Japan drugmaker Shionogi to tie up with Ping An as eyes China expansion (updated)

Ping An Healthcare and Technology Co

30/03/2020 09:02

(Adds company statement in 3rd paragraph, details throughout.)
    TOKYO, March 30 (Reuters) - Japan's Shionogi & Co  4507.T ,
creator of the blockbuster cholesterol treatment Crestor, said
on Monday it would tie up with Ping An Insurance Group Co of
China  601318.SS , selling a 2.05% voting stake for 33.53
billion yen ($311 million).
    Shionogi will form a joint venture with the Chinese group's
unit, Ping An Life Insurance of China Ltd, with the aim of
discovering and distributing new drugs and developing generic
ones as it looks to expand in China, it said in a statement.
    "To attain our growth strategy beyond 2020, we must realize
the expansion of our business in China, which is expected to
show the greatest pharmaceutical market growth in the world over
the next 10 years," Shionogi said in the statement.
    Shionogi, which gains roughly half its revenue from
royalties, posted four-straight years of record operating profit
through 2019. It focuses on infectious diseases but a looming
patent cliff for its HIV treatments will create an earnings gap
that will be hard to completely offset.  urn:newsml:reuters.com:*:nL4N23P2AP
    Ping An Insurance Group, China's largest insurer by market
value, said in February it expected the coronavirus outbreak to
affect its business in the first half. 
    The group's Good Doctor  1833.HK  subsidiary is ramping up
its online doctor consultation business in Asia as the virus
spread spurs demand. Japans' SoftBank Group  9984.T  has
invested in Good Doctor and the two formed a healthcare joint
venture last year.  urn:newsml:reuters.com:*:nL4N2AK32N  urn:newsml:reuters.com:*:nL4N2BH1TQ
    Shionogi's shares rose 2.8% in Tokyo trading before the
announcement, versus a 1.6% drop in the broader market.

 ($1 = 107.7200 yen)

 (Reporting by Chang-Ran Kim and Rocky Swift in Tokyo; editing
by Emelia Sithole-Matarise)
 ((ran.kim@thomsonreuters.com; +81-3-4563-2740;))