Samsung Biologics said Friday it is investing 2 trillion won ($1.5 billion) to build its fifth production plant as part of efforts to meet market demands and bolster its manufacturing competitiveness.

The company announced the plan after an approval from the board of directors earlier in the day.

Last year, the company’s revenue exceeded the 3 trillion-won mark for the first time within the bio pharma industry, with its operating profits reaching some 1 trillion won.

While its fourth plant is still under construction, the company said the upcoming fifth plant is expected to help secure the production capacity needed to respond to the surging contract manufacturing orders.

The fifth plant will be located on a 96,000-square-meter site within the company’s new complex, called Bio Campus II, with a planned production capacity of 180,000 liters per year.

Considering it spent 700 billion won on building its third plant with the same production capacity, the planned spending is expected to be more than doubled.

“While the third plant was about building the facility alone, the fifth plant will cover the construction of the whole complex,” said John Rim, the company’s CEO and president, during the shareholders meeting.

“The investment is expected to be reduced from the sixth plant.”

Samsung Biologics plans to start the construction of the fifth plant in the first half of this year, with the completion set for September 2025. When the fifth plant is completed, the company would boast the world’s largest production capacity of a combined 784,000 liters.

“Demand for biopharmaceuticals is on the rise since the COVID-19 pandemic, driving up orders for outsourcing manufacturing,” the CEO said. “In order to continue our leadership in the market, we need to continue spending on production expansion.”

During the shareholder meeting, Rim was appointed as the new chair of the board, replacing his predecessor Kim Tae-han who served as the company’s CEO between 2011 and 2022.