China Pharma Outsourcing Selected News Compile - April 2009

8/14/2019 China Pharma Outsourcing Selected News Compile - April 2009

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JZMed, Inc. China Pharma Outsourcing News Compilev

________________________________________________________________________Page 1 of 26 JZMed, Inc. (www.jzmedi.com) 4/1/2009

China Pharma OutsourcingSelected News Compile

First Quarter of 2009

JZMed, Inc.

April, 2009

ZMed, Inc.


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Table of Contents

No. Date News Title Page No.

1 January 6 Leading Researchers Establish FORMA Therapeutics toIntegrate Transformative Biology and Chemistry to AddressChallenging Targets and Develop Breakthrough Oncology Drugs 4

2 January 6 WuXi adopts H-Cube for drug discovery 5

3 January 9 e-Therapeutics to Offer Computational Biotech Services fromNanjing Office 6

4 January 15 Hutchison MediPharma Options Program to J&J 6

5 January 15 Asian pack machine demand a boon US and EU industry 7

6 January 21 Cogenics Partners to Bring Genomic Services to China 8

7 January 22 CEE Could Gain from Asias Reputation for Fakes 8

8 January 27 Pharmaceutical Sector Expected To Fast Grow In 10 Years 9

9 January 27 Rem Gets into Bed with PsyPharma for Sleep Studies 10

10 January 28 China's Anti-Cancer Drug Market Forecast Exceeded $3.5 BillionIn 2007 11

11 January 27 Basilea Pharmaceutica Plans to Expand Its WorldwideOrganization add More Than 100 Positions 12

12 January 27 Orexo and NovaMed Pharmaceuticals (Shanghai, China) SignedA Licensing and Distribution Agreement 12

13 February 5 Step Forward for Vortex Resources and YaSheng Group Merger 12

14 February 5 USP Announces New Standards for Heparin and Glycerin 13

15 February 11 Zhangjiang Park and CRO Sundia MediTech Form Incubator 13

16 February 12 Bayer Schering to Open Beijing R&D Center 13

17 February 12 OriGene Secures $6.5M to Set Up mAb Manufacturing Facility


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in China 14

18 February 12 Charles River Cuts Preclinical Jobs in Global Gloom 14

19 February 16 Research and Markets: China Pharma Outsourcing Market

Forecast to 2015 15

20 February 18 HUYA Joins Forces with the Beijing Institute of Materia Medica 16

21 February 19 Study Raises Questions about Sending Trials Out of U.S. 17

22 February 25 Frontage Deal Expands Service Offering in China 19

23 February 26 Novartis sets $627 M Revenue Goal for China in 2009 19

24 March 3 Immtech Signs MOU with Beijing Pharmaceutical Group 20

25 March 5 Sinovac Receives GMP Certification for Its New Filling AndPackaging Production Facility 20

26 March 9 Tigermed Aims Big with MacroStat Alliance 21

27 March 12 China's Shanghai Ruijin Chooses the Mobetron for AdvancedCancer Care 21

28 March 22 SGS opens new micro test lab in China 22

29 March 25 AstraZeneca and BioDuro Expand Discovery Contract 23

30 March 25 WuXi PharmaTech Announces Fourth-Quarter and Full-Year2008 Results 24

31 March 30 SAFC launches service to secure supply chain 25


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China Pharma OutsourcingSelected News Compile

First Quarter of 2009

1. Leading Researchers Establish FORMA Therapeutics To IntegrateTransformative Biology And Chemistry To Address Challenging Targets AndDevelop Breakthrough Oncology Drugs

January 6, 2009

FORMA Therapeutics announced today its debut as an integrated, global drug discovery

company. The Company was founded by leading researchers from the Broad Institute ofHarvard and MIT to integrate important new advances in biology and chemistry tounlock essential oncology targets that have been elusive to the best scientists in theindustry. FORMA has received initial equity and non-dilutive funding of $25 millionfrom multiple sources including Novartis Option Fund and Bio*One Capital of Singapore.

Formas co-founders from the Broad Institute include Stuart Schreiber, Ph.D. Director ofChemical Biology and a Howard Hughes Medical Institute investigator; Todd Golub,M.D., Director of the Cancer Program, and an investigator at the Dana-Farber CancerInstitute and Howard Hughes Medical Institute; and Michael Foley, Ph.D., Director of theBroads Chemical Biology Platform. Additional members of the FORMA founding team

include: Steven Tregay, Ph.D., President and CEO, formerly Managing Director,Novartis Option Fund; and Nikolai Kley, Ph.D., Vice President of Biology and Head ofDrug Discovery, formerly Vice President and Head of Research, GPC Biotech.

Genetic studies of human cancers have provided important insights into oncogenicpathways and their associated drug targets. However, many of such high value drugtargets have posed significant challenges to traditional drug discovery approaches.

Over the next five years, genomic medicine efforts such as the NIHs Cancer GenomeAtlas Project (TCGA), will elucidate the genomes of many tumor types andfundamentally change our understanding of cancer drug targets, said Dr. Foley. I

believe that the new tools and capabilities coming out of chemical biology research willenable the discovery and development of innovative drugs against novel, high valuetargets and FORMA is uniquely positioned to capture this opportunity.

The strength of FORMAs scientific platform and the caliber of scientists and industryexecutives that have come together to build this company make it a highly promisinginvestment opportunity in oncology drug discovery, commented Reinhard Ambros,Head of the Novartis Venture Funds. I believe the companys integrated drug discovery


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approach positions FORMA for success in areas that are considered holy grails ofoncology drug discovery such as interfering with protein-protein interactions orfunctional activity of transcription factors.

FORMA is uniquely positioned through its unprecedented combination of technological

capabilities and oncology expertise to access such novel target space and to develop anew generation of breakthrough oncology drugs. Some of the key features of FORMAsdiscovery capabilities include:

Versatile cell-based screening platform which allows the screening of discrete targets incells and quantitative genome/proteome-wide profiling and target identification.

