The global economic downturn has posed a big challenge to enterprises from multi-national giants to small-medium enterprises. China, too, has been afflicted with many companies undergoing financial difficulties. Despite the tough business environment, C&O’s operations continue to be strong with a sound financial position. Our stringent capital and risk management strategies indeed served us well.
Notwithstanding the hurdles before us, we continue to be optimistic about our business prospects. The healthcare reform carried out by the PRC government will remain the focus of the market, providing both challenges and opportunities to the healthcare and pharmaceutical sectors.
Meanwhile, we will continue to keep a close eye on further implementation policies regarding the healthcare reform and respond promptly.
CORPORATE STRATEGIESContinued focus on developing new drugs
R&D will continually place C&O on the frontiers of discovering new drugs and formulations. To boost our R&D capabilities, we have relocated our Nanjing R&D facility to a bigger new site located at Nanjing Xingang Economic Technology Development Zone with a floor area of 26,668 square metres and a built-up area of nearly 20,000 square metres. This new R&D centre will house a state-of-the-art laboratory and other research facilities for (i) pharmacokinetics and drug metabolism (ii) synthesis of new chemical compounds (iii) study on new formulations of drugs and (iv) quality control and quality assurance. In addition, the Nanjing R&D centre will also house the joint venture laboratory with US-based Xenobiotic Laboratories, Inc.
We have also relocated our expanded research team in Shanghai to a new R&D facility located at Pudong. This facility that spans over 2,400 square metres in floor area, will focus on developing innovative drugs which will be in the areas of anti-infective, anti-diabetic, anti-tumour, anti-obesity and polypeptide-based.
With our emphasis on R&D, C&O’s new drug development efforts will continue to grow, particularly, when we partner other international pharmaceutical companies to bring in new and better drugs into China.
Expand portfolio of C&O branded products
While we continue with the development of generic
drugs, our focus will be placed on producing drugs
of higher value that target the mid to high end
markets as competition is less keen in these
segments with prices remaining relatively stable,
unlike the low end market that experiences constant
downward pricing pressures.
We will continue our strategy to introduce more of our own drugs into the market.
Contract Research and Contract Manufacturing
C&O has been providing contract research and
contract manufacturing services to pharmaceutical
companies both in China and outside of China. With
our state-of-the-art R&D facilities and expertise,
sophisticated manufacturing plant, and most
importantly, our familiarity with the PRC market, we
believe we are a strong contender for partnerships
with the multinational pharmaceutical companies.
Distribution and Marketing
We will continue to expand our distribution network,
particularly in the area of south western part of China.
We will also launch more marketing campaigns to
boost up the sales of C&O branded and third party
products and increase our market penetration.
We envisage our future growth to be driven by the following trends:
- increasing in consumer spending power induced by strong economic growth;
- greater awareness of the need for healthy living; ageing population in China;
- strong interests of overseas pharmaceutical companies to enter the PRC market due to market potential;
- growing trend of overseas pharmaceutical companies to outsource R&D and manufacturing activities to third parties in China;
- increasing government expenditure in healthcare and widening subsidized medical coverage to stimulate market demand.
