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JZMed, Inc.

China Pharma Outsourcing News Compile

China Pharma Outsourcing
Selected News Compile
Second Quarter of 2009

JZMed, Inc.

July, 2009

JZMed, Inc.
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JZMed, Inc. China Pharma Outsourcing News Compile

Table of Contents

No. Date News Title Page No.
1 June 22 Sinovac Receives China's First Influenza A (H1N1)
Vaccine Order 4
2 June 22 Strong growth predicted for Chinese vaccine market 4
3 June 19 China Resuming IPOs After 9-Month Suspension 5
4 June 17 Large pharmas turning to 3PL to cut costs 6
5 June 16 Eli Lilly and Company Announces New Drug Discovery
Initiative 7
6 June 16 Eastar Chemical expanded custom manufacturing and
product development service 9
7 June 10 GSK grows in Asia vaccine market 9
8 June 10 CBI targets “boom” in peptide outsourcing market 10
9 June 9 Syntagon “cuts out middlemen” with China office 11
10 June 2 Kendle further expands Asia-Pacific presence 12
11 June 2 Sparta brings pharma quality management to Asia 13
12 June 1 Gerresheimer opens new primary packaging plant in China 13
13 June 1 Asymchem Laboratories opened a high-potency API
manufacturing facility in Tianjin 14
14 May 26 Simcere Pays $28.5M for Majority Stake in Chinese
Vaccine Company 15
15 May 26 Big not always best for biotechs using CROs 15
16 May 26 China Says it is Not a Center for Fake Drugs 16
17 May 20 XBL To Launch China Lab 16
18 May 20 China's Jinsite Gets $15M from Kleiner Perkins 17
19 May 19 ChemWerth and Tianjin Tianyao Pharmaceuticals Co.
formed partnership 18
20 May 18 CRO Delivery Quality More Variable to Biotech
Companies Than to Pharma Companies 18
21 May 14 Overseas API vendor qualification under US FDA spotlight 19
22 May 14 WuXi PharmaTech Announces First-Quarter 2009 Results 20
23 May 11 Pfizer CEO’s Three Tips for Research Success 21
24 May 7 Hospira Launches Biologics 'Clock' And Web Resource
To Raise Awareness Of Potential Biogenerics' Impact 22
25 May 6 ellCentric Moves Deal with HD Biosciences from Screening
to Discovery 23
26 May 6 Charles River maintains 2009 guidance; preclinical orders
“stabilize” 23
27 May 6 Biotech business model “unsustainable”; report 24
28 April 29 China Medical Technologies Receives SFDA Approval
For Its Bladder Cancer FISH Probe 25
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29 April 28 Novozymes begins work on Chinese bHA plant 26
30 April 24 Excel Pharma Studies Crowned "CRO of the Year" in
Asia Pacific 26
31 April 23 China Breaks Ground On Largest Comprehensive Stem
Cell Storage And Processing Facility 27
32 April 23 Hovione shows off Irish API plant 28
33 April 22 Sinobipharma claims manufacturing first with capsule
perindopril 29
34 April 21 Sanofi-Aventis Builds New Manufacturing Base in
Hangzhou 31
35 April 21 Sanofi-Aventis Announces New Investment in China to
Locally Produce Lantus SoloSTAR 32
36 April 21 Aoxing’s pain drug plant gets GMP OK 33
37 April 20 Shanghai ChemPartner and SKK Announce Strategic
Alliance 34
38 April 17 LGC opens office in China to raise local lab standards 34
39 April 16 GVK - Excel alliance reaches from India to China 35
40 April 16 China still important for Big Pharma despite M&A
slowdown 36
41 April 8 BioDuro to work with Roche on discovery chemistry 37
42 April 7 Asia-Pacific manufacturing growth attracts Werum 38
43 April 6 Immtech Announces Investment In China 38
44 April 6 ReSearch buys Chinese CRO 39
45 April 1 Institute of Microbiology Of The Chinese Academy Of
Sciences And TB Alliance Announce Partnership To
Develop New Tuberculosis Drugs From Natural Sources 40

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JZMed, Inc. China Pharma Outsourcing News Compile

China Pharma Outsourcing
Selected News Compile
Second Quarter, 2009

1. Sinovac Receives China's First Influenza A (H1N1) Vaccine Order

June 22, 2009

Sinovac Biotech Ltd. (NYSE Amex: SVA), a leading developer and provider of
vaccines in China, announced today that the Company received the first order in China
to supply its influenza A (H1N1) vaccine to the Beijing government. The initial order
consists of 4 million doses and is expected to be delivered by the end of September.
This order will be administered to 2 million people in the high risk group. Additional
orders are expected beginning in October and, in total, Sinovac expects to supply
approximately 10 million doses to the Beijing government. The 10 million doses will be
administered to 5 million people in Beijing.

On June 14, 2009, Sinovac completed construction of the H1N1 virus seed bank
necessary to produce a virus antigen and commenced production of the first batch of
H1N1 vaccine. Sinovac expects to complete production of the first batch by the end of
July.

Mr. Weidong Yin, Chairman, President and CEO of Sinovac, commented, "We are
organizing and coordinating all personnel and resources to produce the H1N1 vaccine,
as we have almost completed the production of our seasonal influenza vaccine. With the
support and instruction of the relevant government and health authorities, Sinovac will
fully utilize its proven development and production abilities from both the H5N1
vaccine and seasonal flu vaccine to ensure the efficient production of the H1N1 vaccine.
We are working closely with authorities in order to contribute to the prevention and
control of the H1N1 epidemic situation."

2. Strong growth predicted for Chinese vaccine market

June 22, 2009

The growth of the Chinese vaccine market is set to outstrip the country’s pharma sector,
according to a Frost & Sullivan (F&S) report that predicts 14-15 per cent CAGR.

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F&S asserts that the Chinese vaccine market is already a major force in the country’s
pharma sector and will continue to be in the coming years.

Four reasons are cited to support this view, the first of which covers the stable demand
for vaccines in the country. F&S predicts that this will support the sectors growth, with
demand for children’s vaccines playing an important role.

There were more than 16m newborns in China last year with a birth rate of 12.4 percent
and although this is predicted to drop the country’s large population should ensure a
sizeable market for children’s vaccines.

In addition awareness of the importance of vaccinations is rising in China, with the
recent outbreak of H1N1 cited by F&S as a factor that reinforced this message.

This has been aided by increased advertising by pharma companies, which have begun
promoting vaccines on television and in the form of public service advertisements.

Government plays its part

F&S also believes the vaccines market has received a boost from the Chinese
government, which intends to increase investment from 218m RMB (€23m) to 2.8bn
RMD.

This increase in funding “provides the whole industry with a strong confidence and
good environment for further development”, according to F&S.

In addition F&S predicts the market for self-paid vaccines will increase. Currently the
rate of self-paid EPI (Expanded Program on Immunization) vaccines is 10 - 20 per cent
but increased awareness should increase usage in the coming years.

China tackles H1N1

China-based Hualan Biological Engineering has claimed it has produced 90,000 doses
of a H1N1 vaccine, which will now undergo testing and should be available in
September.

Hualan believes that it will be able to produce 600,000 doses a day once the vaccine is
approved by the Chinese State Food and Drug Administration (SFDA), which has
received a clinical test plan from the company.

3. China Resuming IPOs After 9-Month Suspension

June 19, 2009

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Chinese regulators today lifted a nine-month ban on IPO offerings after markets
rebounded in recent months from the plunge that prompted the moratorium. A small
drug maker, Guilin Sanjin Pharmaceutical, announced it will become the first IPO of
2009, debuting June 29 in Shenzhen, where the smaller of China's two exchanges is
located. China halted IPOs last September after the Shanghai index tumbled 60 percent
from its high the previous year.

4. Large pharmas turning to 3PL to cut costs

June 17, 2009

Large pharma companies will increase the level of supply chain activities they
outsource in the next few years but smaller businesses are predicted to keep them in-
house, according to a report.

The survey, which was conducted by Harris Interactive on behalf of UPS, found that 43
per cent of companies with revenues of more than $1bn a year are planning on
increasingly outsourcing supply chain activities.

Bill Hook, UPS vice president for global strategy, healthcare logistics, said: "We are
seeing a real shift in the marketplace in terms of large healthcare companies
increasingly embracing outsourcing of supply chain functions ranging from the
distribution of drugs and medical devices to customer service and support functions.”

Hook went on to explain how companies are outsourcing to third party logistics (3PL)
providers in an attempt to increase efficiency in response to financial pressures. If
successful this frees up money for use in R&D, marketing and acquisitions.

This contrasts with the results from the small to medium sized businesses that were
surveyed, which showed that of those that currently use in-house supply chain teams
three per cent are planning on outsourcing in the next two years.

Focus on regulations

Many respondents regarded regulatory changes as the most pressing business concern,
with larger companies being particularly worried about the impact on their operations.

Hook commented: "There are many market factors driving regulatory concerns,
including a heightened focus around security and product safety, increasing global
border controls and more products requiring special handling coming into the market."

The report recommends that companies take this uncertainty into account when
designing their supply chains to ensure they can adapt to changes.

Struggling to manage costs

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Managing costs was the most important supply chain specific issue for the majority of
respondents but companies are struggling to do so, with fewer than 50 per cent of both
small and large companies reporting successes.

In last year’s survey managing costs also topped respondents list of concerns and the
worsening of the economy is likely to have increased pressure in this area.

5. Eli Lilly and Company Announces New Drug Discovery Initiative

June 16, 2009

INDIANAPOLIS, June 16, 2009 /PRNewswire-FirstCall via COMTEX News Network/
-- Goal is to foster open collaboration between Lilly and global laboratory researchers

Alzheimer's disease. Cancer. Diabetes. Osteoporosis.

These are the diseases for which Eli Lilly and Company will be engaging researchers
from around the world in a new and unique drug discovery initiative.

