GSK planning joint venture to tap into Chinese vaccine demand

In recent weeks GlaxoSmithKline ($GSK) and China have rarely featured together in a headline without the words "scandal" or "corruption." Despite the negative attention, GSK is still pressing ahead with its Chinese expansion plans, and its vaccine unit is a major part of the strategy.

Talking to Bloomberg, GSK's vaccines chief Christophe Weber outlined plans to partner with a local company to help with research and marketing. The partner would contribute its knowledge of the local market as part of a joint venture, Weber said, and talks with several companies are continuing despite the corruption scandal. GSK has used joint ventures to tap into local skills and knowledge in China before. In 2009 it teamed up with Shenzhen Neptunus on influenza vaccines, and two years later bought the Chinese partner's stake to take full control. Now, with demand for vaccines in China expected to accelerate, GSK is once again trying to set up a joint venture.

"We are keen to find a partner in China. [Over the next 10 years] the Chinese government will progressively upgrade its immunization calendar, and we want to be there and to be a partner when that happens," Weber said. The search for a Chinese partner continues GSK's vaccine strategy of teaming up with local partners. In January, GSK allied with India-based Biological E to produce a 6-in-1 vaccine to protect against polio and 5 other diseases. And in March 2012, the British Big Pharma inked a vaccine pact with Daiichi Sankyo to boost its standing in Japan.

Success in emerging markets could drive big increases in vaccine volumes at GSK, but the jabs are sold at lower prices. To increase profitability without raising prices, GSK is trying to improve manufacturing productivity. At the vaccine units headquarters in Belgium, for example, GSK is building a polio vaccine plant with more efficient technology and capacity than its existing site.

- here's the Bloomberg interview
- check out FiercePharma's take