Want China Times, Staff Reporter 2014-03-04
German pharmaceutical giant Bayer announced on March 3 that it has signed an agreement to buy privately-held Chinese traditional herbal medicine (TCM) maker Dihon Pharmaceutical Group, reports the website of Shanghai's Xinmin Evening News.
The Bayer HealthCare R&D center in Beijing. (Photo/CFP) |
German pharmaceutical giant Bayer announced on March 3 that it has signed an agreement to buy privately-held Chinese traditional herbal medicine (TCM) maker Dihon Pharmaceutical Group, reports the website of Shanghai's Xinmin Evening News.
While the
two companies refused to reveal further details of the deal, a former senior
executive at Dihon stated that the acquisition could be worth up to 3.6 billion
yuan (US$587.3 million).
Kunming-based
drug maker Dihon makes a range of popular over-the-counter (OTC) and TCM
products, including dandruff and scalp disorder treatment Kang Wang and an
antifungal cream Pi Kang Wang. It also produces TCM Dan E Fu Kang, which is
used to treat various conditions that affect women.
"We
aim to strengthen our life sciences portfolio with strategic bolt-on
acquisitions globally," said Olivier Brandicourt, chief executive of Bayer
HealthCare. "Adding the strong OTC brands from Dihon to our portfolio will
significantly advance our business in China and position us well for future growth."
"Equally
important is the foothold we will gain in traditional Chinese medicine, which
makes up for about half of the OTC segment in China and is a well-accepted and
sought after line of natural science-based alternative therapies for consumers
looking for trusted solutions for their healthcare needs," Brandicourt
added.
Guo Zhenyu,
chairman and CEO of Dihon, said "We believe that Bayer, with its
marketing, sales, distribution and research expertise is well positioned to
take our success to the next level."
"This
acquisition will further strengthen the Yunnan pharmaceutical industry and
offer the potential to further expand TCM to other parts of the world,"
Guo said.
The deal is
expected to be completed during the second half of this year, a Bayer spokesman
revealed.
Yang
Weiqiang, an industry expert, said that international pharmaceutical companies
had been reluctant to invest in TCM production because it remained a mystery to
them. However, a number of European pharmaceutical firms have found that some
of the components in TCM products can be more effective than western chemical
medicines, and they are now more willing to invest in the sector.
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