Korean firms to invest $9 bil. in biotechnology by 2023

President Moon Jae-in delivers his opening speech on the sidelines of his participation to congratulate Samsung Biologics and Celltrion's investment plans to expand the annual capacity of bio drugs in Songdo, Incheon, Wednesday. Yonhap

By Nam Hyun-woo, Do Je-hae

Biotech companies here, including Samsung Biologics and Celltrion, will invest a combined 10 trillion won ($9.03 billion) by 2023 in line with President Moon Jae-in's initiative to make biotechnology a growth driver for Asia's fourth-largest economy.

This comes in response to an administration initiative unveiled Wednesday to help these firms upgrade their structure for the manufacture and distribution of drugs and medical devices, and to hire more talented employees.

President Moon Jae-in thanked Samsung Biologics and Celltrion for their planned massive investment in upgrading and developing biotechnology as the Moon administration explores ways to find new economic growth engines.

"Today, Samsung Biologics held a groundbreaking ceremony for a new biopharmaceutical manufacturing plant, the result of a 1.7 trillion won investment. Plus, Celltrion also held an event to celebrate the groundbreaking for a research center, the result of 500 billion won. Samsung Biologics will become the world's top contract drug producer and Celltrion will rise as the world's leader in terms of developing bio drugs," Moon said at the start of a speech during an event in Incheon to unveil the country's updated strategies for the biotechnology industry, according to Cheong Wa Dae press pool reports.

The President congratulated Korean firms for their steady investment in biotechnologies. Moon said 40 biotech companies are set to invest at least 10 trillion won, collectively, by 2023, which would create more than 9,000 new jobs.

"The country's annual capacity in producing bio drugs will rise to 910,000 liters by that time from the current 600,000 liters. This will help Korea become a global bio drug manufacturer. Thank you to the two companies for your large-scale investment decisions. And I also thank you, Incheon citizens, for this," Moon said, adding the biotech industry has greater growth potential.

"There are numerous requests from a lot of countries battling with the coronavirus to supply test kits. The development of vaccines and possible COVID-19 treatments is seeing visible progress and I can say the commercial availability for COVID-19 treatments will be possible from the end of this year, at the earliest," Moon said.

The event was held in Songdo, the city where Samsung Biologis and Celltrion operate key plants.

Samsung Biologics CEO Kim Tae-han said the Samsung affiliate's plan to build a fourth plant was in accordance with Moon's initiatives to boost the biopharmaceutical industry as a new growth engine for the country. "Samsung will back up the government's efforts in creating a bio-focused eco-system by developing COVID-19 treatments and establishing a stable supply," Kim said.

The Moon administration has picked non-memory chips, future-generation vehicles and the bio-health industry as its three new growth drivers. Specifically, the biotech and pharmaceutical industry has risen as a promising business amid the rapidly aging population that will clearly raise the demand for healthcare services. As of October, the country's drug and medical device companies have logged a trade surplus for 14 straight months, and total exports surpassed $10 billion in response to explosive demand for COVID-19 testing kits made by domestic firms.

So far this year, Moon has made a number of visits to biopharmaceutical and diagnostics firms as the healthcare industry is bearing a greater significance in the wake of the COVID-19 pandemic. He visited COVID-19 testing kit maker SeeGene in March, the Pasteur Institute Korea in April and SK Bioscience in October.

As follow-up measures, the government pledged Wednesday to spend 1.7 trillion won next year on supporting policies, up 30 percent from the 1.3 trillion won spent for biotech research and development this year. In the policy package, the government said it will help firms to upgrade their manufacturing and distributing structure.

For this, the industry ministry will spend 85.7 billion won to help firms localize materials, components and equipment technologies, as well as establishing a government-run agency to help companies innovate their drug and medical device manufacturing process. Also, the government will establish state-backed academic institutions at Yonsei University to educate more than 2,000 biotechnology experts every year from 2024. It will devise additional curricula on biotech regulations and other processes in the drug supply chain, so firms will be able to hire specialists and experts suitable for their business.

During the ceremony, Samsung Biologics signed an MOU with a domestic biopharmaceutical engineering and equipment firm, Junghyun Plant, in a bid to be consistent with government efforts to localize key industrial components. Junghyun will supply all the culture media required by Samsung Biologics Plant 4, which will help it enhance its presence in the global pharmaceutical engineering market.

Celltrion plans to complete the new research center by July 2022. When a new manufacturing plant is finished, the company will be able to produce 250,000 liters of biologic drugs annually, up from the current 190,000.