In its thirtieth year of entering the Chinese market, AstraZeneca, a multinational pharmaceutical company in its prime, is aggressively increasing its localization investment in China.
Signed an exclusive cooperation agreement with Chengyi Biotechnology for GLP-1 drug ECC5004 for $2.01 billion; Collaborate with Peking University Weixin to promote the export of Xuezhikang capsules to the Brazilian market; Signed contracts with multiple provinces in Jiangsu, Shandong, and Guangdong: increasing capital in factories, building rare disease industrial parks, and establishing a global research and development center in Hong Kong, China... At the recently concluded 6th China International Import Expo, AstraZeneca announced a series of investments and cooperation in China, promoting over 60 contracts, and achieving a signed transaction value of over 400 million US dollars.
AstraZeneca Wuxi Production Base
Relying on the strategy of deeply cultivating the Chinese market, this multinational pharmaceutical company, formed by the merger of two "century old stores" - Astra in Sweden and Zoellicon in the UK, has also embarked on a unique path of localization in China.
AstraZeneca is a company that operates globally from top to bottom, truly rooted in the local Chinese market. We even focus our global strategic research and development cooperation on China. Recently, Wang Lei, AstraZeneca's global vice president, international business, and China president, expressed his unwavering optimism about the Chinese market. Since joining AstraZeneca in 2013, Wang Lei from Wuxi, Jiangsu, has been promoted to Global Executive Vice President in just four years, breaking the record for the highest position of a local manager in the management system of multinational pharmaceutical companies and becoming a footnote to AstraZeneca's "localization" strategy.
Using Chinese people to manage the Chinese market, under the leadership of Wang Lei, AstraZeneca has withstood the pressure of the epidemic, centralized procurement, and medical insurance negotiations. From 2019 to 2022, AstraZeneca's revenue in China ranked first among multinational pharmaceutical companies, with revenue reaching $5.792 billion in 2022.
Since the beginning of this year, AstraZeneca has cast a vote of trust in the Chinese market with real gold and silver. In Wuxi, AstraZeneca plans to invest nearly $400 million to build a new small molecule drug factory. It is expected that small molecule drugs listed in China in the future will be supplied to the domestic and overseas markets from formulation to packaging at the new factory in Wuxi; In Taizhou, on the basis of the new production line built last year, AstraZeneca will increase its capital to build another new production line, helping to build Taizhou into a global production base for AstraZeneca diabetes products. After the production is put into operation, the annual output value of the production and supply base in Taizhou is expected to reach 10 billion yuan. In Qingdao, AstraZeneca is continuously increasing its investment in the AstraZeneca Qingdao Inhalation Aerosol Production Base project. Currently, the second phase of the base project has been officially launched, with a total investment of 700 million US dollars.
The market in China is the largest, and the supply chain in China is the best, "Wang Lei said. For AstraZeneca, investing in China is a sure thing, taking the path of" localization ", hoping to enable Chinese patients to use drugs from all over the world and also enable patients from all over the world to use Chinese drugs.
[Dialogue]
How does AstraZeneca understand the Chinese market? What innovative strategic adjustments are reflected behind the significant signing at the CIIE? How will AstraZeneca continue to embrace the Chinese market in the next decade? Recently, Wang Lei, Global Executive Vice President, International Business and China President of AstraZeneca, gave an interview to reporters from Yangcheng Evening News and shared his views one by one.
Rooted in the local Chinese market from top to bottom
Yangcheng Evening News: How do you view AstraZeneca's thirty year development history in China? Many multinational companies are targeting the Chinese market. What is the most distinctive feature of AstraZeneca compared to them?
Wang Lei: This year is AstraZeneca's 30th year entering the Chinese market. In the first decade, multinational corporations mainly established representative offices in China and brought drugs to China through trade imports. They were more interested in the Chinese consumer market, and AstraZeneca was also like this. I remember our headquarters was still in Hong Kong at that time, mainly engaged in drug trade.
The second decade after entering the year 2000 was the decade when factories were established, and China became a manufacturing center. It was during this period that AstraZeneca's two factories settled in Wuxi and Taizhou.
In the past decade, with the improvement of people's living standards, China hopes to accelerate the introduction of international new drugs in major diseases. The Drug Administration has accelerated the reform of drug approval, including the timely inclusion of medical insurance, which has accelerated the opportunities for everyone to use good and innovative drugs. It is precisely because of such good policy incentives that not only promote more multinational enterprises to enter China, but also drive the rise of domestic innovative pharmaceutical enterprises.
In the next decade, AstraZeneca should strive to achieve a "fusion of Chinese and Western innovation" with Chinese innovation. This is our idea, tightly embracing Chinese innovation, combining international innovation with Chinese innovation, learning from each other's strengths, complementing each other, and achieving a win-win situation.
In the Chinese market, compared to other multinational pharmaceutical companies, we need to be a leader rather than a follower. Many multinational companies have their headquarters in China, and AstraZeneca's headquarters in China is also the headquarters of the entire company in developing countries. We have a layout in research and development, production, and commercialization, and even place global strategic research and development cooperation in China, ensuring that it is rooted in the local Chinese market from top to bottom.
