AstraZeneca continues China push with logistics center

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China at night, courtesy of NASA.

As some Big Pharma players have struggled in China recently, AstraZeneca ($AZN) has managed to keep up its double-digit sales growth there through the first quarter. Now, to meet strong demand, the U.K. pharma has opened a $40 million logistics center to store and ship medicines from its global outposts.

The opening of AstraZeneca’s supply chain facility, located in the Wuxi National Hi-tech District, marks the company’s move to regionalize production, logistics and sales, Chinadaily reports. AZ began construction on the project in 2014 and will turn over operations to logistics specialist DHL. 

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The pharma is not new to the area. It has had its Wuxi manufacturing outfit since 2001, with its total investment at the site tallying $555 million. That’s set to expand, according to Chinadaily, as AZ has signed a memorandum of understanding with the district stating that it intends to invest more to boost production.

For AZ, the opening follows a strong Q1 in China, during which it posted sales gains of 11%. Luke Miels, EVP for global product and portfolio strategy, said at the time that the company’s product mix was “extremely competitive," with Pulmicort Respules serving as the top multinational pharma drug in the country. Nexium and Crestor joined it in the top 15.

While China was a Q1 source of strength for AZ, some of the company’s peers haven’t been as lucky there. The country’s recent moves to curb healthcare spending have taken a toll at Bayer and GlaxoSmithKline ($GSK), with GSK’s China sales tumbling 28% in the first quarter.

In another move to build up its presence in the area, AstraZeneca inked a deal in December to buy a $100 million biologics plant from WuXi PharmaTech as that company invests in new capacity. AZ is also working to build out an existing small-molecule drug plant and to build a local R&D hub for small molecules and biologics.

- here's the report

Related Articles:
AstraZeneca keeps double-digit China growth on track in Q1
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