Samsung Biologics, the drug manufacturing business that a South Korean conglomerate formed earlier this year with the help of pharmaceutical services firm Quintiles, is partnering on a $300 million initiative with Biogen Idec (NASDAQ:BIIB).
The joint venture, which will be based in South Korea, will develop, manufacture and market biosimilars, biological products that are similar to already marketed products. The Samsung-Biogen Idec joint venture will not make biosimilars of any Biogen Idec products.
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Although Samsung will be the leader in the joint venture, Weston, Massachusetts-based Biogen Idec will lend its expertise in protein engineering and biologics manufacturing. The company already has a significant manufacturing presence in Research Triangle Park, North Carolina, where it makes its multiple sclerosis drugs Avonex and Tysabri. Under the agreement, Samsung will contribute $255 million for an 85 percent stake; Biogen Idec will contribute $45 million for a 15 percent stake. The joint venture will contract with Biogen Idec and Samsung Biologics for development and manufacturing services.
“By combining Biogen Idec’s expertise in biologics with our business acumen and proven record of success in new business development, we are taking a significant step toward becoming a major player in the biopharmaceutical industry and investing in an important growth engine for our company,” Samsung Biologics CEO Tae-Han Kim said in a statement.
Samsung announced in 2010 that biopharmaceuticals was one of the areas it will target for growth to expand beyond already diversified lines of business that include consumer electronics, finance and insurance. Samsung’s 2010 revenue was $220 billion. The conglomerate committed to invest $2.1 billion in biopharmaceuticals by 2020. Samsung Biologics was created in April as part of that effort. Durham, North Carolina-based Quintiles contributed $30 million toward the $266 million Samsung Biologics initiative.
Completion of the Samsung Biologics-Biogen Idec joint venture is subject to customary closing conditions, including antitrust clearance by U.S. and South Korean regulators.