Celltrion (068270.KS) has completed the acquisition of a biopharmaceutical production facility in New Jersey, establishing its U.S. manufacturing footprint. The company is launching its contract development and manufacturing organization (CDMO) business with a 678.7 billion won ($473 million) contract manufacturing deal with Eli Lilly over the next three years.
Celltrion announced Wednesday that it completed the ownership transfer of a biopharmaceutical production facility in Branchburg, New Jersey, from Eli Lilly on December 31. The deal was finalized approximately five months after being selected as the preferred bidder in late July last year, following the signing of the main contract in September and completion of corporate merger reviews in Ireland and the United States.
Immediately after the acquisition, Celltrion secured a contract manufacturing organization (CMO) agreement worth $473 million (approximately 678.7 billion won) from Eli Lilly and began production immediately. The contract runs for three years, with an option to extend up to four years depending on circumstances. The company expects to recover the $330 million (480 billion won) invested in acquiring the production facility within several years through CMO revenue, excluding facility operating costs.
Celltrion expects U.S.-based production to help mitigate tariff risks while reducing logistics and manufacturing costs. The Branchburg production facility is a large-scale campus spanning approximately 148,760 square meters, comprising four buildings including production facilities, a logistics warehouse, a technical support building, and an operations building. The facility has annual production capacity of approximately 66,000 liters based on drug substance (DS), and Celltrion plans to invest an additional 700 billion won to expand capacity to 132,000 liters. Industry observers note that the facility's compliance with U.S. current Good Manufacturing Practice (cGMP) standards reduces the time and cost burden associated with constructing new plants.
The company is also proceeding with commercialization procedures, including validation for its own products to be sold in the U.S. market. As a result, CMO volumes and Celltrion's own product manufacturing are expected to continue without interruption at the facility. The retention of skilled workers through employment succession of existing staff is also expected to contribute to a stable production transition.
Celltrion is developing CDMO as its next growth pillar. Under the business structure, Celltrion and its U.S. subsidiary Celltrion USA handle facility investment and production, while subsidiary Celltrion Biosolutions manages global sales and project management.
"Demand for local CMO services from global pharmaceutical and biotech companies is expected to expand following the passage of the U.S. Biosecure Act," a Celltrion official said. "Through this acquisition of U.S. production facilities, we have established a foundation to proactively respond to market changes."