Morning Roger...press release of this a.m.
Altachem Pharma signs JV letter of intent with J.I. & C.C.
Altachem Pharma Ltd AAF
Shares issued 14,735,899 1999-07-23 close $0.55
Monday Jul 26 1999
Mr. Warren Jackson reports
Altachem Pharma has signed a joint venture letter of intent with J.I. & C.C. of Bao Shan District of Shanghai, China, on the manufacturing facility, development and commercialization of a pellet core product for the China market. The pellet core products are spherical particles usually less than one millimetre in diameter for use in the manufacture of sustained-release dosage forms. The drug is applied over the cores as a thin film from a solution or suspension and subsequently the medicated cores are coated with a film (polymers, waxes, etc.) which controls the release kinetics of the drug. Currently, the pellet core product is imported into China from various countries such as France, Italy and the United States. Upon completion, this new venture will be the first domestic product of its kind in China. Since the pellet core is not classified as a pharmaceutical product, the SDA (State Drug Administration) approval is not required for marketing.
Altachem Pharma's participation in this joint venture is 25 per cent along with J.I.& C.C.'s participation of 75 per cent. Fifty per cent of Altachem Pharma's investment ($125,000 (U.S.)) will be by means of providing the technology for the formulation of the product, and the other 50 per cent ($125,000 (U.S.)) a combination of state-of-the-art manufacturing equipment and/or operating capital. J.I.& C.C.'s contribution will consist of approximately $750,000 U.S. in the forms of facility, equipment and capital. Under the deal, Altachem Pharma will receive a 2.5-per-cent royalty on gross sales, paid quarterly, plus 15 per cent of the net profit paid yearly during the life of the joint venture. The first year of production is estimated at approximately 250 metric tons, with sales forecast of approximately $3.5-million (Canadian) to $4-million (Canadian).
The joint venture company will be in the wealthiest municipality of Bao Shan District of Shanghai. The management team will consist of directors and officers from Canada and China. The construction of the manufacturing facility is scheduled to begin upon signature of the joint venture agreement and targeted to start production of the pellet core in June, 2000. The unit will also provide infrastructure for the future manufacturing of sustained-release products by the joint venture.
J.I. & C.C. of Bao Shan District of Shanghai has formed a number of collaborations with foreign countries (France, Switzerland, United States, Japan) in a full range of commercial activities. Altachem Pharma will be the first Canadian company to invest in this municipality of Shanghai, China.
This joint venture is in addition to several agreements already in place in China.
Proprietary drug division
Licensing agreements are currently under negotiations with CSP from China for two molecules. The principal of the agreements will be that CSP is responsible for all the co-ordination of clinical trials, and registration with the SDA, for exclusive rights to manufacture, distribute and market the products. Altachem Pharma Ltd. will receive a royalty on sales. The collaboration would significantly accelerate the clinical development programs of those molecules in China.
WARNING: The company relies on litigation protection for "forward-looking" statements.
(c) Copyright 1999 Canjex Publishing Ltd. canada-stockwatch.com
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