London: GlaxoSmithKline stepped up its drive into emerging markets on Tuesday by agreeing to buy a 9.9% stake in South Korea’s Dong-A Pharmaceuticals for £73.9 million ($114 million).
Emerging markets are the new battleground for the world’s top drugmakers as sales stall in Western markets.
The deal wins the British-based group an alliance with the leading pharmaceuticals and over-the-counter medicines company in South Korea — a market expected to grow around 10% a year through 2012.
Glaxo chief executive Andrew Witty has already signed a string of deals to increase his company’s footprint in key emerging markets, including taking a similar minority holding in South African Aspen Pharmacare.
The new alliance will initially co-promote selected Glaxo and Dong-A drugs for use in primary care, but the companies said that additional synergies would be explored.
Glaxo and Dong-A, which had sales last year of £414 million, will share profit from the co-promoted products above pre-agreed baselines. A new business unit will be created within Dong-A to manage the collaboration.