Building a Global Supply Chain Center in China
Yangcheng Evening News: How do you view China's policy of opening up to the outside world? Especially on August 13th this year, the State Council issued the "Opinions on Further Optimizing the Foreign Investment Environment and Increasing the Attraction of Foreign Investment", proposing to accelerate the landing and production of foreign investment projects in the field of biopharmaceuticals. What are the impacts of this on AstraZeneca's layout in China?
Wang Lei: China has continuously introduced favorable policies for foreign investment and further expanded its opening up to the outside world. We have also witnessed the continuous improvement of the business environment. The opinions recently issued by the State Council further encourage the implementation of the biopharmaceutical industry in the supply chain. In fact, during the epidemic, we have already seen the strong resilience of China's supply chain. In our view, "supplying the Chinese market in China" has become a thing of the past, and the future trend is "supplying the global market in China". The products we currently produce in China can already be supplied to approximately 70 countries and regions worldwide. In recent years, we have also continuously strengthened our layout in cities such as Qingdao, Taizhou, and Wuxi.
Among them, this year we will make two additional investments in Qingdao, with a total investment scale of 700 million US dollars. The Qingdao factory will produce inhaled aerosols for the treatment of asthma and chronic obstructive pulmonary disease. It was precisely on the second day after we announced the additional investment in Qingdao that the State Council issued the above opinion, which made us feel that investing in China now is at the right moment and at the right time. I believe we will not be the only foreign-funded enterprise to increase investment, and many multinational enterprises will increase their efforts to invest in China.
We think the certainty is simple: China's market is the largest, China's supply chain is the best, and China also has the world's best manufacturing industry, scientists, and innovation, leading the world in green and low-carbon aspects. So we still need to do our job well and innovate better, so that Chinese patients can use drugs from all over the world, and patients from all over the world can use Chinese drugs.
Almost every month, we announce new collaborations with Chinese companies
Yangcheng Evening News: At this year's CIIE, AstraZeneca has also brought many innovative drugs. On which tracks will AstraZeneca increase its research and development efforts, and how will it innovate with Chinese companies?
Wang Lei: Over the past 30 years, we have introduced 40 innovative drugs to China, and every CIIE we introduce innovative products and cooperation projects to China. This year, we have presented several heavyweight products at the Jinbo Expo, including two global innovative drugs, Andasha Gliclazin Metformin Sustained Release Tablets and Kesaiyou Hydrogen Sulfate Smetinib Capsules.
China is now becoming a world-class pharmaceutical highland that integrates drug production, research and development, and manufacturing. As a multinational pharmaceutical company, I am optimistic that we will continue to bring new products into China, integrate the production capacity of innovative drugs into China, and fully utilize China's manufacturing efficiency and national incentive policies.
The key to the success or failure of pharmaceutical enterprise development is innovation, whether you have popular products or good products. Our company specializes in the field of oncology, and we will move on to areas such as rare diseases and cell therapy. Every company has its own strengths, and we don't look around, we still need to develop our strengths well.
After the epidemic, AstraZeneca announced new collaborations with Chinese companies almost every month. So the next focus is on how to make good use of China's innovation. At the same time, we also help accelerate the export of Chinese products and companies to the sea. This year, we have led local Chinese enterprises to Brazil and the Middle East for exchange and cooperation. In the future, we will also go to Hong Kong, China, Indonesia, and other places. We often choose markets that have more opportunities for Chinese companies to succeed, utilizing AstraZeneca's international experience and platform to help Chinese companies go global, which will be a major highlight of AstraZeneca this year.
Assisting the high-quality development of the biopharmaceutical industry in the Greater Bay Area
Yangcheng Evening News: AstraZeneca is building a global research and development center in Hong Kong, China. What new opportunities can the construction of the Guangdong Hong Kong Macao Greater Bay Area bring to multinational pharmaceutical companies?
Wang Lei: We have layouts in many cities in the Greater Bay Area. Not long ago, Hong Kong introduced the Office of Key Enterprises to hold the "Key Enterprise Partner Launch Ceremony", and AstraZeneca became one of the first 20 key enterprise partners, which will help accelerate Hong Kong's economic development.
Hong Kong is an important part of the Greater Bay Area, and we still value it highly. Hong Kong is an important financial and trade center in the world, with four of the world's top 100 universities located in Hong Kong and a large number of researchers and world-class experts. Therefore, we believe that Hong Kong is a good place for research and development.
Guangzhou is also very good. There are research institutes and tumor hospitals in Guangzhou, and the market is also large. In 2021, AstraZeneca settled its southern headquarters on Guangzhou Biological Island, accelerating its support for the Guangzhou economy.
For us, Guangdong Province is one of the most attractive provinces in China, and we attach great importance to the talent flow between Guangdong, Hong Kong, and Macao. We hope to bring scientists together and retain talents.
Among them, the "Hong Kong Macao Pharmaceutical Equipment Connect" policy is an important symbol of openness, and new drugs approved by Hong Kong and Macau can be used in the Greater Bay Area with basic and unimpeded access. I think this is an important support for the research and development of the entire Greater Bay Area. Next, we will promote the certification of new drugs in Hong Kong and actively negotiate with the government on how to achieve high-quality development of the biopharmaceutical industry in the Greater Bay Area.
Article | Reporter Chen Zeyun, Sun Qiman
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