Yicai Global) June 19 -- A report that AstraZeneca plans to spin off its China business for a separate listing in Hong Kong is “rumor” Leon Wang, international executive vice president and China president at the Anglo-Swedish pharmaceuticals giant, told Yicai Global today.

According to a Financial Times report on June 18 that cited three people familiar with the matter, AstraZeneca “began discussing the idea with bankers several months ago,” though it also said that the separation “might not ultimately take place.”

AstraZeneca is the UK’s biggest listed company, with a market capitalization of GBP182 billion (USD233.2 billion) at the end of last week. China is AstraZeneca’s second-largest market, and it is the biggest overseas drugmaker in China, generating revenue of about USD1.6 billion in the country in the first quarter of this year.

AstraZeneca supplies drugs to about 70 markets globally through production bases in China. The firm began building its Qingdao plant in March, and said it will continue to expand its two existing production sites in Wuxi and Taizhou in Jiangsu province.

Since it entered China in 1993, AstraZeneca has attached great importance to localization. In 2017, it separated its China Innovation Center and set up a research and development joint venture, Dizal Pharmaceutical, with SDIC Fund. In December 2021, Dizal was listed on Shanghai’s Nasdaq-like Star Market.

AstraZeneca has also expressed interest in doing deals with Chinese biotech companies. In May, the firm signed a USD600 million deal with Shanghai LaNova Medicines for the global licensing rights of a potential cancer drug. It has also inked an agreement with a partner to sell a traditional Chinese medicine that lowers cholesterol.

China is an attractive market for pharmaceutical companies because of its large and ageing population, which is increasingly suffering from diseases caused by smoking, pollution, and bad diets.

Editor: Peter Thomas