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CRL buys back into China research models market

By Gareth Macdonald , 08-Nov-2012
Last updated on 08-Nov-2012 at 12:21 GMT2012-11-08T12:21:24Z

CRL re-invests in China

CRL re-invests in China

Charles River Laboratories (CRL) has acquired a stake in Beijing-based Vital River predicting an uptick in Chinese research models market.

The deal – which saw CRL pay $27m for a 75 per cent stake – will see the US contract research organisation (CRO) take control of Vital River, which has been a local distributor of its research models for the last decade.

CLR’s investment in Vital fits others it has made this year – such as the investment in IT and the acquisition of Accugenix in August - but it marks something of a turnaround in its attitude to China.

While initially enthusiastic about the country’s preclinical services market, in 2010 CRL started scaling back its presence in China.

The firm sold its research models site to Shangpharma in 2011 just months after CEO James Foster told investors the establishment of China's preclinical services market was “going to take a lot longer than we all expected.”

Evidently, CRL thinks things are now picking up. Foster said during the firms Q3 conference call last month that: “We expect demand for research models in China to significantly increase over the next several years as drug development initiatives in academia, government and biopharmaceutical companies expand.”

He went on to explain that the idea is to sell to international companies working in China that are already clients as well as well as government institutions and academics groups.

AstraZeneca in China

The Vital investment comes weeks after CRL confirmed its strategic partnership with AstraZeneca , which established the US CRO as preferred toxicology, safety pharmacology, and development DMPK.

That announcement followed two days after the Anglo-Swedish drugmaker formed a partnership with China-based Pharmaron in a deal focused on chemistry, drug metabolism and pharmacokinetics (DMPK), and efficacy screening services.

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