Hutchmed Regulatory News (HCM)

16 Oct 2009 07:00



Hutchison China MediTech Limited ("Chi-Med")

(AIM: HCM)

Newly Published China National Essential Medicines List Reference Prices 

No Overall Negative Impact on Chi-Med Prices

London: Friday, 16 October 2009: Chi-Med, the pharmaceutical and healthcare company with operations primarily in China, today provides an update in relation to the New China National Essential Medicines List (the "Essential Medicines List") Reference Prices (the "Reference Prices") which were published by the National Development and Reform Commission ("NDRC") in China on 28 September 2009.

On 27 August 2009, Chi-Med announced that 14 of its main drugs, representing over 80% of the China Healthcare Division's sales of prescription and over-the-counter drugs, have been included in the Essential Medicines List ("14 Chi-Med Essential Drugs").

To secure national distribution of our generic listed essential medicine drugs, Chi-Med will be required to first price tender and then supply state-owned health institutions at ex-factory prices that would support the new Reference Prices set by the NDRC. The new Reference Prices represent the maximum allowable retail prices that these items can be sold for in hospitals and pharmacies in China.

The NDRC has now published the new Reference Prices for 2,349 dosage forms and package configurations of the 307 drugs on the Essential Medicines List. About 45% of these items had Reference Prices cut by an average of 12%, 49% saw prices remain unchanged, and the remaining 6% are to receive moderate price increases due to short supply. These new Reference Prices will be effective on 22 October 2009. 

Christian Hogg, Chief Executive Officer of Chi-Med, said, "The overall impact of these new Reference Prices on the retail or ex-factory prices of the 14 Chi-Med Essential Drugs is immaterial. Therefore, we do not believe that these new Reference Prices will lead us to have to adjust our China Healthcare Division's price tendering strategies or reduce ex-factory prices below current levels. This positions us well to continue to grow our China Healthcare Division which, for the first 6 months of 2009, grew sales 23% to $53.1 million and grew net profit after tax and minority interests 35% to $6.6 million."

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About Chi-Med

Chi-Med is the holding company of a pharmaceutical and healthcare group based primarily in China and was admitted to trading on the Alternative Investment Market of the London Stock Exchange in May 2006. It is focused on researching, developing, manufacturing, and selling pharmaceuticals, health supplements and other consumer health and personal care products derived from Traditional Chinese Medicine and botanical ingredients.

Chi-Med is majority owned by Hutchison Whampoa Limited, an international company listed on the Main Board of The Stock Exchange of Hong Kong Limited.