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Sandoz To Invest EUR 150 Mln In Austrian Facility To Strengthen Antibiotics Manufacturing

Sandoz, Novartis AG's (NVS) generics and biosimilars division, announced Monday plans for a joint investment with Austrian federal government for large-scale manufacture of active ingredients for penicillin products. The deal would strengthen antibiotics manufacturing in Europe.

Sandoz intends to invest more than 150 million euros over the next five years. The Austrian federal government would contribute or coordinate public funding totaling approximately 50 million euros towards the total investment.

Under the deal, the company plans to strengthen the long-term competitiveness of its integrated antibiotic manufacturing operations at Kundl facility in Austria, developing and introducing innovative manufacturing technology for both active pharmaceutical ingredients or APIs and finished dosage forms or FDFs.

The government funding would primarily support new process technology to produce API for penicillin products at Kundl. Sandoz would commit to related penicillin API production in Europe for the next 10 years, despite fierce global price competition, particularly from China.

The joint plan is subject to formal approvals by both parties. Sandoz and the Austrian government anticipate a formal closing of the agreement before the end of the year.

The deal is part of Austrian federal government's efforts to increase European-based production of essential medicines.

Sandoz noted that it produces enough penicillin products at Kundl to potentially meet all current Europe-wide demand.

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