Samsung Biologics will open a European sales office in the Netherlands in the third quarter of this year. Following the securing of a U.S. production base, the move aims to expand global customer touchpoints by building local sales networks in Japan and Europe. The strategy is to complete a global order-intake network that spans the United States, Europe and Japan, and further strengthen its position as the world's largest contract development and manufacturing organizations (CDMO) for biopharmaceuticals.
John Rim, CEO of Samsung Biologics, held a media roundtable with Korean reporters at "BIO USA" in San Diego, California, on the 23rd (local time) and said, "We plan to open an office in the Netherlands in the third quarter of this year," adding, "It will serve as a hub overseeing all European sales."
Samsung Biologics currently operates sales offices in Boston and New Jersey in the United States and opened an office in Tokyo, Japan, last year. With the addition of a European base, the company has built a sales network that effectively covers the global pharmaceutical markets in the United States, Europe and Japan.
John Rim said, "From a sales perspective, we can cover almost everything," adding, "After the United States, Europe, then Japan are Samsung Biologics' key markets." He said the company is "not considering entry into the Chinese market yet because intellectual property (IP) issues are complicated."
As for why the Netherlands was chosen as the European base, he cited accessibility and expense efficiency. John Rim said, "The Netherlands is relatively inexpensive and sits at the center of Europe," adding, "We plan to set up an office near Amsterdam Schiphol Airport, from which we can reach major countries such as the United Kingdom, France and Denmark within two hours."
According to John Rim, European clients currently account for a share of Samsung Biologics' orders similar to the United States (about 40%). With many global big pharma companies such as GSK plc, AstraZeneca (AZ) and Sanofi headquartered in Europe, the need to expand local customer touchpoints is also significant.
◇ Acceleration of global base expansion built on the "three growth pillars"
The establishment of a European sales base aligns with Samsung Biologics' "three growth strategies" of global base expansion, capacity expansion and portfolio diversification. The company is particularly focused on strengthening its ability to serve global customers following its recent acquisition of a U.S. production base.
In Mar., Samsung Biologics acquired a biopharmaceutical manufacturing facility in Rockville, Maryland, from GSK. The plant, which has drug substance (DS) production capacity of 60,000 liters, currently employs about 520 people.
John Rim said, "The Rockville acquisition was a very good decision in terms of geographic expansion," adding, "Global pharmaceutical companies now place great importance on securing manufacturing facilities in the United States." He said, "The Rockville plant is close to the U.S. Food and Drug Administration (FDA) headquarters, and major clients, including GSK, already know the facility well," adding, "Clients are actually visiting the site to confirm production capabilities."
The Rockville plant acquisition is also seen as laying the groundwork to address supply chain uncertainties and tariff risks beyond expanding capacity. John Rim said, "Biosimilars are not greatly affected by tariffs, so the direct impact on the company is limited," but added, "From clients' perspective, securing a U.S. production option is important."
Analysts say the U.S. government's stance of checking China's bio industry is also working in favor of Samsung Biologics. John Rim said, "Five years ago, Chinese CDMO companies touted scale and price competitiveness as strengths, but you hardly hear that now," adding, "Among the facilities built by Chinese corporations, not a few are not actually operating."
◇ Expanding top global pharma clients… Continued investment in Plant 6 and the third campus
Samsung Biologics is continuing to increase orders on the back of an expanded global sales network and expanded production capacity.
This month alone, the company increased the size of contract manufacturing deals with existing clients three times, pushing its cumulative order backlog past $10.4 billion. After expanding a European pharma contract on the 9th, the company also increased contracts with a U.S. pharma on the 17th and an Asian pharma on the 22nd.
John Rim said, "Last year, we announced that we had secured 17 of the world's top pharmaceutical companies by market capitalization as clients, and we must be close to 20 now," adding, "As mergers and acquisitions (M&A) by large pharmaceutical companies of biotech firms pick up, our client base continues to expand."
Capacity expansion is also underway in step with the increase in orders. Samsung Biologics brought its fifth plant, with capacity of 180,000 liters, online last year, expanding total capacity to 785,000 liters, and after acquiring the Rockville plant, it built a production system totaling 845,000 liters.
The company plans to decide within the year whether to break ground on a sixth plant with capacity of 180,000 liters. John Rim said, "Plant 5 is running smoothly and orders keep coming in," adding, "We will finalize the related decision on Plant 6 within this year."
Development of the third biocampus to expand the portfolio is also moving into full swing. John Rim said, "We have begun site work," adding, "We are reviewing various modalities, including not only antibody drugs but also peptides, cell and gene therapies (CGT), and adeno-associated virus (AAV)-based gene therapies."
He added, "Given current market conditions, the third campus is likely to focus on the peptide business," and "We expect demand for GLP-1 peptide production to increase as the obesity treatment market grows."
He continued, "CGT and AAV are still in the early stages of the market," adding, "Even in the United States, there are cases where related corporations are downsizing or selling their production facilities."
◇ Managing labor-management conflict amid aggressive expansion
However, despite aggressive business expansion and rising orders, labor-management conflict remains an issue to resolve.
Regarding the ongoing wage negotiations with the labor union, John Rim said, "There is still a gap between labor and management," adding, "There are no problems with production and business operations. Clients do ask about the situation, but we continue to explain that there are no issues with supply."
He said, "Global pharmaceutical companies are most wary of uncertainty in the supply chain," adding, "In the past, geopolitical risk was the main concern, but recently, union issues are also seen as a factor in assessing supply chain stability."
However, he emphasized, "This is not a situation where clients are worried about production stoppages or the possibility of contract cancellations," adding, "To date, there have been no disruptions to production and supply."