Bayer to strengthen its commitment to TCM industry

Bayer, the German healthcare solution provider, has vowed to strengthen its commitment to the traditional Chinese medicine industry in order to benefit more consumers.

"Firmly bearing the mission of 'Science For A Better Life', Bayer will deepen its collaboration with local partners and focus on innovation to provide more advanced self-care solutions for the Chinese people," said Richard He, vice-president and head of marketing and innovation at Bayer Consumer Health.

Bayer started operating in China in 1882. It entered the TCM market by acquiring a 100 percent stake in privately held, Yunnan province-based Dihon Pharmaceutical Group for 3.6 billion yuan ($526.6 million) in November 2014.

The acquisition expanded Bayer's portfolio with well-known consumer brands, greatly strengthening its position in the Chinese over-the-counter industry against multinational competitors, according to the company.

Bayer's first over-the-counter TCM-based ointment for menstruation-related cramps, produced by Bayer's Majinpu factory in Kunming, Yunnan province, was introduced to Chinese consumers on June 23.

Leslie Huang, vice-president and head of sales at Bayer Consumer Health, said that the launch marked a major milestone in the company's development in China.

"Bayer will enthusiastically seize opportunities in the TCM market," said Huang.

In addition to bringing in capital, Bayer is also keen to bring its global production and operation standards into the Chinese market to boost efforts to upgrade the TCM industry.

The Majinpu factory, the company's second-largest OTC manufacturing facility in the Asia-Pacific region, was upgraded according to Bayer's standards. The upgrade cost 1.4 billion yuan in total, according to Bayer.

The first phase - designed for TCM production - was put into operation in 2016 and has been certified in accordance with Good Manufacturing Practice standards.

Bayer also applies strict standards in raw material quality control and sustainability to ensure the quality of its final products.

"By focusing our efforts on the key areas of safety, quality, efficacy, sustainability, responsible sourcing, access and benefit sharing, we are establishing a foundation that will guide our business and serve as an example to the industry," He said.

Looking ahead, Bayer is optimistic about the development of China's TCM market.

"It is widely accepted and a well-adopted practice that consumers are using both Western medicine and TCM as complementary ways of managing their health. So we believe TCM and Western medicine can help each other to offer better self-care solutions to Chinese consumers," He said.

"TCM makes up about half of the OTC segment in China and is a well-accepted and sought-after line of natural, science-based alternative therapies for consumers looking for trusted solutions for their self-care needs," He said.

A report from consulting firm IMS Health shows that the scale of China's OTC drugs market reached 17.42 billion yuan in 2015, increasing 6 percent from 2014.

The government's support for TCM also provides tremendous business opportunities for Bayer.

The Chinese central government issued the Healthy China 2030 blueprint in 2016, aiming to develop China's healthcare capability, promote health management and disease prevention, enhance healthcare services and develop healthcare-related industries.

"We will spare no efforts to support Healthy China 2030," Huang said. "We believe a medical solution provider should not only focus on selling medicines to people. It has to bear a social responsibility: promoting the concepts of self-care, disease prevention and health management," Huang said.

Bayer has made significant investment in TCM products' research and development over the past two years.

Its Chengdu Naturals Research Center in Sichuan province - which was developed by Dihon - is being upgraded to meet increasing Chinese and global business demands.

He said Bayer will consider promoting TCM to the global market at the appropriate time. However, the company will focus on seizing opportunities in the Chinese market for now.

"Our primary effort is to strive to be one of the best-in-class operators in the TCM market in China, with a focus on ensuring a high-standard approach across everything we do, from raw material sourcing, environmental sustainability and consistent manufacturing processes, in order to deliver trustworthy, safe and effective products to Chinese consumers."