Merck KGaA Invests €250 Million in China

08.11.2016 -

Germany’s Merck KGaA has inaugurated its new pharmaceutical plant at Nantong China, built at a cost of €80 million. The facility will produce high-quality pharmaceuticals on China’s Essential Drug List, with the first drugs to be delivered to patients from the second half of 2017. At the inauguration ceremony, Merck said it plans to build an €90 million expansion to the new plant, as well as an €80 million Life Science Center nearby. The latter will be run by its Life Science business segment.

The Nantong pharmaceutical site will focus on the production of Glucophage, Euthyrox and Concor, Merck’s leading brands to treat chronic diseases diabetes, thyroid disorders and cardiovascular diseases. With the start-up of the second phase in 2021, the complex will be able to produce up to 10 billion tablets a year. The site currently employs 180 people, and the workforce is expected to increase to more than 400 in the final phase.

Altogether, the Darmstadt-based group, which claims to be the first multinational enterprise to dedicate a large-scale greenfield investment to the production of essential pharmaceuticals in China, said its investment in its healthcare value chain in the People’s Republic will total €250 million. It said the strategic investments will further support expansion in the country, which is expected to become the world’s second-largest pharmaceutical market by 2018.

“With our new state-of-the-art pharmaceutical production, Merck is transforming from an import-based company to a full-fledged local industry player in China,” said Marc Horn, managing director of the company’s biopharma business there. He added that Merck’s investment in its largest manufacturing plant outside Europe is in line with its healthcare vision, aimed at addressing widespread healthcare needs in the populous country.

The Life Science facility will reinforce Merck’s leading position in inorganic salts for active pharmaceutical ingredients and excipients as well as cell culture media (CCM) for the pharmaceutical, biopharma and healthcare markets in China and ready-to-use (RTU) media for environmental and sterility testing, the company said.

“Combining the strengths of our two business sectors Healthcare and Life Science, the Nantong site is a pioneering initiative to foster a comprehensive value chain that will create better access to health, enabling Merck to support China’s evolving developmental and healthcare priorities,” said CEO Stefan Oschmann.

Merck’s Performance Materials (chemicals) business segment also has invested heavily in China in recent years. Projects include the Liquid Crystal Center completed in 2013 at a cost of more than €30 million) and the Shanghai Display Materials R&D Center completed in 2015 at a cost of more than €5 million.