pharm edaily

[Song Young-doo, Edaily Reporter] Celltrion is moving to acquire a U.S. manufacturing facility owned by a global company. It has been selected as the preferred negotiation partner, beating out two global companies in a competitive bid. If the acquisition is finalized, the company is expected to fully resolve the highly uncertain issue of U.S. pharmaceutical tariffs.

On the 29th, Celltrion held an online press conference to announce its plan to acquire the U.S.-based manufacturing facility. Speaking at the event, Celltrion Group Chairman Seo Jung-jin emphasized the need for the acquisition, stating, “Selling products in the U.S. is inevitable, so our goal is to eliminate uncertainty. To do that, our fundamental policy is to produce and sell products that are Made in USA.”

The facility is a large-scale cGMP-compliant drug substance(DS) manufacturing site owned by an undisclosed global pharmaceutical company, located in a major U.S. pharmaceutical industry cluster. The plant has been producing key biologic drugs such as anticancer and autoimmune therapies for several years. Details including the name of the company being acquired will remain undisclosed until the final contract is signed, expected in early October depending on mutual agreement.

On the 29th, Celltrion Group Chairman Seo Jung-jin announces the plan to acquire a U.S.-based manufacturing facility during an online press conference. (Image=Screenshot from online press conference video)

Among Korean pharmaceutical and biotech companies, Celltrion is the first to formalize the acquisition of a local manufacturing facility in response to U.S. tariff uncertainties.

According to Celltrion, the company currently sells 11 biosimilar products in the U.S. as of this year, and that number is expected to increase to 22 by 2030 and 41 by 2033. Seo explained that resolving uncertainty in the U.S. market caused by tariffs would significantly impact the company’s future growth, especially when adding new drug candidates to the mix.

Over the past few months, Celltrion has been reviewing the acquisition, and after fierce competition with global companies, it was selected as the preferred bidder. If negotiations proceed smoothly, the final contract is expected to be signed in October.

Seo stated, “If negotiations go well from August to October, we could sign the final agreement in the first week of October. If that happens, we plan to acquire 100% of the facility and begin direct management within this year,” and added, “The total cost for acquisition and operation is expected to be around KRW 700 billion. This will be funded through our own capital and with the help of financial institutions. Depending on small-scale or large-scale expansions, an additional KRW 300 billion to KRW 700 billion could be invested.”

Once the expansion is complete, the facility’s production capacity could be increased to 1.5 times that of Celltrion’s second Songdo plant. By expanding local production capacity, Celltrion aims to strengthen its responsiveness to the U.S. market while also bringing new product pipelines out of tariff risk early on.

After expansion, the facility is expected to handle the entire production cycle within the U.S.from DS(drug substance) to DP(drug product) and packaging logistics.

Expected Benefits: Additional Revenue, Talent Acquisition, and Modality Expansion

As Celltrion brings the U.S. facility acquisition closer to reality, it anticipates various synergies beyond tariff relief. Seo emphasized, “Acquiring an existing facility in the U.S. is more advantageous than building a new one in terms of cost and time.”

In particular, 50% of the facility is tied to CMO(contract manufacturing organization) agreements, allowing Celltrion to exclusively produce biologics for the current owner for five years, enabling immediate revenue generation after the acquisition. The remaining 50% will be used to produce Celltrion’s major products currently sold in the U.S.

There is also potential for Celltrion to absorb high-quality personnel at the facility. Seo said, “Upon review, the company was found to have many excellent personnel,” adding, “We(Celltrion) need to expand our scale, so we plan to work closely with them in managing the plant. While Korean staff will be dispatched, overall, the facility is judged to have a strong workforce.”

The acquisition is also expected to reduce manufacturing costs. Celltrion currently produces biosimilars under contract with U.S.-based CMOs, but if it acquires the facility, some production could be internalized. In the long term, if high-margin biosimilars are produced in-house, significant cost improvement is expected. Seo said, “We’ll run simulations to optimize operations under the Made in USA strategy and minimize costs.”

There is also potential for modality expansion beyond antibodies. Although the current facility is set up for antibody drugs, Seo explained that some new products in the pipeline may require facility upgrades, which will be considered during commercialization.

With this acquisition, Celltrion expects to save considerable time and investment compared to building a new cGMP plant from scratch. The company will effectively secure an ideal local business ecosystem in the world’s largest pharmaceutical market, covering research, production, and sales in the most efficient way.

Unrelated to Celltrion‘s CDMO Business

The investment in this facility acquisition has drawn attention for its potential relation to Celltrion BioSolutions, the CDMO subsidiary established by the group. However, the company clarified that it has no relation to its CDMO business.

Seo stated, “This facility acquisition investment is unrelated to Celltrion Group’s CDMO business or Celltrion BioSolutions. For our CDMO strategy, we will finalize plans once the U.S. tariff policy becomes clearer by the end of this year,” and added, “Once the U.S. tariff policy is decided, we’ll determine where and how much to invest. We’ll announce the most optimal solution.”

Celltrion Holdings to Launch KRW 250B Share Buyback in Early August

Seo also mentioned a share buyback plan through Celltrion Holdings to protect minority shareholders and gain investor trust.

He stated, “The principle of management is to eliminate uncertainty in advance and execute promising investments at the right time while transparently sharing information with investors. Some of the repurchased shares will be retired, and others reused for reinvestment,” and added, “Of the KRW 500 billion fund at Holdings, KRW 250 billion will be used for the first phase of the buyback starting August 5. If the stock price rises above a certain level, the remaining KRW 250 billion will be used as a financial investment. Celltrion will do its best to become a company trusted by both domestic and global investors.”