The initiative, called the Lilly Phenotypic Drug Discovery Initiative, or PD2
(pronounced PD-squared)*, uses Lilly-developed disease-state assays and a secure web
portal to evaluate the therapeutic potential of compounds synthesized in university and
biotechnology laboratories. Findings from this initiative could ultimately form the basis
for collaboration or licensing agreements between Lilly and external institutions.

"Each year, researchers throughout the world design and synthesize compounds in
university and biotechnology laboratories that are never fully evaluated as potential
drug candidates," said Alan D. Palkowitz, Ph.D., vice president of discovery chemistry
research and technologies at Lilly. "There's an untapped source of ideas and compounds
in the greater scientific community that could ultimately impact patients' lives following
further evaluation and development."

Collaborations between Lilly and external researchers are not new; however, the PD2
initiative is designed to provide a more convenient point of entry for global external
researchers into Lilly's drug discovery and development process. By doing so, PD2
allows for the establishment of productive relationships with institutions and
organizations that may not previously have worked with Lilly.

"Increasingly, innovation depends on a broad network of relationships outside our
walls," said Palkowitz, adding that PD2 is yet another example of Lilly's evolving
transformation from a Fully Integrated Pharmaceutical Company, or FIPCO, to a Fully
Integrated Pharmaceutical Network, or FIPNet.

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Through the automated PD2 interface, researchers confidentially submit a structure of
their compound for an initial computational evaluation using a set of proprietary Lilly
algorithms focused on drug-like properties and structural novelty. If the compound
structure meets certain specified criteria, the researcher is then invited to submit a
physical sample for biological testing. All testing by Lilly is free, and all intellectual
property rights remain with the submitting researcher and/or institution at this stage. An
objective of PD2 is not to promote a random, high volume submission of compounds,
but rather to encourage the testing of molecules that represent novel structural diversity
and hypotheses that are thoughtfully considered in light of the biology associated with
each assay module.

After biological testing is completed, Lilly provides the external researchers a data
report with a complete biological profile of the compound across the four assay
modules mentioned earlier (Alzheimer's disease, cancer, diabetes and osteoporosis).
Because these data are derived from sophisticated and systematic in vitro model
systems, they provide researchers with broader assessments of a compound's biological
profile than what is generally available today in academic or government laboratories,
said Palkowitz.

In return for these data, Lilly has first rights to exclusively negotiate a collaboration or
licensing agreement with submitters of those compounds that demonstrate biological
activity that Lilly would like to further explore. If there is no agreement within a
defined time period, the researcher is granted no-strings-attached ownership of the data
report and can choose to use it in publication or grant proposals, or to further refine
structural hypotheses, all of which may advance scientific discovery.

One of the external experts who consulted with Lilly on the development and testing of
PD2 is Peter Wipf, Ph.D., a distinguished professor of chemistry and professor of
pharmaceutical sciences at the University of Pittsburgh. He said that, for researchers not
employed at a pharmaceutical company, the major potential benefits of PD2 include the
ability to test compounds in well-validated assays, the comprehensive nature of the data
reports and the opportunity to exchange ideas and hypotheses with Lilly experts on
compounds of interest.

"I'm looking for drug discovery experts who can critically evaluate the data on my
compounds and engage me in discussing their immediate potential for optimization and
perhaps their ultimate impact on specific areas of human health with unmet medical
need," said Wipf.

The potential benefit for Lilly is increased access to top global research talent, novel
therapeutic hypotheses and rich chemical diversity to amplify and leverage Lilly's work
and expertise in these areas. "We believe open collaboration with a network of scientists
will create new venues to deepen our understanding of complex biological processes
and eventually to discover novel therapeutics that benefit patients," said William Chin,
M.D., vice president of discovery research and clinical investigation at Lilly.
"Ultimately, our hope is that the patient will be the biggest winner of all."

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6. Eastar Chemical expanded custom manufacturing and product development
service

June 16, 2009

Eastar Chemical (Sacramento, CA) expanded its custom manufacturing and product
development offerings to include custom quality assurance and quality control services.
The company offers custom manufacturing and analytical services in the United States
and China.

7. GSK grows in Asia vaccine market

June 10, 2009

UK drug major GSK has had a busy week in the Asia, signing an influenza vaccine
manufacturing deal with China’s Shenzhen Neptunus Interlong Bio-Technique just days
after it opened a new S$600m (EUR294m) production facility in Singapore.

The Shenzhen joint-venture (JV), which will see GlaxoSmithKline (GSK) pay $34m for
a 40 per cent share, will develop and manufacture influenza vaccines, both seasonal and
pandemic, for the Chinese, Hong Kong and Macau markets.

Under the terms of the agreement GSK, which plans to acquire a controlling stake in the
business over the next two years, will make its established adjuvant technologies
available to Shenzhen for further R&D and commercial vaccine manufacture.

Jean Stephenne, president and general manager of GSK Biologicals, said the alliance
“enables GSK to build new vaccines capability in a critical emerging market such as
China.”

Stephenne highlighted the improved access to locally-circulating influenza virus
antigens as one of the key benefits the partnership with Shenzhen will provide.

With the World Health Organization (WHO) poised to declare H1N1 “swine flu” a
pandemic, GSK’s renewed focus on vaccine production for markets in one of the
world’s populous regions is well timed.

WestLB analyst Simon Mather told Reuters that the deal is a further example of GSK
CEO Andrew Witty’s desire to grow in emerging markets. In May, the firm bought a 16
per cent stake in Africa’s largest generics firm Aspen Pharmacare.

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Singapore pneumococcal vacc plant

The day before announcing the China JV GSK showcased a new S$600m vaccine
production facility in neighboring Singapore.

The 85,000 sq m plant, which is located in the Tuas Business Park in the west of the
country, will be used to make GSK’s pneumococcal conjugate vaccine when fully
operational in 2011.

Company vice president Emmanuel Amory said Singapore had been chosen as the site
for GSK’s first vaccine plant in Asia due to the highly skilled local workforce, which is
a result of the government’s decade long policy of developing biologics expertise.

Singapore’s science talent pool has been attracting many major Pharma industry players
in recent years with Bayer, Schering-Plough and Takeda all expanding their operations
in the country.

More recently Swiss biomedical science group Lonza unveiled plans to build on its
Singaporean presence and set up a CHF30m (€19.7m) cell therapy manufacturing plant
in the country.

8. CBI targets “boom” in peptide outsourcing market

June 10, 2009

Commonwealth Biotechnologies (CBI) is set to acquire China-based peptide
manufacturer GL Biochem, which it believes will create a dominant force in the non-
GMP segment of the market.

CBI believes the purchase will cement its position in the sector and enable it to
capitalise on the growth it anticipates on the markets for good manufacturing practice
(GMP) peptides, custom antibodies and specialty amino acids.

Paul D’Sylva, director of CBI and chairman of Mimotopes, said: “Peptides make up
only a small proportion of the pharmaceutical products on the market today but
represent one of the fastest growing classes of new drugs because of their high activity
and specificity, low toxicity and high degree of potential chemical diversity. “

CBI believes these traits will help the market for peptide drugs achieve a compound
annual growth rate of 7.5 per cent and be worth $13.4bn by 2010. This growth should
result in an upturn in outsourcing of peptide manufacturing, which CBI believes it can
benefit from.

D’Sylva added: “The increased interest in peptides as therapeutics has triggered a boom
in the outsourcing of peptide reagents and custom peptide synthesis, core business areas

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for both GL Biochem and Mimotopes. The proposed transaction with GL Biochem
would make CBI the largest global player in the non-GMP segment of this market.”

Over the past five years privately owned GL Biochem has posted compound annual
revenue growth of over 40 per cent, with due diligence showing that in 2008 it had a net
income of $2m (€1.4m).

In addition the acquisition of GL Biochem fits with CBI’s China-strategy. GL Biochem
now employs over 800 people and claims to be the largest manufacturer of research-
grade peptides and peptide reagents globally.

9. Syntagon “cuts out middlemen” with China office

June 9, 2009

Swedish CRO Syntagon has set up an office in Shanghai, China to forge stronger links
with a broader range of local raw materials suppliers, saving its customers time and
money.

CEO Michael Lofthagen explained that the “Shanghai office will allow us to source
high quality raw materials at competitive rates,” adding that these savings will be
passed on to clients.

He told Outsourcing-Pharma that the direct access to local producers that it provides
allows the firm to “[bypass] agents and middlemen, and [thereby] reduce delivery time.

“We will typically reduce delivery times and perhaps more importantly getting accurate
updates if delays do occur. Costs will be lower the effects will perhaps be more
dramatic for API's with lengthy synthesis and high raw material costs.”

Proximity improves monitoring

Lofthagen explained that since the Shanghai unit was opened, it has been used to source
“several key raw materials have been sourced for a clinical API synthesis by Syntagon,
at [the firms] Swedish cGMP certified site.

“The quality of the raw materials is controlled by Syntagon, typically by verifying
identity and purity. For advanced intermediates we will perform on-site inspections of
the manufacturer.”

He went on to say that “Being close to the producers gives us a better possibility to
monitor the whole process from order to manufacturing to shipment.

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“And we monitor this process very closely since we are very much aware of the fact
that delivery of raw materials for clinical API synthesis is typically on the time critical
path for the whole development project.”

The Stockholm based contract research organization (CRO) provides lead optimization,
process development, chemistry and crystallization services for drug firms through to
Phase II clinical trials.

10. Kendle further expands Asia-Pacific presence

June 2, 2009

US CRO Kendle has set up three units in Malaysia, Thailand and the Philippines,
further demonstrating the growing importance of the Asia Pacific for the contract
research sector.

The new offices, which are in Kuala Lumpur, Bangkok and Manila, will focus on
providing contract research services for the region’s biopharmaceutical development
and manufacturing sector.

Ross Horsburgh, vice president of Kendle’s global clinical development operations
explained that: “With more than half of the world’s population, Asia offers an
abundance of patients in nearly every therapeutic area.”

