Polish pharmaceutical distribution giant Neuca has found itself at the center of a contentious debate following reports of a potential acquisition by Chinese investors. The company, which commands a substantial 30% share of the pharmaceutical wholesale market in Poland, has sparked concerns among experts regarding the implications of such a deal.
While investors may see the Chinese acquisition as a lucrative opportunity, critics worry about the potential risks to national security, foreign relations, and the delicate balance between Poland’s healthcare system and corporate greed.
Neuca S.A., a public company listed on the Warsaw stock exchange (Ticker: NEU), was founded by the Herba family 30 years ago. The conglomerate currently has an annual revenue stream of nearly 3 billion USD and employs 5k employees.
Since the Polish right winged ‘Law and Justice Party’ rose to power in 2015, the conglomerate has grown by 400%, rumored to be a derivative of aggressive lobbying in the government and favorable legislation.
The pharmaceutical giant’s potential buyer is the People’s Republic of China, a one-party state ruled by the Chinese Communist Party (CCP) that operates via government proxies in the form of corporations. Based on Chinese law, the CCP and military are supreme entities, thus above all personal and corporate considerations. This means the populace of 1.4 billion citizens, and all industry and infrastructure are to serve the CCP and military. The country prohibits women from having more than 2 children, thus wealthy Chinese “capitalist” investors are naturally considered communists at birth, and agents of the CCP and military apparatus during their ongoing years.
Polish Anti-Competitive Legislation
There are currently 38m citizens serviced by 12,000 pharmacies in Poland. The larger companies purchase from multiple wholesalers, while a third of the Polish pharma market numbering 4000 branches procure their medicine exclusively from Neuca.
Recently, the Polish Government made amendments to ‘The Pharmaceutical Law’ and ‘Drug Reimbursement Act’ (known as ADA and ADA2), which further strengthens Neuca’s wholesale position within the market.
To understand the changes of the pharma laws in simple laymen terms, the newer ADA law amendments prevent companies from creating pharmaceutical franchise chains or owning more than 5 branches. In addition, the bill prohibits existing pharmacy owners from transferring ownership or selling their businesses.
More concerning to existing prescription drug retailers, the ADA legislation allows the Polish Provincial Pharmaceutical Inspectors the right to retroactively revoke existing pharmacy licenses, essentially putting them out of business. Industry insiders claim these newer provisions will soon lead to the closure of 1,000 pharmacies and cost the economy over 6,000 professional pharmaceutical jobs.
The ADA legislation essentially hinders the pharmacy industry’s ability to grow in branches and clientele, thereby reducing their purchasing power or ability to negotiate favorable discounted deals in bulk for medicine and medical devices. According to industry insiders, the only way for pharma businesses in Poland to acquire advantageous discounts for medicine is by signing long-term service agreements with Neuca.
Will China buy 30% of Poland’s Medicine Market?
Whispers of Neuca’s sale to Chinese investors (potentially Sinopharm) have raised concerns across Poland and beyond. The recently passed anti-competitive pharmaceutical laws have a distinct smell of monopolistic corruption at the government level because they only benefit Neuca.
The Asian’s, reportedly backed by powerful party leaders within the communist party Government, are rumored to have joined Neuca in spending considerable amounts of money to lobby Poland’s legislative body to pass the ADA laws.
Various government and industry insiders who agreed to speak on condition of anonymity claim that Waldemar Buda, the Polish Minister of Development and Technology, was the main driving force behind the amendments to the Ada legislation.
Since Poland is a member of the European Union (EU), the potential Chinese takeover also reverberates within the context of EU-USA-China relations, impacting the delicate balance of power between these global players.
In 2018, the Trump Administration announced sanctions, tariffs, and importation barriers against the communist nation. The Biden administration has not only kept the penalties in place against China, but also considerably increased them, cementing one of the few issues both Republicans and Democrats agree on.
As Poland navigates this complex terrain, the outcome of the Neuca acquisition could send ripples not only through the nation but also across the wider international stage.
The main concern is if Poland is willing to sell China 30% of their healthcare sector against expressed US policy, will it lead to unfavorable access to the Whitehouse and American Congress.
Assuming the EU eventually adopts similar trade and importation embargos (as the USA) against China, then the sale of Neuca would consequently affect local supply chains causing a hike in medicine prices.
Private EU and USA Citizen Medical Data Shared with China
Outside of Poland, the Neuca Group has collaborated with thousands of doctors, treated over 300,000 patients, and boasts more than 90 Clinical Research Centers spread across 5 European countries (Germany, Bulgaria, the Czech Republic, Germany, Spain and Ukraine).
OncoBay Clinical Inc, a subsidiary of Neuca, is an American company specializing in immuno-oncology research. The potential acquisition by Chinese investors have raised a chorus of concerns by their US employed staff, highlighting potential risks that could reverberate across both healthcare and national security sectors. It’s fair to assume the sensitive medical data and payment information of Europeans, both in Poland and other EU countries, will reside on Chinese computers servers allowing the communist regime full access to their private medical history.
It’s important to note China does not have a great history of securing medicine, sensitive data, or medical devices. Experts recently testified and produced evidence to a congressional oversite committee describing how China’s government destroyed samples, hid records, imprisoned Chinese journalists, and actively engaged in the spread of misinformation to cover up the Covid-19 pandemic.
Dr. Robert Redfield, former director of the U.S. Centers for Disease Control and Prevention (CDC), testified before Congress that the science indicates all COVID-19 related illnesses, including the infection of over a billion people globally causing the untimely deaths of over 10m, were the result of a lab leak in Wuhan, China.
Earlier this month, Joe Biden issued a Presidential executive order banning U.S. investments flowing into China’s technology sectors. The purchase of the Polish company Neuca would de-facto allow the Chinese communist party via OncoBay Clinical Inc. the ability to defy the Presidential order and give the Chinese communist regime access to American medical research and private sensitive medical history pertaining to US citizens.
Based on the Wuhan lab leak and China’s negative track record of medical related deception, the Polish government needs to re-consider exporting 30% of their medicine supplies market to the communist regime.
Traditionally, the Chinese are best known for intellectual property theft, human rights abuses, and purchasing cheap electronics on Alibaba. More recently, the communist regime has added to their dubious resume infecting the entire world with Covid-19, a deadly disease that infected 1 billion innocent people that caused the untimely death of tens of millions globally, while subsequently causing worldwide lockdowns resulting in poverty and social distancing.