Fosun Pharma joins Shenzhen government to raise US$700 million healthcare fund to invest in biomedicine innovation

Fosun Pharma teams up with Shenzhen government to raise 5-billion yuan fund to invest in start-ups and innovations in cellular biology, genetics and related fields
Fund aligns with Shenzhen government’s plan to develop the city into a healthcare manufacturing hub, says Fosun Pharma

Shenzhen

Peggy Sito

Published: 7:00pm, 14 Mar 2024

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One of China’s biggest pharmaceutical producers will team up with Shenzhen’s government to raise a 5-billion yuan (US$700 million) healthcare fund to invest in start-ups and innovations in cellular biology, genetics and other fields related to biomedicine.

Fosun Pharma said its subsidiaries, namely Fuxin Shenyao, Fosun Pharma (Shenzhen) and Fujian Fund Management, will join the Shenzhen Guidance Fund in launching the fund. It will have a duration of 10 years, according to an announcement by Fosun Pharma on Thursday.

The Guidance Fund, which is controlled by the municipal government of southern China’s technology centre, will subscribe to half of the as yet unnamed fund.

At least 70 per cent of the fund will be allocated to the biomedical industry, aligning with the Shenzhen government’s plan to develop the city into a healthcare manufacturing hub, according to the announcement.

The city is already home to 140 large biopharmaceutical firms, of which 11 are publicly listed, eight have revenues exceeding 1 billion yuan and four enjoy turnover of above 10 billion yuan, according to data released by the Shenzhen government in December.

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The biopharmaceutical industry in Shenzhen contributed 14 billion yuan to the local economy in the first three quarters of last year, according to official data.

In December 2023, Fosun Pharma established its Greater Bay Area headquarters in Shenzhen, showcasing its confidence in the city’s potential.

The company said the municipal government has introduced a series of measures over the past two years to promote the development of the biomedicine and general health industries. It expects the government will continue to enhance industrial policies to support the sector.

Fosun Pharma emphasised its intention to increase its investments in biomedicine, precision medicine and related fields, leveraging the support from the Shenzhen authorities.

Fuxin Shenyao, a subsidiary indirectly controlled by Fosun Pharma, will serve as the general partner of the 5-billion-yuan healthcare fund and will oversee its day-to-day operations. The fund will aim to attract non-local enterprises to invest in biomedical firms in Shenzhen and provide support to small and medium-sized enterprises in the city.

It will also strive to obtain the relevant approvals needed for clinical drug trials and registration certificates.

Overseas companies such as Siemens Healthineers have set up bases in Shenzhen since the early 2000s. Last year, the German medical technology company reportedly said it would invest at least 1 billion yuan to set up a new research and production site in the city, marking its second such facility in the southern metropolis.

Fuxin Shenyao plans to invest 20 million yuan in the new fund. Fosun Pharma’s two wholly owned subsidiaries, Fujian Fund Management and Fosun Pharma Fosun (Shenzhen), will together invest in 1.48 billion yuan, and the remaining 1 billion yuan will be mainly contributed by other district governments in the city.

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