Accessing new chemical space through structure guided drug discovery (SGDD)approaches leveraging proprietary computational and structural biology combined withour integrated chemistry platform which incorporates Diversity Orientated Synthesis(DOS). DOS combines the high stereochemical and structural diversity found in natural

products with traditional combinatorial chemistry techniques. This approach has beenproven to work for challenging targets and will allow the rapid optimization of leadtherapeutic candidates.

Our goal is to develop a robust and sustainable pipeline of truly innovative drugs withqualified mechanisms of action, said Dr. Tregay, FORMAs CEO. Our internal drugdiscovery efforts are focused on targets of high value and interest in oncology; however,we intend to leverage our platform through collaborations in other therapeutic areas.

FORMA is a global company headquartered in Cambridge, MA with research operationsin Connecticut, Singapore, and Beijing.

The FORMA Board of Directors includes: Steven Tregay, Michael Foley, Alexis Borisy,Founder and CEO of CombinatoRx, Reinhard Ambros and Simon Campbell, Ph.D.Former SVP, Worldwide Discovery and Medicinal R&D Europe, Pfizer.

FORMA Therapeutics is integrating transformative biology and chemistry to unlock thebest targets and pathways that genomics medicine has revealed. FORMA builds on thevision of its academic founders: Stuart Schreiber, Todd Golub and Michael Foley, eachof the Broad Institute of Harvard and MIT. FORMA leverages its innovative drugdiscovery platform to address challenging targets and develop a robust internal pipelineof breakthrough oncology drugs. FORMA is a global company headquartered inCambridge, MA with additional research operations in Connecticut, Singapore andBeijing.www.formatherapeutics.com

2. WuXi adopts H-Cube for drug discovery

January 6, 2009


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WuXi AppTec is to use ThalesNanos H-Cube for laboratory-based hydrogenation,which the CRO believes offers advantages in drug discovery over traditional batchprocesses.

By using the H-Cube WuXi joins illustrious company, with ThalesNano claiming that the

worlds top 20 pharmaceutical companies all use the technology.

The H-Cube is a bench-top standalone device that uses continuous-flow microchemistrywith hydrogen needed for the reaction generated in-situ and on demand.

Since the necessary hydrogen is produced in the H-Cube no external storage is requiredwhich reduces the space the system takes up.

Reactions take place on disposable catalyst cartridges, which are modeled after highperformance liquid chromatography (HPLC) systems.

ThalesNano claims that in comparison with traditional techniques the H-Cube is safer,faster, more cost-efficient and gives increased yields.

Shuhui Chen, chief scientific officer of WuXi AppTec, said: "We are very pleased for theemployment of H-Cube, as Hydrogenation in flow for drug discovery is significantly amore productive and safer approach than traditional batch-based technique. We arelooking forward to working with ThalesNano as we move to larger scale in the future."

The larger scale model that Chen refers to is the H-Cube Midi that increases the capacityup to a maximum of 500g a day using the same technology as its smaller sibling.Consequently WuXi should be able to scale-up its production runs and maintain the sameresults.

3. e-Therapeutics to Offer Computational Biotech Services from Nanjing Office

January 9, 2009

e-Therapeutics, a British software firm offering a computational biotechnology platform,has opened an office in Nanjing that will allow the company to collaborate withbiopharmas in China. The companys software models the interactions of a givencompound, predicting the degree to which it will bind with the bodys proteins. It can beused in drug discovery programs to predict efficacy as well as unwanted interactions. InSeptember 2008, e-Therapeutics announced a partnership with Nanjing KeyGen Biotech.

4. Hutchison MediPharma Options Program to J&J

January 15, 2009


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Hutchison MediPharma Limited and Ortho-McNeil-Janssen Pharmaceuticals, Inc., adivision of Johnson & Johnson have formed collaboration, taking advantage ofMediPharmas work on a novel inflammation/immunology target. MediPharma willcontinue its discovery and development activities through clinical proof-of-concept,unless OMJPI exercises an option to take over the development. If that happens, OMJPI

will have exclusive rights to develop and commercialize the compounds

5. Asian pack machine demand a boon US and EU industry

January 15, 2009

The market for packaging machinery is set to grow 5 per cent a year and be worth $40bn(30.3bn) by 2012, driven partly by a hike in demand for drug products in pharmergingeconomies, according to a new industry report.

The study predicts that global economic output will improve; enabling higher consumerspending that in turn will drive greater manufacturing activity and demand for moreefficient packaging machines and processes.

Pharmaceutical manufacturing hotbed China is expected to see the largest growth indemand for packaging machines with the market set to expand by over $3.3bn through to2012, toppling the US from its position as global leader.

Additionally, other developing economies like India and Russia, and to a lesser extentlower volume markets like Ukraine, Indonesia, Malaysia, Saudi Arabia, Mexico andTurkey, will need more packaging machines as standards of healthcare and consumerspending continue to increase.

The report also suggests that demand for drug packaging capacity in developedeconomics will increase, albeit at a slower pace than in Asias booming manufacturinghubs. Growth in the west will be driven by an aging population and a greater reliance onsingle-use disposable packaging.

However, while demand for machines may shift east over the next five years, over 66 percent of all the packaging units sold worldwide will be made by manufacturing firmsbased in Western Europe, the US and Japan.

US High visibility packaging market also set for gains

Another report released this week suggested that the US market for high-visibilitypackaging, including pharmaceutical blister packs, will be worth $8.5bn by 2012,equivalent to a growth rate of 4 per cent a year.


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Blister packaging will generate around $2.2bn in sales by 2012, a compound annualgrowth rate of 4.4 per cent, with the pharmaceutical and healthcare sector under going thegreatest increase in demand for this type of product.While drug packaging firms are set to be major beneficiaries, industrial plastic resinmakers may be the overall winners. The report predicts that creation of an estimated 34bn

individual packages by 2012 will require nearly 1.2bn pounds of plastic.

