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| A manufacturing plant of Lotte Biologics in Syracuse, New York / Courtesy of Lotte Biologics |
By Lee Kyung-min
Lotte Biologics, a biopharmaceutical affiliate of Lotte Group, said Tuesday that on Dec. 31 it acquired a manufacturing plant of its New York Stock Exchange-listed peer, Bristol Myers Squibb in East Syracuse, New York.
This is a follow-up to an earlier contract signed last May whereby Lotte agreed to buy the facility for $160 million (203 billion won).
Lotte will be able to generate a profit this year due to the immediate manufacturing and sales of key products at the U.S. facility, which it says will be the hub for Lotte's North America operations concerning its contract development and manufacturing organization (CDMO) business.
The acquisition has moved up the timeline in profit generation by five years, the minimum period that would have been needed if it had built the facilities from scratch.
Over 92 percent of the employees at the U.S. facility, including core technology experts with at least 15 years of experience, will continue working there.
The firm will make further investments of about $70 million in human capital, including 70 new hires.
"The East Syracuse site has been an important part of our company's history and our manufacturing network for many decades, and we are confident that Lotte will fully leverage the facility, its capabilities and its experienced workforce as it continues to play a vital role for patients around the world," said Karin Shanahan, executive vice president, Global Product Development and Supply, Bristol Myers Squibb, according to Lotte's statement.
"We have taken a thoughtful approach to this decision and are confident this will best support the continued evolution of our manufacturing network and our mission to deliver innovative medicines that help patients prevail over serious diseases."
Lotte Biologics CEO Richard Lee said the firm will leap forward to become a global CDMO player.
"We seek to generate 1.5 trillion won in sales, increase operating profit by 30 percent and raise the corporate value to 20 trillion won by 2030," he said in a statement.
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