Baek Byung-yeul is a journalist at The Korea Times focused on cultural content, including films and cultural events in South Korea. You can contact him at baekby@koreatimes.co.kr to share your insights.
Samsung Biologics raises sales forecast on higher utilization of new plant
Samsung Biologics' Plant 4 in Songdo, Incheon / Courtesy of Samsung Biologics
By Baek Byung-yeul
Samsung Biologics raised its sales forecast for 2023 to more than 20 percent from between 15 percent and 20 percent thanks to the increased use of its new factory Plant 4, the drug manufacturer said Wednesday.
The company said it is forecast to generate sales of 3.6 trillion won ($2.65 billion), up 75.1 billion won from its previous guidance of 3.53 trillion won. This is the second time the company raised its guidance. In April, it said it raised its 2023 sales forecast to between 15 percent and 20 percent from 10 percent and 15 percent a year ago.
The second increase stems from higher utilization rates of Plant 4. Samsung Biologics began full operation of its Plant 4 in June. The new plant has an annual production capacity of 240,000 liters and due to its large, Samsung said it is able to receive large-scale orders from global pharmaceutical companies.
The utilization rate of Plant 4 has been increasing at a faster-than-expected pace. “The sales outlook was raised due to faster-than-expected ramp-up of Plant 4 utilization, led by a large CMO contract from big pharma,” a company spokesperson said adding that the revenue generated from Plant 4 will be fully recognized in the third quarter earnings.
Samsung Biologics has secured 14 of the top 20 global pharmaceutical companies as customers. Among the new and increased contracts announced this year, there are a total of eight large-scale contracts worth more than 100 billion won. The company secured 2.7 trillion won worth of contracts in the first half of this year, surpassing 2020’s order intake of around 1.9 trillion won in less than half a year.
Since 2020, Samsung Biologics has actively won orders from global big pharmaceutical companies such as GSK, Eli Lilly, AstraZeneca, Moderna, Novartis and Pfizer. Novartis especially strengthened its partnership with Samsung by expanding the production scale of its existing contract.
“In the pharmaceutical sector, which is directly related to life, a company’s credibility is a key factor in determining the success or failure of its business,” the official said. “In a short period of 12 years, we have succeeded in establishing ourselves as a global leading CDMO company by building high credibility in the global market.”