TAI'AN, China, July 11, 2011 /PRNewswire-Asia-FirstCall/ --
China Biologic Products, Inc. (NASDAQ: CBPO) ("China Biologic," or
the "Company"), a leading plasma-based biopharmaceutical company in
China, today announced that the
Guizhou Provincial Health Department has issued a "Plan for Guizhou
Provincial Blood Collection Institutional Setting (2011-2014)" (the
"Plan").
The Plan, in the relevant part, states that "in accordance with
the demographic distribution, economic development condition,
disease prevalence, and actual situation of plasma supply for the
manufacturing of blood-based products, plasma collection stations
will be set up in 10 counties, including Xi
Feng, Kai Yang, Zi Yun, Pu Ding, Du Shang, Long Li, Chang Shun, Huang Ping, Qing Long, and Na Yong, etc."
Currently, there are 18 plasma collection stations, in 18
separate counties, operating in Guizhou
Province.
China Biologic's 54% indirectly owned subsidiary, Guizhou
Taibang Biological Technologies Co., Ltd., currently has 6 active
plasma collection stations in the Guizhou
Province. Among the 6 active plasma collection stations, 3
are located in the counties included in the Plan (Pu Ding,
Huang Ping, and Na Yong) and are currently expected not to be
affected directly by the Plan.
Based on the Company's preliminary understanding of the Plan,
subject to further clarifications from Guizhou Provincial
government regarding the implementation of the Plan, the Company
currently anticipates the licenses of its 3 other plasma collection
stations in Dan Zhai, Wei Ning, and San Sui counties may not be
renewed (until at least 2014) after their respective plasma
collection permits expire at the end of July
2011. The Company's 3 stations in Dan Zhai, Wei
Ning, and San Sui counties together accounted for about
24.5% of the Company's total plasma collection by volume in 2010.
In addition, 1 inactive plasma collection station that the Company
purchased from the government is unlikely to be licensed as
planned, because it is in Zhengyuan County, a location not included
in the Plan.
The 3 active plasma stations in the counties included in the
Plan that are expected to continue operating are scheduled for
relicensing before the end of July. The relicensing will require
inspection of the plasma stations by provincial and other
government officials. While the Company believes it meets or
exceeds all inspection requirements at those stations, it is not
yet clear what influence on the inspections the new Plan may have,
if any.
The Company is currently evaluating the effect of the Plan and
the anticipated closing of the 3 active plasma collection stations
including, among other items, the potential reduction in
China Biologic's previously issued
financial guidance for the year 2011, potential reduction in its
business operations and financial performance in current and future
periods, potential assets impairments associated with these plasma
collection stations and the 1 inactive station, and other possible
effects.
In a bid to mitigate the reductions from the anticipated closing
of the 3 plasma collection stations in Guizhou, the Company is exploring alternative
solutions and opportunities, but no assurance can be given that it
will be successful in doing so. Among all of the Company's efforts,
the Company is (1) requesting that the Guizhou Provincial
government to reconsider the implementation of the Plan, (2)
contemplating new regions to apply for establishing new plasma
stations, (3) minimizing the writing off of already collected
plasma within the required 90-day quarantine period that
potentially may be affected by the Plan, and (4) creating the
contingency plan for moving assets and paying severance to
employees related to the three plasma stations affected by the
Plan, if the anticipated closings happen.
About China Biologic Products, Inc.
China Biologic Products, Inc., through its indirect
majority-owned subsidiaries, Shandong Taibang Biological Products
Co., Ltd. and Guiyang Dalin Biologic Technologies Co., Ltd., and
its equity investment in Xi'an Huitian Blood Products Co., Ltd., is
currently one of the leading plasma-based biopharmaceutical
companies in China.
The Company is a fully integrated biologic products company with
plasma collection, production and manufacturing, research and
development, and commercial operations. The Company's plasma-based
biopharmaceutical products are irreplaceable during medical
emergencies and are used for the prevention and treatment of
various diseases. The Company sells its products to hospitals and
other healthcare facilities in China. Please see the Company's website at
www.chinabiologic.com for additional information.
Safe Harbor Statement
This news release includes forward-looking statements including,
among others, those concerning the implementation of the Plan, the
expected relicensing of three plasma stations in the counties
included in the Plan and closing of three plasma collection
stations in Guizhou, and the
expected effect on our financial performance, business operations,
and our ability to seek alternative solutions and opportunities, as
well as all assumptions, expectations, predictions, intentions, or
beliefs about future events. Forward-looking statements can in some
cases be identified by the use of forward-looking terminology such
as "anticipates," "believes," "expects," "should," "will," or
similar expressions. Factors that could cause actual results to
differ materially from our forward-looking statements include our
potential inability to find alternative sources of plasma,
potential inability to pass inspection and obtain relicensing of
these plasma collection stations at permitted sites, potential
inability to increase production at permitted sites, potential
inability to mitigate the financial consequences through cost
cutting or other efficiencies, and potential addition regulatory
restrictions on our operations. For a description of additional
risks and uncertainties that may cause actual results to differ
from the forward-looking statements contained in this news release,
see our most recent Annual Report on Form 10-K filed with the
Securities and Exchange Commission ("SEC"), and our subsequent SEC
filings. Copies of filings made with the SEC are available through
the Company's website at www.chinabiologic.com and through SEC's
website at www.sec.gov. Future business decisions are subject to
change and the Company does not undertake to update the
forward-looking statements contained in this news release except as
required by law.
Company
contact
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Mr. Y. Tristan
Kuo
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Chief Financial
Officer
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China Biologic Products,
Inc.
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Tel: +86 53 8620
2206
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Email:
IR@chinabiologic.com
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www.chinabiologic.com
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SOURCE China Biologic Products, Inc.