Group 1 - Haleon has completed the acquisition of the remaining 12% stake in China-SK Pharmaceutical Co., Ltd, marking the end of a nearly 40-year joint venture with a total transaction value of 1.623 billion yuan [1][2] - The joint venture, established in 1984, was set to last until June 30, 2025, but the lifting of foreign ownership restrictions in China allowed Haleon to take full control [2] - The separation signifies a shift in the business landscape, as joint ventures have become less adaptable to the evolving strategies of multinational pharmaceutical companies [1][3] Group 2 - China-SK has been a significant player in the Chinese pharmaceutical market, focusing on pain management, respiratory health, skin health, and digestive health, with well-known brands such as Fenbid and New Contac [3][4] - Following the acquisition, Haleon plans to enhance its development strategy for China-SK, leveraging its strong brand portfolio and established sales network while investing in product lines based on consumer demand [4][5] - China is a key market for Haleon, driving global growth and enhancing brand competitiveness, with the acquisition seen as a major milestone in deepening its commitment to the Chinese market [5]

Core Viewpoint - The acquisition of the remaining 12% stake in the joint venture China-US Tianjin Schering Pharmaceutical Co., Ltd. by Heliang marks the end of a nearly 40-year partnership, allowing Heliang to fully control the company and strengthen its position in the Chinese OTC market [1][2]. Group 1: Company Acquisition - Heliang has completed the acquisition of the remaining 12% stake in China-US Tianjin Schering, making it a wholly-owned subsidiary [1]. - The acquisition process involved two transactions in September 2024, where Heliang increased its stake from 55% to 88% by acquiring shares from Darentang and Tianjin Pharmaceutical Group [1]. - The joint venture was originally established in 1987 by GSK and local partners, and Heliang became an independent company after spinning off from GSK in July 2022 [1][2]. Group 2: Market Position and Strategy - China has become the second-largest health consumption market globally, providing significant opportunities for multinational companies focused on consumer health [2]. - Heliang's full acquisition of China-US Tianjin Schering will enhance its presence in the OTC drug sector in China [2]. - The company has been expanding its regional market presence by establishing subsidiaries in cities like Chengdu, Xi'an, Shanghai, and Guangzhou to penetrate lower-tier markets [2]. Group 3: Consumer Trends and Product Development - There is an increasing demand for nutritional health products, particularly those that boost immunity, driven by rising health awareness among consumers [3]. - Heliang aims to maintain flexibility and responsiveness in a rapidly changing market, focusing on continuous innovation to build consumer trust [3]. - The OTC and nutritional health product markets are influenced by various factors, including product functionality, pricing, and brand trust, necessitating ongoing innovation to capture market share [3].

Core Insights - The Chinese pharmaceutical market has undergone significant changes over the past 40 years, with foreign pharmaceutical companies adjusting their strategies as the joint venture model may no longer be suitable for current market dynamics [1][3] - Heliang has completed the acquisition of the remaining 12% stake in its OTC joint venture, China-US Tianjin Schering Pharmaceutical Co., Ltd. (referred to as "China-US Schering"), making it a wholly-owned subsidiary and ending nearly 40 years of joint venture history [1][3] - The acquisition enhances Heliang's position in the Chinese OTC market, which is experiencing growing consumer demand for health products, making China the second-largest health consumption market globally, after the United States [3] Company Developments - Heliang's acquisition of China-US Schering involved two transactions in September 2024, increasing its stake from 55% to 88% through the transfer of shares from Darentang (13%) and Tianjin Pharmaceutical Group (20%) [1] - China-US Schering focuses on pain management, respiratory health, skin health, and digestive health, with brands like Fenbid, New Contac, and Fufang [3] - Heliang has established subsidiaries in cities like Chengdu, Xi'an, Shanghai, and Guangzhou to enhance product penetration in lower-tier markets [3] Market Trends - There is an increasing demand among Chinese consumers for health products, particularly in the nutrition and immune-boosting segments, driven by heightened health awareness [4] - Heliang, having spun off from GSK in 2022, aims to maintain flexibility and responsiveness in a rapidly changing market, facing diverse consumer preferences and intense competition [4] - The OTC and nutritional health product markets are directly consumer-facing, requiring companies to innovate continuously to build trust and meet complex consumer decision-making factors [4]

Group 1 - Haleon has completed the acquisition of the remaining 12% stake in its OTC joint venture, China-SK Pharmaceutical Co., Ltd., making it a wholly-owned subsidiary [1] - The acquisition signifies Haleon's commitment to the Chinese market, which is crucial for driving global growth and enhancing brand competitiveness [1] - China-SK has a strong historical presence and is recognized for its brands in pain management, respiratory health, skin health, and digestive health [1] Group 2 - Haleon aims to enhance daily health with its mission and will continue to support the innovation and development of OTC products in China [2] - The company plans to deepen its channel layout to reach a broader consumer base with its health products and services [2] - Haleon's product portfolio includes six core categories: oral health, nutritional health, pain management, respiratory health, digestive health, and skin health [3]