Sinovac forms vaccine manufacturing JV
Vaccines for rabies, mumps, varicella and rubella are in Sinovac’s pipeline and by striking the deal with Dalian, which will provide land use rights, manufacturing facilities and established operating infrastructure, it believes it can support their production.
Weidong Yin, chairman, president and CEO of Sinovac, explained that the deal leverages “the favourable investment environment” to add an important manufacturing site for the company’s vaccines. Yin added that Dalian has a relatively low operating cost.
The joint venture is called Sinovac (Dalian) Vaccine Technology and will be headquartered in Dalian, Liaoning Province in North East China, occupying a 1m sq ft site and a 200,000 sq ft building.
Housed in the headquarters is a 60,000 sq foot manufacturing and R&D facility with two vaccine production lines, one for live attenuated vaccines and another for vero cell cultured vaccines.
The site has the capacity to house approximately six different production lines and has quality assurance and control facilities, a research laboratory, office building and warehouse.
To establish the joint venture Sinovac has made an initial cash contribution of $8.8m (€5.8m) and Dalian has provided assets, including its manufacturing facilities, production lines and land use rights, with a value of $22.5m.
Dalian will have a 70 per cent equity interest in the joint venture, with Sinovac taking the remaining 30 per cent. Sinovac has the option to increase its equity stake to 55 per cent in exchange for a cash contribution of $7.5m.
The day-to-day operations of the joint venture will be led by Sinovac management, with the positions of chairman, general manager, head of research and development and financial director being held by the biotech’s representatives.
