East meets West in Tasly’s TCM venture

East meets West in Tasly’s TCM venture

By He Wei - China Daily (June 2, 2011 9:38 PM)

SHANGHAI - The traditional Chinese medicine (TCM) industry looks likely to gain an overseas presence by tapping into the US market. 

Tasly Group Co Ltd, one of China's leading biopharmaceutical companies, announced on Thursday a $40 million investment plan in TCM product research at a new operation in the US state of Maryland.
This is the latest plan by a Chinese medicine manufacturer to gain a stronger international presence, after a European Union regulation in effect removed TCMs from the European market.
By opening a production facility and training center in Maryland, Tasly intends to leverage the state's vast bioscience resources as it prepares for Phase III clinical trials of its TCM product Compound Danshen Dripping Pills (CDDP).
The investment plan is an effort to put the first US Food and Drug Administration-approved TCM medication on the market, according to Yan Xijun, chairman of Tasly.
"We think it is an incredible opportunity for Tasly to innovate new products and introduce them to the US market. This also marks an important chapter in the globalization of traditional Chinese medicine," Yan said at the signing ceremony for the investment plan in Shanghai.
Maryland Governor Martin O'Malley said the cooperation reflects a mutual Chinese and US aspiration to advance TCM on the global market.
"Traditional Chinese medicines are famous for their lack of side effects and provide better treatment. We are excited to figure out ways to combine the West and East and contribute to the internationalization of the medicine," O'Malley said.
CDDP, developed to treat and prevent coronary disease, is the first Chinese combination medicine to complete Phase II clinical studies both in China and abroad. If all goes well with the Phase III trials, it is expected to be formally launched as early as 2014.
Anticipating possible concerns of Western users, Yan said modern TCM products are made from the same traditional ingredients, but are packaged in capsules like chemical medications.
During clinical trials, tests are conducted to ensure the safety of the medication and identify any adverse reactions. All medicines approved for the US market must undergo three phases of trials, said Song Ruilin, executive president of the China Pharmaceutical Industry Research and Development Association.
"TCM is based on experience, rather than experiments. To get an operating license, manufacturers must present detailed results of experiments showing that their products meet the safety, purity and effectiveness requirements. This is the biggest hurdle for Chinese herbal medicine producers," Song told China Daily.
The European Union imposed strict regulations on herbal medicine products on May 1, significantly raising the threshold for market access. No Chinese company was able to meet the new standards.
Tasly says it will strive to provide high quality TCM products for the US and European markets and play a part in regulating TCM packaging and manufacturing overseas.
Tasly is also attracted by Maryland's proximity to Washington DC, where federal authorities, including the FDA, are concentrated, Yan said.

Citic Securities Closes $1B Dollar-denominated Fund

The private equity unit of China’s Citic Securities Co. has closed a dollar-denominated fund worth roughly $1 billion, Reuters reported. The CPEChina Fund inked $990 million from 39 overseas limited partners, the firm said in a statement, though it declined to name specific LPs. The fund will focus on Chinese companies in industries including manufacturing, technology, financial institutions and services, energy, resources, healthcare, consumer goods and retail, Reuters reported.
(Reuters) - The private equity unit of Citic Securities Co , China’s biggest listed brokerage, announced on Monday the closing of a dollar-denominated fund worth nearly $1 billion, underscoring huge foreign demand for China assets.
The CPEChina Fund secured $990 million of committed capital from 39 overseas institutions including sovereign wealth funds, pension funds, endowments, family offices, PE) said in a statement.
The fund, which was substantially over-subscribed, will focus on investments in Chinese companies, and will support their international acquisitions.
China’s major brokerages including Citic, China International Capital Corp and Haitong Securities have in recent years set up private equity units to broaden their revenue streams and reduce reliance on trading commission incomes.
Citic PE, established in 2008, raised 9 billion yuan ($1.4 billion) late last year in its first fund, the Citic Mianyang Private Equity Fund, and has since closed about 30 deals worth a total of 10 billion yuan, according to its statement.
The Mianyang fund has invested in e-commerce website Happigo Ltd and liquor maker Shanxi Xifeng Liquor Group Co Ltd, according to Reuters data.
The firms’ portfolio companies also include Chinese liquor maker Kuaijishan Shaoxing Wine, financial data services provider Wind Info and Beingmate, the top domestic brand in China’s infant food market.
Citic PE said that its new fund will mainly invest in industries including manufacturing, technology, financial institutions and services, energy, resources, healthcare, consumer goods and retail.
The fund has attracted investors from North America, Europe, the Middle East and Asia, reflecting strong demand for China exposure.
About $17 billion of private equity funds have been raised in Asia so far this year, of which $11.9 billion, or 70 percent, was raised in China. ($1 = 6.493 Chinese yuan) (Reporting by Samuel Shen, Stephen Aldred Jacqueline Wong)

