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China Launches Therapeutic Licorice R&D
June 16, 2010
Weikang Bio-Technology Group Co., Inc., a leading developer, manufacturer and marketer of Traditional Chinese Medicine (TCM), Western prescription and OTC pharmaceuticals and other health and nutritional products in the People's Republic of China, announced that the Company is launching a new project to research and develop licorice flavonoids for use in therapeutics. Weikang anticipates sales of therapeutics derived from the project will add approximately $13 million to annual revenue and approximately $5.7 million in annual after-tax net income.
Licorice contains glycyrrhetinic acid, which, in addition to being widely used as a flavoring agent, has also been shown to be effective in treating conditions and afflictions such allergies, hepatitis, inflammation and swelling, including peptic ulcers, hypertension, excessive potassium in the body, skin conditions, viral infections, tumor formation and weight loss.
"We are extremely excited to launch the Licorice Flavonoid Project which we believe will be one of the premier sources in China for research and development of extracting and use of glycyrrhetinic acid as a therapeutic. Glycyrrhetinic acid has been proven to provide numerous health benefits for a variety of aliments and through the use of our state-of-the-art technology we expect to be able to produce high quality therapeutics using this important medicinal compound," commented Mr. Yin Wang, Chairman and CEO of Weikang Bio-Technology Group. "Moreover, Heilongjiang Association of TCM conducted a study at our request on the therapeutic benefits of licorice flavonoids and verified that there are multiple benefits to be derived from this compound and is providing their full support for the project."
To ensure Weikang is able to develop the highest quality glycyrrhetinic acid compounds, the Company will use several advanced technologies to extract, isolate and purify the licorice flavonoid substance. The technologies Weikang intends to use include supercritical carbon dioxide extraction technology to produce superior quality herbal extracts, column chromatography (CC) to isolate and purify compounds and high-performance liquid chromatography (HPLC) to separate, identify, and quantify compounds based on their idiosyncratic polarities. One of the Company's first research projects will be on licorice flavonoids effectiveness in treating tumors which will include running systematic studies of clinical prescription categorization, doze type, pharmacology, toxicity, stability tests and ensuring quality standards.
In addition to the research, development and production of licorice flavonoid based therapeutics, the Licorice Flavonoid Project will directly benefit the local economy by adding jobs, increasing investment in technology and boosting demand for local licorice planting and processing. Due to the positive effects on the local economy, preferential tax treatments from the government are anticipated.
The total investment for the Licorice Flavonoid Project is expected to be $6.58 million, including $2.93 million in R&D; and the first full year of production expected to yield a return on investment of 86%. The construction of the new factory and purchase of equipment will start upon the successful completion of the R&D. Weikang is targeting to begin production of therapeutics developed from glycyrrhetinic acid in 2011 and to reach the full design output of the new factory by 2012.
Source: Weikang Bio-Technology Group Co., Inc.
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