Sandoz Invests in Extra European Antibiotic Capacity

09.11.2022 - Sandoz, the generics arm of Swiss drugmaker Novartis, has announced plans to spend an additional €50 million on raising European manufacturing capacity for finished dosage forms of amoxicillin and other key penicillin products.

The announcement follows plans revealed in May last year to invest more than €100 million in new manufacturing technology for producing oral amoxicillin API at its site in Kundl, Austria, as well as investing a further €50 million to expand sterile API production at Palafolls, Spain.

“Antibiotics remain the backbone of modern medicine and we are seeing rapidly increasing demand following the unprecedented market swings of the past few years. This investment will help to meet that growing patient need, to support the creation of hundreds of new jobs, and to partially offset the impact of high energy prices by lowering unit costs,” said CEO Richard Saynor.

The new facility, which will be connected to an existing penicillin production plant, will be ready for operation by early 2024. The expansion, which will focus on bulk formulation and fill-finish activities, will support a double-digit increase in Sandoz’ future output capacity for penicillins.

Saynor added: “Minimizing production costs, particularly in the face of soaring energy costs in Europe, is key to our future success, but we also need a market framework that is sustainable in the long run. In economic terms, antibiotics in Europe are still treated largely as commodities, but with one big difference – producers have to supply at fixed price levels, regardless of supply and demand changes. We urgently need to change the operating framework, to introduce basic concepts such as inflation-linked pricing and tenders with criteria that go beyond price.”

In August, Novartis confirmed definite plans to spin off Sandoz into a standalone company. The split is expected to complete in the second half of 2023.

Author: Elaine Burridge, Freelance Journalist