The French pharmaceutical company Sanofi-Aventis has signed agreements with ChinaÔÇÖs Minsheng Pharmaceutical Co. to form a new consumer healthcare joint venture.
Sanofi will obtain a majority equity stake in the new venture, which will focus on vitamin and mineral supplements (VMS), the largest consumer healthcare segment in China.
Minsheng already has a strong presence in the sector, with its flagship brand of multivitamins.
Sanofi hopes that the joint venture will enable it to continue expanding its global footprint. It has recently embarked on a number of mergers and acquisitions, including the purchase of Chattem, a leading manufacturer of branded consumer healthcare products, toiletries and dietary supplements in the US.
ÔÇ£We are pleased to take a significant step toward establishing the new consumer healthcare joint venture with Minsheng, our long-standing partnerÔÇØ, said Hanspeter Spek, SanofiÔÇÖs president of Global Operations.
ÔÇ£Combined with our leadership position in vaccines, we will continue to contribute to preventative healthcare in China. Entering the worldÔÇÖs second largest consumer healthcare market is also a strategic move for Sanofi-Aventis to consolidate its position in consumer healthcare.ÔÇØ
ÔÇ£We are equally excited about the prospect of forming the new consumer healthcare joint venture with Sanofi-Aventis, after more than ten years of successful partnership,ÔÇØ said Zhu Fujiang, chairman of Minsheng Pharmaceutical Co.
He added: ÔÇ£We hope that once materialized, the new venture will revitalize our consumer healthcare business and expand the reach of our products to benefit more consumers. We also hope that the new venture will serve as a platform for us to develop more health products in order to contribute to the local economy and meet consumer needs.ÔÇØ
In 2008, the consumer healthcare market in China was estimated to be worth around Ôé¼7 billion, with double-digit growth forecast for the next five years.
Growth will be driven by factors such as increasing consumer affordability, government focus on health awareness and prevention, and the expansion of pharmacy chains and modern trade.
Sanofi was one of the first foreign pharmaceutical companies to open offices in China; it is now one of the fastest growing healthcare companies in the country.
In 2007, the company invested $94 million (approximately Ôé¼67 million) in a new high-tech manufacturing facility in Shenzhen. In April last year, it spent $90 million (Ôé¼64 million) on upgrading and expanding its manufacturing facility in Beijing.
At the same time, the company invested Ôé¼44 million in the relocation of its manufacturing facility in downtown Hangzhou to a new manufacturing site in Binjiang New Development Zone.
Founded 80 years ago, Minsheng was one of the first western medicine manufacturers to establish a presence in China.
