AstraZeneca’s pioneering artificial intelligence (AI) research center could fall into foreign ownership under a reported plan to spin off AstraZeneca’s China unit and go public separately.
The British company is said to be considering plans to spin off its China operations and list them on the Hong Kong or Shanghai stock exchanges to shield the rest of its business from geopolitical tensions.
The China division owns the company’s global R&D center in Shanghai, as well as the “AI Innovation Center” under development there.
The Financial Times reported that AstraZeneca’s board has been discussing the idea of breaking up its China business for months.
The move is reportedly seen as a way to protect the company from Beijing’s move to crack down on foreign companies, while also tapping into new sources of capital amid heightened tensions with the U.S. government.
An AstraZeneca spokeswoman declined to comment on Monday.
“We do not comment on rumors or speculation regarding future strategies or mergers and acquisitions,” the spokesperson added.
According to a 2019 statement, Astra’s AI Center will “leverage the latest digital technologies in research and development, manufacturing, operations and commercialization to accelerate the delivery of medicines to patients in China and around the world.” said to have been established.
In addition to this, Astra also invests heavily in manufacturing plants in China that produce a significant portion of certain pharmaceuticals.
The company has manufacturing bases in Wuxi and Taizhou, cities in eastern Jiangsu, China.
Astra is China’s largest foreign pharmaceutical company with annual sales of $1.6 billion (£1.25 billion).
The company’s chief executive, Sir Pascal Soriot, is also bullish about opportunities in the country.
Asked last year about the prospects of spinning off the China business, Lord Pascal said:
“China continues to be a very important country for us, not only because it provides our products to patients, but also because it will be a source of great innovation in the future.
“At least in our industry, we don’t see some of the challenges that others see in China.
“China is an open market. It’s a thriving market for innovation. There’s a lot of investment going on and a lot of new science coming out, and we want to be a part of it.”
