| By L. Armand, Pharmaceutical ManufacturingNews |
| Tuesday, 13 January 2009 |
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After three years of talks, Dutch pharmaceutical giant DSM and North China Pharmaceutical Group Corp (NCPC) are expected to sign a final agreement soon establishing a joint venture through which NCPC will be licensed to use DSM’s PureActives
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technology in producing penicillin industrial salt, one of NCPC’s core products, according to a source at a meeting recently held by the State-owned Assets Supervision and Administration Commission of Hebei province, China.
To date, the two parties have signed up to 19 preliminary agreements, mainly governing capital increase, asset transfer and technology licensing, and are undertaking other
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preparatory work for the partnership, the source said.The joint venture is expected to enable NCPC to expand its profit margin in its penicillin industrial salt business by replacing NCPC’s chemical synthesis process with the DSM PureActives while enabling DSM to get wider access to the Chinese pharmaceutical market as the world’s largest penicillin antibiotics manufacturer, noted Wang Yanming, an analyst at Capital Securities.
Several reports have indicated that the two parties have long been in talks for the proposed partnership: NCPC announced its plan to set up the joint venture to produce nutrition products and anti-infectives as early as 2005 and filed a feasibility report on the joint venture with China’s National Development and Reform Commission in December 2007.
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However, the talks between the two firms progressed slowly over the past year, and, commenting on the latest news, Zhang Qianbing, general manager of North China Pharmaceutical Group, simply stated that the group is still in talks with DSM for the partnership.
Any definite progress concerning the talks will be announced in a timely manner through the Shanghai Stock Exchange, Zhang indicated.
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