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AstraZeneca to buy Chinese generics firm

Acquisition of Guangdong BeiKang follows the Anglo-Swedish pharma company’s $200m investment in Chinese manufacturing facility
AstraZeneca is to acquire China-based generics firm Guangdong BeiKang Pharmaceutical Company.

The Anglo-Swedish pharma company will gain a portfolio of injectable medicines to treat infections, which the company to market in China.

Mark Mallon, president of AstraZeneca's Asia-Pacific region, said: “Our new acquisition further underscores our intention to serve the health needs of Chinese patients through our innovative medicines and, increasingly, high quality branded generic treatments that are locally produced to global standards.”

Financial terms of the deal, which is expected to close early 2012, were not disclosed, but AstraZeneca said it would increase the accessibility and affordability of medicines for underserved patient populations in the country,

The move comes two months after AstraZeneca declared its plans to invest $200m in a new manufacturing facility in the country, which is becoming an increasingly important market for pharmaceutical companies.

The investment is in contrast to AstraZeneca's performance in the US, where it has just announced it will cut 1,150 sales jobs – almost a quarter of its American field force.

Revenue for AstraZeneca in China for the first nine months of 2011 stood at $947m, an increase of 21 per cent on the same period in 2010.

This compared to a 5 per cent decrease in revenue for the company in the US from the first nine months of 2010 to the first half of 2011, although the total figure still far outweighed total revenues in China for the period, coming to $9.78bn.

China's pharma market

China is facing a growing population as well as increasing levels of chronic disease due to the adoption of more 'western' lifestyles and diets. Improved economic standing is also leading to greater expectations in healthcare.

The Chinese pharmaceutical market has consequently seen strong growth in recent years, increasing from $10bn in 2004 to $41bn in 2010 with further expectations to grow to over $100bn by 2015 according to analysts IMS Health.

This week also saw the country introduce new plans to plans to improve drug safety, including increasing the monitoring of pharmaceutical companies. China has faced several major pharmaceutical issues in recent years, and the State Council admitted 'medicinal safety is in a high-risk stage'.

8th December 2011

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