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Entered into Strategic Cooperation Agreement with Sinopharm Capital

Source: Kingworld medicine

19 January, 2015] Kingworld Medicines Group Limited (“Kingworld Medicines” or the “Company”, Stock code: 01110), a distributor of renowned branded imported pharmaceutical and healthcare products in the PRC, is pleased to announce it has entered into a strategic cooperation agreement (the “Strategic Cooperation Agreement”) with Sinopharm Capital Management Company Limited(國藥資本管理有限公司) (“Sinopharm Capital”,). Under the agreement, both parties will closely cooperate in product distribution, potential acquisitions and e-commerce by integrating their advantages and resources in order to promote Kingworld Medicine’s rapid business development.

As the investment platform of China National Pharmaceutical Group Corporation (“CNPG”, 中國醫藥集團總公司), Sinopharm Capital has become the strategic investor of Kingworld Medicines since September 2014. Through the Strategic Cooperation Agreement, the Company’s well-known brands and new key products will be distributed through the CNPG’s distribution channel, including pharmacies and hospitals. Meanwhile, Sinopharm Capital will assist the Company to select appropriate OTC pharmaceutical products, healthcare products and medical appliances from CNPG’s diversified product portfolio. Integrating Kingworld Medicines’ effective marketing capabilities with CNPG’s extensive distribution network, the potential synergies will create new growth driver to both the Company and CNPG.


In addition, Sinopharm Capital will cooperate with Kingworld Medicines in the selection of potential targets for acquisitions, including e-commerce providers, clinical marketing services providers and upstream manufacturers, with a view to upgrade the Company into a comprehensive channel coverage distribution platform with manufacturing capabilities, covering channels such as pharmacies, e-commerce and clinics.


To seize the huge opportunities arising from the China’s pharmaceutical e-commerce market, Sinopharm Capital will assist Kingworld Medicines in the establishment of the Company’s e-commerce and mobile internet services platform and provision of value-added services. The Company has established the cross-border e-commerce platform and nationwide medical logistics centre in Qianhai, Shenzhen. Going forward, through the incorporation of CNPG’s resources and existing market competitiveness and favorable government policy enjoyed in Qianhai, the Company will establish its medical supply chain financing services platform and integrate online and offline resources to transform Kingworld Medicines into a comprehensive solutions provider in the medical healthcare industry.

Mr. Zhao Lisheng, the Chairman of the Board of Kingworld Medicines said, “Through the strategic cooperation with Sinopharm Capital, Kingworld Medicines will integrate advantages and resources from both companies and achieve mutual benefit and win-win development. China consumers have placed more concerns on health, while the consumption channel is under the flatter trend. The close partnership between the two companies will foster Kingworld Medicines to capture the huge market opportunity and increase the market competitiveness.”


About Kingworld Medicines Group Limited

Kingworld Medicines Group Limited is principally engaged in the distribution of branded imported pharmaceutical and healthcare products in the PRC. The Group ranked among the top 100 importers of its kind in China in 2010 based on imported value. The Group managed a portfolio of 60 products under 10 different functional categories which are manufactured in Japan, Canada, Hong Kong, Taiwan, Thailand and the PRC and sourced from 13 different suppliers. Many of which are established brand names including Nin Jiom Pei Pa Koa, Taiko Seirogan, Kawai Liver Oil Drop series, Flying Eagle Wood Lok Medicated Oil, Imada Red Flower Oil, Kyushin Pill and Mentholatum series. The Group’s existing distribution network covers all regions in China excluding Xinjiang and Tibet, spanning retail stores exceeds 70,000.


About Sinopharm Capital Management Company Limited

Sinopharm Capital Management Company Limited is an equity investment company jointly established by China National Pharmaceutical Group Corporation (“CNPG”, 中國醫藥集團總公司). CNPG is the largest medical and healthcare industrial platform in the PRC under the administration of the State-owned Assets Supervision and Administration Commission of the State Council of the PRC, and is also the only pharmaceutical industry group in the PRC which is listed in the Fortune 500. CNPG has over 10 subsidiaries as well as six listed companies, namely Sinopharm Group Co. Ltd. (國藥控股股份有限公司, HK: 1099), China National Medicines Co., Ltd. (國藥集團藥業股份有限公司, 600511), China National Accord Medicines Co., Ltd. (國藥集團一致藥業股份有限公司, 000028), Beijing Tiantan Biological Products Co., Ltd. (北京天壇生物製品股份有限公司, 600161), Shanghai Modern Pharmaceutical Co., Ltd. (上海現代製藥股份有限公司, 600420) and China Traditional Chinese Medicine Co. Limited (中國中藥有限公司HK:570). Sinopharm Capital Management Company Limited makes its investment layout in respect of the medical and healthcare industry in the PRC with investment covering the whole medical and healthcare industry such as the traditional Chinese medicine, medical equipment, chemical reagents, medical services, healthcare and pharmaceutical e-commerce.