Pharma deal easy pill to swallow
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Nycomed International's 51.3 percent stake purchase of Guangdong-based Techpool Bio-Pharma may prove to be a shot in the buttocks for China's pharmaceutical industry.
"...(The trend of foreign firms buying into the China market) will be beneficial in helping upgrade the entire Chinese pharmaceutical industry, as they can learn from the advanced technologies and management expertise of foreign companies," said Guo Fanli, a pharmaceutical industry analyst with the CIC Industry Research Center.
Swiss-based Nycomed specializes in producing medicines for gastrointestinal diseases, respiratory diseases and oncology.
Guo told the Global Times that the acquisition would prove beneficial for both sides.
"Nycomed will get access to Techpool's distribution channels … and Techpool also gets the chance to learn from Nycomed and strengthen its global presence," Guo said.
Techpool has a strong intellectual property portfolio, with 35 patents filed, 17 of which have been approved, including one in the US.
Its products are sold across China and exported to a number of countries, including Japan and South Korea.
"There was hardly ever any news of foreign pharmaceutical companies' taking over (Chinese firms) just a few short years ago," Guo said.
"At that time, the industry was kind of a mess, so foreign companies preferred to set up their own companies on the Chinese mainland."
That's starting to turn around, though, as many foreign companies are looking toward the growing opportunities in China.
In 2009, German pharmaceutical-maker Bayer spent 1.07 billion yuan ($160 million) to purchase several over-the-counter drug brands from Topsun Science and Technology Co, based in Jiangsu Province.
In addition, US-based Charles River Laboratories failed in their attempt to purchase Jiangsu-based WuXi AppTec earlier this year.
For another major share holder of Techpool, the Shanghai Pharmaceuticals Holding Co, which holds 40.8 percent of Techpool's shares, Nycomed's acquisition is also potentially good news.
"The acquisition brings the two companies (Shanghai Pharmaceuticals and Nycomed) closer together, allowing for further cooperation," Guo said.
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