Generic drug sector developing

The chief executive of Sandoz, the German-based unit of Swiss pharmaceuticals giant Novartis AG, came to China twice this year to seek new business opportunities stemming from the pending reform of China's healthcare system.

Jeffrey George, the global CEO of generic medicine maker Sandoz, cited the quality and affordable price of generic drugs versus higher-priced patented medicines.

The lower cost of generic medicines has made them increasingly popular in developing countries, George said.

Making more generic drugs available in China also is in line with China's three-year, 850 billion yuan medical reform package, which is being designed to provide more accessible and affordable healthcare to the country's 1.3 billion people.

"We have been continuously focused on driving the costs down. This year alone, Sandoz cut billions of dollars in costs so we can offer lower prices," George said.

"Our aim is to help Chinese people acquire high-quality medicines," he said. "Our principle is offering the best quality at an affordable price."

George cited recent developments by the company's parent, Novartis AG, to grow Sandoz's reach in China.

"Novartis just announced they will make a $1 billion investment in a research and development center in Shanghai within five years, which then will be the company's third-largest R&D center in the world," George said.

"We will do more on the development side than the research side, since our objective is to create localized business," he added.

Sandoz operates a manufacturing plant in Zhongshan, Guangdong province, with more them 300 employees.

"Our plant is just part of our plan. We want to build a whole value chain in China," said Nathan Pang, CEO of Sandoz China.

"If we can make it happen, it will be a great step for us in lowering costs, but that doesn't mean we will have different quality standards in China. We insist on the same standard of quality all over the world. That is our key to success," Pang said.

George said Sandoz can help demonstrate high production standards in China.

"We would like to help the Chinese government to raise the standards for quality in the generic medicine market, which will benefit consumers," he said.

Sandoz last year acquired EBEWE Pharma for $1.3 billion.

George said the company will benefit from about $470 billion worth of original medicines losing their patents by 2015, which then will open the door to lower-cost makers of generic versions of the drugs.

Sandoz sales in 2008 totaled $76 billion, the company reported. Sandoz employs more than 23,000 people in 130 countries. The company has about 390 employees in China.

(China Daily 12/05/2009 page8)