Novartis has announced plans to spend $1.25 billion to expand its research efforts in China.

First of all, the Swiss major said it is making a $1 billion investment over the next five years, including a significant expansion of the Novartis Institute of BioMedical Research (CNIBR) in Shanghai. The institute specialises in basic R&D of new drugs including small molecule and biological medicines “to treat diseases that are highly prevalent in China”.

The CNIBR is expected to be the third largest R&D centre for Novartis, after Cambridge, Massachusetts the facility at its headquarters in Basel. It will become the "largest comprehensive R&D centre in China" and the number of jobs will increase from 160 today to about 1,000.

Chief executive Daniel Vasella said Novartis is confident that “our expanded investment in R&D will result in innovative therapies for patients in China and other countries nurtured by the growing scientific excellence in China”. He added that the firm is pleased to contribute to the Shanghai government's “aim to establish the city as the premiere R&D centre for China's bio-medicine industry by 2012”.

The Chinese government is working to expand access to affordable, basic medical services to all citizens by 2020, Novartis noted, and recently announced that it will spend $124 billion over the next three years to further build the nation's health system. This will involve expanding insurance coverage, updating public hospitals and training community healthcare workers.

Novartis also announced that it has invested $250 million in a new facility in Changshu. That plant is focused on technical R&D and manufacturing activities of active pharmaceutical ingredients.