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COVID-19 treatment

SK seeks to make Pfizer, Merck COVID-19 pills in CMO deals

The company also aims to strengthen its gene therapy business via the acquisition of CBM

By Nov 17, 2021 (Gmt+09:00)

3 Min read

A COVID-19 treatment pill called Molnupiravir being developed by Merck and Ridgeback Biotherapeutics
A COVID-19 treatment pill called Molnupiravir being developed by Merck and Ridgeback Biotherapeutics

SK Inc., the investment and holding company of South Korea’s SK Group, is seeking to make COVID-19 treatment pills developed by Pfizer Inc. and Merck & Co Inc. under a contract manufacturing organization (CMO) scheme.

During a meeting with analysts and institutional investors on Tuesday, Lee Dong-hoon, chief of SK’s bio investment center, said the company is in talks with global drugmakers that recently developed antiviral pills to treat COVID-19.

“We expect to participate in the production of the pills from the early stage of the manufacturing process,” he said.

If deals are signed, SK will produce the Pfizer and Merck pills at the Korean company’s US factory, operated by SK Pharmteco, the group’s CMO affiliate, according to industry sources.

The deals would make SK the first Korean contract drug manufacturer to make COVID-19 treatment pills.

A few Korean biopharmaceutical companies, including SK Bioscience Co., Samsung Biologics Co. and Huons Global Co., are currently producing COVID-19 vaccines under contracts for global drugmakers.

Since the pandemic erupted last year, researchers worldwide have raced to develop a pill to treat COVID-19 that can be easily taken at home to ease symptoms, speed recovery and keep people out of the hospital. At the moment, most COVID-19 treatments must be delivered intravenously or by injection.

SK seeks to make Pfizer, Merck COVID-19 pills in CMO deals

Earlier this month, Pfizer said its antiviral pill, to be sold under the brand name Paxlovid, was found to be strongly effective in preventing the severe onset of COVID-19 when given to high-risk unvaccinated study volunteers soon after they started showing COVID-19 symptoms.

Merck also said its pill, Molnupiravir, jointly developed with Ridgeback Biotherapeutics LP, was found to halve the chance of dying or being hospitalized for COVID-19 patients at high risk of serious illness.

CELL AND GENE THERAPY

At Tuesday’s meeting, SK Inc. also unveiled its vision to become one of the world’s top five CMO players by 2025 through facility expansion and acquisitions of CMO startups to particularly expand its cell and gene therapy business.

The company said in March it acquired a 70% stake in Yposkesi, a French bio contract manufacturing organization, to advance into the cell and gene therapy business in a bid to strengthen its contract development and manufacturing organization (CDMO) portfolio.

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.

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.

Pfizer
Pfizer

The gene and cell therapy business SK entered 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.

CBM DEAL IMMINENT

SK said it is in final talks to make an equity investment in the Center for Breakthrough Medicines (CBM), a Philadelphia-based cell and gene therapy CDMO company, with an aim to sign a deal by the end of this year.

CBM is known for the production of plasmid DNA, a key raw material for cell and gene therapeutics, and viral vectors, a tool used to inject genetic material into cells.

A researcher at SK Bioscience's lab facility
A researcher at SK Bioscience's lab facility

Once it acquires CBM, SK said it will expand the US firm’s facilities, located in the bio cluster of Cellicon Valley in Philadelphia, to a size stretching 65,000 square meters by 2025.

SK Inc. has been ramping up investment in the bio business, one of the Korean conglomerate’s four core areas, including batteries, chosen to drive its future growth.

SK targets annual revenue of 1 trillion won ($844 million) in its bio CMO business alone by 2025.

Write to Ju-Hyun Lee at deep@hankyung.com
In-Soo Nam edited this article.
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