GlaxoSmithKline (NYSE:
GSK) will begin manufacturing its treatment for flu, Relenza, in China to supply China's domestic market. GSK received approval of the drug in September from the SFDA. Relenza, like Tamiflu from Roche (SW: RO), aims at reducing both the severity and the duration of flu symptoms, though some resistance to the drugs seems to be evident.
The move by GSK reflects the larger trend of big pharmas' interest in providing basic medicines to China, a trend that seems to be gaining momentum.
GSK said it has taken a "three-pronged" approach in China to fight the H1N1 flu epidemic by producing vaccines, Relenza and anti-viral face masks.
GSK projects that it will sell 450-500 million doses of its H1N1 flu vaccine and 60 million packs of Relenza from Q4 of 2009 through 2010.
The company has been adding vaccine capacity in China through partnering with China companies. In June, GSK announced a $78 million JV with Shenzhen Neptunus Interlong Bio-Technique Co. Ltd. to develop flu vaccines. GSK paid $31 million, which includes its vaccine adjuvant technology, for a 40% stake in the company, while NIBT will contribute $47 million in assets. GSK has the right to gain majority control of the JV in the first five years.
In October, GSK established a $65 million JV with Jiangsu Walvax Biotech Company that will focus on pediatric vaccines for the China market. GSK will provide $32 million of the capitalization, part of which is Priorix™, GSK's pediatric vaccine for measles, mumps and rubella (MMR), the JV's initial product. The JV will build a new manufacturing facility, and it plans to extend its operations to include other pediatric vaccines over time.
