Samsung Biologics' (207940.KS) acquisition of Swiss peptide contract development and manufacturing organization (CDMO) PolyPeptide is a strategic investment aimed at capturing the global obesity treatment market, according to an analysis. While profitability may be somewhat diluted in the short term, the deal is assessed as securing a growth engine with antibodies and peptides as its two axes over the mid-to-long term.
Han Seung-yeon, an analyst at NH Investment & Securities, said in a report on the 21st, "This acquisition is a deal that aligns with the strategy of expanding production capacity, geography, and modality (business portfolio) that the company has pursued as a pure CDMO company since the Epis spinoff." She analyzed it as "a strategic acquisition to make a full-scale entry into the global obesity CDMO market."
Samsung Biologics recently signed a tender offer agreement to acquire a 100% stake in Swiss peptide CDMO company PolyPeptide for approximately 2.7 trillion won. It has secured a firm commitment to tender the 56% stake held by the largest shareholder, and the acquisition will be finalized if it secures more than 66.7% on a voting-rights basis in the tender offer in September. The company plans to complete the transaction within the year and secure a 100% stake.
NH Investment & Securities assessed PolyPeptide as a direct beneficiary of the growth of the global obesity treatment market. PolyPeptide is a global peptide CDMO company with 70 years of history, and it has experience developing and producing more than 1,000 peptide therapeutics to date.
In particular, the analysis is that portfolio expansion centered on obesity and metabolic diseases is driving earnings improvement. The share of metabolic disease revenue expanded from 22% in 2021 to 57% this year, and the company is carrying out a total of 47 metabolic disease projects, including 10 commercialized products from global big pharma. It has also secured clinical-stage projects from 25 pharmaceutical companies, of which seven are Phase 3 projects.
The share of commercialized product revenue also rose from 41% in 2021 to 61%, improving profitability. The company has presented targets of more than 640 million euros in revenue and a 25% earnings before interest, taxes, depreciation and amortization (EBITDA) margin by 2028.
Han said, "Samsung Biologics has the capabilities to produce antibody drugs, antibody-drug conjugates (ADC), and multispecific antibodies, but it did not possess the peptide production technology that is the core ingredient for obesity treatments." She explained, "As the global obesity market is growing at an annual average of more than 20%, this is a strategy to reduce the opportunity cost from market expansion by acquiring a proven company rather than developing in-house."
The industry is also paying attention to the possibility that Samsung Biologics could expand its peptide production capabilities to Korea following this acquisition. Han said, "There are also hopes for the possibility of building a large domestic peptide production facility after internalizing PolyPeptide's production technology going forward." She forecast, "Over the mid-to-long term, Samsung Biologics' growth axis will expand to two axes of antibodies and peptides."
However, the funding for the acquisition was cited as a burden factor. As the 2.7 trillion won acquisition amount is being pursued in parallel with the existing expansion of Plant 6, external financing such as borrowing and corporate bond issuance is expected to be necessary. She also analyzed that the possibility of a rights offering needs to be kept open.
In terms of earnings, PolyPeptide's results are forecast to be reflected on a consolidated basis from 2027. Annual revenue is expected to increase by around 700 billion to 800 billion won, but the consolidated operating profit margin (OPM) is estimated to fall somewhat from around 45% on the existing standalone basis to the high 30% to low 40% range.
Han said, "This is the time to focus on securing structural growth rather than profitability dilution," adding, "Commercialized production orders from global pharmaceutical companies developing obesity treatments can also be expected."
Securities analysts view the acquisition as a positive factor not only for securing a mid-to-long-term growth engine but also in terms of corporate value. Han added, "Samsung Biologics' 2026 EV/EBITDA is currently 21 times, and most of the valuation premium over its competitor Lonza (19 times) has been resolved. Considering revenue growth rate and profitability, it is still in a zone with high valuation appeal."
