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8-K - CHINA MEDICINE CORP | v209746_8k.htm |
China Medicine Corporation Receives
Manufacturing License for rADTZ
-
Company Reaffirms
2010 Guidance and Provides Full Year 2011 Guidance -
Guangzhou, China, February 1,
2011 – China Medicine Corporation (OTC BB: CHME) (the “Company”), a
leading manufacturer, developer and distributor of Western pharmaceuticals,
traditional Chinese medicines (“TCM”), and other health products in the People’s
Republic of China, today announced that the Company has received the
manufacturing license from the Chinese Ministry of Agriculture (“MOA”) for the
Company’s proprietary recombinant, Aflatoxin Detoxifizyme (rADTZ), which is used
for removing a potential cancer causing agent, aflatoxins (AFT), from food
and animal feed. This license grants the Company a five-year
exclusive right to produce and sell rADTZ for usage in feed and feed additive
fields. The
Company expects revenue contribution from the product in the second half of
2011, after MOA completes an onsite equipment inspection.
Mr.
Senshan Yang, Chairman and CEO of China Medicine Corporation, commented, “We are
honored to announce the exciting news that rADTZ has received its manufacturing
license in the feed and feed additive fields. rADTZ is one of the
Company’s key pipeline candidate products that will play a critical role in the
Company executing its strategy of building up its biological product
line. We have already begun to build out our marketing team and sales
force in preparation for the launch of rADTZ and we will be well-prepared to
quickly and effectively launch this product in the second half of
2011. We expect $2 million to $3 million in sales from rADTZ
production in 2011, and additional revenue contribution in 2012 and
beyond. It is believed that the rADTZ technology has the potential to
be the most effective method in removing, detecting and detoxifying AFT, and
could be widely used in multiple fields, including feed, food, pharmaceutical,
AFT detection, etc. As a result, rADTZ has the opportunity to become
our flagship biological product, marking the Company's rapid transformation into
a multi-industry player."
The
Company reaffirms its previously announced fiscal 2010
guidance. The Company continues to expect revenue to be in the range
of $68 to $70 million, gross margin in the range of 33% to 38%, and operating
expenses in the range of 16% to 18% of revenues.
For fiscal year
2011, the Company expects that
revenue will be in the range of $54 to $58 million, and gross margin will be in
the range of 33% to 38%. The Company anticipates full
year operating expenses to represent approximately 22% to 26% of
revenue. This guidance reflects the Company’s current and preliminary
views, which are subject to change.
Mr. Yang
continued, “We expect the fiscal year 2011 will remain challenging due to the
combined impact of (i) margin pressure on distributing prescription drugs
because of the government’s influence on the drug distribution bidding system,
(ii) rising prices of certain raw materials used in our proprietary products,
and (iii) the execution of our ‘high-margin focus’ sales strategy for our
distribution business. Furthermore, we will continue expanding the
production capacity at LifeTech and ramping up the production and sales for
rADTZ. We are very confident that we will be able to manage through
these challenges in 2011 and we will start to realize results from
above-mentioned efforts starting in 2012.”
About
China Medicine Corporation
China
Medicine Corporation, a vertically integrated enterprise with a research and
development centre, manufacturing facility and well established sales network,
engages in the production and distribution of prescription and over the counter
drugs, traditional Chinese medicine products, herbs and dietary-supplements,
medical devices, and medical formulations in China. The Company is developing a
number of proprietary products for a variety of indications, including oncology,
high blood pressure and toxin removal from food and animal feeds. For more
information, please visit the Company's website at
http://www.cmc621.com.
Safe-Harbor
Statement
This
press release contains forward-looking statements concerning the Company’s
business and products. The Company’s actual results may differ materially
depending on a number of risk factors including, but not limited to, the
following: general economic and business conditions, obtaining regulatory
approval for new products, government support for rural health care, competition
from existing and new competitors, changes in technology, and various other
factors beyond its control. All forward-looking statements are expressly
qualified in their entirety by this cautionary statement and the risk factors
detailed in the Company's reports filed with the Securities and Exchange
Commission. China Medicine Corporation undertakes no duty to revise or update
any forward-looking statement to reflect events or circumstances after the date
of this release.
Contact
Information
ICR,
Inc.
In New
York: Ms. Christine Duan: 1-203-682-8200
In
Beijing: Ms. Wen Lei Zheng: 86-10-6599-7968