He went on to say that: “Governments have highlighted biopharmaceutical development
as a key pillar to their economies, resulting in much more favorable environments for
global clinical development work.”

According a recent study by the Tufts Center for the Study of Drug Development 65 per
cent of all US Food and Drug Administration (FDA) regulated trials will take place
outside the US, with a significant proportion being carried out in Asia.

Recognition of this trend coupled with an increasing awareness of the importance of
local knowledge has seen a number of US contract research organizations (CRO), most
recently Covance and PRA, invest in the region.

Cost of trials

While the potential of the Asian trial market is clearly a motivation for Kendle building
its presence in the region, the cost savings provided by the region are also a factor.

In Q1, the firm reported a 45 per cent project cancellation rate, cut its 2009 earnings
expectations and said that it was examining ways of reducing costs, including
expanding it network in Asia.

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11. Sparta brings pharma quality management to Asia

June 2, 2009

Sparta Systems is establishing operations in Hong Kong as part of efforts to expand in
Asia-Pacific (APAC), where it believes there is a growing market for quality and
compliance management.

Growth of APAC has led to an increasing number of companies based in the region
seeking to improve operations and ensure compliance, which Sparta believes its
TrackWise software can help with.

Sparta is increasing efforts to establish TrackWise in APAC, with the company
promoting that the software can streamline management operations to ensure
compliance, improve control, reduce risk and lower costs.

James McGowan, CEO of Sparta, said: "The APAC region is a critical centre for global
manufacturers in regulated industries, and Sparta Systems sees a great opportunity to
drive quality efforts in this market while expanding our global presence.

"We recognize that suppliers, manufacturers and distributors require our expertise for
enabling enterprise quality management and global compliance best practices. We plan
to support these organizations while helping improve product supply quality for
companies on a global scale."

To drive its efforts in APAC Sparta has appointed Critz Chan as its managing director
in the region. Chan will take responsibility for setting the business strategy, driving
overall sales and supporting customer deployments for the region.

TrackWise

Sparta claims TrackWise can differs from other quality management offerings as it “is
the only solution that enables companies to manage and report on all events and actions
using one software package”.

By consolidating everything into one piece of software Sparta believes users can reduce
licenses, maintenance and training costs.

12. Gerresheimer opens new primary packaging plant in China

June 1, 2009

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German glass making giant Gerresheimer has opened a new packaging plant in
Danyang, China, further indicating its plans to grow in the world’s fifth largest
pharmaceutical market.

The new 16,000 sqm facility, which is situated 250km west of Shanghai at the heart of
the region’s pharma manufacturing hub, will make vials and injection cartridges for
local and international producers as part of the firm’s Shuangfeng subsidiary.

Standard & Poor’s (S&P) analyst Izabela Listowska told in-PharmaTechnologist that
the facility “is an important strategic step not only to be well placed in this promising
market but also to optimally serve global customers who favor producers with
international presence.
“Gerresheimer is expanding its manufacturing footprint in China to be able to serve
other very promising markets in the region,” continued Listowska, adding that S&P
“view this expansion strategy as very positive for the credit quality of the company.”

Gerresheimer Shuangfeng currently runs three plants in China, including a second
facility in Danyang that is exclusively for the manufacture of pharmaceutical vials, and
has more than 150 production lines in operation.

In total Gerresheimer employs 1,500 people in China, and already has six
manufacturing facilities producing glass vials, ampoules and syringes for a large
number of domestic and international pharmaceutical firms.

Gerresheimer did not respond to a request for additional information.

International growth strategy

Growth in China’s pharmaceutical manufacturing sector fits well with the plan outlined
by CEO Axel Herberg at Gerresheimer’s annual results presentation in February.

At the time Herberg suggested that: “Even in a phase of worldwide economic downturn,
pharmaceutics and life science are still growth markets and, with its broad technology
base and worldwide presence, Gerresheimer has a strong position here.”

Gerresheimer’s pharmaceutical division contributed 75 per cent of the firm’s total
revenue in 2008 with its ready-to-fill syringes (RTF) business providing the biggest
gains by growing 36 per cent.

13. Asymchem Laboratories opened a high-potency API manufacturing facility in
Tianjin

Asymchem Laboratories (Tianjin, China), a contract manufacturer of active
pharmaceutical ingredients (APIs) and intermediates, opened a high-potency API
manufacturing facility in Tianjin, China. The facility provides containment for

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production of potent APIs at an occupational exposure level (OEL) of < 0.1mg/m3/8hrs,
validated by an expert independent assessor. The facility features two separate API
manufacturing trains of 50 and 100L, and contains four independent breathing air lines
per suite. The space will allow for the future addition of smaller-scale research and
production of oral dosage forms, tablets and capsules, and manufacturing that
incorporates potent ingredients.

14. Simcere Pays $28.5M for Majority Stake in Chinese Vaccine Company

May 26, 2009

Simcere Pharmaceutical plans on acquiring a 37.5% stake in Jiangsu Yanshen
Biological Technology for RMB 195.5 million, or about $28.5 million. Upon the
closing of the transaction, Simcere is expected to be the largest shareholder in the
company.

Jiangsu Yanshen's core products include an influenza vaccine and a human-use rabies
vaccine (vero cell). The products have the second and the fourth largest market shares
in China, respectively.

In addition, Jiangsu Yanshen has received a new medicine certificate from the PRC
State Food and Drug Administration for its freeze-dried human-use rabies vaccine (vero
cell) and has completed clinical trials of its purified hepatitis A inactivated vaccine
(vero cell). GMP certification for the associated new manufacturing facility is pending.

“Vaccines have strong market potential and represent one of China's key emerging
industries,” notes Jinsheng Ren, chairman and CEO of Simcere Pharmaceutical. “We
are delighted to enter this new market through our investment in Jiangsu Yanshen.”

15. Big not always best for biotechs using CROs

May 26, 2009

Biotechs use smaller CROs as much as larger service providers and regard patient
recruitment speed as by far the most important characteristic, according to a report.

Industry Standard Research (ISR) published the paper, which seeks to asses how
biotechs are using contract research organizations (CRO) and their satisfaction with the
service provided.

This has become an increasingly important topic for the industry, with biotech rising in
prominence and pressures on the sector meaning it has to maximize value from service
providers.

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Despite the financial difficulties facing many biotechs ISR notes that cost is not a major
decision making attribute, with patient recruitment speed being regarded as far more
important than other factors.

Kevin Olson, President of ISR, said: "Today biotechnology companies are playing an
increasing role in both drug discovery and clinical development. To maximize the
potential of their products, biotechnology companies need CROs and given the
uncertainty in large pharma right now, the CROs need biotech customers. The challenge
has always been how to work together.

"CROs often do not distinguish between the needs of smaller biotech companies and
those of their large pharma customers. And with less outsourcing experience, many
biotech companies don't know how to evaluate CROs in a way that maximizes their
chances of a successful partnership."

Niches available

The report states that there limited differentiation among service providers but that
opportunities exist for companies to specialize and create niches within the biotech
sector.

By specializing smaller companies could avoid going head-to-head with the major
players in the sector, which include the company described in the report as “the 800-
pound gorilla in the market”, Quintiles.

The report says that respondents gave Quintiles high marks for many attributes, in
particular for factors relating to running large, global studies.

16. China Says it is Not a Center for Fake Drugs

May 26, 2009

BEIJING--China has been unfairly branded a center of fake drugs, an official with the
country's drug watchdog said Tuesday, blaming instead some overseas companies that
source their raw materials through illegal suppliers. China's pharmaceutical industry is
lucrative but poorly regulated.

17. XBL To Launch China Lab

May 20, 2009

XenoBiotic Laboratories (XBL), a contract lab focused on bioanalytical and ADME,
will open XBL-China this summer.

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XBL-China's new 36,000-sq.-ft. laboratory in Nanjing has a 12,000-sq.-ft. vivarium and
analytical instrumentation. With additional offices in Shanghai, XBL-China will
provide bioanalytical and metabolism services to the standards comparable to XBL's
New Jersey facility. Jinn Wu, president and chief executive officer of XBL, "The initial
goal for XBL-China is to offer GLP-level bioanalytical as well as discovery PK services
to support drug development programs being conducted in Asian countries. Additional
services such as synthetic chemistry, formulation services, Phase I clinical trial conduct,
and SFDA registration are planned for the future. This is a significant expansion for
XBL and will allow us to provide services to global pharmaceutical companies." An
open house ceremony is planned for October 2009.

XBL has also boosted its U.S.-based services with the addition of a large molecule
bioassay/cell-based assay group, Debra LIMS, QWBA and in-house NMR services.

"With the addition of a state-of-the-art laboratory and expertise to conduct Quantitative
Whole Body Autoradiography (QWBA) studies, in-house NMR (500 MHz) and the
industry standard Debra LIMS software, we now offer a complete and comprehensive
package of services for ADME studies," saidDennis Heller, XBL's vice president of
Pharmaceutical Development. "In addition, we recognized the expanding need for
quantitative bioanalytical services for biologics (biotherapeutics and biomarkers) and,
as a result, invested in a new biologics group that will provide ELISA-based services
for quantitative PK bioanalysis for biotherapeutics, immunogenicity screening and
biomarker assays. Our biologics group is also developing key cell-based assays to
screen the biological activity of macromolecules."

18. China's Jinsite Gets $15M from Kleiner Perkins

May 20, 2009

The Chinese arm of the U.S. venture capital fund Kleiner Perkins Caufield & Byers, has
invested in a biotechnology firm in eastern China for $15 million, a source with direct
knowledge of the matter said on Wednesday.

The fund, also know as KPCB, struck a deal with Jinsite Science and Technology
(Nanjing) Co Ltd, a subsidiary of U.S.-based GenScript Corporation, which offers
outsourcing services on biological and pharmaceutical research, the source said.

