GlaxoSmithKline (GSK) plans to expand its sales force in China as the Chinese government makes drugs more widely accessible – even though prices are being cut.
So said GSK Chief Executive Officer Andrew Witty in Beijing on Monday.
Bloomberg news reported that Witty is prepared to expand its Chinese sales force of some 4,000 by “a few hundred” in order to increase sales and make up for lower prices being paid for those drugs.
“Nobody likes prices cuts,” Witty told Bloomberg. “But in the overarching context, this is a growing marketplace and the government’s initiatives are not just to reduce prices but also to increase access.”
Witty is in Beijing for talks about approval of new drugs. Three were OK’d for sale in China last year.
GSK also is looking to make acquisitions in China. It bought a Chinese firm in December 2010 for some $70 million. However, Witty said GSK is being cautious about making buys.
“Of course M&A is part of the agenda for China,” he said. “One of the reasons we’ve done less M&A in the last 18 months is because we think valuations are overheated. Certainly that can be true in China, but it’s less true in China than some other places, like India for example.”
GSK announced the forming of a joint venture in Japan last week to develop vaccines.
Read the Bloomberg report here.
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