GSK Expands Presence in China

RNS Number : 2972A

GlaxoSmithKline PLC

06 October 2009

 



 Issued: Tuesday 06 October 2009, London UK

GSK Expands Presence in China through strategic
cooperation to form a Joint Venture on Paediatric Vaccines 

London (UK), October 6, 2009 - GlaxoSmithKline (GSK) and Jiangsu Walvax Biotech Company (Walvax) today 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.¹  According to the World Health Organization (WHO), 197,000 people worldwide died of measles in 2007; more than 95% of these deaths occurred in low-income countries.² Following its pledge to eradicate measles by 2012,³ the Chinese Ministry of Health incorporated MMR vaccine into its Expanded Programme on Immunization (EPI) in 2008. 

Simon Bicknell

Company Secretary

6 October 2009

About Measles Mumps Rubella (MMR)

Measles, mumps and rubella are three serious viral diseases that threaten the health of millions of individuals worldwide and cause enormous distress. Measles alone affects over 20 million people every year and is a leading killer among vaccine-preventable childhood diseases. Even in countries with adequate healthcare, this highly contagious disease can cause significant, often fatal, complications including pneumonia and encephalitis. While death from mumps is rare, it can be associated with a number of serious complications, such as meningitis and encephalitis, especially in older individuals. In children, rubella can be overlooked or misdiagnosed due to mild, variable symptoms, but it can cause a number of significant complications in adults including arthritis/arthralgia and encephalitis. However, the main problem with rubella results from infection during early pregnancy. This can result in congenital rubella syndrome (CRS) and lead to abortion, miscarriage and stillbirth, with many children suffering blindness, deafness or mental disabilities.

Walvax - one of the most progressive vaccine manufacturers in China. Yunnan Walvax was  inaugurated in January 2001 and is dedicated to the R&D, manufacturing, marketing and sales of human vaccines in China. A certified hi-tech company in Yunnan Province with a registered capital of more than US$11M, Jiangsu Walvax was launched in April of 2009 to develop viral vaccines in Taizhou, Jiangsu Province. 

GlaxoSmithKline - one of the world's leading research-based pharmaceutical and healthcare companies - is committed to improving the quality of human life by enabling people to do more, feel better and live longer. For further information please visit www.gsk.com

Enquiries:
UK Media enquiries:	Philip Thomson	[phone]
	Claire Brough	[phone]
	Stephen Rea	[phone]
	Alexandra Harrison	[phone]
	Gwenan White	[phone]
US Media enquiries:	Nancy Pekarek	[phone]
	Mary Anne Rhyne	[phone]
	Kevin Colgan	[phone]
	Lisa Behrens	[phone]
European Analyst/Investor enquiries:	David Mawdsley	[phone]
	Sally Ferguson	[phone]
	Gary Davies	[phone]
US Analyst/ Investor enquiries:	Tom Curry	[phone]
	Jen Hill Baxter	[phone]

Cautionary statement regarding forward-looking statements Under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, GSK cautions investors that any forward-looking statements or projections made by GSK, including those made in this announcement, are subject to risks and uncertainties that may cause actual results to differ materially from those projected. Factors that may affect GSK' s operations are described under 'Risk Factors' in the 'Business Review' in the company' s Annual Report on Form 20-F for 2008.

1 World Health Organization. (2008). Measles Fact Sheet. Available at http://www.who.int/mediacentre/factsheets/fs286/en/index.html Last Accessed: 17 September 2009 

2 Ibid

3 World Health Organization - Western Pacific Regional Office. (2009). Vaccinating China's children.  Available at:  http://www.wpro.who.int/china/sites/epi/overview.htm. Last accessed: 17 September 2009 

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