Sanofi has announced its largest-ever investment in China, committing €1 billion ($1.04 billion) to establish a new insulin production facility in the Beijing Economic and Technological Development Zone. This strategic expansion is a direct response to the rising diabetes crisis in China, where approximately 140 million adults were diagnosed with diabetes as of 2021. The new manufacturing site will become Sanofi’s fourth in China, joining its existing operations in Beijing, Shenzhen, and Hangzhou. The investment underscores Sanofi’s commitment to addressing the growing demand for diabetes care in the region and strengthens its manufacturing footprint in a crucial market.

The announcement comes at a time when trade tensions between China and the European Union are still a concern. Despite these challenges, China has been actively working to enhance economic ties with individual EU countries. In this context, Chinese Commerce Minister Wang Wentao reassured Sanofi’s chairman, promising the company full support in terms of technological innovation and competition in the market. The Minister also emphasized China’s commitment to providing a stable business environment for foreign companies, which includes creating favorable conditions for investment in sectors like healthcare and manufacturing.

At the same time, other global pharmaceutical companies, such as Johnson & Johnson and Merck & Co., have been scaling back their operations in China, as reported by several news agencies. These companies have faced increased competition from local players and the Chinese government's push to reduce healthcare costs. In particular, the volume-based procurement (VBP) program, which prioritizes cheaper domestic suppliers for hospital contracts, has posed challenges for multinational companies. As a result, Johnson & Johnson’s surgery division and Merck’s diabetes unit have been affected by workforce reductions in China.

In addition to its manufacturing expansion, Sanofi has also been making strides in the Chinese market with its biologic treatment Dupixent. In September, Dupixent received approval in China as the first biologic treatment for adults with uncontrolled chronic obstructive pulmonary disease (COPD) characterized by elevated blood eosinophils. The approval followed encouraging results from two Phase 3 clinical trials, which showed significant reductions in COPD exacerbations, improved lung function, and enhanced quality of life for patients. Dupixent, which targets the IL-4 and IL-13 pathways, is already approved for COPD in over 30 countries and has also been approved in China for other respiratory and dermatological conditions.

Sanofi has a vast global presence, with 59 manufacturing sites and 20 research and development facilities across the world. Its medicines and vaccines are distributed in 180 countries, showcasing its role as a leading player in the global healthcare industry. The company’s €1 billion investment in China further solidifies its commitment to the region, where it continues to focus on addressing critical healthcare needs such as diabetes and COPD. This strategic move not only strengthens Sanofi’s position in a key market but also highlights its dedication to innovation and expanding access to vital treatments worldwide.