Medicine Maker Moves into Joint Venture with State Firm

China NT Pharma (1011) plans to set up up a 200-million-yuan (HK$250 million) joint venture with Sinopharm Group (1099) to distribute its vaccines and cold-chain products.

The Shanghai-based medicine maker has signed of memorandum of understanding with state-owned Sinopharm to cooperate on sales and promote two of China NT Pharma's products.

The firms will set up a special purpose vehicle, with Beijing-based Sinopharm holding 70 percent and BT Pharma the remainder.

Subsidiary firms in Beijing and Guangzhou are also planned.

NT Pharma has been trying to exit the low-margin vaccine business since last year due to strict regulations and a challenging operating environment.

But it said the vaccine and cold-chain product assets it still owns will provide a strategic platform for Sinopharm, which wants expand in these areas.

Sinopharm, meanwhile, said it sold H shares worth HK$4 billion on Thursday to expand its distribution and retail network. The 166 million Hong Kong-traded shares, representing a 6.5-percent stake, were HK$24.60 each - an 8.89-percent discount on Wednesday's closing.

That action came after the firm issued corporate bonds worth 4 billion yuan.

Sinopharm shares fell 7.2 percent to HK$25.05 on Thursday. Those of NT Pharma were suspended.