left corner left corner
China Daily Website

Pharmaceutical companies seek global solutions

Updated: 2012-10-09 09:15
By Liu Jie ( China Daily)

It is hoped that the combination of the two companies will result in an operation that brings together complementary scientific and technological expertise and research and development capabilities.

One local press report in the US suggested recently, "the acquisition could be read as a signal to the world that China is determined to be a major competitor in the future genome sequencing market".

Ben Sim, a spokesperson for BGI-Shenzhen, says Complete will concentrate on medical research in an ambitious effort to speed up clinical trials and advance the era of personalized medicine, while BGI-Shenzhen's businesses are broader, and the government has approved it to do clinical research domestically.

The deal appears to be a perfect example of international cooperation that benefits both sides, according to Bruce Liu, a partner, and head of the medical care unit, at Roland Berger Strategy Consultants.

He says overseas M&As by Chinese companies are ideally aimed at expansion of product portfolios, the marrying of complementary technologies, and the best use of foreign resources, such as knowledge and distribution networks in local markets.

But he says that some Chinese companies have chosen other avenues for international expansion.

The Shanghai biopharmaceutical enterprise Fosun Pharmaceutical Group Co Ltd, for example, has chosen to take the more conventional route of organic expansion in a foreign market, he says.

In July, it set up a plant in Cote d'Ivoire, aiming to cover 17 nations and regions across the western side of the African continent.

In late August, it received a five-year, 300-million-yuan ($47.2 million) loan from International Financing Corp for its overseas ambitions.

Liu explains that Fosun's main product in Africa is Artemisinin, a new anti-malarial drug, extracted from a traditional herb grown locally.

"Establishing a production base in Africa means getting close to the raw materials it needs to produce the drugs, and the patients it needs to treat," he said.

However, different from the Fosun example, many Chinese companies believe cooperation with foreign counterparts is the safer and easier way to explore an international market.

Bernard says his company hopes to build more partnerships with local Chinese healthcare counterparts, to help it enter other foreign markets, aided by the French company's existing global sales network.

"It is very expensive to create new channels. But Chinese companies can take advantage of the network we have spent 40 years to set up," he says.

Amir Yaar, one of the leading financial entrepreneurs in Israel, also wants to help Chinese medical companies go abroad.