6.Cogenics Partners to Bring Genomic Services to China

January 21, 2009

Cogenics has entered into a partnership with SinoGenoMax to bring its clinicalgenotyping services to the expanding Chinese market.

By partnering with an established force in the Chinese genomics market Cogenics is

hoping to gain access to clients beyond its primary markets in the US and Europe.

SinoGenoMax provides genomic services to local and international universities, researchinstitutes and pharmaceutical companies. The partnership should give Cogenics access tothese clients and expand the range of services that the companies can offer.

Michael Lutz, Global Manager of Cogenics, said: The extensive pharmaceutical andbiotechnology infrastructure and large number of clinical trials conducted in China makethis an increasingly important market for clinical genotyping services.

Our partnership with SinoGenoMax provides us with an established presence in Chinaand an experienced international service partner who operates with similar platforms andhigh quality standards, thus expanding Cogenics offering to our growing globalpharmaceutical customer base.

Cogenics claims its clients include the top 20 pharmaceutical companies operating in theUS and Europe. Companies in China will now have greater access to these services,which include next generation sequencing, gene expression and clinical and non-clinicalgenotyping.

In addition Cogenics can provide biomanufacturing support, nucleic acid extraction andbiobanking for research and regulated environments.

Cogenics entry into China suggests it believes that the number of clinical trials conductedin the country will continue to grow, driving demand for related services.

7.CEE Could Gain from Asias Reputation for Fakes

January 22, 2009


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On January 21, 2008, the State Council, China's cabinet, passed the final medical systemreform scheme, and up to CNY 850 billion is planned to be pumped into the domestichealthcare and medical treatment sector from 2009 to 2010.

The Chinese central government plans to come up with the basic medical insurance

system across the country before 2011 and thus more citizens can lighten their burdens ofmedical expenses. In the upcoming three years, China will commit itself to lifting theparticipation ratios of the basic medical insurance system for urban employees and thenew rural cooperative medical scheme (NCMS) to over 90%, respectively.

In order to further improve the medical service and to standardize drug prices, the state isbrewing the start-up of the pilot public hospital reform projects.

SOURCE: Chinese pharmaceutical industry

9.Rem Gets into Bed with PsyPharma for Sleep Studies

January 26, 2009

Two US companies specializing in sleep disorders - Rem Medical and PsyPharma Global,have pooled their resources to offer research services to the pharmaceutical industry.

Rem Medicals primary business is in the running of sleep disorder clinics. Now, with theacquisition of a clinical site in Tucson, Arizona, operated by PsyPharma, it will be able toprovide Phase II-IV trial services across a wide range of sleep and related psychiatricdisorders.

PsyPharma specializes in Phase II-IV trials of sleep, psychiatry and neurology disorders,with operations in both the US and China.

Insomnia treatments are the main product category among sleep disorders and represent amultibillion dollar market in their own right, albeit one that is mature and heading forimminent generalization.

But sleep disorders span a broad range of indications, including restless legs syndromeand obstructive sleep apnoea, which are the focus of considerable research by the drugdevelopment sector.

OSA is one of the fastest growing sectors in the sleep disorder treatment market, with upto 18 million patients in the US 85 per cent of who are estimated to be undiagnosed.

Rem Medical said in a statement that through the acquisition it has retained anexceptional investigative, clinical and administrative team with a track record of qualitytrial activity.


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The Arizona unit is led by Derek Loewy, the principal investigator in over thirty clinicaltrials since completing his sleep medicine fellowship training at Stanford University in2001.

Prior to PsyPharma, Dr Loewy was the director of the insomnia program at the Sleep

Clinic of San Francisco

10.China's Anti-Cancer Drug Market Forecast Exceeded $3.5 B In 2007

January 28, 2009

According to the Chinese Ministry of Health (MOH), there are approximately 2.13million patients with newly diagnosed tumors (both benign and malignant) each year, ofwhich 1.06 million are newly diagnosed cancer patients. Cancer has become the leadingcause of mortality in both urban and rural China. According to national statistics data, the

cancer mortality rate of urban Chinese residents is currently 140.47 per 100,000 (21.82%of all urban deaths) and the cancer mortality rate of rural Chinese residents was 111.57per 100,000 (16.50% of all rural deaths).

In the Chinese hospital drug market, sales of anti-cancer drugs have risen steadily inrecent years. During 2003-2005, the annual compound growth rate of anti-cancer drugsales was approximately 24.5%. In 2006, due to the national campaign on anti-commercial bribery as well as other related government policies, the market growth ofanti-cancer drugs slowed down to approximately 11.1%; however, the growth of the anti-cancer drug market regained momentum and reached an annual growth rate ofapproximately 22.2% in 2007. The total market size for anti-cancer drugs in 2007 was25.5 billion RMB (3.6 billion USD).

Major topics covered in this report include: Summary of Global Markets of Anti-CancerDrugs, Summary of Anti-Cancer Drugs in China, Market Analysis of China's Anti-Cancer Drugs, List of Brand Names, Generic Names of Anti-Cancer Drugs and theirCorresponding Manufacturers in China, Packaging and Pricing of Anti-Cancer Drugs inChina, Anti-Cancer Drugs on the National Healthcare Insurance Coverage list,Regulatory and Government Policies for Anti-Cancer Drugs in China, Current Anti-Cancer Drugs in China, and Current Anti-Cancer Drug Development in China.

