Boston Scientific will establish its first China-based manufacturing site in Shanghai, the company announced earlier this week.
The site is part of the biotech manufacturer's localization strategy in China for its supply chain and production. Products at the site will be sold to the China market, the company said in its announcement on the social media app WeChat.
"We are grateful for the immense opportunities presented here and are committed to supporting the high-quality development of China’s healthcare industry through commercial excellence, agile and localized operations, and sustained investments in talent and capabilities," Chairman and CEO Michael Mahoney said in a statement.
While the Shanghai factory will be Boston Scientific's first owned manufacturing operations in the country, the company has previously produced certain products in the city, including intravascular ultrasound systems. The company opened its Shanghai R&D center in 2013.
"Setting up a manufacturing plant of our own and accelerating local production are crucial strides toward establishing a foothold in Shanghai and comprehensively implementing our localization strategy," June Chang, president of Boston Scientific Greater China, said in a statement.
Boston Scientific declined to comment on the value or size of the new facility, as well as which products will be made at the site. It also declined to comment on whether the new facility would share data or other information with facilities outside China.
The biotech manufacturer has been committed to the China market for decades, opening its country headquarters in 1997 and operating R&D centers in Chinese cities including Beijing, Shanghai and Guangzhou.
Boston Scientific's focus on the China market comes as many manufacturers are finding it difficult to continue operating in the country, pushing them to consider moving production. In a recent survey of U.S. companies in China, 40% are redirecting or plan to redirect investment originally planned for China, according to the American Chamber of Commerce in Shanghai.
Despite the difficulties, Boston Scientific continues to be drawn by China's market potential. The company has highlighted China as one of 20 key emerging markets, focusing on the country's potential for future growth, targeting the country for new R&D and manufacturing investment.
McKinsey valued China's medtech sector at $70 billion in 2021, with the potential to more than double by the end of the decade.
Boston Scientific has been looking to capitalize on that growth through M&A deals in recent years as well. In December, the company bought a majority stake in Chinese medical device maker Acotec Scientific Holdings Limited for $523 million, part of a strategy to gain greater access to the market.