The domestic biotech sector is witnessing contrasting trends between the two industry leaders, Samsung Biologics and Celltrion. Samsung Biologics reported record earnings in the first quarter of this year but is grappling with prolonged labor disputes that threaten its reputation with global clients and dampen investor sentiment. In contrast, Celltrion is capitalizing on the expansion of its Jimpenetra product in the U.S. and Europe, alongside a robust push into contract development and manufacturing (CDMO).
According to industry reports, Samsung Biologics achieved first-quarter revenues of 1.2571 trillion won ($1.1 billion) and an operating profit of 580.8 billion won ($490 million), marking its highest quarterly performance to date. This represents a 25.8% increase in revenue and a 35.0% rise in operating profit compared to the same period last year. The strong results were driven by full operations at its first four plants and ramping up production at its fifth plant, along with operational leverage.
However, market attention has shifted from the record earnings to the looming 'labor risk.' The Samsung Biologics Workers' Union has been unable to reach an agreement with management during wage and collective bargaining negotiations, leading to concerns about a second strike following an initial walkout earlier this month. Analysts predict that production disruptions could impact the company's second-quarter performance and new orders.
This situation has dampened forecasts from financial analysts. Samsung Securities lowered its target stock price for Samsung Biologics from 2.2 million won to 2.1 million won on April 23. The company's stock price surged to 1.965 million won on January 15 but has since declined due to uncertainties surrounding the labor strike, closing at 1.458 million won, a drop of about 26% from its January peak.
Despite the strong first-quarter results, Samsung Biologics has set an annual revenue growth guidance of 15-20%, though the potential for a slowdown cannot be ignored. An industry insider noted, "In the contract manufacturing business for biopharmaceuticals, which involves long-term production commitments from clients, predictable supply and accident-free operations are crucial. This labor dispute could tarnish Samsung Biologics' stability premium, which has been its greatest strength."
On the other hand, Celltrion is maintaining a relatively stable trajectory. The company is accelerating the market entry of its autoimmune disease treatment Jimpenetra in the U.S. and expanding into Europe, while prominently featuring its CDMO business as a new growth pillar. Celltrion's CDMO subsidiary, established at the end of last year, aims to achieve 3 trillion won in revenue by 2031, enhancing its full-cycle services for drug development and production.
Celltrion's contract wins are also boosting market expectations. Earlier this year, the company signed a contract worth $473 million (approximately 698 billion won) with Eli Lilly, followed by an additional contract for up to 375.4 billion won for the contract manufacturing of biopharmaceutical raw materials with a global pharmaceutical company in March. The cumulative CMO order backlog surpassed 1 trillion won in the first quarter.
In addition to its core biosimilar business, Celltrion is positioning CDMO as a new growth engine, where production stability is becoming a key selling point.
An industry expert remarked, "Ultimately, the contrasting fortunes of the two companies reflect differences in operational stability rather than mere performance comparisons. Samsung Biologics stands out in terms of results and production capacity, but labor risks are weighing on investor sentiment, while Celltrion is gaining momentum with relatively quiet internal operations and new contract wins." The expert added, "Resolving the labor dispute is crucial for Samsung Biologics, while early success in the CDMO business is vital for Celltrion."
* This article has been translated by AI.
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