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Gene CMO

SK acquires 70% stake in Yposkesi to jump into cell, gene CMO business

Mar 31, 2021 (Gmt+09:00)

SK acquires 70% stake in Yposkesi to jump into cell, gene CMO business

SK Inc., the holding and investment company of SK Group, South Korea’s third-largest conglomerate, has acquired a 70% stake in Yposkesi, a French bio contract manufacturing organization (CMO), to advance into the cell and gene therapy business.

SK Inc., formerly known as SK Holdings Co., said on Mar. 31 that its Chief Executive Jang Dong-hyun and Frederic Revah, CEO of Genethon, the largest shareholder of Yposkesi, have signed a contract to close the deal through an online ceremony.

Financial terms of the deal were not disclosed.

“Through our investment in Yposkesi, SK is entering the promising gene therapy CMO space. We’ll spare no efforts to foster the company as a global player,” SK CEO Jang said after the deal.

The Korean company said in mid-December that it was in talks to take over Yposkesi to expand its CMO business.

DEAL TO STRENGTHEN CDMO PORTFOLIO

The acquisition will add a cell and gene therapy business to SK’s growing contract development and manufacturing organization (CDMO) portfolio.

The deal, estimated to be worth multimillions of dollars, is the Korean company’s third cross-border buyout and complements its synthetic drug-focused CMO business.

In 2017, SK acquired Bristol-Myers Squibb (BMS)'s manufacturing facility in Ireland and in the following year, it took over California-based AMPAC Fine Chemicals, a CDMO.

Yposkesi will fall under SK Pharmteco, the Korean firm’s CMO holding company, formed last year to oversee its growing portfolio of pharma manufacturing facilities and businesses.

Founded in 2016, Yposkesi specializes in advanced cell therapies with a manufacturing platform for viral vectors that support gene therapy applications.

SK acquires 70% stake in Yposkesi to jump into cell, gene CMO business

REVOLUTIONARY SECTOR

Gene therapy is a technique of inserting a gene transfer into a patient’s cells to treat a disease or a process of replacing defective genes with healthy ones. It is regarded as a revolutionary approach because it aims to treat complex diseases by regulating gene expression.

The gene and cell therapy business SK is entering through the acquisition of YposKesi is a revolutionary sector of the pharmaceutical industry, in which global pharmaceutical companies are actively investing. It accounts for over 50% of a total of 1,800 biologics pipelines under clinical development in advanced nations annually.

According to global consulting firm Deloitte, the gene and cell therapy market is expected to grow at an average annual rate of 25% until 2025 and is expected to surpass antibody therapies, currently the largest bio market.

SK Pharmteco posted 700 billion won ($642 million) in sales last year, about seven times its annual sales in 2016. Following the latest acquisition, SK Pharmteco’s revenue is expected to reach 1 trillion won within the next few years.

SK Inc. will seek an initial public offering for SK Pharmteco in 2023 at the earliest.

Write to Kyung-Min Kang at Kkm1026@hankyung.com

In-Soo Nam edited this article.

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