"OTCBB-listed Jiangbo Pharma is also currently preparing to list on the Nasdaq within the next six to 12 months, Sung said. " Jiangbo Pharma aims high as health care reform rolls out - CFO
Shanghai April 24
By Karl Zhong, Interfax
Jiangbo Pharmaceuticals Inc., a U.S.-incorporated pharmaceutical company that operates primarily in China and was formerly known as Genesis Pharmaceuticals Enterprises Inc.,is well positioned to benefit from the health care reform given its sound pharmaceutical marketing network and expanded product portfolio, according to Elsa Sung, the company's chief financial officer.
In January this year, the company's wholly-owned subsidiary Laiyang Jiangbo Pharmaceutical Co. Ltd. entered into an asset transfer agreement with Hongrui Pharmaceuticals Co. Ltd. for the purchase of most of Hongrui Pharma's assets, including the production rights to 22 types of traditional Chinese medicines (TCM), at a deal price of RMB 110 million ($16.11 million).
“The acquisition has expanded our product portfolio. Two of the TCM medicines in particular, a drug to treat bone marrow inflammation and a cough suppressant, have great market potential,” Sung said.
According to Sung, the Chinese government's expansion of the new rural cooperative medical insurance program as part of the health care reform will help to promote the company's TCM sales.
Jiangbo Pharma expects to generate fast growth sales for the TCM products by leveraging on its sound marketing network, which consists of 470 full-time sales representatives and 620 part-time representatives in 30 provinces, cities and regions across China.
“Regional distributors are more familiar with the situation in their local markets. Jiangbo Pharma will benefit by working closely with these distributors, especially in the future when essential drugs [which are commonly purchased generic drugs that patients receive reimbursements for under their medical insurance] are distributed on a regional basis,” Sung said. The company recently lowered its wholesale prices in a bid to motivate regional distributors to improve sales.
While maintaining sales of its existing products and growing the market shares of new products form Jiangbo Pharma's short-term strategy, Sung said the company is looking towards merger and acquisition (M & A) deals and strengthening its research and development (R & D) efforts in the long run.
More M & A opportunities have opened up as a result of the economic downturn and the company is eyeing drug developers that hold the rights to national class one or two new drugs, the highest levels of innovation in China, according to Sung.
With regards to R & D efforts, Jiangbo Pharma put about 3.34 percent of its sales revenue towards R & D in the second half of last year, considerably higher than what many other generic drug manufacturers in China allocated to R & D. “We have been working with Shandong University and the Chinese Academy of Sciences (CAS) on new drug development, which gives us priority in commercializing the products they develop,” Sung said.
At the moment, the company has three drugs that are awaiting final approval from the State Food and Drug Administration (SFDA), including Bezoar Yijin tablets to treat inflammation, felodipine sustained-release tablets for hypertension, and Yuandu Hanbi capsules to relieve arthritis pain.
OTCBB-listed Jiangbo Pharma is also currently preparing to list on the Nasdaq within the next six to 12 months, Sung said.
Jiangbo Pharma is located in an economic development zone in Shandong Province's Laiyang City and produces both western and TCM drugs. Its sales revenue amounted to $60.5 million in the second half of last year, up 40.2 percent from the same period of the previous year.
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