Choi Tae-won's Next Target is Bio... Finalizing Acquisition of French Company

Negotiations for Share Acquisition of French Gene Therapy CDMO Eposkeshi
SK Major Shareholder...Local R&D Company Also to Hold Partial Shares

French gene therapy CDMO company Eposkeshi

[Asia Economy Reporter Choi Dae-yeol] SK Group's holding company SK Inc. is reportedly in the final stages of negotiations to acquire shares in Eposkeshi, a French pharmaceutical contract development and manufacturing organization (CDMO).

Recently, SK entered into exclusive negotiations for the share acquisition, with expectations that the deal would conclude around the second quarter of this year. However, the company anticipates that the negotiations could be completed sooner. SK has been steadily acquiring contract manufacturing organizations (CMOs) over the past 3 to 4 years and is expanding its footprint by encompassing sectors with high growth potential.

According to foreign media and company statements on the 28th, SK Inc. has mostly finalized the negotiations for acquiring shares in Eposkeshi, which have been ongoing since last year, and is currently fine-tuning the details. It is reported that SK is discussing becoming the major shareholder while the local partner company Geneton, which focuses on research and development (R&D), will hold a portion of the shares.

CDMO involves producing pharmaceuticals after R&D is completed or developing early-stage research materials, making partnerships with companies that have R&D capabilities crucial. The biopharmaceutical market is a prominent sector within the overall pharmaceutical industry, and gene therapy CDMO, which is Eposkeshi’s business area, is expected to grow by more than 30% annually over the next several years.

Last month, President Moon Jae-in (right) and SK Group Chairman Chey Tae-won, who visited the SK Bioscience factory in Andong, Gyeongbuk, are holding up a COVID-19 vaccine.

Once this acquisition is completed, SK Inc. will have established a major framework for its core investment area in bio. SK Group is building its bio business capabilities around two pillars: ‘new drug development and CMO.’ While its subsidiary SK Biopharm handles synthetic drug development, the group has expanded its business into innovative new drugs through overseas companies. Since 2017, SK Pharmteco, formed by acquiring overseas factories and integrating them, has been responsible for CMO.

Whereas previously acquired companies like BMS and M-Pac focused mainly on synthetic drugs, Eposkeshi, which is currently being acquired, specializes in biopharmaceuticals. As seen in the business models of Celltrion and Samsung Biologics, the biopharmaceutical CDMO business requires scaling up, and large-scale investments are expected going forward. SK Pharmteco is anticipated to pursue an initial public offering as early as next year to secure investment capacity. SK Inc. stated, "Our goal is to become a global top-tier CMO encompassing both synthetic and bio."

SK Inc., the business holding company, is the only company where SK Group Chairman Chey Tae-won serves as CEO, positioning itself as an investment specialist. It has reorganized its entire organization by designating four core investment areas: advanced materials such as semiconductors and battery materials; green sectors including hydrogen, eco-friendly energy, and alternative foods; bio including new drug development and contract manufacturing of active pharmaceutical ingredients; and digital sectors such as artificial intelligence (AI), digital technology (DT), and mobility.