China inflation may hit 6%, no end to tightening

(chinadaily.com.cn)

Updated: 2011-04-06 14:03

BEIJING - Chinese inflation may top an annual rate of 6 percent in the coming months, preventing any relaxation of monetary tightening, the China Securities Journal said on Wednesday, a day after the central bank raised interest rates for the fourth time since October.

"Under severe controls from the central bank, monetary conditions fuelling price rises have clearly been curbed. But inflationary pressure still cannot be overlooked," the newspaper said in a front- page commentary.

"Keeping inflation in check remains the focus of current monetary policy. There is still room for interest rates, the reserve requirement ratio and the exchange rate to move higher," it added.

China increased benchmark one-year deposit and lending rates by 25 basis points on Tuesday, raising suspicions that data next week may show inflation rose more than expected in March.

The newspaper cited market estimates that the consumer price index might have hit a 32-month-high of 5.2 percent in the year to March and that the world's second-largest economy might grow 9.5 percent in the first quarter, relieving any concern that interest rate rises would hurt economic expansion.

"It's unlikely that monetary policy will be loosened in the second quarter or even over a longer period of time," the newspaper said, adding that CPI will probably stay above 5 percent and even hit 6 percent year-on-year in the second quarter.

China might allow the yuan to rise more than 5 percent this year, it said, adding that the country would also need to raise banks' reserve requirements in order to absorb excess cash, partly arising from maturing central bank bills and repos.

Bright Food to renew efforts for overseas asset purchases

SHANGHAI - Bright Food (Group) Co Ltd will continue to explore buying assets overseas, despite several failed attempts last year, Ge Junjie, vice-president of the Chinese food and dairy giant, said.

The Shanghai-based company has identified Australia and New Zealand as the main destinations for its overseas expansion during the next five years.
The company will target the sugar, milk and alcoholic drinks sectors to cater for the Chinese market, Ge said after attending a conference in Shanghai.
"These sectors are strong in those two countries and are also Bright Food's main businesses in China," Ge said. "So acquisitions will help our company to extend the lead in China and to tap overseas markets."
Many companies in the food sector in Australia and New Zealand are controlled by private-equity firms, and following the global financial crisis that status will provide Bright Food with a better chance of striking deals, Ge said.
A special team has been set up to study the countries' social systems, tax policies, industries and laws to facilitate deals, he said.
He said a new deal is already in the pipeline, but declined to provide any details.
Bright Food was in the spotlight last year when it expressed an interest in buying the assets of global giants such as Australia's CSR Ltd and the US nutritional product retailer GNC Holdings Ltd. But it lost out to Singapore's Wilmar International Ltd in July for the sugar and biofuel unit of CSR, and abruptly ended discussions with GNC in January.
Last month, the company also lost in a bid to buy a 50 percent stake in French yogurt maker Yoplait SA. The US food group General Mills Inc bought the stake instead.
"The failed bids won't affect Bright Food's strategy to go overseas," Ge said. "In fact, our overseas expansion has just started. The company's internationalization, as the focus of our business, will achieve fruitful results over the next five years."
In a bid to fund acquisitions, Bright Food may raise as much as 6 billion yuan ($917 million) this year, Bloomberg reported on Saturday, citing Wang Zongnan, the chairman.
A Hong Kong initial public offering of Yunnan Yinmore Sugar Co (Bright Food holds 60 percent of shares in the company) may raise 2.5 to 3 billion yuan, and a bond sale in China may raise a further 3 billion yuan, the report quoted Wang as saying.
The company aims to boost revenue from outside China to as much as 30 percent of sales in five years from 5 percent now, the report added.