WuXi PharmaTech Inc, China's largest drug research contractor, said yesterday it will increase spending on equipment and materials by 50 to 100 percent this year.

The company is expanding its research capacity and supporting its newly acquired United States counterpart.

Total spending on laboratory equipment and reagents will reach 300 million yuan (US$41.67 million) to 400 million yuan this year, according to Samuel Li, senior director of WuXi's international operations.

The Shanghai-based company will collectively source materials this year, instead of each branch acquiring supplies, to improve efficiency, delivery times, costs and quality.

The company has asked suppliers for longer payment periods, quality guarantees and lower prices, according to suppliers who were briefed yesterday at WuXi's headquarters.

"What we want is a win-win cooperation for us and our suppliers," Li Ge, WuXi's chairman and chief executive officer, told suppliers.

The bulk of its supplies come from overseas companies to ensure research quality for its customers, mostly overseas drug makers that include nine of the world's top 10.

The United States Federal Trade Commission has just approved the company's purchase of US-based AppTec Laboratory Services Inc.

WuXi announced earlier this month it agreed to buy AppTec for US$151 million to expand its customer base and boost research capacity in biologics.

The deal will boost its earnings per share, excluding amortization of the acquired assets and other one-off charges, it said on January 3.

The company has raised its 2007 revenue guidance to somewhere between US$131 million and US$135 million on strong growth by the third quarter last year.

(Shanghai Daily January 29, 2008)