China's Shanghai Pharmaceuticals Holding has agreed to buy the Chinese business of NYSE-listed Cardinal Health for $557 million in cash, potentially making it the largest distributor of imported drugs in the country.
Cardinal Health was the eighth largest drug distributor in China in 2016 across 13 cities and supplying 11,000 medical institutions. The US firm’s sales in China have grown 12.8% year-on-year in 2017 but its earnings slipped 13.2%.
The acquisition boosts Shanghai Pharma’s market share in pharma distribution by about 1%, based on data from Ministry of Commerce. The deal also bolsters its geographical network and broadens its product mix.