Schering-Plough has gained a foothold in China after acquiring the shares of its joint venture partners Shanghai Pharmaceutical Industry and Shanghai Pharmaceutical Group, in a move deemed by chief Fred Hassan to be part of the US giant’s “long-term global geographic expansion strategy”.

The new firm will be known as Shanghai Schering-Plough and will focus on the field of allergy/respiratory, cardiovascular, central nervous system, skin care, oncology, infectious diseases and women’s health.

A number of pharmaceutical companies are targeting China for future growth as they pursue innovation at a lower cost. This, however, is only part of the equation as China also offers huge patient populations, as well as a growing incidence and spread of chronic disease.

Terms of the deal, which will also see S-P acquire a drug manufacturing plant in Shanghai, were not disclosed but are not believed to be material to earnings.