China Medicine Corporation (OTCPK:CHME) signed a two-year renewable agreement with Heilongjiang Liao Yuan Technology, Inc. for exclusive rights to distribute Nianlianping, an anti-adhesive, in Guangdong province.
Nianlianping is a medical macrogol berberine solution used to restrain tissue from adhering to the lesion site after surgical operation. It is widely used to prevent surgical adhesions, including ascites, joint effusion, pelvic fluid and pelvic inflammatory disease. It is also used to reduce tissue fluid exudation and antibiotic usage. Compared to similar drugs in China, Nianlianping is the only one that can be stored at room temperature.
China Medicine estimates that sales of Nianlianping will reach approximately 30 million RMB ($4.4 million) per year over the next three years. It expects sales to rise to 50 million RMB ($7.3 million) annually starting from the fifth year, provided that the two-year contract is renewed.
The contract excludes certain areas of Guangdong province, specifically Foshan, Zhongshan, Dongguan areas and Guangzhou Military Hospital.
China Medicine discovers and develops medical products as well as distributing over 2,400 specifications of pharmaceutical products in China, including prescription and OTC drugs, TCM products, herbs and dietary-supplements. The company reported 2008 revenues of $53.6 million, a 27% increase, which produced net income of $9.1 million or 60 cents per diluted share. China Medicine has a market capitalization of only $19 million.