Two deals this week signify the increasing importance of the Chinese healthcare market for biopharmaceutical companies. Swiss biopharma Nycomed acquired 51 percent of Guangdong Techpool Bio-Pharma for $210 million, significantly expanding its presence in China.

 

Nycomed gains access to a fast-growing manufacturer of biologic and protein-based drugs with international potential and a commercialization base for Nycomed products in China. “Techpool's specialty franchise is highly complementary to Nycomed's development strategy and will become a cornerstone of our international expansion in emerging markets,” says Hakan Bjorklund, CEO of Nycomed.

 

Techpool specializes in the research, development, manufacturing and marketing of biologic drugs derived from natural sources. Techpool's products are sold across China and exported to a number of countries and regions, including Japan and South Korea. The company has also built a strong intellectual property position, with 35 patents filed, of which 17 have already been granted, including one U.S. patent approval. Shanghai Pharmaceutical Group, a leading Chinese pharmaceutical conglomerate, holds 41 percent of the shares of Techpool and has previously been the majority shareholder.

 

The second China-focused deal involves a partnership between Simcere Pharmaceutical Group and Bristol-Myers Squibb to co-develop a preclinical therapeutic for the treatment of cancer. Under the terms of their agreement, Simcere will have exclusive rights to develop and commercialize BMS-817378, a small molecule MET/VEGFR-2 inhibitor, in China while Bristol-Myers will retain exclusive rights in all other markets. The partners will determine the strategic development together, which will initially be conducted by Simcere. Financial terms were not disclosed.

 

The partnership represents a creative approach to accelerate a preclinical oncology compound to clinical proof-of-concept by leveraging the complementary strengths of a Chinese pharmaceutical company and a global pharmaceutical company, according to Bristol-Myers.

Simcere Pharmaceutical Group specializes in the development, manufacturing, and marketing of branded generic and proprietary pharmaceuticals in China. Its shares are traded on the New York Stock Exchange.

 

McKesson’s acquisition of US Oncology was the biggest deal of the week, valued at $2.2 billion, including the assumption of debt. McKesson, a healthcare services and information technology provider, will purchase all outstanding shares of US Oncology, an integrated oncology company, for cash. The deal strengthens McKesson’s solutions offerings in oncology, one of the fastest-growing segments in healthcare. The deal is expected to close by the end of the year.

 

Hungarian pharmaceutical Gedeon Richter acquired the oral contraceptive business of German pharma Grünenthal for $330 million in cash. The deal is a strategic fit for Richter to both strengthen its presence in Western European markets and expand its oral contraceptive product portfolio and follows its recent acquisition of Swiss pharma PregLem. The companies have agreed to complete the technology transfer before late 2012, prior to which Grünenthal will manufacture and supply to Richter the products for all markets.

 

Finally, the biggest funder this week was the U.S. government, awarding more than $1 billion in grants and tax credits to hundreds of small life sciences companies developing new therapies, diagnostics, and medical devices to treat unmet needs; prevent, detect or treat chronic or acute diseases and conditions; reduce the long-term growth of healthcare costs in the United States; or significantly advance the goal of curing cancer within 30 years. A full list of Qualifying Therapeutic Discover Project grant and credit recipients is available here.  


DEALS FOR THE WEEK ENDING NOVEMBER 5