Samsung Biologics Co., the biotech arm of South Korea’s Samsung Group, announced Monday that it signed a new partnership with Bristol Myers Squibb (BMS) to manufacture a commercial antibody cancer drug substance.

Under the contract manufacturing organization (CMO) agreement, Samsung Biologics will provide $242 million worth of antibody cancer drugs to BMS over the next 7 years. BMS is known for viewing Samsung Biologics as a trusted partner, with the Korean company having the world’s largest production capacity in terms of production speed and delivery deadlines.

Samsung Biologics’ largest bio-manufacturing facility, Plant 4 located in Songdo, Korea began operation in June and will be utilized as a production base to produce the antibody cancer drug substance.

Plant 4 has an annual production capacity of 240,000 liters and has had a high utilization rate on the back of steady orders from major pharmaceutical companies.

The revenue from Plant 4 is expected to be reflected in the third-quarter results.

Meanwhile, Samsung Electronics Executive Chairman Jay Y. Lee reportedly played a significant role in securing the latest contract.

Lee, who picked biopharmaceuticals as one of the new growth engines to succeed semiconductors, met with BMS CEO Giovanni Caforio in May during his business trip to the United States and discussed cooperative measures to enhance competitiveness of bio business as well as nurture new businesses.

BMS, which placed seventh globally in sales last year, signed its first CMO business contract with Samsung Biologics in 2013 and expanded the scope of product and service cooperation a year later. BMS, a leading U.S. pharmaceutical and biotechnology company, is developing treatments for cancer, blood disorders, immune diseases, and cardiovascular diseases. It is expanding into new markets including chimeric antigen receptor T-cell (CAR-T) therapy, which is viewed as a next-generation biotechnology.

Samsung Biologics has signed contracts not only with BMS but with other major pharmaceutical companies and is negotiating new and additional contracts. The company has currently secured 14 out of top 20 global pharmaceutical companies as its customers.

By Kang Min-ho and Lee Eun-joo

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