13/06/2024 2:46 PM

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Ping An Insurance partners with Japanese drug maker Shionogi

Ping An Insurance partners with Japanese drug maker Shionogi

Ping An Insurance Group Co. of China will partner with Japanese pharmaceutical company Shionogi & Co., taking a 2.05{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} voting stake in the drug maker for ¥33.53 billion (US$311 million).

According to a report by Reuters, Shionogi and Ping An’s life insurance arm will form a joint venture. The resulting entity aims to formulate and distribute new medications, including generic ones, as it seeks to further Shionogi’s expansion in China.

In a statement, Shionogi said that China is expected to be the fastest-growing pharmaceutical market in the world over the next 10 years. Incorporated in 1919, Shionogi is best-known for developing the anti-cholesterol drug Crestor. It earns most of its revenue from royalties, and has seen record earnings for four consecutive years, the report said. However, Shionogi’s HIV treatments are set to go off-patent soon, and the company is scrambling to fill the income gap it will create.

Ping An, meanwhile, has intensified its investments in healthcare and technology over the past few years. In 2017, it launched the US$1 billion Global Voyager Fund, which will drive the group’s investments in fintech and health.

Earlier this year, Ping An announced that it will boost its investment in technology for 2020, after it missed its earnings target for 2019. Ping An also identified the coronavirus outbreak as a major setback for its earnings, saying that it expects it to inflict a great deal of losses to its business in the first half.

Ping An’s Good Doctor business, which provides medical teleconsulting services across Asia, is seeing increased demand amid the coronavirus outbreak. Major Japanese conglomerate Softbank Group is an investor in Good Doctor, and the two formed a healthcare joint venture in 2019.

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