Traditional Chinese medicines draw pharma's attention
Pharmaceuticals, a manufacturer of Chinese herb medicines, in a bid
to get a first step into the burgeoning traditional Chinese herbal
medicine market.
Jinguang, located in the Hainan province of China, specialises in traditional Chinese Li medicine, one of the major traditional Chinese medicinal herbs.
The company has invested more than $4m (€3m) in manufacturing facilities in the past two years and has also developed its own research and development center, a planting farm, manufacturing facilities under GMP standards, and a dedicated salesforce.
It is expected that Jinguang will generate approximately $15m in annual sales in 2007, which is projected to grow to approximately $29m in annual revenues in 2008.
While terms of the agreement were not disclosed, packaging manufacturer Dragon said it will begin due diligence on the company.
"Jinguang has been our client for several years, and we believe we can facilitate its substantial growth in revenues and earnings by infusing work capital, since Jinguang has completed construction of its farming and manufacturing facilities," said David Wu, CEO and chairman of Dragon.
"The addition of Jinguang would diversify our business and enhance our strong growth prospects in revenues and earnings for years to come."
In China, traditional herbal preparations account for 30 to 50 per cent of the total medicinal consumption, according to the World Health Organisation (WHO). The global market for herbal medicines currently stands at over $60bn annually and is growing steadily, which shows an increasingly wider acceptability of "natural medicines".
Big Pharma is also showing interest for this emerging market and an example which illustrates this attention is the deal that Merck KGaA has just signed with Chi-Med under which the German drugmaker will develop new cancer treatments using traditional Chinese medicines.
Chi-Med is a Chinese pharmaceutical company that develops drugs and consumer health products based on botanical ingredients used in Chinese medicine.
Under this agreement, the two companies have agreed to develop small molecule anti-cancer drugs while Chi-Med can use its portfolio of botanical compounds to help manufacture the products.
Chi-Med believes that traditional Chinese medicine is a huge, under-exploited source for the development of novel drugs for the global pharmaceutical market.
