The world’s biggest food group Nestle is moving into traditional Chinese medicine by joining forces with Chinese pharmacy group Chi-Med, the Swiss group said on Wednesday.
The new entity, called Nutrition Science Partners (NSP), is to be owned equally by the two parties, Nestle said in a statement, without revealing any of the financials behind the deal.
NSP will research, develop, make and sell nutritional and medicinal products derived from botanical plants, it said.
The joint venture will also hand Nestle’s Health Science division, which is handling the deal, access to Chi-Med’s traditional Chinese medicine library, which with more than 50,000 extracts from more than 1,200 different herbal plants is one of the world’s largest, the statement said.
Initially, the product focus will be on gastro-intestinal health -- a market worth up to US$6 billion according to Chi-Med -- but could in future expand into metabolic diseases and brain health, Nestle said.
For Chi-Med, the deal, which is still subject to regulatory approvals, will bring “a stream of novel botanical medicines and nutritional products to market and in so doing build significant value for patients and for our shareholders,” company chief executive Christian Hogg said on a conference call.