Fresenius makes a flurry of deals in Chinese dialysis clinics and hospitals

China flag against blue sky
According to estimates, only half of China's 1 million registered patients with end-stage renal disease are receiving dialysis treatment, with the total number growing 15-20% per year. (SW1994/Pixabay)

Fresenius Medical Care has moved to dramatically widen its footprint in China’s dialysis market, acquiring large shares in multiple Chinese companies and hospital systems across the country.

The German company bought a 70% share of the dialysis-focused Guangzhou KangNiDaiSi Medical Investment Co., which is currently building three independent treatment centers in Guangzhou and Zhaoqing in southeast China, with a proposal for a fourth awaiting government approval.

Fresenius also netted 55% stakes in Henan Aishen Hospital Management Co. and Aishen Beijing Hospital Management Co., which are building 13 more dialysis centers and a grade I renal hospital.

That will add to Henan Aishen and Aishen Beijing’s dialysis care network spanning the country’s Henan, Shandong, Guangdong and Hainan provinces. Finally, Fresenius also acquired a 60% share in Daqing Kangda Dialysis Center Co., in the northeastern Heilongjiang province.

“These acquisitions mark an important strategic step in our business development in China,” Fresenius CEO Rice Powell said in a statement. “As the second largest product market, China is already today an important business growth driver for Fresenius Medical Care.

The flurry of acquisitions follows up on its 2017 purchase of Yunnan Kunming Wuhua Healthcare Hospital, as well as newly disclosed acquisitions of 70% shares apiece in Sichuan Hejiang Kangcheng Renal Hospital and Sichuan Ziyang Zhongxin Hospital, both in the Sichuan province, from this past summer.

“We have been continuously investing in enhancing our product range within the local market. We have also started to enter the provider business to introduce advanced dialysis services and operations management in China,” Powell said.

Chronic kidney disease affects just over 10% of China’s population, totaling more than 120 million people, Fresenius said. Citing figures from the Chinese Society of Nephrology, the company says there are currently 1 million registered patients with end-stage renal disease, but only about half receive dialysis treatment.

“As a leading provider of dialysis products and services in China, we are eager to work with other companies that are dedicated to elevating the treatment of kidney disease in this huge country,” said Harry de Wit, CEO of Fresenius Medical Care Asia-Pacific. “In particular, we focus on increasing access to treatment in rural areas, where there have traditionally been fewer options for patients.”

In a note to clients, analysts at Bernstein said the Chinese dialysis market ranks second behind the U.S. in terms of patient count, and estimated that the number of China’s dialysis patients is currently growing between 15% and 20% per year.