It is the first deal for the Silicon Valley-based fund in China this year, and the fund is
expected to make six to seven deals in total this year, said the source, who declined to
be identified before a public announcement is made.

Founded in 2004, Jinsite, which is located in the capital city of eastern Jiangsu Province,
has a registered capital of $18 million, according to its website.

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KPCB, one of the biggest U.S. venture capital funds, started business in China in early
2007. It has previously financed companies such as Google Inc (GOOG.O) and
Amazon.com Inc (AMZN.O).

It now manages around $500 million in China fund, the source said.

Officials at KPCB in Shanghai did not return calls seeking comments. Jinsite could not
be immediately reached.

19. ChemWerth and Tianjin Tianyao Pharmaceuticals Co. formed partnership

May 19, 2009

ChemWerth (Woodbridge, CT) and Tianjin Tianyao Pharmaceuticals Co. (Tianjin,
China), a manufacturer of steroid active pharmaceutical ingredients, have formed a
contract manufacturing partnership. The agreement will add capacity for the
development and GMP manufacture of hormonal drugs.

20. CRO Delivery Quality More Variable to Biotech Companies Than to Pharma
Companies

May 18, 2009

Industry Standard Research (ISR) today announced the release of its CRO quality
benchmarking report that focuses specifically on CROs' delivery to the critical
biotechnology segment of clinical trial sponsors. This report captures the experiences
and satisfaction of 44 different biotechnology companies across 130 different CRO
interactions.

"Today biotechnology companies are playing an increasing role in both drug discovery
and clinical development. To maximize the potential of their products, biotechnology
companies need CROs and given the uncertainty in large pharma right now, the CROs
need biotech customers. The challenge has always been how to work together," states
Kevin Olson, President, ISR. Olson went on to explain: "CROs often do not distinguish
between the needs of smaller biotech companies and those of their large pharma
customers. And with less outsourcing experience, many biotech companies don't know
how to evaluate CROs in a way that maximizes their chances of a successful
partnership."

This point is illustrated in the study results where biotechnology companies value a
CROs' "Contingency Planning and Trial Risk Management" activities more highly than
pharma companies. Further, CROs tend not to recognize this and often fail to meet this
need.

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The results of the study show that across attributes, CROs tend to meet biotech
customers' expectations less consistently than they do pharma customers'. But there are
clear exceptions. PRA International received higher ratings among their biotechnology
customers than from their pharma customers.

This benchmarking study is unique in that the respondents were subjected to stringent
screening criteria and the research was developed and analyzed by industry
professionals. The average respondent has over 14 years of industry experience.

Kevin Olson, President ISR, further explains:

"It is our hope and expectation that this report will enhance the critical relationship
between biotechnology companies and their CRO partners by providing a common
language the parties can use to convey service needs and clearly communicate
expectations."

21. Overseas API vendor qualification under US FDA spotlight

May 14, 2009

US drug firms’ qualification of overseas API vendors will be subject to increased FDA
scrutiny in the coming years according to a new industry report by analysts Hogan &
Hartson (H&H).

The Washington DC legal firm said that despite 80 per cent of the Food and Drug
Administration (FDA) warning letters issued in the last year being sent to domestic
manufacturers, the agency's December “Beyond our Borders” initiative indicates a
change in focus.

H&H cited several recent good manufacturing (GMP) warnings issued to Chinese
active pharmaceutical (API) suppliers, including Qingdao Jiulong Biopharmaceuticals
and its subcontractor Shanghai No 1, as evidence that agency priorities are shifting.

Increased FDA scrutiny of ex-US suppliers would go some way towards addressing
recent Government Accountability Office (GAO) criticism of the agency’s failure to
keep accurate data about overseas drug facilities .

Additionally, asking US importers to play a greater role in proving the quality of ex-US
manufacturers may reduce the number of facilities the FDA must inspect, which would
help alleviate concerns about the cost of the agency’s overseas activities.

More aggressive use of GMP warnings

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H&H’s research also highlighted an increasing trend in the FDA to become more
aggressive with its use of GMP warning letters and “bundle” drug manufacturers’ wider
business violations in with quality concerns.

The authors suggest that more and more the agency is using warnings to notify
pharmaceutical firms if their products lack the necessary approvals or are misbranded or
to raise concerns about promotional activities.

They reference several GMP warning issued to Deltex Pharmaceuticals, Cascadia
Manufacturing, Omega Tech Labs and Civic Center Pharmacy as a basis for their
contention.

While all these warnings were sent last year a quick glance at recent FDA letters issued
to Mallinckrodt Pharmaceuticals Group, Glenmark Generics and Boehringer Ingelheim
would seem to confirm the observation for misbranding transgressions at least.

H&H go on to predict that: “as the agency continues to face an increasingly large
number of enforcement priorities with limited resources, we believe that this bundling
approach…will become more common.”

22. WuXi PharmaTech Announces First-Quarter 2009 Results

May 14, 2009

Highlights:
-- First-Quarter 2009 Net Revenues Increase 5% Year Over Year to
$59.1 Million
-- Laboratory Services Net Revenues Grow 33% Year Over Year to
$56.5 Million, Driven by Organic Growth and the AppTec Acquisition
-- China-Based Laboratory Services Net Revenues Grow 28% Year Over Year
to $41.6 Million
-- GAAP Diluted Earnings Per ADS of 16 Cents
-- Non-GAAP Diluted Earnings Per ADS of 20 Cents
-- Company Reconfirms 2009 Financial Guidance, Including 15-20% Net
Revenue Growth in China-Based Laboratory Services

Detail:
First-quarter 2009 net revenues grew 5% year over year to $59.1 million, driven
primarily by 28% growth in revenues for China-based Laboratory Services, offset by an
81% decline in Manufacturing Services revenues. China-based Laboratory Services
benefited from strong demand year over year, as life science companies increasingly
acted to reduce cost and improve productivity by outsourcing R&D services. Revenue
in Manufacturing Services is inherently variable due to the size of this business. The
year-over-year decline in Manufacturing Services revenue resulted from project delays
that postponed work authorization and delivery. In addition, the majority of

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Manufacturing Services revenue in first-quarter 2008 came from a single non-recurring
project. On a pro-forma basis, including January 2008 revenues of $5 million, U.S.
testing revenues declined 1% in the quarter to $14.9 million on a year-over-year basis.

First-quarter 2009 GAAP gross profit declined 11% year over year to $23.3 million,
mainly due to a decline in the gross-profit contribution of Manufacturing Services,
offset by increased contribution from China-based Laboratory Services. First-quarter
2009 GAAP gross margin declined to 39% from 47% in the first quarter of 2008 due to
declines in gross margin in China-based Laboratory Services, in the U.S. Laboratory
Services business due to project mix, and in Manufacturing Services due to project mix
and low capacity utilization.

Whole year guidance:
The Company reconfirmed its earlier financial guidance for 2009:
-- Total net revenues of $265 million-$275 million(1)
-- Net revenue growth in China-based Laboratory Services of 15-20%
compared to 2008 China-based Laboratory Services revenue
-- Manufacturing Services net revenue lower than 2008 Manufacturing
Services net revenue
-- U.S. testing (AppTec) net revenue comparable to 2008 U.S. testing
net revenue on a pro-forma basis(1)
-- Non-GAAP gross profit and operating income lower than 2008 amounts
in dollars and as percentages of net revenues as we invest in new
capabilities and capacities
-- Adjusted EBITDA (excluding share-based compensation charges and
potential mark-to-market gains or losses from foreign-currency
forward contracts) relatively flat with 2008 adjusted EBITDA of
$72 million
-- Capital expenditures of $50-$60 million

23. Pfizer CEO’s Three Tips for Research Success

May 11, 2009

The conventional wisdom in the drug business these days is that smaller and more
entrepreneurial is better when it comes to research. And it’s no secret that Pfizer, with
its multi-billion-dollar research budget, has had its share of R&D troubles.

So we took note today when Pfizer CEO Jeff Kindler, on a visit to Health Blog HQ, laid
out a few principles he’s tried to use in remaking Pfizer’s research operations. He
managed to boil it down to three basic ideas as the company has created research groups
focused on specific diseases.

1. Each group should have between 100 and 150 scientists — few enough that they can
all get together in the cafeteria to talk about what they’re doing.

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2. Each should be run by a chief scientific officer prominent in the field.

3. They should be left alone “to create their own culture,” and should be judged, for the
most part, on a single metric: Discovering drugs that demonstrate proof of concept.

It’s too early to say how well this will work. In any case, Pfizer certainly isn’t alone in
trying to push its labs in this direction.

GlaxoSmithKline started breaking up its labs years ago, and more recently launched a
push to have its scientists compete for $1 billion in internal funding from a board that
includes a venture capitalist and the CEO of a biotech company. Sanofi-Aventis’s new
CEO suggested he may cut his company’s early-stage research budget in half, and
spend more on licensing compounds from other companies. And Merck’s chief strategy
officer recently pointed out that 75 cents of every dollar the industry spends on R&D
“goes to fund failure,” and said Merck is going through a “painful” restructuring of its
research divisions.

24. Hospira Launches Biologics 'Clock' And Web Resource To Raise Awareness
Of Potential Biogenerics' Impact

May 7, 2009

Hospira, Inc., the world leader in generic injectable pharmaceuticals, recently launched
a clock tracking real-time U.S. prescription sales of costly biologic drugs as part of an
informational Web resource highlighting the potential impact of biogenerics – generic
versions of biologics – on the U.S. healthcare system. Although biogenerics are widely
available in Europe and other parts of the world today, there is currently no legislative
pathway allowing the U.S. Food and Drug Administration (FDA) to approve these safe,
cost-effective alternatives for Americans.

"As the first U.S. company to launch a biogeneric medicine in Europe, Hospira brings
unique expertise to the growing effort to create a regulatory pathway for these life-
saving and life-enhancing drugs in the United States," said Christopher B. Begley,
chairman and chief executive officer, Hospira. "We enthusiastically support legislation
in Congress to make high-quality, safe and more affordable biogenerics available in this
country."

