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Zoetis, an animal-health company spun off from pharmaceutical giant Pfizer, on Thursday announced the opening of a manufacturing facility in Suzhou and a research and development center in Beijing, as the company continues to grow in the $2.2 billion animal health sector in China.
The multinational company's new Suzhou site will manufacture medicated feed-additive products that will be used to raise pigs, cattle and poultry. The facility replaces its original manufacturing site that opened in 1995, when Zoetis first began operations in China.
"The expansion of our manufacturing capacity in Suzhou helps us establish a center of excellence for pre-mix and soluble powder medicines to keep farm animals healthy, and sets a strong foundation for our future growth in China," said Roman Trawicki, executive vice-president and president of global manufacturing and supply at Zoetis. "We are committed to growing our business through manufacturing operations in China to serve the animal health market in China and worldwide."
Zoetis, which had revenue of $107 million last year, is the largest multinational animal health company in the second-largest animal health market in the world. China's market was valued at approximately $2.2 billion in 2014 and is expected to grow at 8 percent a year, according to Zoetis.
The opening of the R&D facility in Beijing's Life Science Park is a continuation of Zoetis' research efforts in the country, which includes the company's participation in a Chinese joint venture in 2011 that helped launch a vaccine in 2013 against a significant disease in pigs.
The company serves five core species: pigs, dairy cattle, poultry, dogs and cats - the latter animals are now a focus for the company, thanks to a rise in pet ownership in China, according to Catherine Knupp, executive vice-president and president of research and development. It has another R&D facility in Jilin.
Knupp told China Daily that in order to meet customers' needs, the company needed to develop products locally so that it can work on specific strains of viruses that affect livestock, and that this couldn't be done from another part of the world.
With the vaccine launched in 2013, a different strain of a disease found in the US and Europe was prevalent in pigs in China, and local development of a vaccine was needed.
"If one wants to be able to offer such a product in a reasonable time frame, no other region of the world wants you working on somebody else's strain in their backyard, so to speak, because of the risk now of introducing another version of that virus," she said.
Approximately 800 million pigs and 600 million sheep and goats are raised annually in China, with medical feed-additive sales reaching $512 million in 2014. Zoetis sees opportunity in the market as a growing middle class consumes more protein and cares more about food safety, Knupp said.
"In China, the realization is that while many livestock are grown, it's not just how much can be produced, it's how efficient and how well can the animals be managed so that they stay healthy.
"The industry in China is really beginning to appreciate the value of health in the production of the protein, which leads to a much better efficiency and will help with affordability as well," she said.
The R&D facility in Beijing will have 15 staff members, and Zoetis will keep working on its joint venture and other academic institutions. Knupp said that the company wants to increase its interactions with Chinese authorities, who have expressed interest in animal health research that goes on in other parts of the world.
