Companies

Sanofi-Aventis redoubles efforts in Chinese market

By Wang Hongyi (China Daily)
Updated: 2011-05-17 11:19

China is now the world's second-largest consumer healthcare market after the United States, and was estimated to be worth around $9.89 billion in 2008. [Photo/China Daily]

SHANGHAI - China may become the second-largest market for the French pharmaceutical company Sanofi-Aventis SA within five years, according to the company's Chief Executive Officer Christopher A. Viehbacher.

He added that goal has prompted the drugmaker to redouble its efforts in its consumer health business and in vaccines for flu and other diseases during the coming years.

This year, Sanofi-Aventis expects revenue of about 100 million euros ($141 million) - out of a global total of 3 billion euros - from its consumer health business in China, said Viehbacher.

"The Chinese government has made health a major priority. We hope we can be more involved in China's health reforms and meet the needs of the people," he said.

Favorable market trends, such as increasing consumer awareness of health issues, and the government's focus on health are also providing increased opportunities.

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Last year, Sanofi-Aventis acquired the Chinese drug company BMP Sunstone Corp for $521 million. The move not only gave Sanofi control of BMP's treatments for coughs, colds, and women's health products but also access to a well-established distribution network in the sector.

Last year, the company also set up a joint venture in vitamin and mineral supplements with Hangzhou Minsheng Pharmaceutical Group Co Ltd. "We have a 15-year collaboration with Minsheng and have established a good relationship. We believe that Minsheng's 21 Super-Vita, the well-known line of vitamin products, has great brand value," said the CEO. Viehbacher added that the joint venture will help Sanofi-Aventis to consolidate its position in China's consumer health business.

China is now the world's second-largest consumer healthcare market after the United States, and was estimated to be worth around $9.89 billion in 2008. Sanofi-Aventis says it expects to generate "double-digit" sales growth over the next five years.

The Paris-based company has been expanding in emerging markets and consumer health products to counter a loss of revenue caused by the expiry of the patents on some of its best-selling drugs.

Christopher A. Viehbacher, CEO of Sanofi-Aventis SA

Despite being ranked fifth in the global "over the counter" (OTC) market, Sanofi-Aventis is still a newcomer in China's OTC market, meaning mergers and acquisitions will be an important strategy, according to Thomas Kelly, senior vice-president of Sanofi-Aventis Asia.

"We are just tapping into the OTC market, so collaborating with established brands and excellent products that have wide distribution channels is a very efficient way for us to compete. We will continue to look for other good opportunities for collaboration or acquisitions," said Kelly.

"However, we are in no hurry to do that, because we have our own line of consumer health products, which is expected to be launched in China this year," he added.

Last week, Sanofi-Aventis launched its five-in-one combination children's vaccine Pentaxim in China.

The company says the treatment is effective against several of the most prominent childhood illnesses such as diphtheria, tetanus, polio and Haemophilus influenzae type B.

The vaccine will also help lower the number of shots required for immunization from 12 to four.

Meanwhile, the company is building a factory in Shenzhen, Guangdong province, which will produce flu vaccine for 2013. The drugmaker also expects to launch a dengue vaccine in the country in 2014 or 2015.

Viehbacher said Sanofi also sees opportunities for treatment aimed at other illnesses, such as liver cancer, and will increase investment in manufacturing, research and development, and will cooperate with universities.

The company has also announced that it will support a five-year plan for diabetes management established by China's health ministry. The program, led by the Chinese Center for Disease Control, will train 500 diabetes specialists, and provide 10,000 community and rural-based doctors to deliver diabetes care and patient education by 2015.