Novartis expands R&D operations in China; to invest $1 bn in 5 years

Swiss drug major Novartis AG is increase its research and development activities in China by investing a USD 1 billion investment over the next five years, the company said in a press release.

Novartis’s USD 1 billion investment will include a significant expansion of The Novartis Institute of BioMedical Research (CNIBR) in Shanghai.

The Novartis Institute for BioMedical Research in Shanghai (CNIBR) is currently located in Zhangjiang High-tech Park.

CNIBR specializes in basic research and development of new drugs including small molecule and biological medicines to treat diseases that are highly prevalent in China.

The BioMedical Research Institute will relocate to a new state of the art campus in Shanghai to allow for this large expansion.

CNIBR’s activities are expected to span work in analytics and biomarkers, in vivo pharmacology, protein production, characterization and scale-up screening and chemistry and proteomics, genomics and imaging.

CNIBR is expected to extend and increase its collaborations with institutions in China and is committed to cultivating local R&D talent, sharing the world-leading development technology platform of Novartis and years of drug development experience.

Novartis plans to make CNIBR to be the third largest R&D center for Novartis, after the R&D center in Cambridge, Massachusetts, USA and the facility at the Novartis headquarters in Basel, Switzerland, and to become the largest comprehensive R&D center in China.

Novartis plans an estimated increase the number of R&D associate positions from 160 today to about 1,000.

Novartis has also invested USD 250 million in a new global technical center which is opening in Changshu, focused on technical research, development and manufacturing activities of APIs (active pharmaceutical ingredients).

The synergies gained from the co-location of both technical R&D and manufacturing enable significant pharmaceutical process improvements and operational efficiencies. The number of high quality jobs at the new center is projected to nearly double, and the facility is expected to be a critical part of the global production and supply chain network.

Increasing R&D activities in China confirmed Novartis’ long term commitment to China’s further economic development, health reform and improving the health care of the Chinese people, Novartis said.

“We are confident that our expanded investment in R&D will result in innovative therapies for patients in China and other countries nurtured by the growing scientific excellence in China.” said Dr Daniel Vasella, chairman and CEO of Novartis.

Novartis was contributing to the Shanghai government’s aim to establish the city as the premiere R&D center for China’s bio-medicine industry by 2012.

Demand for healthcare in China is growing rapidly. In addition, the burden of disease now includes more chronic diseases associated with lifestyle choices.

Chinese government is working to expand access to affordable, basic medical services to all citizens by 2020.

China has recently announced that it will spend approximately USD124 billion over the next three years to further build the nation’s health system.

Chinese government’s efforts are expected to extend to expanding insurance coverage, updating public hospitals and training community healthcare workers.

China also focuese on activities anticipated to help improve health IT systems and strengthen the quality and safety of pharmaceutical production capabilities, improving access to innovative treatments.

Headquartered in Basel, Switzerland, Novartis offers a diversified portfolio of innovative medicines, cost-saving generic pharmaceuticals, preventive vaccines, diagnostic tools and consumer health products. Novartis is the only company with leading positions in each of these areas.

Novartis Group’s operations achieved net sales of USD 41.5 billion and net income of USD 8.2 billion in 2008.

Novartis has invested approximately USD 7.2 billion in R&D activities throughout the group.

Novartis Group companies operate in more than 140 countries around the world.