The Straits Times / The Business Times News on AsiaPharm

AsiaPharm using foreign tie-ups to boost image

CHINA-BASED drug maker AsiaPharm Group sees a bright future for the mainland's drug industry but believes tie-ups with foreign firms are vital to overcoming perceptions of low industry standards.

The mainboard-listed firm is following that prescription exactly.

This year alone, it has signed collaborative agreements with four international pharmaceutical groups, including Switzerland's Sochinaz and Italy's Biomedica Foscama, to manufacture and distribute drugs in Asia and Europe.

AsiaPharm has also established a partnership with GEA-NUS Pharmaceutical Process Research Laboratory to jointly develop lovastatin controlled-release pellets, which are cholesterol-reducing drugs.

AsiaPharm's executive chairman, Mr Liu Dianbo, said such tie-ups are part of AsiaPharm's strategy to change perceptions of the low industry standards of pharmaceutical companies in China.

'China's pharma industry has bright prospects,' he said. 'Our economy is doing well. Our standards are rising, and in the future, I believe the Chinese pharma industry will be able to manufacture generic drugs cheaply.'

He acknowledged there are Chinese firms that might not meet international industry standards.

But these weaker companies, he said, would be eliminated by the influx of multinational companies (MNCs) which have increased investments in China's pharmaceutical industry.

He said these MNCs have raised the bar to international standards and intensified competition, and thus, strong China firms that meet such standards will stand to gain.

Mr Liu said as a result of intensifying competition, smaller drug companies in China now focus on very specific areas such as research and development, sales or distribution in a bid to carve out a niche.

He added it was critical that companies keep a close watch on 'industry happenings' and know which sector the Chinese government is encouraging, so as to capitalise on emerging market trends.

AsiaPharm's profit in the first quarter shot up by 54.8 per cent to 15.56 million yuan (S$3.2 million) from a year ago.

Its shares dropped 0.5 cent to 60 cents yesterday.