To Create High-end Medical R&D Pattern by Win-win Cooperation

Fosun Pharma & Lonza Jointly Invest Zhangjiang Hi-tech Park

On September 6th, 2011, Fosun Pharma announced its cooperation in Shanghai with the world’s leading supplier Lonza Group based on Swiss who specializes in pharmaceutical, healthcare and life sciences industries to institute a joint venture in Zhangjiang to jointly develop the high-tech barrier medicine which urgent needed in Chinese market. It is learned that the first phase investment of the two sides reached RMB 100 million, and the medicine for initial R&D aims at anti-tumor, anti-infective, cardio-vesicular diseases, and other therapeutic fields.

The related leaders from Shanghai Food and Drug Administration, Shanghai Pudong New District Government, Shanghai Zhangjiang Administrative Commission attended the signatory ceremony and delivered their congratulations in the day. According to the introduction of Mr. Ding Lei, Executive Vice-Director of Shanghai Zhangjiang Administrative Commission and General Manager of Shanghai Zhangjiang (Group) Co., Ltd, so far, over 210 pharmaceutical enterprises from China and overseas, dozens of state-level pharmaceutical R&D institutions, global R&D centers from multi-national countries have gathered to Zhangjiang “Medicine Valley”. As an “National Shanghai Bio-medical Science & Technology industry base “ established by Ministry of Science and Technology, Ministry of Health, State Food and Drug Administration, Chinese Academy of Sciences, as well as the Municipal Government of Shanghai, Zhangjiang High-tech Park is undertaking the state mission of accelerating the innovative development for biomedicine. In his addressing, Mr. Ding Lei said, “According to currently innovative development demand for biomedicine, we shall provide necessary support and assistant to enterprises who registered in Zhangjiang high-tech Park for its development. We shall target the forefront international biomedicine technology; we shall explore the innovative pattern and the internationalization development strategy for biomedicine industry; we shall dock with high quality capital and projects and we shall take the new development opportunity to promote the development and construction for biomedicine industry in Shanghai Zhangjiang High-tech Park.

In recent years, Fosun Pharma has continuously brought innovative initiatives to pharmaceutical industry development and has achievement rapid progresses. Fosun Pharma is a private- owned listed enterprise cultivated in Shanghai, and now the company becomes the front runner in Chinese pharmaceutical industry. As a private-owned listed company, Fosun Pharma highlights the pharmaceutical & healthcare industry and bases upon the fast growth of Chinese pharmaceutical market, meanwhile, Fosun Pharma follows the method of endogenous growth, denotative expansion and integrated development, as well as innovation and internationalization oriented to vigorously develop strategic product, so as to build a global pharmaceutical & healthcare enterprise with international competitiveness. Lonza Group is an enterprise advanced in global technology and its scale, it specializes in API R&D and CMO with more than 100 years experiences, the company has led the world in terms of core pharmaceutical technology, API R&D as well as production process including small molecule, polypeptide, large molecules, histology and other various fields.

Mr. Harry Boot, Member of Administrative Commission of Lonza Group, expressed that “with more than one year communication with Fosun Pharma, we are impressed by the company’s standard, transparent internal management, and the company’s strong corporate social responsibility, as well as the company’s innovative management team, therefore, we choose Fosun Pharma as the first option as Lonza’s long-term strategic cooperation partner. Furthermore, introduce molecule drugs into the abbreviated new drug market is exactly in line with our strategy of more close to patient, and it tightly follows our steps toward the abbreviated new drug market. We shall together with Fosun Pharma to provide safe, effective, good quality and competitive drugs for Chinese patient; meanwhile, when create value for Chinese abbreviated new drug market, we continue to maintain the intellectual property for our existing customers.

Profit from the rapid growth of Chinese economic and the new reform of medical service in China, Chinese pharmaceutical market will welcome the golden ten years. IMS estimates that China will become the global second biggest pharmaceutical market in around 2020. In the meantime, the peak expiration time for global drug patent is in the next five years, that is to say, the patents for more than USD 160bilion sales volume drugs shall expire during 2011 to 2015, which shall bring great opportunities to pharmaceutical enterprises in China. However, these drugs often has very high technical barriers, the purpose of the two sides hand in hand cooperation is to seize the fast-growing market opportunity to develop much good quality drugs with more reasonable prices, so as to benefit Chinese patients. 

Mr. Li Xian Lin, Senior Vice President of Fosun Pharma and Chairman of Pharmaceutical Management Committee, indicated that “Global patent drugs are mostly owned by multi-national pharmaceutical enterprises, and the price for those drugs usually is very high. To lower the load of patients and society, Fosun Pharma is proactively seeking for cooperation with well-known pharmaceutical enterprises through combining its own advantages. Over the years, Fosun Pharma continuously inputs investment in innovation, and institutes the R&D system which combined abbreviated new drugs and innovative drugs in terms of cardio-vesicular disease, metabolism anti-infective, anti-tumor, central nerve system and hepatopathy, and other priority fields, meanwhile, Fosun Pharma has also created certain advantage in above described fields. We believe the cooperation with Lonza Group shall further strengthen Fosun Pharma’s innovative capability in Pharmaceutical manufacturing, promote Fosun Pharma’s industrial competitiveness, and truly combine the both parties advantage in respect of brand, technology, as well as distribution network to realize win-win cooperation and to achieve greater success in Chinese market and global market.

Appendix: Two Parties Presentations

Brief of Fosun Pharma

Shanghai Fosun Pharmaceutical (Group) Co., Ltd, founded in 1994 and listed on Shanghai Stock Exchange in August, 1998, is a listed company specializes in pharmaceutical and healthcare industry. At present, Fosun Pharma’s business covers pharmaceutical R&D and manufacturing, medical commerce, diagnoses product, medical devices and medical services; the company is a large-scale professional pharmaceutical enterprise group with large scale and leading market position in China.

As of 2010, Fosun Pharma realized total assets of RMB16.8 billion and net assets of RMB8.4billion; meanwhile, it also realized annual business income of RMB 4.55 billion and net profits of RMB 860 million; furthermore, the company’s sales revenue, net profits, and the market value of shares all rank top in listed Chinese pharmaceutical enterprises.

In terms of pharmaceutical, Fosun Pharma owns state-level enterprise technology center and ranks top in segment markets of hepatopathy, diabetes mellitus, tuberculosis, and anti-malaria drugs, etc.

Fosun Pharma established an ambitious & strategic planning to integrate company’s existing advantages with global resources, so as to become the magnate in Chinese market and eventually achieve the leading position in global mainstream medical market.

Brief of Lonza Group

Lonza Group is one of world’s leading suppliers to pharmaceutical, healthcare, and life sciences industries. The company’s product and service span its customer’s needs from R&D to final product manufacture. It is the global leader in the production and support of active pharmaceutical ingredients both chemically as well as biotechnologically. Biopharmaceuticals are one of the key growth drivers of the pharmaceutical and biotechnology industries. Lonza has strong capabilities in large and small molecules, peptides, amino acids and niche bio products which play an important role in the development of novel medicines and healthcare products. In addition, Lonza is a leader in cell-based research, endotoxin detection and cell therapy manufacturing. Furthermore, the company is a leading provider of value chemical and biotech ingredients to the nutrition, hygiene, preservation, agro-chemicals and personal care markets.

Lonza is headquartered in Basel, Switzerland and is listed on the SWX Swiss Exchange. In 2010, the company had sales of CHF 2.6