HANGZHOU - Pharmaceutical giant Sanofi-Aventis SA plans to double its after-tax sales in China's over-the-counter (OTC) market to 1.5 billion yuan ($223.9 million) within five years, the company's top management said on Wednesday.

The target, which demonstrates the Paris-headquartered company's determination to accelerate its expansion in China's consumer healthcare business, is mainly driven by its new joint venture with Hangzhou Minsheng Pharmaceutical Group Co Ltd and its takeover of BMP Sunstone Corp.

According to Thomas Kelly, vice-president of Sanofi-Aventis China, the company will take a 60 percent stake in the joint venture. And the new company's after-tax sales value will grow from the existing 500 million yuan to 1 billion yuan in the following five years.

"We joined hands with Minsheng because we have a good relationship and firmly believe in the brand value of 21 Super-Vita, one of the most well-known vitamin products in China," Kelly said.

Though Sanofi-Aventis ranks fifth in the global OTC market, it is still a new player in China's OTC market.

Cooperating with an established brand boasting a wide sales network is a highly efficient way to enter the market, industry analysts said.

"It is just the beginning for us to tap the OTC market, and we will continue to look at other collaboration or acquisition opportunities," Kelly said.

On Oct 28, Sanofi-Aventis agreed to buy BMP Sunstone Corp, the maker of the Hao Wawa brand of children's cough and cold treatments, for $520.6 million in cash.

Hao Wawa is China's top children's cold medicine, and BMP Sunstone also makes Kang Fu Te brand hygiene products for women, the company said.

"If the acquisition of BMP Sunstone wins the regulatory approval, our outlets in China, particularly in second and third-tier cities, will be much stronger," said Paul Leung, general manager of Hangzhou Sanofi Minsheng Consumer Healthcare Co.

The Ministry of Commerce recently gave the green light to Sanofi-Aventis' joint venture with Minsheng Pharmaceutical Group.

China's $16.7 billion consumer healthcare market is the world's second-largest after the United States and has grown 11 percent annually in the past five years, Sanofi said.

The company has been expanding in emerging markets and consumer products to replace lost revenue as patents expire on some of its best-selling pharmaceuticals.

By Hu Yuanyuan (China Daily)

(China Daily 11/04/2010 page16)