Bayer Buys China’s Dihon to Gain OTC and Herbal Therapies

Bayer AG (BAYN) agreed to buy Dihon Pharmaceutical Group Co. to gain Chinese over-the-counter products and traditional herbal treatments as drug companies expand in Asia. “This acquisition moves us into a leading position amongst multinationals in the OTC industry in China,” Marijn Dekkers, chief executive officer of the German drugmaker, said today in a statement. “It also brings a portfolio of well-known consumer brands, which will allow us to provide consumers with an even broader range of self-care options.” Dihon’s brands include Kang Wang for dandruff, Pi Kang Wang antifungal cream and Dan E Fu Kang for women’s health. The deal underscores interest from large drugmakers in over-the-counter health products, with Merck & Co.’s consumer health business expected to fetch about $5 billion in a potential asset trade with Novartis AG, people familiar with the matter said last month. Financial terms of Bayer’s purchase weren’t disclosed. The world’s biggest drug companies have increasingly been interested in herbal treatments, including Paris-based Sanofi, which is developing related diabetes and cancer therapies. Sanofi bought Beijing-based BMP Sunstone Corp. for $520.6 million in October 2010. Bayer rose 0.5 percent to 100.85 euros at 9:50 a.m. in Frankfurt, giving the company a market value of 83.4 billion euros ($114 billion).

Herbal Treatments

The world’s biggest drug companies have increasingly been interested in herbal treatments, including Sanofi, which is developing related diabetes and cancer therapies. Sanofi already has traditional Chinese therapies after buying Beijing-based BMP Sunstone Corp. for $520.6 million in October 2010. Bayer agreed to buy all shares in closely held Dihon, which also sells products in Nigeria, Vietnam, Myanmar and Cambodia. The Kunming Yunnan, China-based company generated sales of 123 million euros ($168 million) last year and has 2,400 employees. Bayer said it expects the deal to close in the second half of the year, pending regulatory approval. Source :  http://www.bloomberg.com/news/2014-02-27/bayer-buys-china-s-dihon-to-gain-otc-and-herbal-therapies.html