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INTERVIEW - Merck says growth in China could exceed mkt pace

A view of the Merck & Co campus in Linden, New Jersey March 9, 2009. REUTERS/Jeff Zelevansky/Files

BEIJING (Reuters) - Drug giant Merck & Co IncMRK.N expects to grow as fast or faster than China's broader pahrmaceutical market, now expanding by more than 20 percent each year, as Beijing rolls out a new healthcare system and an emerging middle class spends more money on medicine.

Rapid expansion of medical spending in China, where the government is introducing a new health safety net to replace the defunct socialist system, could help propel China to one of Merck’s top five global markets within the next 10 years, Michel Vounatsos, president of the company’s China operations, told Reuters in an interview.

“We see the China market continuing to grow strongly,” he said, estimating that the market would grow 23-25 percent this year.

“This is important for local players and also global players. We are focusing very much on growth within emerging markets, and China is a sizable part of that.”

Beijing aims to complete landmark healthcare reforms by 2020 to ensure safe and affordable medical coverage for more than 1 billion Chinese. It plans to spend 850 billion yuan ($125 billion) on the initial stage to 2011, according to state media.

China’s broader drug sales reached $34 billion in 2007, and are seen growing at 20-30 percent each year over the near term.

Reporting by Doug Young; Editing by Chris Lewis