LOS ANGELES, Calif., Dec. 13 /Xinhua-PRNewswire-FirstCall/ -- China Sky
One Medical, Inc. (OTC Bulletin Board: CSKI), one of the leading producers
and distributors for external-Chinese medicines in China, has announced that
a strategic agreement was reached between Liu Yan-qing, president of China
Sky One Medical, Inc. and Mr. Wu Jie-chen, president of Heilongjiang Tianlong
Pharmaceutical Company. As a result of this agreement, CSKI will acquire all
of the products, dealership, marketing network of Tianlong Beijing office and
the Beijing office staff for USD $381,700. Under the terms of the agreement,
CSKI will complete the transaction by December 15, 2006, and complete the
transition with Tianlong by December 31, 2006, with the expectation that
beginning on January 1, 2007, all products, dealership, marketing network,
staff of Tianlong at its Beijing office will be under the ownership and
management of CSKI.
CSKI and Tianlong have historically been competitors. CSKI had sales
advantages over Tianlong in most cities in China, except in Beijing. Facing
the continuous increase of sales power of CSKI in China, including Beijing,
Tianlong has recently changed its strategy and decided to close its branches
in all areas of China except its Beijing office, and plans to focus on the
research and manufacturing of drugs. In contrast, CSKI has devoted its
efforts to realizing the maximum utilization of its sales network by selling
drugs from domestic and overseas suppliers as well as the development of
pharmaceuticals with the ownership of the related intellectual property.
The two companies entered into the agreement as a means of combining the
efforts, resources and product offerings of both companies.
Tianlong’s Beijing office had revenues of approximately USD $1.5 million
from January to November of 2006, with 20% in net profits. CSKI expects
sales to increase by 30% in 2007, which means the purchase of Tianlong would
increase 2007 sales to approximately USD $1.98 million. The terms of the
transaction were negotiated between the presidents of both companies, and are
based on market input and CSKI’s expectation of revenues resulting from the
acquisition.
About China Sky One Medical, Inc.
China Sky One Medical, Inc., a Nevada corporation, is a holding company
whose principal operations are through its subsidiaries, which are engaged in
the manufacture, marketing and distribution of pharmaceutical and medicinal
products. Through its wholly owned subsidiaries, American California
Pharmaceutical Group, Inc. (“ACPG”), Harbin Tian Di Ren Medical Science and
Technology Company (“TDR”), Kangxi Medical Care Product Factory
(“Kangxi”), and Harbin First Bio-Engineering Company Limited (“First”),
the Company’s principal revenue source is the manufacture and sale of over-
the-counter pharmaceutical products.
ACPG, a wholly-owned subsidiary of the Company, operates as a holding
company for the other subsidiaries. TDR’s principal business is the
manufacture and sale of branded nutritional supplements and over-the-counter
plant and herb-based medicinal products. Its manufacturing facilities are in
the City of Harbin, Heilongjiang Province. It has evolved into an integrated
manufacturer, marketer, and distributor of external use natural Chinese
medicinal products sold primarily to and through domestic pharmaceutical
chain stores in China with its subsidiaries, Kangxi and First. Kangxi’s
principal business activity is to manufacture and sell branded external use
Chinese medicine and other natural products under the registered trademark
“Kangxi.” It has 6 product lines: spray, ointment, powder, patch, cream,
and miscellaneous health and beauty products. It has become one of the
leading external use Chinese medicine factories with a full range of product
lines and development capacity. First’s principal business activity is to
research and develop the use of natural medicinal plants and biological
technology products such as New Endothelin-1. First is one of the first
companies in Heilongjiang Province conducting research and development of
high technology biological products. Its facility is now under final
inspection by the Chinese State Food and Drug Administration (“SFDA”) for
the qualification as a certified GMP production facility. On July 31, 2006,
Kangxi merged with First, with Kangxi’s existing business activities
continuing under First. http://www.skyonemedical.com
Certain of the statements made herein constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act
of 1995. Such statements typically involve risks and uncertainties and may
include financial projections or information regarding our future plans,
objectives or performance. Actual results could differ materially from the
expectations reflected in such forward-looking statements as a result of a
variety of factors, including the risks associated with the effect of
changing economic conditions in The People’s Republic of China, variations
in cash flow, reliance on collaborative retail partners and on new product
development, variations in new product development, risks associated with
rapid technological change, and the potential of introduced or undetected
flaws and defects in products, and other risk factors detailed in reports
filed with the Securities and Exchange Commission from time to time.
