(ATF) China's WuXi Biologics, which makes components for the AstraZeneca/University of Oxford Covid-19 vaccine, said it has agreed to acquire US drugmaker Pfizer's advanced drug production facilities in the country.
WuXi did not disclose the value of the deal, or the products that would be made in the biosimilars facility in the eastern Chinese city of Hangzhou. Wuxi expected the transaction to close in the first half of this year.
Chris Chen, chief executive of WuXi Biologics, said in a statement that the addition of the facility would help address the surging global demands for pharmaceutical development and manufacturing which are “in urgent need now”.
The Chinese group has rapidly expanded its client-base and production since the start of the pandemic, buying facilities in Europe and the US.
Shares in the Hong Kong-listed WuXi dipped 1.6% to HK$89.75 in early afternoon trading. The company has seen its share price drop by more than 33% since its record high of HK$124.40 on February 11.
Analysts shrugged off the decline. "We see no fundamental change for the company and believe the drastic correction mainly reflects market sentiment favouring old economy sectors for a post Covid-19 recovery," Daiwa Capital Markets analyst Dennis Ip said.
WIDE RANGE OF PRODUCTS
The pharmaceutical industry has become increasingly reliant on high-priced biosimilar drugs for its profits. Made from living organisms, biosimilars are more difficult and expensive to produce than conventional medicines based on chemical ingredients.
The facilities are equipped with bioreactors and have capacity for vial and syringe filling, the company said in a statement on Chinese social media WeChat.
Opened in 2018, the facility was Pfizer’s single base for the manufacturing and packaging of living organism-based pharmaceuticals. The American company still operates three other facilities in China that make generic drugs.
Pfizer entered the China market in the 1980s. It offers a range of about 50 drugs, ranging from blood fat-lowering medicine Lipitor to male erectile dysfunction treatment Viagra.
Its anti-infection products include Diflucan, Sulperazon, Zithromax and Tygacil. There has been increasing demand for its anti-depressants such as Zoloft and Efexor XR.
WuXi did not have immediate comment on whether the plant will be used to produce Covid-19 vaccines or materials used in their manufacture.
With reporting by Reuters