By Maggie Fick
LONDON (Reuters) -AstraZeneca said on Friday it will spend $2.5 billion on a research and development hub in Beijing, as the drugmaker scrambles to revive business in its second-biggest market after scandals including the arrest of its China president last year.
Chief executive Pascal Soriot was in Beijing and met with the city’s mayor to reveal the investment, along with two licensing deals with Chinese companies, saying they all showed the company’s commitment to the world’s No. 2 economy.
“This $2.5 billion investment reflects our belief in the world-class life sciences ecosystem in Beijing, the extensive opportunities that exist for collaboration and access to talent, and our continued commitment to China,” Soriot said in a statement.
The R&D centre “will partner with the cutting-edge biology and AI science in Beijing and be a critical part of our global efforts to bring innovative medicines to patients worldwide,” Soriot said.
The Chinese government has launched several investigations into AstraZeneca’s executives and activities in the country, where it has invested billions of dollars to build factories and license experimental drug candidates from Chinese biotech firms.
China accounted for about 12% of revenues last year. The company, the UK’s largest listed company worth 183 billion pounds ($236 billion) on the blue-chip FTSE 100 index, is the largest foreign drugmaker in China.
Soriot has often visited the country in recent years and praised the value of doing business there even when other multinationals complained of challenges or cited geopolitical tensions between China and Western countries as a challenge for the pharma industry.
He is due to attend a flagship development conference in Beijing over the coming days where some are expected to meet President Xi Jinping.
The company put its former China head Leon Wang, who also led its international business as an executive vice president, on administrative leave following his detention by Chinese authorities in October, and overhauled its local management in China.
Soriot said at quarterly results last month that the company still does not know Wang’s whereabouts. Its stock was hit hard by news of the probes in October 2024, but shares have since recovered as investors hope the impact could be minor.
A company spokesperson declined on Friday to comment on the status of the investigations.
($1 = 0.7730 pounds)
(Reporting by Maggie Fick; Editing by Kim Coghill)
Comments