Pharmaceutical giant Roche has announced a significant investment of RMB 2.04 billion (approximately $300 million) to construct a new biopharmaceutical manufacturing facility in Shanghai's Pudong New Area, specifically in Zhangjiang High-tech Park. The investment aims to enhance the company's manufacturing capabilities and strengthen its local supply chain in China, according to an announcement made last week.
The 35,300-square-meter facility will primarily focus on producing Vabysmo, a bispecific antibody used in treating diabetic macular edema and other ophthalmologic conditions. Construction is expected to be completed by 2029, with production operations beginning in 2031.
Strategic Expansion Amid Global Manufacturing Push
This latest investment in China comes shortly after Roche unveiled a massive $50 billion package in the United States. The U.S. investment will fund the construction of at least four new facilities, including a production plant for next-generation weight-loss medicines, a gene therapy facility in Pennsylvania, an R&D center in Massachusetts, and a manufacturing site for glucose monitoring products.
Roche CEO Thomas Schinecker explained the company's global manufacturing strategy during a Q1 earnings call last month: "Over the past years, it's really been our strategy to make sure that we have strong manufacturing presence in all of the major markets." He also revealed that Roche was in discussions with various governments worldwide, including China, to mitigate the effects of ongoing trade tensions.
"We're actually investing in China to build up manufacturing there," Schinecker stated, highlighting the importance of local production capabilities in key markets.
Strengthening Local Presence in China
Vivian Bian, CEO of Roche Pharma China, emphasized the company's long-term commitment to the Chinese market: "Our commitment to China remains unchanged, not only today but also for the years to come, and this new site marks a significant milestone in our journey."
"It also represents a breakthrough in advancing the production of more innovative medicines here in one of our key markets worldwide," Bian added.
The investment underscores China's growing importance as a strategic hub for global pharmaceutical manufacturing and innovation. Roche plans to explore additional opportunities to localize production of more innovative medicines, contributing to the sustainable development of China's biopharmaceutical industry.
Industry Trend of Expanding in China
Roche is not alone in its expansion efforts in China. Other major pharmaceutical companies have also announced significant investments in the country recently:
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AstraZeneca signed a $2.5 billion agreement in March to invest in Beijing over the next five years, including establishing a global strategic R&D center—its sixth worldwide and second in China.
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Eli Lilly launched Lilly Gateway Labs in Beijing in March, its first shared lab platform outside the United States.
Commenting on China's appeal, Eli Lilly Chairman and CEO David Ricks noted: "China's biopharmaceutical innovation is accelerating at an unprecedented pace. China's biotechnology sector thrives on a dual engine, Beijing's constellation of famous medical universities training great minds and biotechnology, coupled with an environment that's cultivating new company formation."
Trade Tensions and Manufacturing Strategy
The timing of Roche's investment comes amid escalating trade tensions between the United States and China. Former President Donald Trump has threatened to impose "major" tariffs on pharmaceutical imports "very shortly," according to recent statements. Commerce Secretary Howard Lutnick reinforced this position, stating that sector-specific tariffs would come "in the next month or two."
The U.S. Commerce Department has subsequently opened a national security probe on pharmaceutical imports, a process that could potentially lead to trade restrictions, including tariffs.
By establishing manufacturing capabilities in China, Roche appears to be positioning itself strategically to navigate these geopolitical challenges while meeting the growing demand for innovative medicines in one of its key markets.
