for a more robust, long-term strategy. As a result, we are looking at expanding our manufacturing facilities to fulfill the needs of the growing biopharmaceutical market. We have also adjusted to operating in a more virtual environment due to COVID-19 and the profound changes it has introduced. Videoconferencing, webinars, and virtual tours are investments in technology that allow us to communicate and serve our clients while also keeping their safety in mind. Our Virtual Exhibition Hall introduced the Samsung Biologics business portfolio to a global audience during BIO Digital 2020, and our Live Virtual Tour solution established a platform where through high definition virtual connectivity, our experts are having richer conversations with potential clients and regulatory authorities than ever before. This level of engagement in a rapidly changing business environment showcased our unique strengths, ultimately allowing us to sign numerous contracts in first half of this year. During this unprecedented crisis, our conviction in our purpose-to achieve a better life for humanity through biomedicines-is stronger than ever. We understand this comes with a great responsibility to support our clients and communities as they navigate the challenges they face. Communication with clients and shareholders on key business environment changes is top of mind in order to maintain trust and cooperation. At Samsung Biologics, we will be innovative in strengthening our cost competitiveness and agility for maximum client satisfaction to grow into a "Super Value Company" that is relentless in its pursuit of innovation. On behalf of Samsung Biologics, I ask for your continued trust and support as we move forward with resilience and fortitude in these uncertain times, and focus on the well-being, health, and safety of all our stakeholders-our clients, shareholders, employees, and communities. Thank you, Tae Han Kim President & CEO, Samsung Biologics July 21, 2020
Dear Shareholders of Samsung Biologics: On November 14, the Securities and Futures Commission (“SFC”) announced the final result of its audit on our accounting in respect of our associate, Samsung Bioepis (“Bioepis”). In this regard, we will explain the progress of this issue and our position on the result of the measure taken by the SFC. ?Samsung Biologics (the “Company”) has been audited by the Financial Supervisory Service (“FSS”) since April 2017 as to whether the accounting was properly treated in the Company’s financial statements in respect of Bioepis, a joint venture between the Company and Biogen in the U.S., and the FSS disclosed the result of the audit to the media in early May. ? After numerous meetings of the audit committee and the SFC, the SFC announced the following results of the measure on July 12, 2018: among the alleged accounting violations of the Company, (i) “gross negligence” for failure to record notes regarding call options granted to Biogen in respect of shares in Bioepis to the auditors’ report for 2012 and 2013; (ii) “willful misconduct” for insufficient record of notes to the auditors’ report for 2014; and (iii) order for re-audit by the FSS with respect to the discretionary evaluation of the investment in shares through an inappropriate change of the accounting standards for 2015. ?In its announcement of the decision on re-audit on November 14, the SFC concluded that the Company’s treatment of Bioepis as a consolidated subsidiary as opposed to an associate under the equity method from 2012 to 2014, which was not deemed a violation in July, was to be deemed “negligence” for 2012 to 2013 and “gross negligence” for 2014. It also announced that the Company’s unjust discretionary evaluation of investment in shares for 2015 and failure to retroactively apply the amended accounting standards to the financial statements after 2012 would be deemed “willful misconduct.” ? Accordingly, the following measures were taken against the Company: i) prosecution against the Company and its representative director; ii) recommendation of dismissal of the Company’s representative director (CEO) and the responsible officer (CFO); iii) compulsory designation of external auditors for 3 years; iv) an order of a corrective measure (retrospective restatement of financial statements); and v) imposition of an administrative fine worth KRW 8 billion for “willful misconduct.” ?According to the KOSPI Listing Regulation, in case of any prosecution for violations of the accounting standards in the amount equal to or greater than 2.5% of the shareholders’ equity (for a large-scale corporation), a listing maintenance review event is triggered and such review must be conducted immediately after suspension of trading activities. Therefore, the trading of the Company’s shares has been suspended since the SFC’s announcement on its resolution after market closing on November 14. ?We deeply regret the findings of the SFC as we are confident that our accounting treatment has been proper under the K-IFRS. As such, we filed an administrative lawsuit against the SFC on October 8 regarding the 1st audit result and another administrative lawsuit against the SFC on November 27 regarding the 2nd audit result. Through these lawsuits, the Company aims to have the legality of its accounting treatment recognized. To prevent the administrative dispositions from taking effect, the Company applied for an order to stay the dispositions on restatement of financial statements, recommendation of dismissal of CEO and CFO, designation of external auditors for 3 years until the court renders a decision. Furthermore, the Company i
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