The firm, also known as Merck & Co., said the expansion consists of manufacturing formulation facilities and support infrastructure and will "add increased capacity and production capability" to its existing 49-acre site in Tuas Biomedical Park.
Operating on the site, MSD already has a bulk pharmaceutical plant making active pharmaceutical ingredients (APIs) for some of its "most important products" as well as a dedicated formulation facility manufacturing its cholesterol-lowering drug Vytorin.
"The new expansion is intended for the manufacture of new medicines that are currently in late stage development, including medicines under development for the treatment of elevated cholesterol levels," said Willie Deese, president of MSD's Manufacturing Division.
MSD, who has only held a presence in Singapore for five years, said: "the new investment will bring our overall manufacturing employment in Singapore to more than 300."
Now in the final stages of construction, the expanded facilities are scheduled to open in the fourth quarter of 2006.
Singapore is fast emerging as an attractive drug-manufacturing destination, with pharmaceuticals now accounting for more than 16 per cent of the country's manufacturing output.
The prime appeal of Singapore as a manufacturing base lies with its strong physical and regulatory infrastructure, qualified skilled workforce, economic stability as well as its Asian proximity - allowing for a low cost base.
In addition, Singapore's government has thrown hundreds of millions of dollars at its biotechnology industry in order to attract foreign investment, and with great results; six of the top ten pharma companies, including Pfizer, MSD and Novartis, now have a presence in the country, making up about 5 per cent of the nation's $118bn economy.
Last month GlaxoSmithKline (GSK) also decided to build a new $190m vaccine manufacturing plant in Singapore - the company's largest investment of its kind in Asia.
The movement of the big pharma firms to the region is also attracting other industry players to follow suit.
Swiss custom manufacturing firm Lonza recently entered into a joint venture with investment management company Bio*One Capital to built a $250m large-scale mammalian cell culture plant in Singapore, underlying Lonza's confidence that demand for the contract manufacturing of commercial biopharmaceuticals will continue to grow.
Swiss QC specialist SGS has also just opened a laboratory in Singapore for the contract testing of pharmaceuticals, biopharmaceuticals and medical devices, eying a budding market, which seems hungry for outsourcing.
And with Singapore aiming to increase its biomedical sciences sector to generate $15.6bn a year by 2015, international pharma firms active in the region are sure to feast.