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AstraZeneca pledges $150 mln Russia plant investmentAstraZeneca (AZN.L) will invest more than $150 million in building a Russian plant, joining rivals looking to sidestep tougher rules on imported medicines as Russia drives to support domestic industry.
Construction will begin in the Kaluga region southwest of Moscow in April this year and the plant is scheduled to launch production of cancer, heart, and other drugs in the spring of 2013, the Anglo-Swedish drugmaker said on Thursday.
The underserved Russian market is set to outpace developed peers as its middle class grows and the government boosts spending on public health, while also tightening legislation to rein in prices and raise the share of locally produced drugs.
Russian President Dmitry Medvedev has put the pharmaceutical industry as one of the key components to his plans to diversify the economy away from oil and gas, offering incentives for local production.
Novartis (NOVN.VX) said in December it would invest $500 million in Russia over the next five years, following other global firms such as Nycomed [NYCMD.UL], Novo Nordisk (NOVOb.CO) and Sanofi-Aventis (SASY.PA), and more rivals are expected to follow suit. [ID:nLDE7171RU]
"In addition to the localisation of production, the company intends to invest in research and development," Nenad Pavletic, AstraZeneca's general manager for Russia, said in the statement.
"The decision about such big and long-term investment projects reflects our confidence in the great potential of the Russian market as its economy develops steadily," he added.
Finnish drugmaker Orion (ORNBV.HE) said on Thursday it was in advanced acquisition talks with several unnamed Russian firms.