Merck, a leading science and technology company based in Germany, said Wednesday it plans to build a bioprocessing unit in Daejeon, South Korea.

Under a three-way memorandum of understanding signed by the firm with Korea's Ministry of Trade, Industry and Energy and the government of Daejeon, they will discuss detailed plans for building the international pharmaceutical company’s new bioprocessing unit that can produce raw materials for drugs.

The Trade Ministry and the Daejeon city government will invest in the manufacturing facility, but the location and size of investment have not been discussed yet.

“South Korea is an emerging global leader in the biotech industry, and this MoU demonstrates Merck’s commitment to the region by working closely with the government to better support our customers,” said Matthias Heinzel, a member of Merck's executive board and CEO of its Life Science business, during a signing ceremony held in Daejeon.

“The proposed facility would play a vital role in fulfilling demand in the Asia-Pacific region while representing an important hub for further biopharma industry development in South Korea,” Heinzel added.

Merck also plans to work with the Daejeon city government to support local biotech companies based in the Daedeok Research Complex in Daejeon. The German multinational science and technology company added it will increase joint research with Korean universities.

The Trade Ministry expects its cooperation with Merck to help stabilize supply of pharmaceutical raw materials in the country, as well as in the Asia-Pacific region.

“The new manufacturing for pharmaceutical raw materials will work as an important base that will help the country diversify its export items," said Trade Minister Lee Chang-yang during the signing ceremony.

"We expect this collaboration to serve as an opportunity for our pharmaceutical-bio sector to take a leap forward."

The Daejeon city government noted the three-way collaboration to build a manufacturing facility in the city will help the country’s efforts in balanced regional development.

“Together with Merck, this planned investment cooperation will help support Daejeon’s growth to become a world-class biotech hub,” said Daejeon Mayor Lee Jang-woo.

Meanwhile, on Tuesday, Belen Garijo, Merck CEO and chair of its executive board, met with Second Vice Health Minister Park Min-soo.

According to the Health Ministry, they discussed potential cooperation opportunities between the Korean government and Merck. They also touched upon plans for the bioprocessing unit in Daejeon.

During their meeting, Garijo said Merck will increase its support to help Korea nurture its pharmaceutical and biomanufacturing capacities, the Health Ministry said.