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Financial Times Examines Novartis’s Health Express Project In China

“As global pharmaceutical companies increasingly look to China and other emerging markets to make up for lackluster sales in the developed world, they are working to build an image as corporate good guys,” the Financial Times writes. The newspaper examines “Novartis’s Health Express project in Xinjiang — which has extended basic health education to 50,000 schoolchildren and trained 260 infectious disease physicians” as “part of [an] attempt to use corporate social responsibility to build a brand in a region that has gone from zero to almost universal health insurance coverage in recent years.” According to the newspaper, “Joe Jimenez, Novartis’s chief executive, says simply donating medicines to those in need is no longer enough. He wants a form of corporate social responsibility that is ‘sustainable’ — sustainable enough to survive his tenure in the top job.” The newspaper continues, “To that end, the Health Express project includes a field sales force selling basic drugs in rural areas on a zero-profit basis: that is, profits get ploughed back into hiring more sales staff, so that foreign medicines can be made available in areas where they otherwise would not be.”

“‘We are leveraging [the project] for sales, and we are proud of that,’ said Mr. Jimenez on a recent trip to Urumqi, the capital of Xinjiang,” the Financial Times writes. “Novartis does not break out figures for its sales in China, although Mr. Jimenez said sales grew 20 percent last year, and China was in Novartis’s top 10 markets,” the newspaper notes, adding, “The company will also not disclose its investment in the Health Express project, which is a public-private partnership with the Xinjiang government (Esquel, a Hong Kong textile group, is also involved).” The newspaper continues, “Jimenez makes clear that Novartis’s financial commitment is not large: it is more about transferring knowledge than transferring cash, for example training infectious disease physicians how to diagnose hepatitis B, a significant problem in China” (Waldmeir/Yan, 6/17).