Tue, 05/27/2008 - 19:05
Shoe giant takes leap towards Chinese vaccine industry
Shanghai. May 27. INTERFAX-CHINA - Aokang Group, China's largest privately owned shoe producer, will branch into the pharmaceutical sector by producing and marketing rabies and meningococcal polysaccharide vaccines from next year, a company official told Interfax yesterday.
"Kanghua Biological [an Aokang Group subsidiary] is expected to obtain production approvals for the vaccines, and start production next year," Wang Hailong, director of Aokang Group's public relations department, said. Its facilities will be able to produce 10 million rabies vaccines and 20 million meningococcal polysaccharide vaccines. Aokang Group's shift into the pharmaceutical sector will help it establish a new growth point, he added.
The rabies vaccine is one of the most commonly used vaccines in China, second only to the flu vaccine. An earlier report by Goldstate Securities states that over 10 million rabies vaccines were sold in China over 2007, with an annual sales value of RMB 400 million ($57.64 million).
With the incidence of rabies increasing over the past few years, supply of the rabies vaccine in China has been unable to meet demand. "We hope to become the largest rabies vaccine supplier in China," Wang said.
Aokang Group is also hoping to enter the government's expanded program on immunization (EPI) to ensure stable sales of its meningococcal polysaccharide vaccine, he said. In 2007, Chinese companies supplied 40 million meningococcal polysaccharide vaccines, generating RMB 100 million ($14.41 million) in sales over the year. The go-ahead to enter this program is still uncertain as Aokang Group will need to bid for a production license.
Due to an increase in trade conflict cases between Chinese shoe producers and western companies, many small and medium-sized shoe producers in Zhejiang and Guangdong provinces are struggling to make ends meet. Coupled with factors like increasing raw material costs, electricity shortages and Renminbi appreciation, many shoe producers are now trying to enter other industries.
-KZ
