Sales plan of KRW 5 trillion next year and KRW 10 trillion by 2027
Celltrion Chairman Seo Jeong-jin presented a blueprint for the CDMO (Consignment Development and Manufacturing) business. They announced that they will begin sales in 2028 by laying the foundation for building production facilities and establishing overseas research institutes starting next year.
Chairman Seo Jeong-jin held an investment briefing for Hong Kong investors on the 27th and said, “Many partners requested to provide services using Celltrion technology, and we decided to enter the CDMO business last year.” He added, “We decided to enter the CDMO business in December.” “We will launch a corporation and begin construction of a production facility next year,” he said.
Chairman Seo first revealed his plans to enter the CDMO business at the Morgan Stanley conference last September. At the time, they announced plans to establish a subsidiary within the year, and specific details about this were released.
First, it was explained that the project would be financed with internal funds. He said, “The first investment for the CDMO business is about 1.5 trillion won, but we plan to start with internal funds without receiving additional investment.” He added, “In particular, Celltrion holds about 5% of the total issued treasury stock, of which 25% will be canceled within the year. And 75% will be used as investment resources for the CDMO company,” he said.
Regarding business competitiveness, various visions were presented. He explained that Celltrion is planning to specialize in the antibody business, double and triple antibody services, and intravenous injections as basic services. In addition, the company announced that it would provide hyaluronidase technology, a key technology for converting intravenous (IV) formulation to subcutaneous injection (SC) formulation, if customers request it.
Chairman Seo said, “In order to administer drugs that need to be administered in large quantities, such as anticancer drugs, by subcutaneous injection rather than intravenous injection, the hyaluronidase technology of Halozyme of the United States is needed, and the substance patent for this will expire in 2027.” He added, “Celltrion has already developed its own patent. “We have finished internalizing it for use in products, and we plan to provide the corresponding service to CDMO customers if they want it,” he said.
He continued, “You can use oral technology if you want, and we also have high value-added technologies such as the mRNA vaccine platform and microbiome. “By utilizing Celltrion’s specialized technologies, we will be able to provide much more in-depth services than existing competitors such as Lonza,” he said, adding, “We expect the CDMO business to contribute significantly to sales after 2028.”
To this end, the plan is to build research centers not only in Korea but also overseas to supply manpower. In order to run the CDMO business in earnest, approximately 500 doctoral-level researchers are needed, and the company plans to create research centers in the U.S., Europe, and India to fill these positions.
The plan is to first build production facilities in Korea. Chairman Seo said, “In order to quickly equip facilities, we plan to set up a production facility in Korea for up to 200,000 liters,” and added, “700 billion won is needed to build a 100,000 liter facility, so we calculated the initial investment cost at 1.5 trillion won. “If more is needed, we will review the environment for expanding capacity in a third country, such as the United States,” he explained.
However, once the CDMO business begins in earnest, it is expected that conflicts of interest with new drug development may arise. CDMO is a business that develops and produces products upon request from external customers, and if it also develops new drugs, the customer company may raise concerns about technology leakage or reliability issues.
Regarding this, Chairman Seo said, “I believe that companies requesting CDMO are not simply requesting production, but are signing contracts because they recognize Celltrion’s technology.” “If requested, we will manage them thoroughly separately to avoid any problems,” he said.
On this day, Chairman Seo explained the competitiveness of the autoimmune disease treatment drug Zimpentra (Remsima SC, US name), the direction of new drug development, and ways to increase shareholder value. In particular, the company expressed its ambition to reach 5 trillion won in sales next year and 10 trillion won in 2027.
The investment briefing session on this day was broadcast live on YouTube at the request of investors in Korea, the United States, and other countries.
Source: kormedi.com
