GlaxoSmithKline (GSK) and Jiangsu Walvax Biotech Company (Walvax) announced a cooperation agreement to form a long-term Joint Venture (JV) to develop and manufacture paediatric vaccines for use in China. The JV will produce vaccines for measles, mumps, and rubella (MMR) (Priorix) and potentially other paediatric vaccines. GSK will also transfer the technology to enable the JV to manufacture the vaccines locally over time.

"This JV further builds on GSK's global business model which has fostered innovative partnerships to develop and deliver vaccines all over the world," said Jean Stephenne, president of GSK Biologicals. "In China, GSK is establishing local production capacity with a leading vaccine manufacturer and developer, in advance of the significant expansion in the Chinese public vaccine market. Together with Walvax, we can support China's goals to accelerate vaccination and save children from preventable diseases."

In addition to the technology transfer, the JV will build a new manufacturing facility for GSK's paediatric vaccine Priorix and once the facility is operational, the JV will supply the vaccines to China's public vaccine market.

Once the JV is formed, upon fulfilment of a number of conditions, a total of £41.2m will be invested into the JV. GSK will initially invest £20.1m at incorporation and an additional £7.3m will be invested in 2015. Walvax will invest a total of £13.8 million. Equity interest will be divided 65% and 35% between GSK and Walvax respectively with provisions enabling both parties to revise their equity share in the future.

"This collaboration will allow Walvax and GSK to produce lifesaving vaccines to help meet China's need for MMR vaccines," said Liu Hong-Yan, chairman of Walvax. "The JV will strengthen our vaccine R&D efforts and build our capacity to increase children's access to vaccines, one of the most cost-effective health interventions available."

Walvax is an affiliate of Yunnan Walvax Biotech Co, Ltd, China's second largest manufacturer of Haemophilus influenzae type b (Hib) conjugate vaccine. With more than 400 employees, the company has been driving biotechnology vaccine innovation and development in China for over eight years. Walvax has significant expertise in freeze-drying technologies, which make vaccine preservation and transportation easier.

The JV further expands GSK's presence in China. In June of this year, GSK also signed an agreement with Chinese biotech company Shenzhen Neptunus Interlong Bio-Technique Co, Ltd, to develop and manufacture flu vaccines.

Despite the existence of an MMR vaccine for years, measles remains a leading cause of death among young children worldwide. According to the World Health Organization (WHO), 197,000 people worldwide died of measles in 2007; more than 95 per cent of these deaths occurred in low-income countries. Following its pledge to eradicate measles by 2012, the Chinese Ministry of Health incorporated MMR vaccine into its Expanded Programme on Immunization (EPI) in 2008.