Samsung Biologics bids $1.8 billion for PolyPeptide

Samsung Biologics is trying to buy Switzerland’s PolyPeptide Group in a 1.46 billion Swiss franc, or about $1.8 billion, all-cash deal. For investors watching the weight-loss drug boom, the move is a bet on the manufacturing backbone behind peptide medicines, including some GLP-1 treatments for obesity and diabetes.

The South Korean biologics manufacturer said Monday it had launched a public tender offer for PolyPeptide, which makes peptide-based active pharmaceutical ingredients. Under the offer, PolyPeptide shareholders would receive 44.31 Swiss francs for each share, Samsung Biologics said.

Samsung Biologics said it expects the transaction to close by the end of the year. The company described the proposed acquisition as the largest biopharmaceutical merger-and-acquisition deal in South Korea’s history.

Why peptides are drawing attention

Peptide therapeutics are drugs built from short chains of amino acids. Some GLP-1 medicines fall into that category. GLP-1 drugs mimic a naturally occurring hormone that helps regulate blood sugar and can reduce appetite, which is why they are used in diabetes and obesity treatment.

Samsung Biologics said the acquisition would help it expand beyond its current focus on antibody drugs and antibody-drug conjugates. Antibody-drug conjugates are targeted cancer medicines that link an antibody to a drug payload, aiming to deliver treatment more directly to diseased cells.

The company said demand for peptide-based GLP-1 therapies is pushing clients to seek manufacturing partners across more types of medicines. By adding PolyPeptide, Samsung Biologics said it would broaden its services in research, development and commercial manufacturing.

What PolyPeptide brings

PolyPeptide is headquartered in Baar, Switzerland, and was spun out of Ferring, a global pharmaceutical company, in 1996. Samsung Biologics said PolyPeptide has experience developing and producing more than 1,000 therapeutic peptides.

The deal would also give Samsung Biologics access to PolyPeptide’s operations across Sweden, Belgium, France, the United States and India. Samsung Biologics said that network includes research and development, drug development and commercial manufacturing capabilities.

Peter Wilden, PolyPeptide’s chairman, said the company’s board reviewed strategic options and viewed Samsung Biologics’ offer as attractive for shareholders because it provides a cash price and immediate value.

Samsung Biologics shares fell 1.3% in early Monday trading, CNBC reported. The share move gives investors an early read on how the market is weighing the price of the deal against Samsung Biologics’ push into a faster-growing part of drug manufacturing.

This story draws on original reporting from CNBC.