S-A invests USD 103.9m in Chinese vaccine plant

French pharmaceutical company Sanofi-Aventis (S-A) has revealed it will build a EUR 70m (USD 103.9m) flu vaccine manufacturing plant near Hong Kong.

S-A says the amount is the largest biopharmaceutical investment ever made by a foreign drug maker in the region.

The Shenzhen plant is aiming for an annual capacity of 25 million flu doses after production begins in 2012, and will employ about 100 people.

In 2006, S-A's existing vaccine packaging plant in Shenzhen delivered five million doses of flu vaccine, while the company's own sales of vaccines in China rose 50 per cent on the previous year to reach EUR 60m.

The deal between S-A and Shenzhen local authorities was signed at a ceremony attended by Chinese President Hu Jintao and French President Nicolas Sarkozy, during his current state visit.

Sanofi-Pasteur, the vaccines division of S-A, is the world's largest vaccine manufacturer with FY06 sales of EUR 2.5bn and a 25 per cent share of the EUR 11bn (USD 16.3bn) global vaccines market. GlaxoSmithKine (GSK) comes second with a 23 per cent share and Merck & Co third with 16 per cent.

Currently, the annual Chinese vaccine market is worth approximately EUR 480m (USD 712.5m). Foreign drug companies control around 22 per cent, but the market is growing rapidly, with the number of flu vaccine doses expected to grow from 12 million in 2003 to 108 million in 2020.

S-A has been doing business in China for 25 years and is now the sixth-largest company in the country's EUR 12bn pharmaceutical market, with annual sales there in the region of EUR 200m (about USD 300m).

The total Chinese drug market is set to become the world's fifth-largest, with expected sales of EUR 28bn (USD 41.6bn) in 2011.