China Medicine Reports Positive Data on Animal Feed Additive

Jul.17.09 | About: China Medicine (CHME)

China Medicine Corporation (OTCPK:CHME) reported positive results from a third party feasibility report on a product in development, recombinant Aflatoxin Detoxifizyme (rADTZ), a food and feed additive directed at detoxifying aflatoxin (AFT). rADTZ is a potential cancer causing agent. The report was produced by the Feed Research Institute of the Chinese Academy of Agricultural Sciences.

In experiments, rADTZ increased the immunity systems of baby chickens and piglets, decreasing mortality. At the same time, rADTZ-treated animals 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 35 million RMB ($5.1 million) in costs by using rADTZ.

Mr. Senshan Yang, Chairman and CEO of China Medicine Corporation, said trial production of rADTZ has begun. Trial sales will follow soon, he added.

China Medicine expects to receive a product permit for rADTZ from the Ministry of Agriculture in about six months, which will allow the sale of rADTZ throughout China. Yang predicts rADTZ will produce net margins of 70% in 2009.

In 2008, China Medicine saw its revenues climb 27% to $53.6 million. Net income rose 33% to $9.1 million. The company has said the global economic crisis will cause it to miss its 2009 revenue targets of a further 30% increase. At the same time, it predicted its 2009 net income would be better than expectations, which called for a rise of between 20% and 22%.

China Medicine Corporation discovers and develops medical formulations, and it also distributes over 2,400 pharmaceutical products in China including prescription and OTC drugs, traditional Chinese medicine products, herbs and dietary-supplements.

Disclosure: none.