Sundia MediTech and Shanghai United PharmaTech Appear to be the first in a new trend.
Sundia MediTech and Shanghai United PharmaTech report that they will be merging. This is a first for China’s young CRO industry, acording to Sundia’s CEO, Wang Xiaochuan, Ph.D. Both Xiaochuan and United PharmaTech’s CEO, Shi Xiongwei, Ph.D., signed a letter of intent agreeing to combine their two companies.
Under the terms of the merger, both United PharmaTech and Sundia MediTech will become subsidiaries of Sundia Investment Group, the British Virgin Islands-based holding company that currently owns Sundia MediTech. Dr. Wang will become the new company’s chairman and CEO, while Dr. Shi will hold the positions of director and executive vp. The former senior management teams of both companies will join together into a new, combined management team.
Zhang Suyang, a partner of IDG VC, said that he believes China’s drug development CRO industry is beginning to emerge from its initial state into one in which companies will begin to consolidate.
“The CRO companies, and the overall size of the CRO industry in China are still relatively small, and there is huge potential for growth, so we can expect that in the following few years there will be many mergers,” explained Zhang. “Companies in this industry will grow quickly and soon; we will see companies of reasonable size and with good governance emerge as corporations with serious long-term potential.” Part of the reason for the merger, noted Dr. Wang, is that it will combine United PharmaTech’s and Sundia’s technical expertise in different fields.
