GlaxoSmithKline (GSK) entered into a strategic alliance with Dong-A Pharmaceuticals Co, Ltd (Dong-A), number one pharmaceutical and OTC Company in South Korea. As part of the transaction, GSK will acquire a 9.9 per cent minority equity shareholding in Dong-A for £73.9m (KRW 142.9bn).
Dong-A has a portfolio of proprietary and generic pharmaceutical products and leading consumer healthcare brands. Last year, Dong-A reported total sales of £414 million (KRW 801 bn).
The alliance will initially co-promote selected GSK and Dong-A pharmaceutical products for use in primary care. Additional synergies will be explored to strengthen both companies’ commercial positions within the Korean pharmaceutical market.
Under the terms of the agreement the companies will share profits generated from the co-promoted products above pre-agreed baselines. A new business unit will be created within Dong-A to manage the collaboration.
Christophe Weber, senior vice president & regional director of Asia Pacific, GlaxoSmithKline said, “With Dong-A’s market-leading position and expertise in Korea, this alliance presents a significant opportunity for GSK to extend its commercial footprint and build operational scale in this fast growing Asian market.”
Won-Bae Kim, the president of Dong-A said, “Together with GSK, we have built an excellent win-win alliance. This collaboration is expected to improve our market competitiveness in the fast changing domestic and global pharmaceutical markets. It will enable us to accelerate our transformation into a true global player taking advantage of GSK’s excellent product pipeline as well as their global marketing/operational expertise and standards.”
Closing of the transaction is subject to fulfilment of certain conditions as agreed between GSK and Dong-A.