AstraZeneca On Friday, he said it would invest $2.5 billion in research and development centres in China’s capital, Beijing, months after the UK drug giant faced scrutiny from local regulators over import operations.
The new hub is expected to accommodate AstraZeneca’s Beijing workforce with around 1,700 employees.
The investment in Beijing will come as part of a partnership with the city’s municipal government and the Beijing Regional Administration Bureau of Economic and Technological Development, AstraZeneca said.
Under the agreement, Astrazeneca will participate in a research and development collaboration with biotechnology companies with Biomed and Syneron Bio, launching a joint venture with Biokangtai, developing, producing and selling vaccines for respiratory and other infectious diseases.
In a partnership with Biokangtai, the company will open its first vaccine manufacturing facility in China.
Astrazeneca’s Beijing Research Hub will be the second kind in China as it already has a research and development center in Shanghai. The Beijing Center will “be an important part of our global efforts to partner with Beijing’s cutting-edge biology and AI sciences to bring innovative medicines to patients around the world,” CEO Pascal Soliott said in a statement.
Astrazeneca stock fell approximately 0.9% at 12:28am in London.
Speaking to CNBC’s Julianna Tatelbaum on Friday, Soriot said China was “a fundamental part of future innovation,” but highlighted his company’s continued dedication to the US footsteps.
“We’re very committed to the US and we have two very large research and development centers in the US,” he said.
European businesses are under pressure to take steps to protect themselves from White House tariffs under Donald Trump’s second administration, which seeks to reduce the trade deficit with US commercial partners and encourage international production nations.
Chinese Probes
Last month, Astrazeneca said it could face fines from Chinese authorities up to $4.5 million in relation to unpaid import duties of $900,000.
The company said an investigation into these allegations was ongoing in China in its full-year revenue report in February.
“To the best of Astrazeneca’s knowledge, the import tax mentioned in the opinion of the assessment is related to (cancer drugs) Imfinzi and Imjudo,” the company said at the time. “If Astrazeneca is deemed liable, there could also be a penalty of 1-5 times the outstanding import tax. AstraZeneca continues to work fully with Chinese authorities.
In an interview with CNBC on Friday, Soliot said his company’s investment in China was “not connected at all” to an ongoing investigation of business activities there.
“We have been committed to investing in China for a long time. Over the past few years we have invested $10 billion in over 10 R&D partnerships with local biotech companies,” he said.
“Companies like us are on our size. This means we face headwinds from time to time, we face challenges and problems. Of course, we regret having to go through such a challenging period, but it has nothing to do with our investment in Beijing.
