BEIJING, June 29, 2020 /PRNewswire/ -- China Biologic
Products Holdings, Inc. (NASDAQ: CBPO, "China Biologic" or the
"Company"), a leading fully integrated plasma-based
biopharmaceutical company in China, today declared that the Company
disagrees with the notice delivered by Xinjiang Deyuan
Bioengineering Co., Ltd. ("Xinjiang Deyuan") to China Biologic,
which attempts to terminate the cooperation between China Biologic
and Xinjiang Deyuan, and urges Xinjiang Deyuan to cure its breaches
and continue to perform its obligations under its cooperation
agreement with China Biologic. In addition, the Company announced
that, through the lawsuits it previously filed against Xinjiang
Deyuan, the Company is seeking monetary claims totaling over
RMB460 million and has obtained
judicial freezing of certain shares of Xinjiang Deyuan and certain
of its plasma collection stations. China Biologic will continue to
take all necessary legal measures to vigorously protect its
rights.
The Company has learned from a public announcement issued on
June 24, 2020 by Southern Shuanglin
Bio-Pharmacy Co., Ltd. ("Shuanglin"), a company listed on the
Shenzhen Stock Exchange, that, following Shuanglin's announcement
on May 15, 2020 of its entry into the
cooperation framework agreement regarding expansion of plasma
collection stations with Xinjiang Deyuan and Xinjiang Deyuan's
entrustment of five plasma collection stations to Shuanglin,
Shuanglin and Xinjiang Deyuan are contemplating entering into a
plasma supply cooperation agreement, pursuant to which the five
entrusted plasma collection stations will supply source plasma to
Shuanglin exclusively in the next five years (the "Shuanglin
Transaction").
The five plasma collection stations that Xinjiang Deyuan
entrusted to Shuanglin are among the six stations that Xinjiang
Deyuan entrusted to China Biologic under the strategic cooperation
agreement (the "Cooperation Agreement") entered into in
August 2015 among the Company's
subsidiary Guizhou Taibang Biological Products Co., Ltd. ("Guizhou
Taibang"), Xinjiang Deyuan and its controlling shareholder (as
supplemented by a supplementary agreement entered into in
August 2018). Under the Cooperation
Agreement, Xinjiang Deyuan has the obligation to supply to Guizhou
Taibang no less than 500 tonnes of source plasma over a three year
period from August 2018 to
August 2021 and as of the date
hereof, Xinjiang Deyuan has not fully discharged its plasma supply
obligations, with approximately 192 tonnes of source plasma
remaining to be supplied to Guizhou Taibang. In addition, as part
of the Cooperation Agreement, Guizhou Taibang lent to Xinjiang
Deyuan a loan with a principal amount of RMB300 million (the "Loan"), and as of the date
hereof, the outstanding principal amount of the Loan is
approximately RMB248 million and the
overdue interest amounts to approximately RMB14 million.
On June 24, 2020, the Company
received a notice from Xinjiang Deyuan attempting to terminate the
Cooperation Agreement. Xinjiang Deyuan's unilateral notice of
termination contradicts the facts and violates the Cooperation
Agreement. The Company disagrees with the termination of the
Cooperation Agreement and believes that Xinjiang Deyuan should
continue to perform its obligations under the Cooperation Agreement
and repay all the debt in connection therewith. In addition, the
Company believes that Xinjiang Deyuan's entry into the Shuanglin
Transaction during the term of the Cooperation Agreement
constitutes material violations of the Cooperation Agreement. The
Company has delivered a written response to Xinjiang Deyuan
demanding Xinjiang Deyuan to cure its breaches of the Cooperation
Agreement, to re-entrust the relevant plasma stations to Guizhou
Taibang and to continue to supply plasma to Guizhou Taibang in
accordance with the Cooperation Agreement.
