Editor’s note: In 2017, the acquisition of India’s Gland Pharma became a milestone event of Fosun Pharma’s internationalization. Today, the People’s Daily published an article titled “Fosun Pharma’s acquisition of Gland Pharma sets an example for cooperation between China and India in advantageous industries” in the headlines of the news page. The article called the “transnational marriage” between Fosun Pharma and Gland Pharma a win-win situation. Li Baijun, Economic and Commercial Counselor of the Chinese Embassy in India, praised Fosun Pharma’s acquisition of Gland Pharma as a model of win-win cooperation between two advantageous industries of the two countries and called on Chinese and Indian pharmaceutical companies to seize opportunities to grow bigger and stronger together. In response to this, Chen Qiyu, Co-President of Fosun International and Chairman of Fosun Pharma, said that Fosun Pharma will guide its leadership with its 4IN strategy (innovation, internationalization, intelligence, integration), adhere to a development model of endogenous growth, extensional expansion, and integrated development, and unswervingly “pour its heart into making medicine!”

The original article is as follows:

Shanghai Fosun Pharmaceutical (Group) Co., Ltd. (Fosun Pharma) acquired Gland Pharma Limited of India last year for USD 1.09 billion, setting the record for the largest single-transaction Chinese investment in India. It was also the largest overseas acquisition made by a Chinese pharmaceutical company last year. A few days ago, our reporter visited Gland Pharma in Hyderabad, India to conduct interviews. The company’s CEO, Ravi, wittily likened the acquisition to a “transnational marriage”. In his opinion, the marriage of an Indian and Chinese pharmaceutical company was not an arranged marriage or a hastily decided marriage. The two parties have been freely in love for nearly two years and were able to tie the knot as they wished. Their relationship can stand the test of time. He said that the prospect of cooperation between India and China in the pharmaceutical industry was worth looking forward to.

Same development direction and mutual support in the face of difficulties

Gland Pharma, which was acquired by Fosun Pharma, is a global expert in the production of injections. According to data from Landing Law Office in India, more than 65 types of injections produced by Gland Pharma have entered the United States market, and more than 150 types of products are in circulation outside the markets of the United States and Europe. Fosun Pharma’s acquisition of Gland Pharma will help further increase its product supply capacity and market share.

Although it was a Saturday when the reporter visited, the LCD screen at the entrance of the loading workshop of Gland Pharma’s workshop showed that 8 of the company’s 11 production lines were in operation. The first thing to catch the reporter’s attention at the production lines was the preparation bottle inspector in a sterile suit. She picked up 100 transparent sample bottles in front of her one by one and injected the test liquid into them. After shaking them, she observed them carefully in front of the test lamp to determine if they really were clean. These sample bottles came from the preparation bottle cleaning workshop, which was on the other side of the window to the inspector. There, thousands of preparation bottles are heated to 350 degrees Celsius in mechanical devices and then allowed to cool down to 45 degrees Celsius. They are manually inspected after that, and the qualification rate is extremely strict. Whenever the standards are not met, the entire batch must be cleaned again.

According to Ravi, Gland Pharma was the first Indian injection manufacturer to be certified by the United States Food and Drug Administration, and heparin and heparin sodium were the company’s flagship products. The company leads the industry in the development and production of related products in India.

In an interview with our reporter, Chen Qiyu, Co-President of Fosun International and Chairman of Fosun Pharma, said that Gland Pharma, which has a history of 40 years, is India’s largest injection manufacturer and has a leading position in the world. The acquisition of Gland Pharma will allow Fosun Pharma to expand quickly in the European and American markets and also realizes good synergies with the company’s existing injection product line. Ravi believes this acquisition is a win-win situation. “Gland Pharma’s experience in the production of preparations and the acquisition of European and American certification approvals can help Fosun Pharma reach go international. At the same time, Fosun Pharma will also bring its strengths in biopharmaceutical research and development to India, injecting vitality into the Indian biopharmaceutical market.”

What factors prompted the companies of the two countries to join hands? Ravi said, “This was made possible by the trust between Gland Pharma and Fosun Pharma after dealing with each other for a long time. This trust comes from the consistency of both parties’ corporate development direction, as well as the mutual support provided in times of difficulty.” Meanwhile, Chen Qiyu believed that China and India had the same willingness to deepen economic and trade cooperation. India’s 2016 policy to further relax foreign direct investment has also made overseas investors, including Chinese companies, more confident in India.

While Fosun Pharma’s acquisition of Gland Pharma for more than USD 1 billion was a big deal, it was only a microcosm of the pharmaceutical cooperation between China and India. During an interview in Hyderabad, the reporter found that this Indian “city of medicine” has always had close economic and trade exchanges with China. The related industries of the two countries have traded raw materials, pharmaceutical intermediates, and medical devices for more than ten years. Zou Lan, who has been involved in the Sino-Indian medicine trade in Hyderabad and Shenzhen for a long time, told our reporter that China and India were both countries that made and consumed a lot of pharmaceutical products, and that they were both highly dependent on each other. In the past, India mainly imported raw materials from China and then produced and sold pharmaceutical products. In recent years, as China has imposed stricter environmental protection requirements on the pharmaceutical industry, the Chinese pharmaceutical industry has begun to import active pharmaceutical ingredients from India, and many Indian factories also hope to register their products in China to open up the Chinese market.

Commenting on the prospects of Sino-Indian pharmaceutical cooperation, Chen Qiyu believed that the complementarity of Sino-Indian cooperation was reflected in many aspects, such as the research and development of novel drugs, in which China is developing very rapidly. In recent years, as the Chinese government continued to promote the creation of major novel drugs, coupled with the capital promotion of China’s pharmaceutical market and the advantages of domestic and overseas medical talents, China’s novel drugs have been catching up with great strides. “At present, China has become the world’s second largest pharmaceutical market. Compared with the local Indian market, Chinese pharmaceutical companies have more innovation opportunities and greater room for development. India has a head start in expanding into the international pharmaceutical market and has more experience. If the Chinese and Indian pharmaceutical industry have stronger cooperation, it is completely foreseeable that they can become a new force in the development and promotion of novel drugs in the international market, which would weaken the monopoly of Western pharmaceutical companies.”

Li Baijun, Economic and Commercial Counselor of the Chinese Embassy in India, was optimistic about the development trend of Sino-Indian pharmaceutical trade. He said that the bilateral trade volume between China and India reached a new high of USD 84.4 billion, of which the total bilateral pharmaceutical trade amounted to USD 6.27 billion, a y-o-y increase of 13.5%, making India China’s fourth largest pharmaceutical trading partner and China’s largest exporter of active pharmaceutical ingredients. On this basis, the two countries are formulating specific measures to strengthen bilateral pharmaceutical trade cooperation and bring more Indian drugs into the Chinese market, and so on. Li Baijun believed that Fosun Pharma’s acquisition of Gland Pharma was an example of win-win cooperation between China and India’s advantageous industries, especially in the context of the Chinese government’s implementation of zero tariffs on imported anti-cancer drugs and the encouragement of innovative drug research and development. He believed that Chinese and Indian pharmaceutical companies should seize the opportunity to increase cooperation and work together to make the pharmaceutical industry bigger and stronger.

(People’s Daily, Hyderabad, India)