July 20, 2009

China Medicine Corporation, a distributor of pharmaceutical and medical products based in Guangzhou, China, reported positive results from a third party feasibility report on a product in development, the recombinant Aflatoxin Detoxifizyme (rADTZ).

rADTZ is a food and feed additive aimed at detoxifying aflatoxin, which is a potential cancer causing agent.

According to the report done by the Feed Research Institute of the Chinese Academy of Agricultural Sciences, rADTZ increased the immunity systems of chicks and piglets as well as decreasing mortality in the experiments conducted. Simultaneously, animals treated with rADTZ experienced healthy growth in body and organ weight.

Applying the benefits shown in the experiment, a separate study showed that a 50 million chicken breeder farm could expect to save up to RMB35 million (US$5.1 million) in costs by using rADTZ.

Yang Senshan, chairman and CEO of China Medicine Corporation, said trial production of rADTZ has begun and trial sales would follow soon.

Meanwhile, the company expects to receive a product permit for rADTZ from the Ministry of Agriculture in about six months time, which will allow the sale of rADTZ throughout China. Yang predicted that rADTZ would produce net margins of 70 percent in 2009.

Last year, China Medicine saw its revenues increased 27 percent to US$53.6 million and net income rose 33 percent to US$9.1 million. Due to the global economic downturn, the company indicated that it would miss its 2009 revenue targets of a further 30 percent increment. However, it predicted its 2009 net income would be better than expectations, which is estimated to rise between 20-22 percent.