Smartphone Maker Also Producing Biologics

The Samsung name and its electronic products are permeating the holiday landscape as the company attempts to gain its share of Christmas shoppers’ wallets. But behind the scenes to most of us, Samsung machines are churning out cancer drugs and other biologics developed by the likes of Bristol-Myers Squibb Co.

According to a report in The Wall Street Journal, Samsung has invested $2.74 billion over the past 4 years to build production and research facilities in an effort to turn its expertise in manufacturing chips into a making biologic drugs for pharmaceutical companies. “Its goal,” says the Journal, is “to become the world’s biggest contract manufacturer of biologic drugs.” It has announced plans to build yet another plant, which will make Samsung BioLogics Co the world’s biggest contract drug-maker by capacity, according to the report. 

“Samsung hopes to reshape the drug-making industry by offering pharmaceutical firms a place to outsource production, in much the same way that semiconductor firms enlisted contract manufacturers to lower costs and allow them to focus more on design,” Kim Tae-han, Samsung BioLogics’ chief executive, told the Journal. 

Samsung’s strategy mirrors how it approached the semi-conductor business, inasmuch as both the semiconductor and biopharmaceutical segments are capital intensive and require significant investment, notes the report.

The effort is not without challenges. Unlike the semiconductor field, production rooms for biopharmaceuticals need to be sterile and free of bacteria to stand up to FDA scrutiny.

Also, just because you build it, will they come? Samsung faces the task of convicting potential partners that it is a better choice than its rivals, says the Journal. --Dean Celia

Reference: Cheng J and Lee MJ. Samsung's bet on biotechnology is test for hein apparent. The Wall Street Journal. December 17, 2015.