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With growing geopolitical turmoil, pharma company AstraZeneca sees it as a good idea to have a foothold in China.

Since the lifting of COVID measures, China has experienced difficulties in launching its economy back. Many companies are reluctant to start investing there, AstraZeneca is not.

In the news: It would be a separate branch, which would remain under the management of AstraZeneca. That reports .

  • There is no clarity yet on exactly which location it would be, although Hong Kong and Shanghai are two options already mentioned.
  • "Every multinational with strong operations in China seems to have considered a similar move," a senior Asian banker told the FT. "If only to have flexibility in the future."
  • AstraZeneca is the U.K.'s largest pharma company, and based on sales figures, the . They "did not want to comment on rumors around a future strategy, mergers or acquisitions."

Why China?

  • For AstraZeneca, China is an interesting market. The population is large and old. So in terms of pharmaceuticals, the market is growing because the aging population is increasingly affected by smoking and air pollution, for example.
  • Having a separate entity in China can make the company safer should the country suddenly decide for political reasons to take stricter action against foreign companies.
  • With increasing geopolitical tensions, there is a global trend in . Countries are from foreign competition, and for this reason, establishing a presence in the local market is often of interest.
  • Moreover, AstraZeneca hopes that it will receive faster permission and support from the Chinese government to innovate and sell drugs there when the facility is located in China. Just last month, AstraZeneca decided to enter into a partnership with Shangai-based LaNova Medicines for a cancer drug.

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