The clock, available at www.hospira.com, gives a year-to-date approximation of
biologic drug sales. It is continually updated so visitors can watch the numbers tick
away, at a rate of $1,331 per second, or an estimated $42B a year. The site also provides
links to a study showing the potential billions of dollars in savings associated with
biogenerics and encourages visitors to make their voices heard in Washington, D.C., as
Congress considers legislation to bring biogenerics to market.

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In Europe, the introduction of biogenerics has led to price savings of 20 to 30 percent in
some markets. Hospira's biogeneric, Retacrit (epoetin zeta), is a treatment for anemia
associated with chronic kidney failure and chemotherapy-induced anemia, and is
available in 15 European countries today. Since launch in early 2008, Retacrit has
obtained a 30 percent share of the biogenerics market for its drug class.

25. ellCentric Moves Deal with HD Biosciences from Screening to Discovery

May 6, 2009

CellCentric expanded its agreement with Shanghai-based CRO HD Biosciences to
progress its drug discovery programs targeting multiple enzyme classes. Six novel
targets prioritized from a pool of candidates now represent the main drive of
CellCentric’s discovery efforts.

The new deal builds on a previous collaboration centered on screening an initial set of
epigenetic targets identified by CellCentric. Errors in epigenetic control mechanisms
can result in abnormal cellular behavior and are implicated in a wide range of diseases
including cancer, inflammatory and cardiac disorders, neurodegenerative diseases, as
well as diabetes.

CellCentrics’s small molecule discovery programs cover a range of enzyme classes
including demethylases, methyltransferases, and ubiquitin modulators. Assays have
been developed for target classes including protein methyltransferases, protein
demethylases, ubiquitin ligases, and cell surface receptors in different epigenetic
pathways.

In January 2009, the company signed an agreement with the Japanese pharmaceutical
giant Takeda covering validation of an epigenetic target implicated in cancer.

26. Charles River maintains 2009 guidance; preclinical orders “stabilize”

May 6, 2009

Charles River Laboratories (CRL) has bucked the CRO sector trend and reaffirmed its
forecasts for 2009, citing an improved order book and better pricing as the reasons for
its relative optimism.

The contract research organization (CRO) posted a less than impressive set of Q1
financials, with profits falling 42 per cent to $25m (€18.7m) and operating income
down 37 per cent to $39m, but said that this was in line with forecasts.

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CEO James Foster explained that “softness” in the CRL’s research model and
preclinical services businesses had dominated the period, but said that: “pricing, inquiry
levels and bookings appear to have stabilized.”

He added that although demand for preclinical services for the rest of the year is hard to
predict, CRL “will achieve the sales and earnings guidance [targets]…previously
provided for 2009.”

For the full year CRL expects net sales to drop by between two and seven per cent and
earnings per share (EPS) to be in the $2.30 to $2.60 range.

Foster’s comments differ significantly from those made by CRO rivals like Kendle,
Parexel and PPD, which have all recently lowered their expectations for the year on the
strength of weak Q1 order books.

Covance comparison

Perhaps the most useful comparison is with Covance which, despite being a bigger firm
than CRL, also tends to focus on the early drug research and preclinical end of the CRO
sector.

On April 30, Covance reported disappointing Q1 income of $27m, down 46 per cent
and cut its EPS projection to between $2.50 and $2.70, which is in line with CRL's
expectations.

The similarities continue. CRL’s optimism about its 2009 order book is also in keeping
with upbeat comments made last week by Joe Herring, Covance’s CEO, who said that:
“bottoming of demand is underway.”

In fact the only real difference between the two firm’s expectations for the year is the
fact that Covance had to restate its guidance at all.

27. Biotech business model “unsustainable”; report

May 6, 2009

Creative thinking is required by biotechs if they are to stay afloat despite the lack of
funding, according to a report by Ernst & Young, and this could reshape the landscape
of the industry.

Biotech is a particularly cash-hungry sector that relies heavily on the support of venture
capital, which has dried up in the economic downturn and left many companies with
less than 12 months cash reserves.

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In its 2009 biotech report Ernst & Young admits that funding levels will remain lower
for the foreseeable future and companies will have to break away from the traditional
business model to prosper.

The report believes that this shift could result in long term benefits, stating: "The
movement to a system that measures and truly rewards companies based on the value
their products deliver could give investors the returns they need and create the basis for
a more sustainable business model."

Ernst & Young suggest that biotechs should start rethinking how they raise capital, with
creative development partnerships and buyouts with long-term financial incentives
possible alternative business models.

However, such measures will probably come too late for many biotechs that are tied to
the “unsustainable” business model, with the report predicting an unprecedented level
of companies will run out of money this year.

This cash-flow crisis is clearly illustrated by the 162 publicly traded biotechs, 46 per
cent of the total, which at the start 2009 of did not have enough operating capital to
survive the year.

One positive to emerge from the report is that 2008 was the first year that the US
biotech sector as a whole posted a profit, although globally it recorded a $1.4bn loss.

28. China Medical Technologies Receives SFDA Approval For Its Bladder Cancer
FISH Probe

April 29, 2009

Beijing /PRNewswire-Asia-FirstCall/ -- China Medical Technologies, Inc. (the
"Company") (Nasdaq: CMED), a leading China-based medical device company that
develops, manufactures and markets advanced in-vitro diagnostic products, today
announced that the Company has received approval for its Bladder Cancer FISH Probe
(the "Probe") from the State Food and Drug Administration (the "SFDA") in the
People's Republic of China.

The Probe is an advanced molecular diagnostic test kit that uses DNA probes for early
detection and monitoring the course of bladder cancer. It is designed to detect and
identify whether aneuploidy for chromosomes 3, 7, 17 and loss of the p16 locus are
present in the human bladder cells. A number of hospitals in China have applied the
Probe for diagnosing patients with hematuria and have diagnosed patients with early-
stage bladder cancer as well as early-stage ureteral cancer, which caused hematuria in
these patients.

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29. Novozymes begins work on Chinese bHA plant

April 28, 2009

Novozymes Biopharma is building a new Bacillus-based hyaluronic acid (bHA)
production facility in China to meet “increasing demand” for the substance that has
drug delivery applications.

The facility is being built at Novozymes’ existing site in Tianjin in eastern China, which
Novozymes says may become a cluster housing plants producing bulk active
pharmaceuticals and other ingredients for the industry.

Preparatory steps for these potential expansions are incorporated into the current $35-
50m construction, which when complete in Q1 2011 will provide pharmaceutical grade
(Q7) bHA to the industry.

Thomas Videbæk, executive vice president of Novozymes, said: “Regulators are ever
more cautious with regard to the safety of products and so a facility that is capable of
delivering pharmaceutical-grade bHA is an essential part of our strategy in bringing
HyaCare forward for use in medical device and pharmaceutical applications.

“China was an obvious choice as we already have a world-class manufacturing
operation there with more than 20 years experience. This site will also facilitate
expansion as business opportunities develop.”

Production and uses of bHA

bHA has been traditionally derived from rooster combs or strains of streptococcal
bacteria but these methods are known to be pathogenic.

Consequently Novozymes has developed an animal-free bHA using non-pathogenic
fermentation method, which produces a high quality product without using organic
solvents, according to the company.

The bHA produced ay the site will go towards meeting rising demand for the substance,
which is widely used in medical device applications and in research into drug delivery
methods, including anticancer therapeutics, tissue engineering, and bone regeneration
treatments.

30. Excel Pharma Studies Crowned "CRO of the Year" in Asia Pacific

April 24, 2009.

Excel PharmaStudies won three Asia Pacific Excellence in Healthcare Awards from
Frost & Sullivan. The company was presented with all three awards in the CRO

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category, including “Asia Pacific Clinical Research Organization of the Year.” The
awards were part of 20 such honors given to life science companies that operate in the
Asia Pacific area.

Dr. William Xiong, CEO of Excel, said in a statement, “We are particularly proud to
win these awards since they are based on feedback to Frost & Sullivan from the
industry and from our clients.”

Held at the InterContinental hotel in Singapore, the fourth annual Frost & Sullivan
banquet bestowed honors on companies for achievements in pharmaceuticals, clinical
diagnostics, imaging, generics, biotech, clinical research services and medical devices.

31. China Breaks Ground On Largest Comprehensive Stem Cell Storage And
Processing Facility

April 23, 2009

Jiangsu government's China Medical City (CMC) and Shenzhen Beike Biotechnology
Co. Ltd. (http://www.beikebiotech.com) broke ground on the 20,000 square-meter Stem
Cell Regenerative Medicine Industrial Project of National Bio-Industry Base (NBPD).
This facility will house China's first comprehensive regenerative medicine technology
center and its largest international stem cell bank.

The NBPD facility is part of multi-stage project that consists of industry partnerships
aimed at providing a central research zone for China's regenerative medicine and bio-
medical industry. Groups associated with this biotechnology incubation joint-project
include those from Stanford University, the University of Texas Houston Medical
Center, Fudan University, Huazhong Science and Technology University, Nanjing
University Medical School, Jiangsu University, Shanghai Jiao Tong University and
Jiangsu Provincial People's Hospital.

Mr. Chen Zhu, China's Minister of Health, sent a letter of support that was read at
April's ground-breaking ceremony. In his letter he stated that biotechnology is China's
fastest developing technology, and stem cell research promises to improve the quality of
life for people everywhere. The NBPD program was created to improve the
understanding of stem cell technology and facilitate China's development as a world
leader in the biotechnology industry.

Located in the heart of Taizhou and occupying more than 20 square kilometers, the
CMC district enjoys investment privileges as well as full support from the local,
provincial and national governments. CMC is quickly becoming a world center for
biotechnology due to the geographical concentration of medical services and
manufacturing, effectively increasing research efficiency and streamlining production.

