Updated on 18 June 2013
Another mega deal was China Pharmaceutical Group's acquisition of Robust Sun Holdings for $1.1 billion, giving access to the buyer to get a strong hold on finished preparations and higher-value drugs. With this transaction, China Pharmaceutical Group acquired the research and production capacities of finished preparations for use in diseases related to CNS. Meanwhile, Guangzhou Pharmaceutical rounded off an impressive year for Chinese companies by acquiring Guangzhou Baiyunshan Pharmaceutical for $949 million in December 2012.
Another big name in the country's pharmaceutical industry, China Resources Sanjiu Medical & Pharmaceutical ventured into skin care market by acquiring Guangdong Shunfeng Pharmaceutical at $95.33 million, getting access to latter's high selling dermatology product Shunfeng. Aiming at enhancing technology assets, Shanghai Pharmaceuticals acquired 70 percent of Chanzhou Kony Pharma for $35 million, and thus gained access to high-quality API production technology for both China and international market.
While most of the international companies were strategizing towards enrichment of their drug pipeline, there were a few who showed interest in acquiring assets in China. However, most of the M&A deals in China were within domestic domain, except for Pfizer that entered into 49:51 joint venture, involving an investment of $145 million, with local drug maker Zhejiang Hisun Pharmaceutical. The move intends to enrich Pfizer's portfolio of generic drugs in China. Another highlight from China was the acquisition of 12 percent (valued at $90 million) share of Nanjing Pharmaceuticals by Europe's Alliance Boots. Nanjing Pharmaceuticals is a $3.2 billion company with operations in 12 cities across China.
Mr Norbert Meyring, head of KPMG Life Science in China and Asia Pacific, says, "Looking forward, we assume there will be 18 to 20 percent annual growth in Chinese drug spending through 2015. The life science sector in China will maintain its rapid pace of growth due to demand generated by robust economic growth and a rising middle class. Additional factors including government support, urbanization pressures and changing lifestyles, as well as, an aging population and increasing awareness for the need for quality healthcare, are also key drivers of the industry boom."
In the outbound deal, China's BGI made a strong presence in the US by acquiring Complete Genomics of California for $117 million. In China, the biggest deal in the medical devices segment was Medtronic's acquisition of China Kanghui, an orthopedic device company, at $755 million.