Companies covered include: Jiangsu Hansen Pharmaceutical Co., Ltd.(Hansen Pharma),Jiangsu Hengrui Medicine Co., Ltd., Novartis, Pfizer, Roche, sanofi-aventis, SichuanDiao Jiuhong Group, Pharmaceutical Co, AstraZeneca, Bristol-Myers Squibb, Eli Lilly &Co., Guizhou Baiqiang, Pharmaceutical Co., Ltd., Hainan Zhonghe Pharmaceutical Co.,Ltd, Jinling Pharmaceutical Co. Ltd., Livzon Pharmaceutical Group Inc., NanjingKanghai Pharmaceutical Co., Ltd., Nanjing Sike Pharmaceutical Co., Ltd., QiluPharmaceutical Co., Ltd., SciClone Pharmaceuticals Italy S.R.L., Shenzhen WanlePharmaceutical Co., Ltd., and Zhejiang Hisun Pharmaceutical Co., Ltd.


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11. Basilea Pharmaceutica Plans to Expand Its Worldwide Organization and AddMore Than 100 Positions

January 27

Basilea Pharmaceutica plans to expand its worldwide organization and add more than 100positions in order to focus on Toctino (alitretinoin) and Zeftera/Zevtera (ceftobiprolemedocaril), two drugs it says are high-priority programs, according to a press release. Thecompany will reduce approximately 30 positions at its headquarters that are mainlyinvolved in research programs of lower priority, and it will create 17 new positions inSwitzerland and a total of approximately 100 new positions worldwide.

12. Orexo and NovaMed Pharmaceuticals (Shanghai, China) Signed A Licensingand Distribution Agreement

January 27

Orexo and NovaMed Pharmaceuticals (Shanghai, China) signed a licensing anddistribution agreement that grants NovaMed rights to seek approval to market Orexosproduct for treatment of cancer pain, Abstral (rapinyl), in China. The terms of theagreement includes an upfront payment, regulatory milestones and sales milestones. Thetotal value of the deal, which includes an upfront payment and milestones, is $4.75million.

13. Step Forward for Vortex Resources and YaSheng Group Merger

February 5 2009

In preparation for a possible merger with Vortex Resources, YaSheng Group has releasedits annual audited 2006 and 2007 financial statements. The companies previously enteredinto a term sheet to develop a logistics center and eco-trade cooperation zone inCalifornia. YaSheng is engaged in agriculture, chemicals, and biotechnology and is basedin the Peoples Republic of China.

The term sheet also gives YaSheng the option to merge other assets into Vortex, acompany that acquires and develops undervalued assets. Vortex currently has operationsin West Texas and Beverly Hills, CA.

By releasing its audited financial statements, the company provides both parties greaterflexibility to close the merger. The transactions described in the term sheet are subject tothe drafting and negotiation of a final definitive agreement, performing due diligence, aswell as board approval from Vortex. This does not guarantee Vortex success with theproposed merger.


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14.USP Announces New Standards for Heparin and Glycerin

February 5, 2009

Rockville, MD (Feb. 4)The US Pharmacopeias (USP) Convention has announced new

standards for heparin and glycerin. USP revised the heparin standard at the request of theUS Food and Drug Administration, in response to adulterated heparin product with over-sulfated chondroitin, which resulted in the deaths of 200 people. Glycerin, a sweetenerand binding agent, has been adulterated in the past by dilution with diethylene glycol.The new standards for glycerin become official in May 2009, and the new standards forheparin become official in August 2009 after a public comment period. All manufacturersof these products are required to comply with the standards.

The US Food and Drug Administration requested a new glycerin standard that establisheslimits for diethylene glycol and revises other high risk articles that have similarapplications. FDA also requested a revised heparin monograph to detect the presence of

over-sulfated chondroitin sulfate. In addition, the modernized heparin monograph aims toprovide improved analytical methods, improved measurement of heparin activity, and thedevelopment of associated reference standards (i.e., heparin identity, heparin potency,oversulfated chondroitin sulfate, and dermatan sulfate).

These new USP quality standards provide better assurance of the quality of marketedproducts by using appropriate and modern analytical methods, says Moheb Nasr, PhD,director of the Office of New Drug Quality Assessment (ONDQA), at FDA's Center forDrug Evaluation and Research (CDER), in a USP press release. This provides aconsiderable safeguard for citizens of the United States and the world by helping toprevent fraudulent suppliers from adding components that in the past have eludedexisting identity tests due to similar properties. The new standards represent a significantimprovement to the safety nets that keep substandard drugs from reaching themarketplace. FDA is pleased to have worked together with USP on this effort.

15.Zhangjiang Park and CRO Sundia MediTech Form Incubator

February 11, 2009

Shanghai Zhangjiang (Group) Co., which operates the Zhangjiang Hi-Tech Park, hasjoined with CRO Sundia MediTech Company to expand the concept of a CRO. The twocompanies have formed a platform that combines Intellectual Property, CRO and VentureCapital services in one group, a biopharma incubator that includes its own CRO. The goalis take a young biopharma from original discovery into clinical trials. At the same time,the incubator will help draw the best young biopharmas to Zhangjiang Park.

16. Bayer Schering to Open Beijing R&D Center


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February 12, 2009

Germany's Bayer said today it will invest $129 million in a new global research anddevelopment center in Beijing over the next five years. China is the third largest marketworldwide for the Bayer group, and it will become the third country besides Germany

and the U.S. to host such a center for its Bayer Schering Pharma unit. Bayer also said it iscurrently in advanced discussions with Tsinghua University on entering into a strategicpartnership to pursue research collaborations for the discovery of new disease-relatedtargets.

17. OriGene Secures $6.5M to Set Up mAb Manufacturing Facility in China

February 12 2009

OriGene Technologies raised $6.5 million, which allows it to complete the acquisition of

Shenzhen P&A Biotech, a manufacturer and provider of mAbs. With the establishment ofthis technology center, OriGene will be able to develop genome-wide mAbs.

With OriGene's China mAb production capacity and genome-wide resources, thecompany believes that it can produce several thousand high quality mAbs per year. Thisgenome-wide mAb production capacity is available to all commercial and academicpartners.

