Medical M&A deals abroad to continue
and on implementing the “Healthy China 2030” program, he said.
“According to the ‘Made in China 2025’ strategy, pharmaceutical and healthcare industries will receive favorable policies and incentives for rapid growth. Through overseas investments, Chinese companies can rapidly obtain sophisticated technology and equipment, thus improving the level of China’s medical industry,” Li said.
The “Healthy China” guidelines were issued in October last year to promote and improve healthcare to a level seen in high-income countries.
When the deals plan was announced earlier, it was touted as the biggest-ever Chinese corporate acquisition in India.
But an Indian official told Reuters that reasons for the delay in approval at the highest level “have more to do with giving control of a large pharma company to a Chinese entity that itself is facing questions from the regulators at home”.
Overseas investments by Chinese companies in the medical sector fell to just 10 deals worth $1 billion in the fourth quarter of last year, and to nine deals worth $1.26 billion in the first quarter of this year.
In January, SanPower Group Co Ltd, a private Chinese company with total assets of 120 billion yuan ($17.8 billion), signed an agreement with Canada’s Valeant Pharmaceuticals International Inc to buy 100 percent stake of US biopharmaceutical company Dendreon Corp.
In 2016, 29 Chinese pharmaceutical companies clinched outbound M&A worth $56.67 billion, significantly surpassing $34.42 billion in 2015. Five transactions were worth over $500 million each, the DTT report said.
Last year, China’s overseas and domestic healthcare M&A rose to a five-year high in terms of both the number of deals and transaction value, while globally, M&A in the sector declined.
The DTT report predicted that the domestic M&A boom is expected to continue this year.
Public hospitals, run by the government or owned by State-owned enterprises, will likely become hot targets for M&A, it said.