South Korean-based biotech Samsung Biologics will be buying Biogen’s equity stake in their joint venture, Samsung Bioepis, for $2.3 billion. The deal is expected to accelerate growth in biosimilars and novel therapeutics R&D.
When their joint venture was established back in 2012, Biogen initially invested in a 15% stake. Their initial agreement outlined that Biogen could purchase up to 50% less one share of Samsung Bioepis, which the Massachusetts-based biotech did in June of 2018.
Their current deal notes that full ownership will take effect once the first payment of $1 billion is made. The transition is expected to increase sales growth and operating margin improvements with “streamlined operational efficiencies, budget surplus and cash flow generation,” the company said.
The purchase doesn’t necessarily come as a surprise, as Samsung Biologics has been prioritizing expansion. They are currently building a facility that will break its own record of holding the world’s largest biomanufacturing capacity. They are also working on securing additional land that would provide 30% more space than they have now.
Samsung Bioepis has had several successful biosimilars on the market, and four others are in phase 3 clinical trials. Their statement included that looking ahead Samsung Biologics, “will continue to deliver quality-driven biomanufacturing services, with existing firewalls between Samsung Bioepis, and expand its biopharmaceutical business in its three core drivers: continued capacity enhancement, the establishment of growth opportunities in new business areas, such as mRNA and cell and gene therapies, and global expansion,” they concluded.