Over the last 10 years, OriGene developed the capacity to produce human full-lengthproteins from human cells. It has spent the last two years developing a genome widecollection of antigen standards and over 100,000 tissue samples for high-quality antibodyvalidation.

18. Charles River Cuts Preclinical Jobs in Global Gloom

February 12, 2009

Charles River Laboratories will reduce its workforce by 3 per cent, close its preclinicalfacility in Arkansas, US and sell off its Phase I trial site in Edinburgh, Scotland as part ofa cost reduction program.

The firm added that it will reduce headcount at its plant in Shewsbury, Massachusetts,and said the decision to restructure its preclinical services (PCS) division is reflective of[its] global client base and the current demand.

Charles River explained that divestiture of the Edinburgh site, for which it may havealready found a buyer according to the Boston Globe, is a response to the decision bymany of its preclinical clients to shift their trial program to India and China due toincreased regulatory demands in Europe.


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The latest announcement follows on from a poor set of Q4 results that saw revenue fromits PCS business fall 8 per cent to $158.6m (123m) on a decline in demand it linked topharma industry restructuring and pipeline reprioritization.

For 2008 the PCS unit performed slightly better, with revenues climbing 4.6 per cent to$683.6m, although margins declined to 1.6 per cent on costs linked to new preclinicalsites in Shanghai, China and Nevada.

Company CEO James Foster added that the firms annual results reflect the impact ofthe global economic crisis and the challenges our pharmaceutical and biotechnologyclients are facing, especially in the PCS segment.

He added that while the firm considers the economic gloom is temporary, it is using theperiod of uncertainty as a window to streamline operations and reduce operating costs by20 per cent this year.

19.Research and Markets: China Pharma Outsourcing Market Forecast to 2015

Mon Feb 16, 2009

It has been widely accepted that China is now the primary choice of outsourcingdestination for drug companies around the world. In the past eight years Chinesepharmaceutical outsourcing industry has grown in an average annual rate of 48%.Starting with chemistry service only, a complete industrial structure with allservice elements now starts shaping. The industry's growth is also acceleratedby the influx of a large number of multinational service providers whoseentrance greatly up-lifted the service capability of this Chinese industry. Inaddition, increasing numbers of traditional Chinese pharmaceutical companies andR&D-oriented Chinese biotechnology companies also join in the service. Atpresent, about 250 professional service providers, 50 multinational serviceproviders, 150 traditional Chinese pharmaceutical companies and 20 Chinesebiotechnology companies have formed a joint force in today's China pharmaoutsourcing industry. Together, they are serving an ever enlarging body ofoutsourcing companies from all over the world. The industry has thus realizedthe service revenue of more than $1.4 B.

Nearly a decade development has significantly uplifted the industry andcompetition as well. How this Chinese industry would likely develop in thefuture has become a common concern to many professionals in all relatedindustries. The current financial crisis also puts the future development ofthis industry into an uncertain path.

Would you like to know how the financial crisis affects this Chinese industry inboth near term and long term? What will the industry look like in five to tenyears? What are the driving forces that keep this industry still fast growing?


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Will China still have cost effective advantage in five to ten years? How doeslabor cost likely grow in next few years? How to compare it with that in othercountries?

"China Pharma Outsourcing Market By 2105" is designed to address these issues

and to answer these questions. It is by far the most comprehensive report aboutChinese pharma outsourcing industry and market. It investigated in depth thedevelopment pattern of service capability and market size of this Chineseindustry and first time displayed to the world a complete picture of Chinapharma outsourcing industry. In addition, with in-depth analysis of more than 50case studies, the report also first time revealed how drug companies around theworld conduct outsourcing in China and what outsourcing models are popularlypursued. More importantly, the report examined in depth both the drivers andresistors of future development of this Chinese industry. It is also the firsttime that a clear picture of future growth and development of this Chineseindustry is depicted.

The report is a must-read book to all professionals in the industries ofpharmaceutical, biotechnology, financial investment and outsourcing service thatare interested in pharma outsourcing in China. It is also a valuable referencebook to drug regulatory agencies and other government agencies involved instrategic planning of development of pharmaceutical industry in their owncountries.

Key Topics Covered:

* Chapter 1: China's Advantages in Pharma Outsourcing* Chapter 2. Current Market Size, Service Capability and Existing Issues* Chapter 3. From Popular Outsourcing Models To Future Development* Chapter 4. Impact of Financial Crisis: Market Development Forecasts for 2009

and 2010* Chapter 5. Future Development: Years beyond 2010* Summary

20. HUYA Joins Forces with the Beijing Institute of Materia Medica

February 18 2009

HUYA Bioscience is partnering with the Beijing Institute of Materia Medica (BIMM) onpreclinical safety and efficacy activities as well as clinical trial protocols. The agreementalso provides HUYA with the right of first review and negotiation for the licensing anddevelopment of certain new compounds owned or controlled by BIMM. This rightincludes drugs for cardiology, endocrinology, oncology, immunology, hematology,neuroscience, and infectious diseases.


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BIMM comprises the Chinese Academy of Medical Sciences and Peking Union MedicalCollege. It concentrates on discovering and developing treatments by isolating naturalremedies. For BIMM, says Xiaoling Wang, M.D., Ph.D., BIMM director, ourpartnership with HUYA signifies an opportunity to bring our expertise and our efforts inpharmaceutical development to the Western market.

HUYA CEO, Mireille Gingras, Ph.D., adds that, HUYA is highly experienced anduniquely positioned in China to leverage the emerging biotech industry through strongcollaborations. This is the culmination of years of relationship-building and exchange ofknowledge between HUYA and BIMM.

21. Study Raises Questions about Sending Trials Out of U.S.

February 19, 2009

Major U.S. drug companies are increasingly performing clinical trials in developingcountries, raising serious concerns about the efficacy, ethics and economics of drugdevelopment, according to a study in the current issue of the New England Journal ofMedicine.

