The deal will see the company set up a joint venture with Hutchison China MediTech and will give Nestle exclusive access to more than 50,000 extracts that are used in the manufacture of Chinese medicines. The joint venture, called Nutrition Science Partners Limited (NSP), will develop and manufacture nutritional and medicinal products.
The deal comes as the global market for Chinese medicines expands. It is valued at more than $83bn by the World Health Organization. In China alone, the industry produced almost $48bn worth of such medicines in 2010.
"We believe traditional Chinese medicine has a real potential to become part of innovative solutions," Luis Cantarell, chief executive of Nestle Health Science, was quoted as saying on a conference call by the Financial Times and the Bloomberg News agency.
