Schott Pharma expands production: Focus on the USA

Mainz - Schott Pharma expands production: Focus on the USA

Schott Pharma is driving the expansion of its business with injectable medication syringes and is investing heavily in production capacities. While the production of traditional products such as ampules or glass vials is shifting from Hungary to Serbia in Europe, a completely new production site is being established in the USA in the coming years.

The investments in new production lines are reflected in the figures published on Thursday for the second quarter: The operational earnings before interest, taxes, and depreciation (Ebitda) decreased by three percent to 67 million Euro. Schott Pharma explicitly attributed this to start-up costs for new production lines and a strong comparison value from the second quarter of 2023. The revenue increased, however, by eleven percent, currency-adjusted, to 247 million Euro.

"The trends are stable, the market is intact, and it's a global business," said CEO Andreas Reisse to the German Press Agency in Mainz. The industry is less affected by recession fears, he added. "Healthcare is the last thing people save on, and there's the megatrend of aging."

Large hopes are placed on injectable polymer syringes, i.e. syringes made of high-performance plastics for certain active ingredients, and especially in the business with large-volume syringes for the treatment of chronic diseases or for cancer medications in development. "MRNA is still a growth driver," said Reisse. "That's a field that will definitely develop." Drivers for glass syringes are biologics, vaccines, insulin pumps, and diabetes medications.

Polymer and glass syringes are among the margin-strong products of Schott Pharma. They currently account for a market share of 53 percent. Medium-term, i.e., within the next two to three years, the share is expected to reach 60 percent, said Reisse. "That's our clear goal." The core business with ampules and glass vials for the pharmaceutical industry will also grow, albeit less dynamically.

Ampules and glass vials are expected to be produced in the future at a new site in Jagodina, Serbia. Production of glass syringes was taken up at the long-standing site in Lukácsháza, Hungary, in the summer. A new production site is expected to go into operation in Wilson, North Carolina, in the US state of North Carolina, in 2027, following investments of around 371 million US dollars. "The USA will become a stronger production base," said Reisse. The US government is doing a lot for this, and if large customers produce there, Schott Pharma must also be present. "It has always been our strategy to be close to our customers."

1. The shift in the production of traditional products like ampules and glass vials from Hungary to Serbia is part of Schott Pharma's expansion in Europe.
2. In addition to its expansion in Europe, Schott Pharma is establishing a new production site for injectable medication syringes in the USA.
3. The production of glass syringes has already started at the long-standing site in Lukácsháza, Hungary, while a new site in Jagodina, Serbia, will be responsible for ampule and glass vial production in the future.
4. Schott Pharma's strategic decision to establish a new production site in the USA is influenced by the US government's support and the presence of large customers in the region.

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