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Jiangsu's Minister of Health Guo Qinghua explained Beike's role in the NBPD project
saying, "Beike is Jiangsu's leading stem cell biotechnology company and can easily take
on the task of building the NBPD. This project is set to become China's largest stem cell
research center." Shenzhen Beike Biotechnology was selected as CMC's partner to build,
develop and operate the NBPD project.

The new stem cell processing facility includes four centers. The first is the Stem Cell
Technology Transfer Center where leading scientists can collaborate and transfer their
research to the clinic. The second is the Stem Cell Bank, which will be the largest stem
cell bank in Asia with the capacity to store one million samples and facilities for a
commercialized iPS bank. The third is the Testing Center, accredited to test the purity,
safety, potency and stability of stem cell products. The fourth is the Clinical
Technology Service Center, which interfaces the stem cell processing base with
hospitals, distribution paths, and offers clinical support services to analyze the outcomes
of the stem cell treatments.

Dr. Sean Hu, chairman and CEO of Beike Biotech, praised China Medical City's
foresight to develop fertile ground for stem cell technology development both from a
regulatory and a funding standpoint. Dr. Hu states, "In the 1970's the US government
provided the intellectual property support and venture capital companies offered the
funding that allowed the US to leapfrog past Europe to become the leader in
biotechnology and pharmaceuticals. China's Medical City is now doing the same and
we are starting to see the results of these efforts. Beike feels honored to be able to help
China Medical City fulfill its mission of making China the world leader in clinical stem
cell technology."

32. Hovione shows off Irish API plant

April 23, 2009

API maker Hovione’s manufacturing facility in Cork, Ireland was unveiled at an
opening ceremony yesterday just two weeks after the previous owner, global drug giant
Pfizer, formally handed over the keys.

The plant can handle a large number of specialized operations such as hydrogenation
and low temperature chemistry, and boasts a new, €70m ($91m) spray-dried
formulations unit.

Under Pfizer the facility's main focus was the production of the active ingredient for the
firm's biggest seller, the world leading hypertension blockbuster Lipitor (atorvastatin).

Before Hovione bought the plant last year Pfizer had been trying to sell it for 12 months
as part of a wide-ranging to cut manufacturing capacity and prepare for the loss of
patents on key products, including Lipitor.

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Hovione said it will continue to make some active pharmaceutical ingredients (API) on
Pfizer’s behalf, but stressed the production of its roster of drug actives as well as
contract manufacture will be the main focus of activities at the site.

In a press statement, Lorcan MacGarry, Hovione’s general manager in Ireland said:
"We will be transferring to the Cork site a number of compounds over the next 18
months,” including approved APIs made at its plant in the Loures, Portugal.

Cork and China

Over the last few years Hovione has increased API manufacturing capacity by around
50 per cent in response to the rising demand for outsourced manufacture that currently
dominates the drug industry.

While the firm has established manufacturing operations in Portugal and China, the
latter through its majority ownership of Hisyn Pharmaceutical, the Cork plant is the first
it owns in Ireland's API producing hub.

A Hovione spokesperson told in-PharmaTechnologist that the high proportion of
available capacity, excellent engineering standards and the "large number of 6 sigma
green and black belt [trained] individuals," were key factors in the decision to buy the
facility.

"We expect to have 80 team members running the plant for the first 18 months, this is
the time it will take for the plant to be qualified and registration validation batches to be
produced and put on stability. After this time we will have actual routine manufacturing
campaigns; when we have a good percentage of the site filled headcount will increase."

She went on to say that: "Adding the Cork site to the Hovione group provided our
customers with the best of both worlds: access to the kind of facilities that only Large
Pharma can afford, with all the benefits associated with Hovione flexibility and speed,
service and compliance.

Another factor in the decision to set up in Ireland were growing industry-wide concerns
about some APIs and drugs sourced in Asia, which was a problem alluded to by
Hovione CEO Guy Villax in December when the plant acquisition was announced.

He said that: “We have been manufacturing in China for over 25 years - we know very
well what China can do for the Pharma industry, but we also know what it can't do - and
it is for those reasons that we are now in Cork.”

33. Sinobipharma claims manufacturing first with capsule perindopril

April 22, 2009

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Sinobiopharma is seeking a Chinese patent covering the manufacture of capsule forms
of the heart drug perindopril, claiming it is the first company in the world to produce the
medication in this easy to swallow format.

Sinobiopharma is attempting to protect the manufacturing and API stabilization
methods that allow it to produce the drug in capsules, rather than the usual tablet form.

Perindopril is a generic angiotensin-converting enzyme (ACE) inhibitor used to treat
hypertension and heart disease, which are a large and growing problem in China.

According to data presented last week at the 5th annual Continent International
Symposium on Cardiovascular in Beijing, cardiovascular disease (CVD) is now the
leading cause of death in China.

The Chinese Center for Disease Control and Prevention (CCDCP) estimates that CVD
kills 2.6m people a year and predicts that, by the end of this year, 100m will be
diagnosed with heart disease as a result of tobacco use and unhealthy diets.

As a result of these social changes Sinobiopharma’s product, which is due for launch
before the end of the year, has considerable market potential, particularly given the
increasing adoption of western medicines and treatments in China.

Expands Chinese distribution network

In other Sinobiopharma news the firm has expanded the Chinese distribution of its pre-
surgical muscle relaxant cisatracurium besylate, which is sold in the country as Kutai.

The Nantong based firm, which is known as Dong Ying Pharmaceutical in China, said
that the new contracts cover sale of the drug in 30 provinces and will require the
manufacture of 1.5m extra doses a year.

Sinobiopharma CEO Lequin Huang explained that, since its launch in late 2006, the
drug has been adopted by more than 700 hospitals in China and predicted that the new
distribution deals will generate additional revenue of $14m (€10.2m) a year.

Dr Huang added that the firm is also in talks to gain 100 per cent ownership of its major
distribution partner Nanjing Langkun Medicine company in a bid to generate further
additional income.

Seeks US partner

April is turning out to be a busy month for Sinobiopharma’s deal department. Two
weeks ago the firm signed a two-year export deal with US marketing and
pharmaceuticals sourcing firm Kingchem focused on cisatracurium besylate.

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Cisatracurium besylate, which is sold in China as Kutai, differs from other muscle
relaxants that must be kept at temperatures of 2 to 8 degrees C in that it can be stored in
ambient conditions.

Sinobiopharma also claims that the drug has an earlier onset of action and longer
duration of effect than other products in its class.

Under the agreement Kingchem will help Sinobiopharma find US companies interested
in importing the drug. Kinchem has also been contracted help secure a development
partner for the product in North America.

Speaking at the time Sinobiopharma Vice President, Xuejun Chen.said that: "We
believe this agreement is a first step in expanding the international marketing of Kutai
to help generate increased sales revenues."

34. Sanofi-Aventis Builds New Manufacturing Base in Hangzhou

April 21, 2009

Sanofi-aventis (EURONEXT: SAN and NYSE: SNY) announced today that the
company will relocate its current manufacturing facility from downtown Hangzhou and
build a new manufacturing site in Binjiang New Development Zone. This new site
represents an investment of 270 million Renminbi (31 million Euro).

The new site is scheduled to be completed by 2012 and have an expanded capacity of
160 million packs. With an area of 44,775 square meters, the new site also allows the
potential for further expansion and the creation of an export hub to other Asian
countries.

Wang Guoping, Secretary of Hangzhou CPC Committee, and Christopher A.
Viehbacher, Chief Executive Officer of sanofi-aventis, presided over the signing
ceremony for the project.

Secretary Wang said: “Sanofi-aventis and Hangzhou have a partnership that dates back
to 1995. The establishment of sanofi-aventis’ new manufacturing base in Binjiang New
Development Zone plays an important role in the further development of a strong
pharmaceutical industry in Hangzhou.” “Much of our history and the success achieved
to date in China is attributed to the great support that we have received from the
Hangzhou municipal government and other partners in Hangzhou. We are excited to
start a new chapter of our renewed commitment to Hangzhou,” said Mr. Viehbacher.

Sanofi-aventis’ current plant produces and repacks the company’s major cardiovascular
and anticancer products, including Plavix®, Aprovel®/Co-Aprovel®, Taxotere®, and
Eloxatin®. With the new manufacturing site to be completed in 2012, Aanofi-Aventis is

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poised to meet the growth demand of the Chinese market and improve the standard of
care for important therapeutic areas such as hypertension, ACS, stroke and cancer.

The new manufacturing site in Binjiang New Development Zone will be built in strict
compliance with the GMP and HSE (Health, Safety and Environment) standards
required by China as well as the Aanofi-Aventis Group.

35. Sanofi-Aventis Announces New Investment in China to Locally Produce
Lantus SoloSTAR

April 21, 2009

French Group Committed to Partnering with the Chinese Diabetes Society to Undertake
in China the World’s Largest Diabetes Genotyping Project -

BEIJING, China, - Sanofi-Aventis (EURONEXT: SAN and NYSE: SNY) announced
today an increase of capital investment in the amount of US$90 million (600 million
Renminbi) to extend its current manufacturing facility located at the Beijing Economic
and Technological Development Area, and to build pre-filled injection production lines
for Lantus® (Insulin Glargine) SoloSTAR®.

With an expected capacity up to 50 million units, the new Lantus® SoloSTAR®
investment will allow Sanofi-Aventis to better meet the growth demand of the Chinese
market and improve the standard of care to combat diabetes in China.

Guo Jinlong, Mayor of Beijing, met with Christopher A. Viehbacher, Chief Executive
Officer of Sanofi-Aventis, and recognized Sanofi-Aventis’ commitment to China.
Officials from Beijing Economic and Technological Development Area were also
present at the meeting.

