Samsung BioLogics Co., a biopharmaceutical business arm of South Korea’s top conglomerate Samsung Group, on Wednesday announced its third deal with Belgium’s UCB S.A. as contract manufacturing organization (CMO), a move that will help the company gain a stronger foothold in Europe.

Samsung BioLogics said on Wednesday that it will produce a candidate substance that restricts aggregation of tau protein that is considered a common element causing Alzheimer disease for UCB.

The deal was made initially in a disclosure on May 17 but Samsung BioLogics did not identify UCB at that time but only as a European pharmaceutical firm. It confirmed the client’s name on Wednesday under agreement with UCB.

The latest deal is expected to guarantee Samsung BioLogics production worth minimum $34 million, which could grow to $148 million upon successful product development leading to commercial production.

The third CMO contract between Samsung BioLogics and UCB comes only 17 months after their previous one signed in December, 2017, to produce UCB’s two bio products.

Industry insiders noted that it is rare for a global top-tier pharmaceutical player to sign a consignment contract for bio medicine development and production with the same organization three times in a short period of time given the fact that CMO partner selection requires great deliberation and strategic business judgment due to its direct impact on credibility and product development.

They also noted that it is often challenging for CMOs to maintain steady business relationship with global pharmaceutical firms and clinch additional deals after their first partnership.

Belgium is a leading pharmaceutical powerhouse in Europe where 29 of global top 30 pharmaceutical companies are operating business. The pharmaceutical and bio industry takes up about 11 percent of Belgium’s total export volume.

UCB – founded 91 years ago in 1928 as United Chemical of Belgium – is one of the oldest pharmaceutical firms in the country engaged mainly in new drug development in neurology and immunology sectors.

It is one of Belgium’s leading pharmaceutical players along with Janssen and Pharmacia that have been striving to nurture pharmaceutical and bio industries as national key strategic sectors. Last year, UCB, listed on the Brussels Stock Exchange, raised 4.6 billion euros in sales.

By Kim Byung-ho and Lee Eun-joo

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