BMY Bristol Myers Squibb Co

SEOUL—The Samsung conglomerate's biologic drug-manufacturing arm said Friday it would construct a new facility in South Korea that will double its production capacity and make it the world's largest contract drug maker when the plant is completed in 2018.

Samsung BioLogics Co., which is 97% owned by Samsung Electronics Co. and de facto Samsung Group holding company Samsung C&T Corp., said in a filing it would invest 850 billion Korean won ($740 million) to construct the facility in Songdo, South Korea, next to its two existing plants.

Unlisted Samsung BioLogics, founded in 2011, has harbored ambitions of becoming the world's biggest contract drug-manufacturing company. In 2013, it won contracts to make biologic drugs for Bristol-Myers Squibb Co. and Roche Holding Ltd.

It is already operating a plant with a production capacity of 30,000 liters in Songdo, built on reclaimed land near South Korea's main international airport. Its second plant, which is five times bigger, is set to ramp up production next year as it seeks approval from the U.S. Food and Drug Administration.

The new facility, which Samsung said would be completed by September 2018, will have 180,000 liters of capacity.

South Korea's biggest conglomerate sees biologic drugs, which are more complex and expensive to make than simpler chemically-synthesized ones like aspirin, as a potential growth engine amid slowing growth of smartphone sales.

Samsung said it hopes to translate its success in semiconductor manufacturing into a foothold in biologic-drug manufacturing.

Write to Jonathan Cheng at jonathan.cheng@wsj.com

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(END) Dow Jones Newswires

November 27, 2015 05:15 ET (10:15 GMT)

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