Dragon Pharmaceutical Inc, a leading international pharmaceutical company, said that beginning with the first quarter of 2008, the company has realigned its business segments into two divisions: Cephalosporin and Penicillin.
This realignment better reflects the company's business strategy to become a leading vertically integrated manufacturer and distributor of a broad line of high-quality antibiotic products. As a result, the segment information included in the financial statements, 10-Q and 10-K reports will reflect this realignment of business segments.
Cephalosporin division would operate the production and sales of 7-ACA, an important intermediate for cephalosporin antibiotics, and 7-ACA downstream APIs and finished formulation drugs. Currently, the company's downstream API products include the crude powder of ceftazidime. The formulation products include injectable powder for ceftriaxone, cefazolin, cefotaxime, cefoperazone, ceftazidime and cefuroxime. Dragon plans to expand its current product offerings to incorporate more high-margin cephalosporin antibiotic drugs.
The Penicillin division currently operates the production and sales of Clavulanic Acid and Cefalexin. Cefalexin was successfully launched and placed into the company's product portfolio in January 2008. Clavulanic Acid is a drug that combines with penicillin group antibiotics to increase the effectiveness of against bacteria resistance. Cefalexin is a Penicillin G downstream product that is widely used to treat urinary tract infections, respiratory tract infections, skin and soft tissue infections. The company intends to introduce more Penicillin G downstream antibiotics into the market in order to generate new drivers of growth, build products synergy and reduce the Company's exposure to overall market fluctuations. A stable and comprehensive supply of key ingredients will reduce the company's current high dependency on third party suppliers.
"Today's announcement reflects our core business strategy with a focus on enhancing our position as a leading producer and supplier of a wide range of high-quality antibiotic products while creating vertically integrated business operations from intermediates to bulk APIs and finished formulation drugs," said Yanlin Han, chairman and CEO, Dragon. "We believe that this strategic decision will offer the Company increased flexibility to expand pipelines and have a better control on product quality and operation costs in the entire production process. We have achieved significant growth in sales and profits for all our products in 2007. With the strengthened market leadership position, coupled with our enhanced product strategy, we are confident Dragon is well positioned for long-term growth."