Sartorius to build $600 mn Korea facilities, open to more investment

Sartorius AG, a global pharmaceutical and laboratory equipment supplier, plans to spend $600 million on its first facilities in South Korea, about six times its initial investment plan while considering further investments to develop the country as a core base for its global business.

The German company is building bio-processing facilities of some 25,000 square meters at the High-Tech Industrial Cluster in Songdo, Incheon, about 30 kilometers southwest of Seoul, with a target of beginning operations in 2025. The company said it started groundwork at the beginning of this year.

Its major clients such as Celltrion Inc., Samsung Biologics Co. and SK Bioscience Co. are operating plants in Songdo.

“We selected South Korea as a hub for bio-raw materials in Asia. China had been one of the candidates but we chose South Korea considering synergy with customers including Samsung,” Sartorius Korea head Kim Ducksang told The Korea Economic Daily on Thursday in a telephone call.

“Any further investments will be made in South Korea, not Europe nor the US. The headquarters is set to concentrate investment in South Korea, not diversify them into other countries.”

Sartorius had planned to build additional facilities but scrapped the plan as it could not secure land, he said. “The door is open for further investments.”

GLOBAL PRODUCTION BASE IN KOREA

The company had initially in November 2020 set aside $100 million for a COVID-19 vaccine materials plant in Korea. But the company raised the budget to $300 million, given the advantage of Korea as a global vaccine production hub, in 2021.

The investment plan was doubled again due to rising commodity prices.

“South Korea is emerging as a favorite core base in the global biopharmaceutical industry -- conservative with high technology entry barriers -- as the country has state-of-art technology with speedy work capabilities,” Kim said.

Reflecting the trend, global major healthcare and life science maker Merck Group agreed to build a biopharmaceutical raw material plant in the country.

Sartorius plans to use the South Korean facilities as a manufacturing base for the global market, Kim said.

“We will produce and export in South Korea to meet demand not only in Southeast Asia and Japan but also Europe and the US,” he said.

Sartorius founded in 1870 is a global top-tier materials and equipment supplier in the biopharmaceutical industry. The company developed the world’s first disposable cell culture bags, dominating the global market in the sector.

It also manufactures research equipment for bio-production processes such as bioreactors and membranes. The firm has operations in about 60 countries and its market capitalization stood at 22.4 billion euros ($24.3 billion) as of Wednesday.

Write to Jeong Min Nam at peux@hankyung.com
 
Jongwoo Cheon edited this article.