The UK-headquartered drugmaker is among the top 10 pharma companies that have embraced outsourcing on a "previously unheard of scale," according to a recent report from IMS.
AstraZeneca said last year that it would expand the purchase of semi-manufactured medicines and the external manufacturing of active pharmaceutical ingredients (APIs) over the coming five to 10 years, as well as certain drug discovery and development functions.
In its latest move, AstraZeneca has signed a three-year extension of its current $14m agreement with WuXi, originally signed in 2006 and covering high-throughout screening services.
Over the period of the first agreement WuXi delivered more than 100,000 compounds, achieving its target two months ahead of schedule.
WuXi will continue to synthesise compounds according to AstraZeneca's designs in the new arrangement, to "further expand AstraZeneca's global compound collection," according to the drug major.
Deborah Hartman, AstraZeneca's vice president, lead generation discovery enabling capabilities and sciences (DECS), said WuXi had exceeded expectations in the first agreement, "delivering value … beyond the cost savings in labour and materials."
The financial terms of the latest deal haven't been disclosed, but it seems likely that it represents an increase on the investment made by AstraZeneca in the first phase of the collaboration.
The company was attracted to WuXi's high-throughout screening service because it is highly scalable, with an annual capacity of more than a million compounds with high purity standards.
The closer ties with WuXi come after a protracted period of investment in China by AstraZeneca.
In 2002, the company opened a research centre in Shanghai, and in May 2006 announced it would spend $100m to establish the AstraZeneca Innovation Center China in the same city as part of its 'in China, for China' project.
The Shanghai site also contains a sourcing centre for active pharmaceutical ingredients (APIs) and chemical intermediates, along with other products and services (e.g. packaging, contract R&D, laboratory equipment and chemicals, contract formulation etc).
Last year AstraZeneca opened a clinical pharmacology unit in China in collaboration with Peking University 3rd Hospital.
Meanwhile, other big pharma companies, such as Bristol-Myers Squibb, GlaxoSmithKline and Pfizer, are also trekking the outsourcing trail.
B-MS is adopting contract manufacturing to enable it to close more than half of its 27 manufacturing facilities by 2010, while GSK is aiming to save approximately £500m in manufacturing costs through 2010, in part by boosting outsourcing.
Meanwhile, Pfizer already outsources 15 per cent of its manufacturing activities to Asia, and wants to double that proportion.