At a signing ceremony in Shanghai, the two companies announced the collaboration would focus on the area of drug tracers and health services via the internet.
Both will explore the area together by utilizing e-commerce pharmaceuticals and artificial intelligence.
The collaboration will begin with Alibaba Health's drug tracking platform, combining Merck's expertise in diabetes, thyroid abnormalities and cardiovascular disease with Alibaba Health in the online healthcare domain.
The two companies also unveiled plans to explore the deployment of online health care services, including Direct-to-Patient models, as well as the activation of Artificial Intelligence on the application of health care.
The Double H (Health and Happiness) strategy implemented at the Alibaba Group's health services is aimed at providing accessible, affordable and fair health services, utilizing its own healthcare ecosystem and innovative technology.
The cooperation of Alibaba and Merck is in line with the Chinese government's policy of encouraging the development of medical technology. It has become the nation's highest priority development strategy, through the "Healthy China 2030" initiative as a long-term strategic plan in the realm of health.