BAD HOMBURG, Germany—Fresenius Medical Care AG said July 23 that it has signed a long-term distribution deal in Japan, and intends to expand its presence in Korea through an acquisition.
The 10-year exclusive distribution agreement is with Japanese distributor Nikkiso Co. Ltd. for Fresenius’ dialysis products, particularly dialyzers and peritoneal dialysis products.
In addition, Fresenius said it intends to expand its presence in the Republic of Korea's dialysis product market by acquiring Nikkiso Medical Korea Co. Ltd., a wholly owned subsidiary of Nikkiso Co. Ltd.
The acquired operations will add approximately $15 million in annual revenue and are expected to be accretive to earnings in the first year after closing of the transaction, according to Fresenius.
"The strategic alliance with Nikkiso will generate significant value to both parties in Japan and Korea, as each company is concentrating on its strengths in these markets," said Roberto Fuste, Fresenius CEO for the Asia-Pacific region.
Japan has approximately 300,000 dialysis patients, according to Fresenius, and the annual patient growth rate is around 2 percent to 3 percent. In Japan, Fresenius is active in the dialysis product business by means of its own sales and marketing channels as well as through distribution partners. The company also provides consulting services for dialysis clinics. However, it does not directly operate dialysis clinics in Japan due to legal restrictions.
The Republic of Korea is has approximately 50,000 patients with an annual growth rate of 6 percent to 7 percent, according to Fresenius. Fresenius is a player in the Republic of Korea's dialysis product market and, through its partnership with the Yeolin-Medical Foundation, is currently treating more than 850 patients in 16 dialysis clinics.
