German Vaccine, Toxin, and CGT CDMO
Acquires IDT Biologica in a Surprise Move
Possesses Production History for US and EU Response Products
Annual Sales of 410 Billion KRW... Higher than SK Bioscience
Capable of Serving as a North American Expansion Hub
SK Bioscience has acquired a local vaccine contract development and manufacturing organization (CDMO) company in Germany to secure a global production base. Through this acquisition, the company plans to accelerate its global regional base expansion project named 'SkyShield.'
Ahn Jae-yong, President of SK Bioscience, is explaining the significance of the acquisition of IDT Biologica at a press conference held on the morning of the 27th in Jung-gu, Seoul. [Photo by Lee Chun-hee]
On the morning of the 27th, at a press conference held in Jung-gu, Seoul, SK Bioscience President Ahn Jae-yong stated, "We acquired Germany's IDT Biologika to leap forward as a global vaccine company," and evaluated the deal by saying, "We were able to purchase a good company at an attractive price at the right time."
SK Bioscience announced on the same day that it acquired IDT Biologika, a German company specializing in vaccines, cell and gene therapy (CGT), and botulinum toxin CDMO services, along with its infrastructure-related subsidiary TEW. The acquisition cost amounts to 339 billion KRW. The company estimates IDT's corporate value at approximately 440 million euros (about 656 billion KRW), and will hold a total of 60.6% of the shares.
The existing owner, the Klocke Group, will continue to hold about 40% of IDT's shares and will invest 75.7 billion KRW to purchase a 1.9% stake in SK Bioscience through a third-party paid-in capital increase. This means that the actual funds SK Bioscience is injecting into the IDT acquisition amount to around 263 billion KRW. President Ahn explained, "The Klocke side expressed their intention to retain shares first," adding, "I believe their retention of shares signifies their intention not to exit but to grow this company together."
Ahn Jae-yong, President of SK Bioscience (left), and Carsten Klocke, CEO of Germany's Klocke Group, are posing for a commemorative photo after signing the acquisition agreement for the management stake of IDT Biologica. [Photo by SK Bioscience]
IDT is a company established in 1921 with over 100 years of expertise and approximately 1,800 employees. It has been recognized for its capabilities by key global pharmaceutical regulatory agencies in the US and Europe and possesses production capabilities for vaccines, bioactive pharmaceutical ingredients, and finished pharmaceuticals throughout all stages from clinical to commercial phases.
IDT has contract manufactured (CMO) COVID-19 vaccines for Janssen and AstraZeneca and also produces Zeomin, a botulinum toxin product from Germany's Merz, under contract. Ahn Jae-hoon, Head of Strategic Planning, explained, "(Regarding toxins) various customer demands continue to come in, and we view the market as promising in the future." Additionally, IDT produces Imlygic, the world's first oncolytic virus therapy, raising expectations that SK Bioscience can establish a foundation for entering the CGT business, which it has identified as a future growth engine.
SK Bioscience's 'Glocalization' Growth Gains Momentum
With this acquisition, SK Bioscience immediately doubles its sales while achieving production capabilities that meet the quality standards of advanced countries such as the US and Europe, as well as building integrated infrastructure connecting global markets.
Despite the transition to an endemic phase last year, IDT recorded sales of 275 million euros (about 410 billion KRW) in 2022, a decrease of only 11.9% compared to 312 million euros in 2021 when it was contract manufacturing COVID-19 vaccines. This performance surpasses SK Bioscience's 369.5 billion KRW sales last year. President Ahn stated, "The combined sales of both companies exceed 700 billion KRW," emphasizing, "This is meaningful in terms of scaling up." However, like SK Bioscience (which posted a 12 billion KRW loss), IDT also recorded an operating loss of 14.7 billion KRW last year. President Ahn assured, "We can catch up quickly," and added, "There are no issues regarding financial structure and cash flow."
In terms of quality, securing a facility certified with the current Good Manufacturing Practice (cGMP) standards of the US Food and Drug Administration (FDA) is highly significant. Although SK Bioscience's L House in Andong, Gyeongbuk Province, was the first in Korea to receive the European Union (EU) GMP certification, it has not yet obtained cGMP certification. Furthermore, recent expansions of L House will accelerate efforts to increase production capacity. Regarding SK Bioscience's global expansion strategy, SkyShield, IDT is expected to function as a base not only in Germany but also in the US, where it has a local subsidiary with process development capabilities.
President Ahn emphasized, "L House's production capacity is fully utilized," adding, "Since expansion takes a considerable amount of time, acquiring IDT means we have secured facilities that cover cGMP, effectively saving time," and highlighted, "There is also a possibility that the 21-valent pneumococcal vaccine scheduled for release in 2029 will be produced at IDT."
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