"There are powerful forces luring clinical trials overseas, including the lower cost ofdoing business and access to larger study populations," says Seth Glickman, M.D., thestudy's lead author and an assistant professor of emergency medicine at the University ofNorth Carolina at Chapel Hill School of Medicine.

"We cannot afford to trade lower costs of drug development for drugs that may be lesssafe and less effective," Glickman says.

Since 2002, the number of Food and Drug Administration investigators based outside theUnited States grew 15 percent per year, while those in the U.S. dropped by more than 5percent, the study found.

Glickman and his co-authors reviewed government registries of Phase III clinical trialsand studies of industry-sponsored trials in 2007, and 300 articles reporting clinical trialresults appearing in the New England Journal of Medicine, the Journal of the AmericanMedical Association and Lancet in 1995 and 2005.

According to the researchers, one-third of these trials from the 20 largest pharmaceuticalcompanies in 2007 were being conducted outside the U.S., and a majority of all trial siteswere abroad. They also found that from 1995 to 2005, the number of clinical trial sitesoverseas doubled, while the number in the U.S. and Western Europe decreased.

One obvious cause for this move is economic. The price per case for a clinical trial at atop-rated medical center in India is about $2,000; in the U.S., it would cost 10-times asmuch. In 2000, the average cost to develop one drug in the U.S. was $802 million, with


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most of the expense resulting from time costs. Countries with fewer regulations can movetrials along faster.

But with lower costs comes less stringent scientific and ethical standards, and the U.S.regulatory system, chiefly the FDA, is already strained.

"This is outsourcing not only of jobs but of the way we test drugs to make sure they aresafe and effective," says Charles Cairns, M.D., chairman of emergency medicine at UNCand a co-author of the study. "Across the globe there are different standards and nouniform approach to conducting clinical trials."

Ethical concerns include the lack of trial oversight and review of study protocols, as wellas the monetary lure of participating in trials, especially in low-income countries. Also,many of the drugs tested in developed countries are for conditions that are not primaryhealth problems there; allergies or overactive bladder instead of tuberculosis or malariawhich disproportionately affect these countries.

Genetics and cultural and social factors also influence how drugs are metabolized. Forinstance, people of Asian decent have a genetic variance that decreases the efficacy ofdrugs like nitroglycerin. Many people in developing countries are also "drug naive," andhave never taken medicine for depression or other chronic conditions. Their bodies wouldreact differently to a drug than someone in a country like the United States who takesmultiple medications and receives routine medical care.

"It is conceivable that use of the same drug in both populations would produce markedlydifferent results," Glickman says.

The problems overseas are often rooted in the U.S. Higher labor costs, time-consumingbureaucracy and a lack of uniformity even in the U.S. regulatory system drives drugmakers to look for places that are more conducive to running trials in a cost-effectivemanner, Cairns says.

The solution lies in a multi-faceted approach to increase cooperation with countriesoverseas while improving the domestic environment and increasing accountability on thepart of industry, says Glickman.

"The U.S. Food and Drug Administration can be a leader globally in addressing theseissues," says Cairns. "The FDA could be a nexus of insurers, providers, industry, patients;so that we could agree on minimal standards that can be transportable across countries."

"This could almost be considered a State Department issue. Energy and global warmingare security issues; this is a medical security issue that needs to be actively discussed."

"Clearly, there is some benefit for everyone involved in clinical trials overseas," saysGlickman. "But we need a robust research framework that will protect trial participantsand ensure that clinical research is conducted to the highest scientific standards."


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22. Frontage Deal Expands Service Offering in China

February 25, 2009

Expansion of Frontages collaboration with Beijing Second Pharmaceuticals will give it anew 1,800 sq m R&D centre and further increase its presence in China.

The companies were already working together but this collaboration has now beenexpanded in an attempt to accelerate Beijing Pharma's entrance into the internationalgeneric drug market.

In return for providing bioanalytical, pre-clinical, clinical and drug development servicesto Beijing Pharma Frontage will obtain the R&D centre and access to goodmanufacturing practice (GMP) compliant manufacturing capacity.

This facility marks another milestone in Frontages expansion into China, whichcommenced three years ago. Since then Frontage has entered into numerouscollaborations with Chinese pharmaceutical companies, including Beijing Pharma since2007.

Under the original arrangement Frontage helped Beijing Pharma with the design,renovation and commission of manufacturing facilities. This was done to ensure theywere compliant with US Food and Drug Administration and International Conference onHarmonisation GMP requirements.

Song Li, president and CEO of Frontage, said: "This partnership demonstrates ourcontinued commitment to support the US, European and Chinese companies'development programs in generic drugs, and to help them gain access to internationalmarkets.

We are pleased that the investments we have made in our business over the last year arebeing recognized by our customers and partners."

Over the next three to five years Beijing Pharma is hoping the collaboration will develop12 abbreviated new drug applications (ANDA). These will be marketed in China, Europeand the US.

23.Novartis sets $627 M Revenue Goal for China in 2009

February 26, 2009

Swiss pharmaceutical giant Novartis International AG expects over RMB 4.29 billion($627.46 million) in sales revenue from the Chinese market in 2009. In 2008 it made 3.3


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billion RMB ($428 million) in China, up 29% from 2007 which was 2.56 billion RMB($376 million). Globally, the company is hoping for a 5% increase in its top line.Novartis also said it plans to introduce six new drugs to China during 2009 and toincrease its employee count by 20%.

24. Immtech Signs MOU with Beijing Pharmaceutical Group

March 3, 2009

Immtech Pharmaceuticals signed a Memorandum of Understanding (MOU) declaring itsinterest in developing a strategic alliance with Beijing Pharmaceutical Group Co. Ltd.(BPGC). The MOU also confirms BPGCs intention to consider a range of collaborativeopportunities with Immtech. The alliance would give BPGC rights to develop drugs fromImmtechs library of compounds, which primarily target hepatitis C and malaria. Nofinancial disclosures were made at this early stage.