“The new Lantus® SoloSTAR® investment signifies a new milestone of Sanofi-
Aventis’ commitment to China. As the first multinational healthcare company to
establish offices in China, we remain convinced of the strategic importance of the
Chinese market,” said Christopher A. Viehbacher. “We are particularly dedicated to
investing in areas that can help China address its public health needs. Lantus®
SoloSTAR® is a result of five years of R&D at the highest level. The local production
of Lantus® SoloSTARr® at the new manufacturing site is scheduled to start in 2012,
and it will bring great benefits to the diabetes patients in China,” added Mr Viehbacher.

Mr. Viehbacher also announced a new partnership with the Chinese Diabetes Society to
initiate a diabetes genotyping project involving more than 46,000 diabetic and non-
diabetic patients. This landmark study will analyze in-depth genetic factors to better
understand the pathogenesis of type 2 diabetes, which could allow for the early
detection of individuals at risk for developing diabetes and define effective risk
prevention strategies. Furthermore, by defining new molecular targets, causally

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involved in the pathogenesis of diabetes, the results of this research might potentially
help to develop new medicines for the prevention and/or treatment of diabetes.

The Lantus® investment follows a 94 million USD (700 million RMB) investment that
Sanofi-Aventis made in 2007 to establish a high-tech manufacturing facility to produce
Vaxigrip® for the prevention of seasonal influenza and to contribute to pandemic
readiness in China. The two investments combined makes Sanofi-Aventis a leading
investor in China’s biological field. Sanofi-Aventis’ Shenzhen flu vaccine facility will
complete construction this year, and enter the phase of equipment qualification and
process validation. Vaxigrip® production is scheduled to start in 2012.

36. Aoxing’s pain drug plant gets GMP OK

April 21, 2009

China Aoxing Pharmaceutical, a specialist developer of pain management drugs, has
received GMP accreditation for the new tablet production and packaging plant it has set
up in Shijiazhuang.

The facility, which has been cleared by the State Food and Drug Administration (SFDA)
for five years, will produce solid dose versions of narcotic painkillers like oxycodone
and buprenorphine for the Chinese market.

The plant will also make the powerful narcotic pain management product tilidine, which
Aoxing became one of the few manufacturers licensed to manufacture for the Chinese
market in 2007.

Aoxing CEO Juan Yue Han said that the accreditation provides the foundation for the
further development and strengthens the firm’s manufacturing base, positioning it for
growth in China’s expanding drug market.
Since the SFDA began tightening up rules on drug production in 2006 the number of
Chinese drug makers that have gained good manufacturing practice (GMP)
accreditation has increased considerably.

However, Aoxing claims that its facility is one of very few in China to have been
cleared for the production of narcotic drugs, which necessarily require stricter control
than other medications.

The company went on to say that the lack of manufacturing capacity, coupled with
increasing demand for western pain medicines, means that the Chinese narcotic
painkiller market is both “very under-served and fast-growing.”

Aoxing said it is working closely with the government and SFDA to ensure the strictly
regulated availability to medical professionals of its narcotic drugs and pain medicines
throughout China.

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In addition, while Aoxing did not reveal any plans to make drugs for the export market,
gaining GMP accreditation from the SFDA will certainly make it easier for the firm to
gain similar approval from regulators outside the country in the future.

37. Shanghai ChemPartner and SKK Announce Strategic Alliance

April 20, 2009

TOKYO, April 20 /PRNewswire-Asia/ -- Shanghai ChemPartner Co., Ltd.,
(ChemPartner) a group company of ShangPharma, and Sanwa Kagaku Kenkyusho Co.,
Ltd. (SKK), a pharmaceutical company headquartered in Nagoya, Japan, today
announced that they have entered into a strategic alliance. The partnership was formed
as a key element of a strategic initiative for SKK to target the Asian market, in step with
SKK's new medium-long term business plan and expanding presence in diabetic
research and will help SKK to achieve its drug discovery goals.

Commenting on this alliance, Michael Hui , CEO of ChemPartner said, "We are
delighted to be entering this strategic alliance with SKK. We are proud and honored that
SKK have selected ChemPartner to be one of their partners and we look forward to
building a long and successful relationship between our two companies in the future."
The business terms and details of this project were not disclosed.

38. LGC opens office in China to raise local lab standards

April 17, 2009

LGC Standards is increasing its presence in Asia through the opening of its first office
in China, which will provide laboratory quality management services to the local
market.

By opening an office in China the UK-based company will allow it to directly support
the growing local pharmaceutical laboratory network, providing technical and logistical
advice in the local language.

LGC has offices throughout Western Europe and representatives in Central and Eastern
Europe, the US and joint-venture in India and has now identified China as the next
location for its international expansion.

Matthias Brommer, director of LGC Standards, said: “The opening of our first Chinese
office clearly demonstrates that LGC Standards is committed to providing global
quality management solutions for laboratories worldwide.

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“Our Chinese team will focus on supplying laboratories in the pharmaceutical,
environmental, food, industrial and forensic sectors with reference materials and
proficiency testing schemes to support laboratory quality.”

From the office LGC will provide a range of products and services for measurement and
laboratory control, such as reference materials and proficiency testing.

LGC believes that by improving the supply of reference materials and proficiency
testing schemes to Chinese laboratories it can help the country meet international
standards.

In addition LGC has indicated that it is keen to partner with local businesses on future
projects and will use the office as a base for establishing these relationships.

The office will be managed by Chen Hong, with Frank Lai joining the company to
provide specialist pharmaceutical knowledge.

39. GVK - Excel alliance reaches from India to China

April 16, 2009

Companies seeking research services in India and China will now be able to use a single
contact following an alliance between GVK BIO and Excel, which the companies claim
is the first to span the two nations.

The cost-effectiveness of both countries and their respective specializations, such as
India’s sponsor friendly regulations and China’s large market, have been cited by the
companies as the motivation for the alliance.

By harnessing the respective strengths of each country and company, India-based GVK
Biosciences and China-based Excel PharmaStudies believe they can quickly and
efficiently move clinical trials from Phase II to IV.

Manni Kantipudi, president of GVK BIO, said: “This is a first of a kind alliance
between an Indian contract research organization (CRO) and a Chinese CRO. The GVK
BIO-Excel alliance integrates trial management across India and China and provides
sponsors with a single point of contact.”

Under the terms of agreement GVK BIO and Excel will assist sponsors with Phase II to
IV trials, statistical analysis and medical writing.

The arrangement between the two companies is that any of GVK BIO’s trials that take
place in China will be carried out by Excel and managed by the Indian company.
Similarly, Excel will manage its trials in India and they will be performed by GVK BIO.

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GVK looks beyond borders

GVK BIO’s alliance with Excel comes three weeks after it gained approval from the
Turkish Ministry of Health to conduct bioequivalence studies, which opens up the
country’s generic drug market to the Indian CRO.

Having gained approval GVK BIO will be able to conduct bioequivalence studies at its
clinical pharmacology sites in Hyderabad, India for clients looking to market generic
drugs in Turkey.

40. China still important for Big Pharma despite M&A slowdown

April 16, 2009

Although the downturn has slowed Big Pharma’s investment in China, the country’s
wide ranging healthcare reforms and changing economic landscape still provide
considerable opportunities says PricewaterhouseCoopers (PwC).

A new PwC report suggest that while the $2.1bn (€1.6bn) worth of M&A deals between
multinationals and Chinese drug makers in 2007 is not likely to be bettered in the
present economic gloom, the country will continue to develop as a key market.

Michael Keech, director pf PwC’s life science industry group, said that: “Impending
healthcare reform, the commitment to innovation by the Chinese government, and
numerous tax incentives among other things are making China a much bigger player in
the global pharmaceutical industry.”

The report claims that R&D spending by the Chinese drug industry was the third
highest worldwide in 2006 and suggests that President Hu Jintao’s pledge to “build an
innovation-oriented country by 2010,” will further increase investment.

China’s contract manufacturing and research sectors are highlighted as success stories.
The report speculates that the rapid adoption of international standards and the Big
Pharma vogue for outsourcing will drive expansion of the two sectors.

While China’s key status as a supplier and production hub has been underlined in recent
years by the creation of US Food and Drug Administration (FDA) field offices and the
establishment of IPEC China, recognition of its importance is relatively new.

Although traditional medicine is cited as a factor in delaying development of China’s
drug market, the country’s track record on counterfeiting and complicated IP rules have
had more of an impact on Big Pharma investment decisions.

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With this in mind the PwC also suggests that December’s reform to Chinese patent law,
which increased the fines IP fraud, coupled with government efforts to combat
counterfeiting and corruption will catch the eye of the multinational drug industry.

China industry changes will go on
While they maintain that China represents a real opportunity for Big Pharma, the
authors caution that the rate of evolution of the country’s drug market is likely to
accelerate, particularly given the recent government reforms.

“Over the last three years, the pharmaceutical landscape has changed rapidly in China,
and…is going to be altered again in the coming years given the direction of the
healthcare reform plan announced by the Chinese government in October 2008.”

“Although the plan gives only high level trends, the changes are expected to be
significant and should have a major impact on multiple aspects of China's
pharmaceutical industry in the coming years.”

41. BioDuro to work with Roche on discovery chemistry

April 8, 2009

Just weeks after expanding its relationship with AstraZeneca, Chinese CRO BioDuro
has been asked by Swiss drug major Roche to help with its discovery phase R&D
program.

Under the contract, which builds on the firms’ existing relationship, BioDuro will
provide early-stage discovery chemistry and biology services for Roche’s early R&D
programs at sites in China and elsewhere.

BioDuro’s claim that its expertise can bring a renewed focus to R&D efforts and help
reduce discovery timelines, could be a major boost for Roche which, like most drug
majors is under pressure to restock dwindling product pipelines.

Robert Goodnow, Roche’s global head of medicinal chemistry outsourcing explained
that: "Presently, there is intense competition within the CRO industry for outsourcing
and drug discovery services, and the expectation is that they will deliver problem
solving skills and innovation in both chemistry and biology."

