Before Alexander Fleming ( Alexander Fleming ) accidentally discovered penicillin 100 years ago, nearly half of all deaths were caused by infections. Fleming's petri dish experiments, along with the subsequent development of modern antibiotics, have extended the average human lifespan by 23 years, and it is believed that millions of lives are saved each year as a result.

Swiss pharmaceutical company Sandoz is one of the last few companies in Europe to produce this vital medication. The company owns a factory in the Austrian Alpine town of Kundl (Kundl) that cost 150 million euros (168 million US dollars) to build. This factory is the only fully integrated antibiotic manufacturing facility in Europe, capable of producing both the active ingredients and turning them into drugs ready for use by patients.

However, Sandoz is facing fierce competition from China. According to data from the European Union Statistics Office ( Eurostat ), last year 86% of penicillin and its derivatives imported by the EU came from China, up from 44% in 2019. China has now become the world's largest exporter of antibiotic raw materials.

Sandoz CEO Richard Saynor stated that Europe's loss of the ability to produce antibiotics would lead to security and sovereignty issues. "We are now the last remaining penicillin producer in the Western world," he said, "Do you really want to live in a world where all antibiotics come from Asian suppliers? I don't think so."

In written testimony submitted to British MPs, Sandoz warned that Europe's dependence on Chinese antibiotics is a 'Achilles' heel' for its public health and national defense, and added that during periods of diplomatic tension, restricting supplies could become a 'tool of economic coercion or hybrid warfare.'

Sandoz is also referred to as 'market-distorting behavior' that helps Chinese manufacturers drive down the prices of their competitors and 'submerge' the global market with ultra-low-priced pharmaceutical raw materials.

The company submitted a complaint to the European Commission in May, requesting an anti-dumping investigation into the import of the active ingredient used in the antibiotic Amoxicillin ( amoxicillin ). Saynor said: "We are competing with heavily subsidized Asian competitors. We hope for a fair competitive environment."

The EU's "Critical Medicines Act" was temporarily approved in May, with the aim of improving the supply and production of critical medicines such as antibiotics and painkillers in Europe. Saynor believes that this is a step in the right direction.

However, he added, "What's unclear is how this will ultimately translate into European governments paying a bit more for these medications. As usual, everyone agrees with your point of view, but once you start talking about the costs, everyone suddenly leaves the table."

According to the reference book "British National Formulary" ( British National Formulary ), which provides guidance on medication and administration for healthcare professionals, the UK National Health Service ( NHS ) currently pays £1.06 (1.41 USD) for a box of 21 250-milligram amoxicillin capsules. Saynor asked, "Why is the price of a box of antibiotics cheaper than that of a bar of Mars chocolate?" "Do we value a drug that saves more lives than any other invention any less than we value a bar of Mars chocolate? The government is good at looking at prices, but not necessarily at value."

Global public health systems are facing financial pressures and budget cuts, but Saynor believes that paying a higher price is not excessive. He added, "To sell all medications at the same price as Mars chocolate bars is not a fair comparison, because developing and bringing products to market costs billions of dollars."

The "Golden Decade" of Cheaper Medicines

Sandoz focuses on the development of generic drugs and biosimilars. These drugs, which have expired patents, have the same clinical efficacy as brand-name drugs, but the procurement costs for healthcare systems are much lower. Generic drugs account for 80% of all drug usage worldwide.

Sandoz It is estimated that within the next 10 years, drug patents with a total value of $650 billion will expire, which will bring about what Saynor refers to as an "unprecedented golden decade" for the biosimilar drugs market.

Last month, Sandoz announced its ambitions to produce over 100 biosimilar drugs by 2040, which is nearly eight times the current 13 varieties. Sandoz estimates that bringing these products to market could create a social impact of nearly one trillion dollars, with a portion of that coming from direct savings in the healthcare system.

To support this goal, Sandoz has invested $300 billion in building a new pharmaceutical raw materials factory in Ljubljana, Slovenia. Saynor said, "We see tremendous opportunities in the field of biologics."

He believes that Sandoz split off from Novartis (Novartis) in 2023, putting the company in a favorable position to seize this upcoming opportunity. “Our responsibility is to challenge patents and get the product to market as soon as possible,” Saynor explained. In contrast, pharmaceutical companies like Novartis are striving to protect their own patents. “From a knowledge perspective, these two things are very different,” he said.

Today, as an independent company, Saynor signifies that Sandoz can become the “voice of the industry.” He added, “I have had the opportunity to interact with the White House, European regulatory agencies, governments of various European countries, as well as international governments around the world. As part of a parent company, I would not have been able to say half of what I can say now. This allows us to influence policy.”

Saynor is also reorganizing its leadership team. In July, Pascal Bouye, who previously held senior operations and supply positions at Mars (Mars) and Danone (Danone), was appointed President of Generic Drugs and Manufacturing Supply; Keren Haruvi transferred from Novartis to Sandoz to be responsible for North American business. Remco Steenbergen, the former Chief Financial Officer of Lufthansa (Lufthansa) in Germany, joined the company in 2024.

In the view of Saynor, bringing in experience from other industries is crucial for the future growth of Sandoz. “Pascal comes from a very complex consumer goods organization, so he knows how to manage a complex supply chain with numerous partners,” he said. At the same time, Steenbergen brings experience in managing finances in asset-intensive industries with relatively thin profit margins.

As Sandoz enters a new growth phase and faces competition from China, Saynor acknowledges that a new perspective will be crucial: "As CEO, I don't have all the answers. We need different viewpoints to challenge our thinking, as well as people who can bring knowledge from various industries—not necessarily from the pharmaceutical sector."

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