Celltrion Enters CDMO… “Achieving KRW 3 Trillion in Sales by 2031”

[Korea Financial Times, Kim Nayoung] Celltrion Group is introducing a new pharmaceutical contract development and manufacturing (CDMO) company, 'Celltrion BioSolutions' (BioSolutions).

At an online press conference commemorating the establishment of the CDMO corporation on the 17th, Celltrion Group Chairman Seo Jung-jin announced, "Today, we completed the establishment of the CDMO corporation. BioSolutions will start as a 100% subsidiary of Celltrion."

'Biosolutions' provides full cycle service for pharmaceutical development, from new drug candidate substance selection to cell line and process development, clinical trial planning, approval document writing, and commercial production.

Lee Hyuk-jae, Senior Vice President of Celltrion, who has extensive experience in product approval, clinical trials, and production within the group, has been appointed as the representative of the corporation.

Chairman Seo Jeong-jin said that he decided to start the business in response to continuous requests for CDMO consignment from domestic and foreign bio companies. He explained that Celltrion has been conducting CMO for some of the company’s products since it started the contract manufacturing (CMO) business in 2002.

In addition, by establishing a multi-variety small-scale production system, the company plans to expand not only antibody treatments but also next-generation modalities such as cell gene therapy and peptide obesity new drugs.

Chairman Seo emphasized contract development (CDO) and clinical research (CRO) as differentiating factors from competitors such as Samsung BioLogics and Wuxi BioLogics. While existing competitors focused on consignment manufacturing of finished products, Celltrion’s strategy is to provide a one-stop service that handles all procedures from candidate substance discovery to clinical trials and approval.

The company will first build the first 100,000-liter plant in Korea with an investment of KRW 800 billion starting next year. The company plans to increase production capacity up to 200,000 liters depending on the order situation.

Chairman Seo said “We will start building the factory in the first half of next year,” and added, ”CDO and CRO will start business from next year, and we will open sales offices in connection with direct sales entities in more than 40 countries.” According to him, the CMO will also enter commercial production in 2028.

The new facility will be equipped with multiple batches of large and small scale incubators to enable mass production, as well as the production of next-generation modalities (therapeutic approaches) such as antibody-drug conjugates (ADCs), multi-antibody therapies, cell-gene therapies, and peptide therapeutics in line with production trends.

The expansion cost will be completed at about two-thirds of the cost of competitors by utilizing the know-how of expanding existing facilities. Chairman Seo said, “We can build the first plant for about KRW 800 billion won by utilizing our expansion know-how,” and ”We will also introduce production facilities suitable for low-volume production of various products and the latest automation equipment.”

The investment in the new corporation will be made with internal investment funds and external financing. First, up to KRW 1.5 trillion of Celltrion Group’s own funds will be invested to build initial facilities and launch CDO services. After that, up to KRW 1.5 trillion will be additionally raised from external sources to expand overseas specialized research institutes and next-generation modality facilities, and a total investment of KRW 2 to 3 trillion is expected to be secured.

Chairman Seo is aiming to rapidly expand its market share in the growing global CDMO market. According to market research firm Modo Intelligence, the global biopharmaceutical CDMO market is expected to grow by an annual average of 10.9% from approximately $18.2 billion (approximately KRW 24 trillion) this year to approximately $30.5 billion (approximately KRW 40 trillion) by 2029.

Chairman Seo said, “Biosolutions aims to generate sales of KRW 100 billion per 10,000 liters, and the expected sales in 2031 are KRW 3 trillion.”

He continued, “We plan to leap forward as a global top-tier CDMO company by 2035. We expect to generate service sales of KRW 100 billion from CDOs and CROs by 2027, and the total expected sales in 2031 are KRW 3 trillion, including KRW 1 trillion from CDOs and CROs and KRW 2 trillion from CMOs.”

He also emphasized, "We will establish specialized research centers in the U.S., Europe, India, etc. and provide integrated consignment development and production comprehensive solutions through technology aggregation."

Kim Nayoung, Korea Finacial Times (steaming@fntimes.com)