"We selected BioDuro due to their demonstrated excellent performance in synthetic
chemistry and ability to deliver integrated medicinal chemistry services," he added.

Goodnow’s thoughts were echoed by BioDuro CEO John Oyler who said that the firm
is “pleased to build upon this existing collaboration and work closely with the
experienced team at Roche to aid in the development of novel therapeutics.”

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Oyler went on to say that the “partnership demonstrates the strength of our innovative,
fully integrated R&D service platform, and is a true testament to the caliber of scientists
that have joined our team."

BioDuro has a team of 580 researchers and technicians at its facility in the Chinese
capital Beijing. It currently has a roster of 40 pharma and biotech clients that it claims
include 10 of 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
expand their businesses.

BioDuro appears to have positioned itself well to take advantage of the burgeoning
contract research market, with Frost & Sullivan predicting Asian CROs will be doing
$2bn (€ 1.5bn) worth of business a year before 2010.

42. Asia-Pacific manufacturing growth attracts Werum

April 7, 2009

Werum Software & Systems has set up offices in Japan and Singapore, which will
strengthen its position in Asia-Pacific and help it meet the region’s growing demand for
tools to improve manufacturing quality.

Asia-Pacific, in particular Japan, India and China, has been highlighted as an area of
growing importance by Werum, with the company hoping the growing number of
facilities and desire to raise quality will create opportunities in the region.

By increasing its presence in the region Werum is positioning itself to capitalize on the
rise in demand for manufacturing execution systems (MES) that it expects to occur.

Hartmut Krome, chairman of the Werum executive board, said: "Many of our large
multinational customers with operations in Asia-Pacific as well as local manufacturers
will improve their manufacturing quality and drug safety in order to meet international
standards.

"Our MES product PAS-X will be the key for such improvements. We expect future
growth in the Asia-Pacific region to contribute a rapidly increasing share, with Japan
and Singapore as the focal points of the business."

The two new offices will operate in conjunction with Werum’s partners in Japan,
Singapore, Thailand, China and Australia.

43. Immtech Announces Investment In China

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April 6, 2009

Immtech Pharmaceuticals, Inc. (NYSE Amex: IMM) announced today that it has made
an investment in Gold Avenue Ltd., a privately-held Hong Kong company with interests
in tin production in China. Gold Avenue is invested in a joint venture to produce tin
products from large tin tailing sites located in Yunnan, China. Tailings are refuse or
dross that collects after ore is mined. Yunnan Tin Group ("YTG") is a large producer of
tin in the world. A subsidiary of YTG is the joint venture partner in this investment.

China is the world's largest consumer and producer of tin. Tin is used in soldering
electronics, in finishing steel and other metals, and in chemicals for multiple
applications. The world's supply of tin has been in decline, while demand for tin has
been growing steadily. The price of tin has been rising on trend for over a decade. In
2008, contract prices on the London Metals Exchange ranged from approximately
$11,300 to $23,900 per metric tonne. Because residual tin deposits in tailings are above
ground and relatively easy to recover, the cost of processing the retrievable tin reserve
is lower than mining, and the process significantly reduces environmental risks.

Eric L. Sorkin, Immtech's Chairman and Chief Executive Officer, stated "This
investment opportunity positions us to create shareholder value by maximizing the
strengths of our business relationships and our understanding of product development
and distribution in China. Established price inelasticity makes tin production an
attractive opportunity. Immtech will continue to seek alliances with well positioned
companies in pharmaceutical and other high growth sectors." Gold Avenue will invest
initially in a loan with an annual interest rate of 22%, convertible, at its option anytime
in the next five years, into shares in the joint venture. About Immtech Pharmaceuticals,
Inc.

Immtech Pharmaceuticals, Inc. and subsidiaries (a development stage enterprise) is
focused on global development in the healthcare sector and opportunities in China.
Immtech aims to apply its expertise and assets in both new drug development and
enhanced healthcare-related services, including research and content distribution for
developed and developing countries. For additional information, please visit the
Company's website at www.immtechpharma.com.

44. ReSearch buys Chinese CRO

April 6, 2009

ReSearch Pharmaceutical Services has expanded its activities into the Asian market via
the purchase of Chinese contract research organization (CRO) Paramax International.

Delaware, US-based RPS will pay around $1m in cash as well as around 531,000 shares
to gain control of Paramax, with the transaction due to complete sometime next month.

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The move will give RPS expanded capabilities in the Asian market, said RPS, which
has already expanded from the US into Europe and Latin America in the last couple of
years.

RPS first started a push to internationalize its business in 2006/2007 with an expansion
into Latin America, and followed it up in 2008 with a push into Europe. Last December,
RPS bought France’s Therapherm Recherches, Imerem of Germany and Spanish CRO
Infociencia for a total of €7.4m, plus stock. The company says 2009 will mark its
expansion into Asian markets.

“The acquisition of Paramax will be a key event in the expansion of our existing
operations for providing globally integrated clinical research services,” commented
RPS’ chief executive Dan Perlman.

Paramax, set up in 2003, represents the first phase of that expansion. The company has
headquarters in Beijing and an operations office in Shanghai which will serve as RPS’
Asian headquarters.

The Chinese CRO has a stake in a Good Laboratory Practice (GLP) certified laboratory
set up with China’s Center for Evaluation of Drug Safety at the Second Military
Medical University (SMMU) in Shanghai.
It specializes in toxicology and pharmacology studies, clinical monitoring, patient
recruitment and clinical data management and biostatistics. Paramax also offers
consulting, regulatory affairs, project management and medical writing services.

RPS’ 2008 results, published last week, indicate that its service revenues advanced
more than 30 per cent to $157m, with earning before interest, taxes, depreciation and
amortization up a third to $8m.

45. Institute of Microbiology Of The Chinese Academy Of Sciences And TB
Alliance Announce Partnership To Develop New Tuberculosis Drugs From
Natural Sources

April 1, 2009

The Institute of Microbiology (IMCAS), a member institute of the Chinese Academy of
Sciences, and the Global Alliance for TB Drug Development (TB Alliance), a not-for-
profit product development partnership accelerating the discovery and development of
new TB drugs, today announced a partnership to discover and develop promising, novel
anti-tuberculosis agents from natural sources, including microbial metabolites and
traditional Chinese medicines.

A pilot screen conducted by IMCAS identified 24 natural product extracts as having
potential anti-tubercular activity. IMCAS and the TB Alliance will collaborate to further

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test these extracts, purify and identify the active components, and develop those that
prove most promising. Additionally, IMCAS and the TB Alliance will work together to
investigate traditional Chinese herbal medicines and purified compounds for biological
activity against the Mycobacterium tuberculosis(M.tb) organism. Scientists in China
have made significant contributions in developing new drugs from natural sources, as
exemplified by the identification of Artemisinin, one of the most effective anti-malarial
drugs, first isolated from a traditional Chinese medicinal plant. The deficiency in natural
product screening directly against M.tb combined with China's strong track record of
successfully developing new drugs from traditional Chinese medicines, suggests such
screenings are likely to yield novel active compounds.

Previously, a group of scientists including Professors Lixin Zhang, Deborah Hung and
Eric Rubin of IMCAS, Broad Institute and Harvard University, respectively, worked
together to investigate underlying mechanisms of M.tb, the bacterium that causes TB,
with the intent to develop new TB drugs from natural sources to treat both drug-
susceptible and drug-resistant TB. Modern technologies including high-throughput
chemical screening, total genome sequencing, and the construction of systematic,
comprehensive arrayed bacterial libraries were utilized in this process.

"This partnership reflects China's increasing commitment to address the deadly TB
epidemic, which has had such a devastating effect on so much of the world for so many
years," said Dr. Mel Spigelman, President and CEO, TB Alliance. "Bringing the best
science in China together with the expertise of the TB Alliance is an example of the
pooling of global resources necessary to save the millions of lives needlessly lost to TB
every year."

Novel drugs are needed to work against drug-resistant TB, the more deadly and
difficult-to-treat form of TB that is on the rise across the globe, including Asia. Drug
resistance oftentimes emerges as a result of patients not completing the burdensome
regimen currently used to treat drug-susceptible TB. The last class of new TB drugs was
developed and approved in the 1960s. While the current treatment regimen for drug-
susceptible TB is effective when administered properly, it must be administered over
six to nine months. Treatment for multidrug-resistant tuberculosis (MDR-TB) usually
takes a minimum of 18 months and only cures approximately half of those infected.
New, faster-acting TB treatments can improve treatment of both drug-sensitive and
drug-resistant TB, enhance compliance, lower relapse rates, reduce the growth of drug
resistant TB, reduce health care costs and save millions of lives. The partnership
between IMCAS and the TB Alliance is a fitting precursor to the three-day ministerial
meeting of high MDR-/XDR-TB burden countries beginning tomorrow in Beijing.

"The fight against tuberculosis is a global endeavor. This partnership represents joint
efforts by IMCAS and the TB Alliance in the development of new TB drugs from
natural resources," said Prof. Li Huang, Executive Deputy Director-General of the
IMCAS. "Natural products have long been an important source of drugs for human
medicine. The rich functionality and stereochemistry of natural products is without
doubt one of their great strengths, providing both potency and selectivity. Taking

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advantage of its expertise in the exploitation of microbial resources, IMCAS has
recently set up the Drug Discovery Center for Tuberculosis. The aim of the Center, led
by Prof. Lixin Zhang, is to develop and deliver novel TB drugs that work quickly and
can help prevent the problems of today's drugs relating to compliance, drug resistance
and TB-HIV co-infection."

The TB Alliance is leading the development of the most comprehensive portfolio of TB
drugs in history, and is accelerating discovery, preclinical and clinical research of
known and novel classes of antibiotics to shorten and simplify the treatment of
tuberculosis, including MDR- and XDR-TB. The TB Alliance is committed to making
all drugs developed by its research partnerships affordable and available to all who need
them.

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