NEW YORK (Reuters) - Teva Pharmaceutical Industries Ltd (TEVA.TA) has yet to make any serious inroads into China, but its chief executive believes the company is better suited than its rival drugmakers to serve the world's fastest growing health care market.
Teva is late to the party in China as most major drugmakers over the past several years have poured resources into establishing a presence in a country that IMS Health has forecast will become the world's second biggest healthcare market, behind the United States, by 2016. Big investors in the country include Pfizer (PFE.N), Novartis NOVN.VX and AstraZeneca (AZN.L).
Pfizer, for example, has two research and development facilities in China and last year formed a joint venture with Zhejiang Hisun Pharmaceuticals (600267.SS) to manufacture and sell off-patent medicines in China.
But Teva believes it has just what the doctor ordered to become a major player in Chinese health care.
The need for cheap generic drugs in the nation with the world's largest population - many from poor, rural areas - certainly plays into Teva's strengths as the No. 1 maker of generics. And Teva's specialty medicines, with a focus in part on respiratory treatments, could also become critical to a nation battling illness from industrial air pollution.
"Our portfolio more closely matches the needs of that nation than nearly any other company in the world," Teva CEO Jeremy Levin told the Reuters Health Summit in a telephone interview on Monday.
Levin, a former Bristol-Myers Squibb (BMY.N) executive who this week celebrates his first anniversary as the CEO of Israel's largest company, has said expanding into China represents an enormous opportunity for Teva as he works to reshape the company and position it for future growth.
"As the healthcare system changes in China, we certainly will be looking to embark on ways of bringing what the Chinese government and Chinese companies want," he said.
"Teva has been extremely successful in understanding the cultures that it works in," Levin said. "We have no intent on being one size fits all across the globe."
Levin, speaking from Tel Aviv, said he was excited by Teva's enormous global footprint when he took over the company.
"It was exceptionally gratifying to me to find with very few exceptions that Teva had not only established a presence but had a thriving business," he said. The exceptions he noted - Brazil and China - represent two of the world's most important and fastest growing emerging markets.
Levin will rely on his own past experience as he charts a course for Teva into China
"I have had the opportunity to participate in several companies' attempts to get substantively in China," the South African-born industry veteran said.
Another area of potential future growth that Levin found to be a pleasant surprise in studying the company as he took the helm last year was over the counter (OTC) medicines sold in a joint venture with U.S. healthcare conglomerate Procter & Gamble (PG.N).
"I am now absolutely convinced that this is a very important opportunity for both Procter & Gamble and Teva. I had no expectations of this. I simply wanted to see how it could work," Levin said.
OTC products currently represent about 5 percent of Teva's revenue and profit, but is the fastest growing segment of the company's diverse businesses.
"Over the years it could become a very substantial portion," Levin predicted.
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Reporting by Bill Berkrot; additional reporting by Ben Hirschler; Editing by Phil Berlowitz