25.Sinovac Receives GMP Certification For Its New Filling And PackagingProduction Facility

March 5, 2009

Sinovac Biotech Ltd. (NYSE Alternext US: SVA), a leading provider of vaccines inChina, today announced that it has received the Good Manufacturing Practice (GMP)certification for its recently opened filling and packaging production facility. Thecertificate of compliance has a five-year term and was issued by the State Food and DrugAdministration (SFDA) following a site inspection.

The GMP certification provides for an overall annual production capacity of 20 milliondoses, with the capability to produce up to 40 million doses through reasonablescheduling of production activities. This production milestone ensures that Sinovac canfully meet increasing market demand and potential production increases for currentlycommercialized products, namely Healive, Bilive and Anflu. The filling and packagingproduction plant also has the capabilities to fill and package Panflu, the Company'spandemic influenza vaccine, in order to support China's prevention and control strategyagainst a potential outbreak of pandemic influenza.

Further to existing commercialized products having obtained GMP certifications, thefilling and packaging plant successfully obtained the GMP certification, which furtherrecognizes Sinovac's implementation of high quality management of production process.

Mr. Weidong Yin, Chairman, President and CEO, commented, "The receipt of the GMPcertification and the operation of the state-of-the-art filling and packaging facility providethe foundation for the further development of Sinovac. We are well positioned to increaseoutput to meet increasing market demand and ultimately achieve sales growth. More


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importantly, the expanded production capacity should enable Sinovac to supply greateramount of vaccines, which is in line with our mission to eliminate human diseases."

26. Tigermed Aims Big with MacroStat Alliance

March 9, 2009

Tigermed is continuing with its plan of partnering to become the top Chinese CROthrough an alliance with MacroStat to improve its range of statistical services, furtherbroadening its business.

The alliance covers the running of clinical trials, data management and statistical analysis,with Tigermed, a Chinese contract research organization (CRO), using MacroStat toimprove its services in these areas.

By enhancing its offering in these areas Tigermed believes it can improve drugdevelopment in China, providing services that meet international standards whilestreamlining clinical research and cutting R&D costs.

In return MacroStat will receive an asset injection, with this additional capital beingused to accelerate development of its biostatistic services and further penetration into theclinical trial market.

Ye Xiaoping, CEO and founder of Tigermed, said: The win-win cooperation betweenleading CROs with complementary advantages is conducive to constructing a higherlevel of CRO service chain and further updating full service capability, which also opensa fast track to the globalization of China CROs.

Under the terms of the deal, financial details of which have not been disclosed, three ofTigermeds executives will take seats on MacroStats board.

The deal forms part of Tigermeds ambitious growth plans that target becoming thebiggest CRO in China within 3 years, with a cash injection from Qiming Ventureunderpinning this period of rapid expansion.

Strategic collaborations have been identified by Tigermed as an important way ofachieving its growth targets, with last years deal with Russian and South Korean CROsbeing used to spread into new markets.

27.China's Shanghai Ruijin Chooses the Mobetron for Advanced Cancer Care

March 12, 2009


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IntraOp Medical Corporation (OTCBB: IOPM), a provider of intraoperative electron-beam radiation therapy (IOERT) solutions for the treatment and eradication of cancer,announced today an order for its Mobetron device from the Shanghai Ruijin Hospital inShanghai, China.

IntraOp's Mobetron is a mobile technology that delivers IOERT to a tumor site duringcancer surgery. The Mobetron enables radiation and surgical oncologists to pinpoint theoptimal site for radiation and deliver an effective dose during the procedure. Since theMobetron is a mobile, self-shielded device, doctors will be able to move the Mobetronamong different operating rooms to more efficiently treat a greater number of patients.Shanghai Ruijin will use the Mobetron to treat many forms of cancer, including breast,colorectal, sarcoma, and lung cancers.

This marks the fourth Mobetron installed in China. In the six months since installing thefirst Mobetron device and beginning treatments, oncologists in China have had notablesuccess using IOERT for cancer therapy, inspiring other centers to follow suit. Two

institutions in Beijing have been using the Mobetron since September of 2008 and haveextremely high utilization rates, reflecting the Chinese doctors' commitment andenthusiasm for IOERT as an emerging standard-of-care for surgeries requiring tumorresection.

Prof. King, director of the radiation Oncology Department, said, "The Mobetron willaugment the surgical and radiotherapy department for Ruijin. This will allow theoncologists there to quickly and effectively treat a larger number of patients, whilereducing tumor recurrences and saving lives."

IntraOp CEO John Powers added, "We continue to be optimistic about the rapid adoptionof the Mobetron technology and IOERT in China. This is the fourth order we've receivedin only 18 months. It is clear that IOERT is having an immediate impact on the deliveryof radiation therapy in China."

28. SGS opens new micro test lab in China

March 23, 2009

SGS Life Science Services opened a new microbiology testing laboratory in Shanghai,China to offer cGMP compliant API testing services for method development andvalidation.

The 700 square meter laboratory, which employs 27 full time analytical staff, will offerlocal drug developers current good manufacturing (cGMP) practice standardmicrobiology, stability and endotoxin assessment services for active pharmaceuticalingredients (API), finished products and traditional Chinese medicines.


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The quality of APIs and drugs from China has become an increasing concern for patientsand importers worldwide following a series of high profile contamination problems thatemerged in recent year.

While standards in China are beginning to improve as a result of efforts by both the

Chinese Food and Drug Administration (SFDA) and other regulators, analytical testingcapacity has not grown at the same rate as the manufacturing sector, creating demand forcontract offerings like SGS.

