Pfizer bets long on biosimilars in China with $350M plant

Pfizer HQ
Pfizer HQ

Pfizer ($PFE) has bet long on biosimilars in China by announcing a $350 million facility, marking a first in Asia and a major new investment in the country where it has seen headwinds for its flu vaccine and shown caution on pushing sales of off-patent branded drugs.

In a release, Pfizer said the investment in the international standard global manufacturing practice (GMP) state-of-the-art Global Biotechnology Center in the Hangzhou Economic Development Area marks the company's third biotechnology center globally and one that will aim production and R&D for China and global markets with completion seen by 2018, adding 150 jobs.

A list of biosimilar products that may be made at the plant was not available. The state of play for regulatory approvals for biosimilars in China is also a work in progress, though China FDA issued guidelines last year.

“We believe that the Pfizer Global Biotechnology Center in Hangzhou will help support China’s aim to increase the complexity and value of its manufacturing sector by 2025, and contribute to building a truly innovative and vibrant biopharmaceutical industry,” John Young, group president for Pfizer Essential Health, said in a statement. “We are encouraged by a series of important reforms introduced by Chinese government that will further stimulate the industry to meet emerging health challenges, such as the rising incidence of non-communicable diseases and an aging population; as well as attract both domestic and foreign investment in healthcare and R&D.”

The facility is planned to rely on single-use KUBio modular construction provided by GE Healthcare ($GE), aiming to cut costs and increase production flexibility by as much as half, the company said, and also accounting for the quick construction schedule of 18 months. GE has assembled other biologics plants from modular kits in China in as few as 11 days.

On the global front for Pfizer, biosimilars of Roche ($RHHBY) and Biogen's ($BIIB) MabThera/Rituxan (rituximab), Roche's Avastin (bevacizumab)‎ and Herceptin (trastuzumab), and Johnson & Johnson/Merck's ($MRK) Remicade (infliximab)‎, as well as AbbVie's ($ABBV) blockbuster Humira (adalimumab), are either‎‎ approved or in the works.

In the U.S., Pfizer is ready to start sales later this year of its copycat of Remicade, though the originator, the Janssen Biotech unit of Johnson & Johnson ($JNJ), has filed a legal challenge to the launch. Pfizer owns the U.S. sales rights through its purchase of Hospira--which in turn has a marketing pact with South Korea's Celltrion--last year. The biosimilar, dubbed Inflectra (infliximab-dyyb), has been sold in Europe since 2015.

In China, Pfizer has a major joint venture with Zhejiang Hisun Pharmaceuticals formed in 2012 under the name Hisun-Pfizer Pharmaceuticals. It was unclear if the joint venture would have any role in the biosimilar effort. However, as a major player in the branded segment in China--off-patent drugs that still sell well as Chinese patients shun local versions on quality concerns--Pfizer has been able to stake a major claim in the market for its products and keep manufacturing costs in check through the JV.

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