Novartis increases stake in Chinese vaccines firm
pharmafile | March 22, 2011 | News story | Sales and Marketing | China, emerging markets, vaccines
Novartis has continued its expansion into developing markets with the acquisition of a majority stake in a Chinese vaccines company.
The Swiss manufacturer now owns 85% of Zhejiang Tianyuan Bio-Pharmaceutical Co, which has an R&D and manufacturing site in Hangzhou, near Shanghai.
Founded in 1994, the private firm marketed the first vaccine in China against hemorrhagic fever with renal syndrome (HFRS) caused by hantaviruses.
Ding Xiaohang, Zhejiang Tianyuan’s founder and chief executive, will continue in his position while holding a minority stake.
For Novartis, the deal is an attempt to unlock what it sees as the potential for launching products treating unmet medical needs in China.
Although it remains tight lipped about the details, Novartis says it has identified several joint development programmes that could be implemented over the next ten years.
“This agreement combines the strength of our vaccines R&D strategy and pipeline with Tianyuan’s deep knowledge of the vaccines market in China, enabling us to better deliver a broad range of vaccines to the Chinese people,” said Andrin Oswald, head of Novartis Vaccines and Diagnostics.
China is the world’s third largest vaccines market, with annual industry sales of more than $1 billion.
And the companies say that a commitment by the Chinese government to improve access to quality healthcare points to sustained double-digit growth in domestic vaccine sales.
“We look forward to working with Novartis to build a broader portfolio of novel and high-quality vaccines to help prevent disease in China and globally,” said Ding Xiaohang.
The Zhejiang Tianyuan move is part of Novartis’ strategy to invest in vaccines innovation and manufacturing technologies in emerging markets.
“Our collaboration with Tianyuan marks an important step in our strategy and long-standing commitment to improve healthcare in China by delivering effective vaccines that prevent diseases,” concluded Oswald.
In 2009 the company announced up a $1 billion, five-year commitment to invest in China as part of a move into the so-called BRIC market countries – Brazil, Russia, India and China.
The company is also planning to invest $500 million in Russia over the next five years, including the construction of a large-scale pharmaceutical manufacturing plant in St Petersburg.
Adam Hill
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