By Ben Hirschler
LONDON, Dec 16 (Reuters) - AstraZeneca aims to buildup its already strong position in China by making and developingmore medicines locally, and will invest more than $800 millionin the country over the next 10 years, it said on Wednesday.
The British drugmaker's decision to step up investment inChina, notably through a strategic alliance with local firm WuXiAppTec, chimes with Beijing's desire to see more treatments madein China.
The upside for AstraZeneca should be that locally producedmedicines win faster approval from the China Food and DrugAdministration, rather than being delayed for years as oftenhappens with imported products.
"We don't want to have drugs that are approved in the U.S.and elsewhere and it then takes another five or six years tobring them to patients in China," Bahija Jallal, head ofresearch at AstraZeneca's biotech division MedImmune, toldReuters.
China is the world's second biggest drugs market, behind theUnited States, and AstraZeneca punches above its weight in thecountry after several years of rapid growth, ranking number twoafter Pfizer.
The Chinese market, however, is challenging formultinational companies following an anti-corruption scandal in2013 that snared GlaxoSmithKline and a government driveto curb the over-prescribing of off-patent Western "brandedgenerics".
In future foreign firms will be more reliant on new,patented medicines, analysts believe, although the scale ofdemand for such expensive products is uncertain in a countrywith only basic health insurance cover.
AstraZeneca hopes to position itself better for this new erawith its new investments.
One element involves WuXi AppTec producing new biotechmedicines locally in China, with AstraZeneca having the optionto acquire WuXi's manufacturing capacity through an overallinvestment of $100 million.
AstraZeneca is also spending $50 million on developing traditional "small molecule" drugs in China and is creating anew global hub for pharmaceutical development in and aroundShanghai.
The decision to increase local Chinese investment parallelssimilar moves made by AstraZeneca and other internationaldrugmakers to invest in production in Russia - another countrywhere the government is keen to build up local pharmaceuticalcapacity.
"In a few larger emerging markets that want to play a biggerrole in meeting their healthcare needs locally, having a localcapability can make a big difference," said AstraZeneca's headof international operations Mark Mallon.
"Russia and China are two markets that are important enoughthat we are ready to partner with governments and meet theirdesires." (Editing by Greg Mahlich)
Astrazeneca (AZN)
