AstraZeneca is set to spend $630 million (€562 million) on R&D in South Korea over the next five years. The commitment is part of a wider agreement between organizations in Korea and Sweden.
In 2016, the Korean government outlined a strategy designed to establish biopharma as a key growth driver for an economy that has relied on tech in recent decades. The strategy aimed to create almost 1 million jobs by offering tax benefits for investments in R&D facilities and other perks intended to get local and foreign businesses to pump money into the industry.
Korean officials want AstraZeneca to support its R&D strategy. In addition to making the financial commitment, AstraZeneca has entered into a letter of intent with a Korean trade promotion agency and industry group.
The letter sets the stage for cooperation on new drug development, the provision of mentoring for biotech startups and the advance of AI and other emerging technologies. Korea plans to invest $2 billion in AI by 2022 and has made the application of the technology to drug development a key part of its strategy.
Korean authorities hope AstraZeneca will help give momentum to these initiatives and the broader biotech sector. While local companies such as Chong Kun Dang Pharmaceutical, Samsung BioLogics and Hanmi Pharmaceutical have begun to establish themselves on the world stage, there is a limited pool of Korean drug developers with the experience to help the country’s nascent biopharma industry.
The selection of AstraZeneca as the company to support the strategy is, in part, a reflection of the Anglo-Swedish drugmaker’s history of working in the country. Over the past five years, AstraZeneca has run more than 130 clinical trials in Korea and seeks to annually support the selection of four preclinical and early-phase clinical cancer research projects with the government-affiliated Korea Health Industry Development Institute.
AstraZeneca confirmed the investment in response to questions from FierceBiotech but declined to provide additional details, stating only that it is committing the cash “to drive biomedical innovation, improve access to healthcare and provide high quality employment in Korea.”