Ulrich Markens, vice president and regional manager of SGS Chinese operations,explained that the firm had received [an increasing number of] requests from severalmultinational companies for microbiology testing in a fully cGMP-compliantenvironment.

Markens added that: Integrating microbiological testing broadens our serviceportfolioin compliance with the increased scrutiny of pharmaceutical manufacturing in

China by the US Food and Drug Administration (FDA).

The laboratory, which began offering contract analytical services in January 2006, is partof SGS integrated network of 14 cGMP-compliant testing facilities worldwide that thefirm believes enhances the quality control operations of both its local and multinationalpharmaceutical industry clients.

SGS also said that the laboratory, which already holds a Chinese National AccreditationBoard for Laboratories ISO 17025 certification, further expands its range of offerings inthe country.

The firm offers consultancy in regulatory affairs and the registration of medical productsin both Hong Kong and China, third party facility inspection and auditing services andadvises producers of import and export requirements.

29. AstraZeneca and BioDuro Expand Discovery Contract

March 25, 2009

The Chinese unit of US contract drug discovery firm BioDuro says that AstraZeneca hasexpand its relationship with the firm to include the optimization of discovery researchoperations focused on drugs for respiratory and inflammatory disease.

Under the updated contract, financial terms of which were not made public, BioDuro willprovide integrated research services in the areas of chemistry, biology, ADME, andDMPK to help enhance AstraZenecas discovery program and shorten timelines.


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Lena Martensson, AstraZenecas director of strategic planning and business developmentexplained that the new deal is based on the firm's previous success and excellent workingrelationship with BioDuro.

Martensson said that: "After a successful collaboration involving discovery chemistry,

ADMET, and DMPK, AstraZeneca has expanded its collaboration with BioDuro toleverage the strengths of its team to help develop new therapeutics."

This positive opinion was echoed by BioDuro CEO John Oyler who said that the firm "ispleased to build upon this existing collaboration and work closely with the experiencedteam at AstraZeneca to develop new clinical compounds.

BioDuro has a team of 580 researches and technicians at its facility in the Chinese capitalBeijing. It currently has a roster of 40 pharma and biotech clients that it claims include 10of the top 12 worldwide.

With Big Pharma increasingly cutting R&D budgets and in-house expertise being scaled-back there is considerable scope for contract research organizations (CRO) to expandtheir businesses.

BioDuro appears to have positioned itself well to take advantage of the burgeoningcontract research market, with Frost & Sullivan predicting Asian CROs will be doing$2bn worth of business a year before 2010.

30. WuXi PharmaTech Announces Fourth-Quarter and Full-Year 2008 Results

March 25, 2009

Key highlights:

Total full-year 2008 net revenues: $261.8 M (including $8.3 M of net revenuesfrom discontinued operations) and adjusted EBITDA: $72.2 M;

74% year-over-year net revenue growth from continuing operations in fourthquarter of 2008, 33% organic net revenue growth for China-based businesses;

87% year-over-year net revenue growth from continuing operations for full-year2008, 45% organic net revenue growth for China-based businesses;

Fourth quarter and full year 2008 net losses reflect non-cash impairment chargesrelating to continuing and discontinued AppTec operations;

Construction completed at Suzhou toxicology laboratory and expanded Jinshanmanufacturing plant;


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Company targets 2009 net revenues of $265-$275 million, including 15-20% netrevenue growth in China-based laboratory services;

Key 2009 investments in laboratory services, toxicology, and manufacturingservices expected to drive revenue growth in 2010 and beyond;

Fourth-quarter 2008 net revenues from continuing operations increased 74% to$64.4 million compared to fourth-quarter 2007;

AppTec contributed $15.1 million of net revenues in fourth-quarter 2008 and$57.7 million in full-year 2008;

Net revenues from Laboratory Services increased 99% to $57.4 million in fourth-quarter 2008 and grew 100% to $205.0 million in full-year 2008, includingincreases of 47% to $42.3 million and 44% to $147.3 million in China-basedLaboratory Services for fourth-quarter 2008 and full-year 2008, respectively;

Net revenues from Manufacturing Services decreased 15% to $7.0 million infourth quarter 2008. Manufacturing Services net revenue increased 48% to $48.5million for full-year 2008, driven by continued expansion of the breadth anddepth of our customers and revenue from a single large project in the first half of2008.

GAAP gross profit grew 27% to $20.3 million in fourth-quarter 2008 and 53% to$96.3 million for full-year 2008, driven by strong net revenue growth, continuedhealthy gross margins for our China-based Laboratory Services business.

GAAP gross margin was 31% and 38% for fourth-quarter and full-year 2008,respectively, versus 43% and 46% for fourth-quarter and full-year 2007,respectively.

31. SAFC launches service to secure supply chain

March 30, 2009

SAFC has launched its Vendor Audit Services that are designed to increase clientsconfidence in the supply chain by providing traceability and quality confirmation of raw

materials.

The service has been set up to assist companies maintain standards when operating withina complex global supply chain, the dangers of which have become increasingly apparentin recent years.SAFC will operate the service as an extension of its in-house auditing, giving clientsaccess to staff with compliance and regulatory experience that operate in locales aroundthe globe.


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Gilles Cottier, President of SAFC, said: "SAFC understands that ensuring the properquality for raw materials that feed customer pipelines is vital to their success, and qualityassurance has always been a top priority for SAFC-sourced raw materials.

"This program leverages the high level of trust our customers have in SAFC's regulatoryexpertise and pioneers a much needed regulatory compliance service that can benefit ourcustomers by providing them with an efficient and effective method to help them ensurethat quality requirements are met for materials internationally sourced."

SAFC believes that clients using the service will be able to perform more audits across abigger geographic area and also achieve cost savings as a result of not having to expandtheir regulatory compliance team.

Further savings can be realized by companies that are willing to allow SAFC to reusetheir audit information for other customers.

Documents

China Pharma Outsourcing Selected News Compile - April 2009