Sinobiomed Buys Distributor, Plans Another Acquisition

Sinobiomed (SOBM.OB) of Shanghai paid $2.4 million to buy a 90% interest in Suzhou Boai Medical Development Company, which distributes pharmaceuticals from its Suzhou hub to southern and eastern China. Suzhou is located 60 miles east of Shanghai.

Suzhou Boai produced $18 million in revenue in 2006, and it has already had sales of $11 million in the first half of 2007. Suzhou Boai has been GSP certified (Good Supply Practice) by the SFDA in China.

Suzhou Boai has two subsidiaries: one is responsible for vaccines, the other for medical devices. It distributes biological products, chemical medicines and traditional Chinese medicines. Sinobiomed will perform a GAAP audit of the company and expects to file the report by October 16, 2007.

Sinobiomed will add its products, which are engineered recombinant protein drugs and vaccines, to the existing products marketed by Suzhou Boai. Within the past six months, Sinobiomed has won approval in China for an ulceration drug, recombinant fibroblast growth factor (see story), and recombinant batroxobin, a genetically engineered version of pit viper venom used to stop bleeding during surgery (see story).

Sinobiomed plans to buy a second distributor in northern China. It also expects to acquire additional pharmaceutical companies with existing products and manufacturing facilities. Sinobiomed is seeking to become a highly profitable, fully integrated pharmaceutical enterprise in China.

Sinobiomed closed its purchase of 82% of Shanghai Waxing Pharmaceuticals in early 2007, and its operations are carried out through Shanghai Waxing.

Disclosure: none.