Carlyle hires former J&J China executive

The private equity firm is the latest to bulk up in healthcare deal-making by hiring Jesse Wu as an adviser to buyouts.

The Carlyle Group said on Tuesday it had hired former Johnson & Johnson China chairman Jesse Wu to boost its ability to seal deals in China’s fast-growing healthcare industry.

Previously the first local chairman of the US pharma giant's China operation, Wu will now advise the Washington-headquartered private equity firm on potential buyouts in China, drawing on his 30 years’ of experience in healthcare and related sectors.

The hire comes at a time when the healthcare industry is growing quickly in China and other venture capital and private equity firms are looking to get in at the ground floor in sectors such as biotech.

China’s enormous healthcare market continues to expand rapidly, driven by an aging population, economic growth and expanding basic health insurance. In 2013, healthcare expenditure in China hit RMB3.2 trillion ($493 billion), maintaining an annual growth rate of 17.2% over the past nine years.

There is overwhelming demand in China’s healthcare sector, which is exerting a huge amount of pressure on the under-resourced state medical system.

“I see fundamental changes happening in this space, ranging from changing demographic trends to more favorable regulatory reforms, as well as exciting, new technologies and treatments,” Wu said in a statement.

Bain Capital said in March it had bought a majority stake in a private hospital group in China as the country’s population ages fast and strained public services struggle to offer specialist care. 

Running a healthcare business in China has also been fraught with risk as China has clamped down on bribery in sales of prescription drugs to doctors working for state-run hospitals.

Born in Taiwan, Wu joined J&J in 1989 as finance director in Taiwan.

He later became chairman of J&J China, a new country-wide role, in 2013. His role included serving as J&J’s point person in interactions with the Chinese government. He was a member of the company’s management committee from 2013 to 2016.

J&J had about 9,000 staff in China and about $2.8 billion in annual revenues as of January 2014.

During his 26 years at Johnson & Johnson, Wu served across multiple roles, including as worldwide chairman of the J&J consumer group and company group chairman for global markets.

Under his tenure, J&J suffered a flood of product recalls in its consumer division soon after acquiring Pfizer in 2006.

Earlier in his career, Wu worked at Procter & Gamble and PepsiCo.

“Jesse will be a great resource for our team and our portfolio companies as we continue to expand our investments in the fast-growing healthcare sector and other related industries in China and across Asia,” X.D. Yang, co-head of the Carlyle Asia buyout team said in a statement.

Wu will advise Carlyle on investment opportunities in the healthcare and related sectors as well as on changes in China’s healthcare policy. Carlyle will also draw on his expertise to evaluate prospective investment targets’ management teams, and mentor them after Carlyle invests.

Carlyle’s buyout team in Asia has already invested more than $1.3 billion of equity in seven healthcare companies across the Asia-Pacific region.

Its investments include Chinese medical examinations firm Meinian Onehealth, Zhongmei Healthcare, MicroPort Scientific and Haier Bio-Medical and Laboratory Products in China. It has also invested in pathology laboratories chain Metropolis Healthcare in India; and Healthscope in Australia.

The firm has several investment professionals focused on Asian healthcare and consumer deals including managing director Janine Feng. Takaomi Tomioka is a managing director on the Japan buyout team advising on Japanese buyout opportunities in the consumer and healthcare sectors. Yutaka Nishimura, an operating executive with the Japan buyout team, is a specialist in both the consumer and healthcare sectors.

Globally, Carlyle has invested more than $8.4 billion of equity in over 50 investments in the healthcare sector.

¬ Haymarket Media Limited. All rights reserved.
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