Key Takeaways
- • Sandoz CEO Richard Saynor argues that Europe's reliance on China for antibiotics is a security and sovereignty risk, noting Sandoz runs what he calls the last remaining penicillin manufacturer in the Western world.
- • According to Eurostat, 86% of EU imports of penicillins and their derivatives came from China last year, up from 44% in 2019.
- • Sandoz has filed a complaint with the European Commission in May seeking an anti-dumping probe into Chinese imports of the active ingredient used in amoxicillin.
- • The NHS pays £1.06 ($1.41) for a 21-pack of 250mg amoxicillin capsules, a price Saynor contrasts unfavorably with a Mars bar as a measure of how governments value medicines.
- • Sandoz estimates patents on medicines worth a combined $650 billion will expire within 10 years, and has set a goal of more than 100 biosimilar products by 2040, up from 13 today.
Summary
Sandoz, the Swiss pharmaceuticals company, is one of the last antibiotic producers in Europe. Its €150 million ($168 million) factory in Kundl, Austria, is the continent's only fully integrated antibiotic manufacturing facility, capable of producing both active ingredients and finished medication. CEO Richard Saynor warns that losing this capacity would raise security and sovereignty concerns, asking whether Western economies want all their antibiotics sourced from Asian suppliers. In written evidence to U.K. lawmakers, Sandoz described Europe's dependence on China for antibiotics as an "Achilles heel" for public health and defense, warning that supply could become a "tool of economic coercion or hybrid warfare" during diplomatic tensions.
Sandoz accuses Chinese manufacturers of "market-distorting behavior" that allows them to undercut competitors and flood global markets with ultra-cheap pharmaceutical ingredients. According to Eurostat, 86% of EU penicillin and derivative imports came from China last year, up from 44% in 2019, and China is now the largest exporter of antibiotic ingredients globally. Saynor said Sandoz is competing with heavily subsidized Asian players and wants a level playing field. The EU's Critical Medicines Act, provisionally approved in May to improve production of key medicines, is a step in the right direction, he said, but he questioned whether it will lead governments to pay more for these drugs.
On pricing, Saynor pointed to the NHS paying £1.06 ($1.41) for a 21-pack of 250mg amoxicillin capsules, per the British National Formulary. "Why should we sell a pack of antibiotics more cheaply than a Mars bar?" he asked, adding that governments "see the price, but they don't necessarily see the value." He argued that developing and launching drugs costs around $100 billion, so comparing medicine prices to confectionery is not fair.
Sandoz, which specializes in generic and biosimilar medicines and was spun out of Novartis in 2023, expects patents on medicines worth a combined $650 billion to expire over the next decade, which Saynor describes as an "unprecedented golden decade" for biosimilars. Last month the company set an ambition to produce more than 100 biosimilars by 2040, nearly eight times its current 13, and estimates this could create almost $1 trillion in social impact. Sandoz has also invested $300 billion in a new drug substance facility in Ljubljana, Slovenia, a figure reported in the source article. Leadership changes include Pascal Bouye, formerly of Mars and Danone, appointed president of generics and manufacturing supply in July, Keren Haruvi moving from Novartis to lead North America, and Remco Steenbergen, former Lufthansa CFO, hired in 2024.
Sandoz accuses Chinese manufacturers of "market-distorting behavior" that allows them to undercut competitors and flood global markets with ultra-cheap pharmaceutical ingredients. According to Eurostat, 86% of EU penicillin and derivative imports came from China last year, up from 44% in 2019, and China is now the largest exporter of antibiotic ingredients globally. Saynor said Sandoz is competing with heavily subsidized Asian players and wants a level playing field. The EU's Critical Medicines Act, provisionally approved in May to improve production of key medicines, is a step in the right direction, he said, but he questioned whether it will lead governments to pay more for these drugs.
On pricing, Saynor pointed to the NHS paying £1.06 ($1.41) for a 21-pack of 250mg amoxicillin capsules, per the British National Formulary. "Why should we sell a pack of antibiotics more cheaply than a Mars bar?" he asked, adding that governments "see the price, but they don't necessarily see the value." He argued that developing and launching drugs costs around $100 billion, so comparing medicine prices to confectionery is not fair.
Sandoz, which specializes in generic and biosimilar medicines and was spun out of Novartis in 2023, expects patents on medicines worth a combined $650 billion to expire over the next decade, which Saynor describes as an "unprecedented golden decade" for biosimilars. Last month the company set an ambition to produce more than 100 biosimilars by 2040, nearly eight times its current 13, and estimates this could create almost $1 trillion in social impact. Sandoz has also invested $300 billion in a new drug substance facility in Ljubljana, Slovenia, a figure reported in the source article. Leadership changes include Pascal Bouye, formerly of Mars and Danone, appointed president of generics and manufacturing supply in July, Keren Haruvi moving from Novartis to lead North America, and Remco Steenbergen, former Lufthansa CFO, hired in 2024.
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