Merck to build Asian R&D center in Beijing

AP News
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Posted: Dec 06, 2011 11:15 AM
Merck to build Asian R&D center in Beijing

Drugmaker Merck & Co. is setting up a new research and development headquarters for Asia in Beijing.

The company said Tuesday that the center's first phase, set to be completed by 2014, will have capacity for about 600 employees spread over about 506,000 square feet of laboratory and office space. They'll be working on discovering potential new drugs, testing them in the lab and then people, getting regulatory approval and doing other research programs.

Merck says the new center is part of its $1.5 billion commitment to invest in such work in China over the next five years. The center will be in Wangjing Park, a rapidly expanding science and technology park in the Chinese capital.

"By strategically locating in China, we are able to complement our existing R&D capabilities, and facilitate new collaborations with scientists in the region and across emerging markets," Peter S. Kim, president of Merck Research Laboratories, said in a statement.

Like most other major drugmakers, Merck sees its revenue leveling off in Western countries, so it's aiming to boost sales in emerging markets, where governments and a growing middle class are spending more on health care. Those include the two most populous nations, China and India, as well as Russia, Brazil and Mexico.

Along with adding new sales offices in cities across China, Merck and its rivals are building new research centers there and in other parts of Asia, as well as factories that can produce medicines cheaply enough that local residents can afford them and the companies can still make a profit.

They are generally employing many local workers or setting up partnerships with local companies to help build familiarity with their brands, create goodwill with government officials and win government health program contracts.

Merck noted that two diseases that are part of its research and treatment focus, diabetes and heart disease, are becoming increasingly common in China.

The company has its commercial headquarters for China in Shanghai and has manufacturing plants at other locations across China.