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| 8-K - AOXING PHARMACEUTICAL COMPANY, INC. 8-K APRIL 26, 2010 - AOXING PHARMACEUTICAL COMPANY, INC. | caxg8k20100426.htm |
April 26,
2010
Aoxing
Pharmaceutical Company Announces Joint Venture with Johnson Matthey PLC to
Manufacture Narcotics and Neurological Pharmaceutical Products in
China
Joint
venture to begin manufacturing in 2011; Seek SFDA approval of 8 new
products
Public
signing ceremony and conference call scheduled in May 2010
New York, New York, April 26,
2010 –Aoxing Pharmaceutical Company Inc. (NYSE AMEX：AXN) (“Aoxing
Pharma”) today announced that Aoxing Pharma and Johnson Matthey Plc have entered
into an agreement to establish a joint venture through affiliated companies
focused on research, development, manufacturing and marketing of active
pharmaceutical ingredients (“API’) for narcotics and neurological drugs for the
China market. The joint venture represents a significant new
opportunity for both companies to expand their business in the rapidly growing
pharmaceutical market in China.
Under the
terms of the agreement, Macfarlan Smith Ltd, a wholly owned subsidiary of
Johnson Matthey Plc, headquartered in the United Kingdom, will contribute
technology expertise and capital to the joint venture. Hebei Aoxing
Pharmaceutical Group Company, Ltd (“Hebei Aoxing”), the operating subsidiary of
Aoxing Pharma, will contribute capital, fixed assets and related API
manufacturing licenses. The joint venture company will be called
Hebei Aoxing API Pharmaceutical Company, Ltd. Hebei Aoxing will have
a 51% stake in the Company, while Macfarlan Smith (Hong Kong) Ltd, (a wholly
owned subsidiary of Johnson Matthey Pacific Ltd), will hold 49%. Each
company will have equal representation on a board of directors that will
oversee a management team responsible for corporate strategies and
operations.
The new
joint venture will be located on the Hebei Aoxing campus in Xinle City, 200
kilometers south west of Beijing. The total capital investment is
projected to be approximately $15 million during the first five
years. The joint venture will seek cGMP approval by the China
SFDA for a dedicated manufacturing facility by the end of 2010 and plans to
begin manufacturing in the first quarter of 2011. It will initially
develop eight narcotic API products for the China market but its product range
could potentially exceed 30 products.
“We take
great pride in this joint venture with Macfarlan Smith Ltd, a world’s leader in
narcotic and controlled active pharmaceutical ingredients, said Mr. Zhenjiang
Yue, Chairman and CEO of Aoxing Pharma. “This collaboration represents a
landmark to our business as well as the greater pharmaceutical narcotics and
pain management industry in China. China is expected to emerge as the
third largest pharmaceutical market in the world over the next two years, yet
the medical use of narcotic pain relief and related products is far behind the
rest of world. The business of finished dosage narcotics in
China has been significantly hindered by the difficulty in accessing the
appropriate quality and quantities of APIs. We believe the time is
right for both companies to take this innovative step to embrace this
significant market opportunity. Furthermore, this joint venture will
strengthen our finished dosage product business and has the potential to more
than double our current product pipeline while also adding to our bottom line in
2011 with the initial manufacturing of API in the dedicated facility, for which
we intend to rapidly seek China SFDA approval. We intend to continue
seeking international business collaborations to expand our pipeline and product
opportunities with companies seeking to access the China
markets.”
Commenting on the joint venture, Roger Kilburn, Managing Director of
Macfarlan Smith Ltd said:
“We are
very pleased to be entering into this joint venture with Hebei Aoxing
Pharmaceutical Group Ltd. China presents significant growth opportunities for
narcotic active pharmaceutical ingredients, a field in which Macfarlan Smith has
world leading technology and has accumulated many years of manufacturing know
how. We look forward to working in partnership with Hebei Aoxing to
develop a range of high quality, high technology API products to serve the
growing market for pain management and other narcotic based medicines in
China.”
Closing
of the transaction is subject to various conditions, including approval of the
Chinese regulators.
About
Pharmaceutical Narcotics API and Pharmaceutical Narcotics Market
Based on
reports from the International Narcotics Control Board, the production and
consumption of narcotics API products experienced steady growth over the last
decade. A preliminary estimate indicates that the API market size of
the top twelve pharmaceutical narcotics was over $1 billion USD worldwide in
2008, while the entire market in China was valued at $20 million USD during the
same period. On the other hand, the market size of finished dosage
narcotics pharmaceutical products was estimated over $10 billion USD in 2007,
and the China market was estimated at $420 million USD in 2007 with a CAGR of
28.5% from 2002-07.
Conference
Call
The
Company will hold a conference call in May to discuss more details of the joint
venture, when both Aoxing Pharma and Johnson Matthey PLC host a public signing
ceremony in China. A separate press release will be announced in due
course.
###
About
Aoxing Pharmaceutical Company, Inc.
Aoxing
Pharmaceutical Company, Inc is a US incorporated specialty pharmaceutical
company with its main operations in China, specializing in research,
development, manufacturing and distribution of a variety of narcotics and
pain-management products. Headquartered in Shijiazhuang City, outside
Beijing, Aoxing has the largest and most advanced manufacturing facility for
highly regulated narcotic medicines. Its facility is one of the few
GMP facilities licensed for the manufacture of narcotic medicines by the China
State Food and Drug Administration (SFDA). It has strategic alliance partnership
with QRxPharma and American Oriental Bioengineering, Inc. For more information:
www.aoxingpharma.com.
About
Macfarlan Smith Limited
Macfarlan
Smith Limited, a wholly owned subsidiary of Johnson Matthey Plc, is a world
leader in the production of alkaloid opiates and other controlled active
pharmaceutical ingredients. As one of the world's oldest pharmaceutical
companies, Macfarlan Smith has manufactured and developed active pharmaceutical
ingredients and intermediates for almost 200 years, and today the company
operates a state-of-the-art plant to the highest level of cGMP. For more
information: http://www.macsmith.com/.
About Johnson Matthey Public Limited
Company
Johnson
Matthey is a speciality chemicals company, publicly traded in London Stock
Exchange, focused on its core skills in catalysis, precious metals, fine
chemicals and process technology. Johnson Matthey's principal
activities are the manufacture of auto catalysts, heavy duty diesel catalysts
and pollution control systems, catalysts and components for fuel cells,
catalysts and technologies for chemical processes, fine chemicals, chemical
catalysts and active pharmaceutical ingredients and the marketing, refining, and
fabrication of precious metals. It reported revenue of £ 7,848
million for the fiscal year ended in March 31, 2009. For more
information: www.matthey.com
For more
information please contact:
Aoxing
Pharmaceutical Company, Inc.
Investor
Relations Contact:
Brian
Korb
Vice
President
The Troup
Group LLC
Tel: +1
646 378 2923
Email:
bkorb@troutgroup.com
Safe
Harbor Statement from Aoxing Pharmaceutical Company, Inc
Statements
made in this press release are forward-looking and are made pursuant to the safe
harbor provisions of the Securities Litigation Reform Act of
1995. Such statements involve risks and uncertainties that may cause
actual results to differ materially from those set forth in these
statements. The economic, competitive, governmental, technological
and other risk factors identified in the Company's filings with the Securities
and Exchange Commission, including the Form 10-K for the year ended June 30,
2009, may cause actual results or events to differ materially from those
described in the forward looking statements in this press
release. The Company undertakes no obligation to publicly update or
revise any forward-looking statements, whether because of new information,
future events, or otherwise.