Guizhou Taibang has previously filed two lawsuits against
Xinjiang Deyuan in the Beijing Third Intermediate People's Court
and the Beijing Chaoyang People's Court, respectively, to demand
Xinjiang Deyuan to repay all of the principal amount and interests
under the Loan, to further perform its obligations under the
Cooperation Agreement, to pay related penalties, and to compensate
all the losses of Guizhou Taibang due to Xinjiang Deyuan's breach
of the Cooperation Agreement, among other claims. As of the date
hereof, the related claims total over RMB460
million. In addition, through these lawsuits, the shares of
Xinjiang Deyuan held by its controlling shareholder and the shares
of the relevant plasma collection stations under Xinjiang Deyuan
have been judicially frozen.
China Biologic will continue to take all necessary measures and
actions to protect its rights and recoup all potential losses due
to Xinjiang Deyuan's breach of the Cooperation Agreement, including
but not limited to penalties for breach of contract and any profit
loss due to Xinjiang Deyuan's failure to supply sufficient source
plasma to the Company.
About China Biologic Products Holdings, Inc.
China Biologic Products Holdings, Inc. (NASDAQ: CBPO) is a
leading fully integrated plasma-based biopharmaceutical company in
China. The Company's products are
used as critical therapies during medical emergencies and for the
prevention and treatment of life-threatening diseases and
immune-deficiency related diseases. China Biologic is headquartered
in Beijing and manufactures over
20 different dosage forms of plasma products through its indirect
majority-owned subsidiary, Shandong Taibang Biological Products
Co., Ltd. and its wholly owned subsidiary, Guizhou Taibang
Biological Products Co., Ltd. The Company also has an equity
investment in Xi'an Huitian Blood Products Co., Ltd. Since the
acquisition of TianXinFu (Beijing)
Medical Appliance Co., Ltd. in 2018, China Biologic is also engaged
in the sale of medical devices, primarily regenerative medical
biomaterial products. The Company sells its products to hospitals,
distributors and other healthcare facilities in China. For additional information, please see
the Company's website www.chinabiologic.com.
Safe Harbor Statement
This news release may contain certain "forward-looking
statements" relating to the business of China Biologic Products
Holdings, Inc. and its subsidiaries. All statements, other than
statements of historical fact included herein, are "forward-looking
statements." These forward-looking statements are often identified
by the use of forward-looking terminology such as "intend,"
"believe," "expect," "are expected to," "will," or similar
expressions, and involve known and unknown risks and uncertainties.
Although the Company believes that the expectations reflected in
these forward-looking statements are reasonable, they involve
assumptions, risks, and uncertainties, and these expectations may
prove to be incorrect.
Investors should not place undue reliance on these
forward-looking statements, which speak only as of the date of this
news release. The Company's actual results could differ materially
from those anticipated in these forward-looking statements as a
result of a variety of factors, including, without limitation,
quality of purchased source plasma, potential delay or failure to
complete construction of new collection facilities, potential
inability to pass government inspection and certification process
for existing and new facilities, potential inability to achieve the
designed collection capacities at the new collection facilities,
potential inability to achieve the expected operating and financial
performance, potential inability to find alternative sources of
plasma, potential inability to increase production at permitted
sites, potential inability to mitigate the financial consequences
of a temporarily reduced raw plasma supply through cost cutting or
other efficiencies, and potential additional regulatory
restrictions on its operations and those additional risks and
uncertainties discussed in the Company's periodic reports that are
filed with the Securities and Exchange Commission and available on
its website (http://www.sec.gov). All forward-looking statements
attributable to the Company or persons acting on its behalf are
expressly qualified in their entirety by these factors. Other than
as required under the securities laws, the Company does not assume
a duty to update these forward-looking statements.
Contact:
China Biologic Products Holdings, Inc.
Mr. Ming Yin
Senior Vice President
Email: ir@chinabiologic.com
The Foote Group
Mr. Philip Lisio
Phone: +86-135-0116-6560
Email: phil@thefootegroup.com
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SOURCE China Biologic Products Holdings, Inc.
