Sandoz presses EU antibiotic trade case as CEO warns over reliance on China

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Sandoz urges EU on antibiotic risks

Highlights

Sandoz filed a complaint with the European Commission in May seeking an anti-dumping investigation, citing that 86% of EU penicillin imports now come from China, up from 44% in 2019.
CEO Richard Saynor warns that Europe's reliance on low-cost Chinese antibiotic inputs poses public health and economic coercion risks, with NHS reimbursing only £1.06 for a 21-pack of 250mg amoxicillin capsules.
Sandoz targets more than 100 biosimilar products by 2040 with new investments including a $300 billion facility in Ljubljana, aiming to capitalize on $650 billion of expiring patents.

Antibiotic supply pressure and trade dispute

As first reported by Fortune, Sandoz is intensifying its warning that Europe’s dependence on low-cost Chinese antibiotic inputs is creating a growing vulnerability for public health systems and industrial resilience. The Swiss drugmaker operates a 150 million euro factory in Kundl, Austria, which it describes as Europe’s only fully integrated antibiotic manufacturing facility, producing active ingredients and finished medicines at the same site.

The company says competition from China is eroding the economics of local production. According to Eurostat data cited in the report, 86% of EU imports of penicillins and their derivatives came from China last year, up from 44% in 2019.

Sandoz has argued in submissions to UK lawmakers that this dependence is an “Achilles heel” for Europe’s public health and defense, warning that restricted supply could become a tool of economic coercion during diplomatic tension. In May, the company filed a complaint with the European Commission seeking an anti-dumping investigation into Chinese imports of the active ingredient used in amoxicillin, saying subsidized Asian manufacturers are distorting the market.

The group also says current medicine purchasing models fail to reflect the strategic value of antibiotic supply. Richard Saynor, Sandoz chief executive, argues that health systems focus too narrowly on low prices, pointing to UK National Health Service reimbursement of 1.06 pounds for a 21-pack of 250mg amoxicillin capsules, according to the British National Formulary.

Biosimilars growth plan and policy stakes

Sandoz says the EU Critical Medicines Act is a positive step because it aims to strengthen the availability and production of essential drugs including antibiotics and painkillers across Europe. However, the company maintains that policy support will matter only if governments are prepared to pay more to preserve domestic and regional manufacturing capacity.

Beyond antibiotics, Sandoz is positioning itself for expansion in generics and biosimilars, which it sees as a major growth area as patents on medicines worth a combined $650 billion expire over the next decade. Last month the company set out an ambition to build a portfolio of more than 100 biosimilar products by 2040, up from 13 now, and says those launches could generate nearly $1 trillion in social impact through healthcare savings and broader access.

The company has invested $300 billion in a new drug substance facility in Ljubljana, Slovenia, to support that strategy, according to the report. Saynor says Sandoz’s 2023 spin-out from Novartis gives it greater freedom to challenge patents, bring off-patent medicines to market faster and advocate more openly with regulators and governments.

Sandoz is also reshaping its leadership team as it pursues that next phase of growth and manages margin pressure from global competition. Recent appointments include Pascal Bouye to lead generics and manufacturing supply, Keren Haruvi to head North America operations, and former Lufthansa finance chief Remco Steenbergen, as the company brings in executives with consumer goods, supply chain and asset-heavy industry experience.

In our earlier article on China’s rare earth export approvals for Europe, we examined Beijing’s signal that shipments would keep flowing even as trade deadlines and negotiations with the U.S. and EU approached. We also outlined how the EU and China were discussing mechanisms to preserve access to critical materials, highlighting Europe’s exposure to potential policy shifts in strategically important supply chains.

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