Samsung Biologics Surpasses Annual Sales of 3 Trillion Won
Sales Triple in 2 Years Since CEO John Rim's Appointment
Growth Continues with Full Operation of Plant 4 and Epics Effect
SD Biosensor Also Expects 3 Trillion Won in Sales
Sales Forecast to Halve This Year
Attempts to Overcome Challenges Through Overseas Expansion Including Meridian Acquisition
[Asia Economy Reporter Chunhee Lee] Samsung Biologics has become the first company in the pharmaceutical and bio industry to surpass annual sales of 3 trillion KRW, sparking growing interest in the next contender. SD Biosensor, which experienced rapid growth due to the COVID-19 pandemic boom, is a strong candidate, but unlike Samsung Biologics, which is expected to sustain growth, SD Biosensor faces a somewhat mixed outlook due to the urgent need to secure future growth drivers.
According to Samsung Biologics on the 30th, the company's consolidated sales last year reached 3.0013 trillion KRW, marking an unprecedented achievement of 3 trillion KRW in annual sales for a domestic pharmaceutical and bio company. While cumulative sales up to the third quarter reached 2.0358 trillion KRW, breaking the 2 trillion KRW barrier for the first time, it defied expectations that 3 trillion KRW would be difficult to achieve by recording nearly 1 trillion KRW in sales in the fourth quarter alone.
In particular, since John Rim took office as CEO of Samsung Biologics in 2021, he has nearly tripled sales in just two years. Samsung Biologics' annual sales, which were 1.1648 trillion KRW in 2020, first surpassed 1.5 trillion KRW the following year with 1.568 trillion KRW, and then doubled again last year. Rim's emphasis on the 'One Team' spirit since his appointment, urging all company members to do their best for the company and customer satisfaction, is considered the driving force behind this growth.
CEO Rim also emphasized 'speed' and pursued a strategy to enhance competitiveness through proactive market preemption. In October last year, the world's largest fourth plant (240,000 liters) began partial operations just 23 months after groundbreaking, successfully widening the overwhelming production capacity gap. Alongside this, to strengthen contract development (CDO) competitiveness, the company launched the dual antibody platform 'S-Dual' and 'Developick,' a new service that analyzes and screens the safety of new drug candidates, thereby strengthening its business portfolio.
Samsung Biologics' growth momentum is expected to continue this year. The company forecasts sales growth of 10-15%, and securities firms estimate sales around 3.233 trillion KRW. A key factor is the full operation of the fourth plant, which currently operates only about 60,000 liters of production capacity, with the remaining 180,000 liters scheduled to start operating after June. This will solidify Samsung Biologics' position as the global No. 1 contract development and manufacturing organization (CDMO) with a total capacity of 604,000 liters. Additionally, the full-year reflection of Samsung Bioepis' complete acquisition effect, which significantly boosted consolidated sales last year, starting from May this year, is expected to further support sustained growth.
Samsung Biologics is not stopping there; it has set a strategy to leap forward by expanding production capacity and securing technology. Discussions to build the second bio campus, planned on a newly secured site of 357,000 square meters, will be intensified this year. With a total investment of 7.5 trillion KRW, the company plans to establish large-scale biopharmaceutical production facilities as well as an open innovation center. It also plans to secure next-generation drug production capabilities such as antibody-drug conjugates (ADC) and gene therapies, while expanding its U.S. base.
SD Biosensor's '3 Trillion Sales' Expectations Rise... Securing Growth Drivers Remains a Challenge
Amid Samsung Biologics' remarkable achievements, expectations are also rising for SD Biosensor's performance. The market currently anticipates SD Biosensor's sales last year to be close to 2.9928 trillion KRW, nearly reaching 3 trillion KRW. Although concerns are high that performance will deteriorate as the COVID-19 boom subsides, SD Biosensor managed to withstand sales declines in the third quarter with its COVID-19 and flu simultaneous diagnostic kits, and achieved a 4.7% year-on-year sales growth by expanding sales in new growth products such as the rapid molecular diagnostic device 'Standard M10.' If it succeeds in somewhat preventing sales decline in the fourth quarter as well, there is hope that it can achieve the annual sales of 3 trillion KRW that narrowly missed in 2021 with 2.93 trillion KRW.
However, despite these achievements, a sharp decline in performance is expected starting this year, which remains a challenge. The market forecasts SD Biosensor's sales this year to drop to about 1.3785 trillion KRW, roughly half of the previous year. Although this is still significantly higher compared to 73 billion KRW in 2019 before COVID-19, it is expected to be the lowest sales record since the pandemic began in 2020.
Cho Hye-im, Executive Director of SD Biosensor, is presenting at the JP Morgan Healthcare Conference held in San Francisco, USA, on the 10th (local time). [Photo by SD Biosensor]
In response, SD Biosensor is also striving to secure future growth drivers. It plans to complete the acquisition of U.S. diagnostic company Meridian Bioscience within the year, marking the largest M&A in the domestic pharmaceutical and bio industry with an acquisition price of 1.53222 billion USD (approximately 1.8923 trillion KRW), accelerating its entry into the U.S. market. Using this as a foothold, the company aims to pursue continuous overseas expansion. Hyeim Cho, Executive Director in charge of global strategy and eldest daughter of SD Biosensor Chairman Youngsik Cho, recently stated at the JP Morgan Healthcare Conference, "We will compete with global in vitro diagnostic companies through U.S. market entry and additional M&As. Entering the U.S. market is truly difficult, but we have laid the foundation to overcome this and plan to expand sales through forward bases in South America, Brazil, and Italy."
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