Shanghai Pharmaceutical Holding Co said it will acquire two drug firms for 3.8 billion yuan (US$570 million) to speed up development in the domestic market.

The Shanghai-listed unit of Shanghai Pharmaceutical Group said it will pay 1.49 billion yuan for the antibiotics business of its parent group as well as 2.33 billion yuan for a 65.24 percent stake in China Health System Ltd from six private equity firms.

China Health System is the third largest drug distributor in Beijing and the company said this move could widen its distribution channel.