AstraZeneca Doubles Down on China Opportunity with $250 Million Additional Investment in Qingdao

 

Recently, AstraZeneca announced an additional investment of 250 million US dollars in Qingdao. On August 14, AstraZeneca signed a Memorandum of Understanding for the second-phase expansion and investment cooperation of its Qingdao production base with the Qingdao High-tech Industrial Development Zone. According to the agreement, AstraZeneca will increase its investment by 250 million US dollars in the Qingdao inhalation aerosol production and supply base project.
 

It is reported that in March this year, AstraZeneca officially signed an investment cooperation agreement with Qingdao, planning to invest approximately US$450 million to build a production and supply base for Budesonide/Glycopyrronium/Formoterol Inhalation Aerosol (pMDI) in Qingdao. This time, AstraZeneca will add an additional investment of US$250 million to the production and supply base, increasing filling production capacity and adding a new inhalation aerosol packaging production line, further expanding the capacity of the production and supply base and promoting Qingdao to become an important part of AstraZeneca's drug supply chain in China.
 

In addition to base construction and capacity expansion, in recent years, AstraZeneca has also established a trading company in Qingdao and set up the "Qingdao-AstraZeneca International Innovation Research Center for Rare Diseases" based on the layout of its Qingdao regional headquarters. By linking with industry, academia, research, medical, and investment partners, AstraZeneca is building a regional innovation ecosystem for rare disease diagnosis and treatment, helping Qingdao become a leading center for rare disease treatment and a medical highland in China.
 

In 2023, AstraZeneca marks its 30th anniversary in China. This recent investment move demonstrates AstraZeneca's confidence and commitment to the Chinese market, as well as the strong appeal of Qingdao High-tech Zone to foreign investment.
 

It is reported that in recent years, with the aggravation of China's population aging, the gradual improvement of living standards, and the continuous upgrading of consumption levels, the scale of China's medical health market has been constantly expanding, which presents enormous attractiveness to foreign pharmaceutical companies. In recent years, Qingdao High-tech Zone has been continuously optimizing the business environment, promoting a higher level of openness, building a new highland for open economy, creating a more optimized investment environment for foreign investors, and boosting the confidence of foreign businesses. Currently, the zone has attracted over 280 high-level foreign-funded enterprises such as AstraZeneca, Hexagon, Edwards, CSM Zojirushi, and Biten Electromechanical. In 2022, the revenue of Qingdao High-tech Zone’s biomedicine and medical device industry surpassed 8 billion yuan, with a growth rate of 28%.
 

And under the continuous boost, the Chinese market has also brought impressive revenue to foreign pharmaceutical companies. The 2022 financial report shows that AstraZeneca's total revenue was 44.351 billion US dollars, of which the income in China was 5.792 billion US dollars, remaining flat year-on-year, accounting for about 13% of the global total revenue, ranking first in the performance list of multinational pharmaceutical companies in China. This proportion once exceeded 20% in 2020. AstraZeneca expects that in 2023, the revenue in China will return to growth, with a low single-digit percentage increase.
 

According to AstraZeneca's financial results for the first half of 2023, its total revenue in the first half of the year was $22.295 billion, representing a 4% increase (at CER, same below). Excluding COVID-19 products, revenue for the first half of the year was $21.961 billion, marking a 16% increase. Among this, the semi-annual revenue generated by the China market for AstraZeneca was $3.043 billion, increasing by 9% year-on-year, aligning with the earlier financial guidance predicting a return to growth at the beginning of the year. (Note: This growth rate excludes COVID-19 products; if including them, the growth would be 7%.).
 

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