(Yicai Global) July 6 -- Moderna said the US drugmaker will set up its Chinese headquarters in Shanghai to promote the research, development, production, and sales of messenger RNA vaccines and drugs in China.

Moderna signed a memorandum of understanding and a land deal with Shanghai’s Minhang district government yesterday to mark the Massachusetts-based firm’s first investment in China.

Sources told Yicai Global that the investment will total USD1 billion. The firm set up a biotech unit with a registered capital of USD100 million in Minhang in May after Chief Executive Stéphane Bancel said the firm would accelerate its investment in Shanghai and join hands with its Chinese partners on research, development, and production.

Moderna will build a plant in China to make respiratory disease vaccines, such as those against respiratory syncytial virus and influenza, Bancel said at yesterday’s signing ceremony, adding that it aims to collaborate with top universities and scientific research institutes on clinical trials and safely bringing products to the market.

Moderna’s mRNA vaccine against Covid-19 helped boost the company’s business performance in recent years. But as the pandemic eases, sluggish demand for jabs is putting great pressure on Moderna, which is searching for new growth points by foraying into the Chinese market.

Biomedicine is one of Shanghai’s top three industries, boasting ample resources in terms of clinical research and trials and supply chain. Last year, four Class-1 innovative drugs developed in Shanghai obtained marketing approval, the highest number among Chinese cities. Three other Class-1 innovative drugs received the green light this year.

Editor: Dou Shicong, Futura Costaglione