Chugai Pharmaceutical has formed a capital and business alliance with global pharmaceutical giant Roche, maintaining independent management while concentrating its resources on drug discovery. Under the alliance, it has entrusted overseas clinical trials and sales to Roche and has increased profits in Japan.
Over the past quarter-century, Chugai Pharmaceutical has grown from a mid-sized domestic company into a highly profitable business. The turning point was its 2002 capital and business alliance with Roche. It transferred a majority of its shares while entrusting overseas clinical trials and sales to Roche under terms that allowed it to maintain independent management.
The alliance is said to have helped revenue expand approximately eightfold and operating profit increase 23-fold. While leveraging Roche's capital strength and global reach, Chugai concentrated its management resources on drug discovery and developed its own strengths.
At the heart of the alliance was a structure that allowed Chugai to maintain its independence while becoming part of a global corporation. Chugai chose to use external capital while pursuing long-term growth by strengthening its drug-discovery capabilities.